A crack in Public Television's wall

This may be an isolated case or an omen of things to come, but KCET, the primary Los Angeles affiliate of the Public Broadcasting System, the U.S. equivalent of the BBC or CBC, announced last Friday that it would drop its affiliation as of January 1st. KCET made the decision because the annual fees that it pays to PBS have been rising for years, to $6.8 million, which is 22 percent of the station's entire budget. KCET will replace PBS programming with classic movies, locally-produced television programs, and series and documentaries licensed from other sources.

KOCE, a public television station located in Orange County, California, south of Los Angeles, will take over as PBS' primary affiliate in the Los Angeles basin. The problem is that KOCE isn't as convenient for viewers to find, either over the air on on cable, satellite or IPTV, so the audience for PBS programming in the second largest city in the U.S. will undoubtedly drop. PBS will feel the pinch financially, since KCET paid nearly 4% of the network's total dues. Producers of shows on PBS are also concerned, because their underwriters, who use their endorsement messages in PBS programming to reach high-income and high-education viewers, will get smaller Los Angeles audiences. Some PBS underwriters may drop out and redirect those funds for other purposes.

For its part, there's plenty of programming for KCET to acquire. There are alternative public television programming services available, such as American Public Television. Some cable networks might jump at the chance to partially defray their production costs by licensing their shows to KCET for airing after they air on cable. If KCET holds onto enough of its audience, pledge income and underwriters to stay viable, other public stations will start questioning whether to leave PBS. In addition, some producers may leave PBS and offer their programming directly to public stations or through other distributors.

Thus, the biggest issue for PBS is what other public broadcasters take away from KCET's decision, which won't be known for at least a year. If KCET's success leads other big-market stations to pull out of PBS, the financial survival of the entire network would be in doubt.