Tribune Company and Local TV have entered into a letter of intent to create a third-party broadcast management company which will provide shared services to all of the stations Local TV and Tribune Company own, respectively.
The company will function as a wholly-owned subsidiary of Tribune Company, and will provide back-office services, administration and a number of other functions to the stations with the goal of maximizing efficiencies, sharing best practices and fostering innovation.
Randy Michaels, who was just named CEO of Tribune Company’s Interactive and Broadcasting business unit, will head the company. This combination will allow Michaels and Lawrence to build on the great track record they have established in their careers together.
“Tribune and Local TV expect to realize significant savings in management, technology, and other overhead costs,” said Michaels. “Things like research and development and automation technology are more efficient on a large platform. All of the stations get to share the benefits. We are going to find new ways to operate smarter, cheaper, and more efficiently.”
While the new management company will serve stations across various owners, Tribune Company and Local TV will maintain their own board of directors, senior management, financial structure, shareholders, station management, programming, and network affiliations. The functions that are common across corporate headquarters will be combined in a transparent manner to both companies.
“The company will immediately focus on back office and administrative functions,” adds Lawrence. “Then we will move to creating specialized knowledge teams for TV assets, addressing market-specific challenges and opportunities with special swat teams, developing vertical and homegrown content, and finding new ways to deploy capital. And that is just the beginning.”
The new broadcast services company will serve Tribune’s 23 large and mid-size stations, and Local TV’s nine small and mid-market stations. The management company will also look towards serving potential third-party-owned stations in the future.