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Posted 24 Feb 2001   For week ended May 07, 2000
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Sent on Mormon-News: 05May00

Summarized by Rosemary Pollock

Reid Benefits From TV Windfall
Washington Post pgA01 1May00 N2
By Dan Morgan: Washington Post Staff Writer

LAS VEGAS, NEVADA -- Senator Harry M. Reid (D) recently hit the Las Vegas television market jackpot while facing a tough run for the governor's seat against Rep. John E. Ensign (R), Jan Jones (D) and Kenny C. Guinn (R). Las Vegas' KVBC-TV station manager, Gene R. Greenberg, compared the final weeks of the campaign to the pressure-cooker atmosphere of the Chicago commodities exchange. "I've never been on the trading floor, but a lot of times it seemed a little like that," he said.

The Nevada NBC affiliate was selling the most valuable commodity in American politics: advertising time on TV. One dollar in five raised by all federal candidates now goes to TV advertising, according to campaign finance analyst Dwight Morris. Political commercials are the third-largest in the TV advertising category, trailing automotive and retail ads. The money to purchase air time is flowing in from political parties and outside groups.

Political spots are expected to add $600 million to stations' revenue, up 40 percent from 1996. Broadcasters, whose companies enjoy pretax profit margins that routinely range from 25 to 50 percent, hold a special public trust. The government imposes obligations in return for granting free use of the airwaves. Stations must offer federal candidates "reasonable" amounts of commercial time at discounted prices.

In practice, there is a finite amount of time slots and a surging demand for TV stations to sell to the highest political bidder what the government has given them for free. Stations regularly ration time to federal candidates or charge more than the discounted rates for air time slots. As a result, the industry has been plunged into the thick of the debate over tightening campaign finance laws. "When it comes to serving as a public trustee, the industry doesn't see beyond its own bottom line," said Paul Taylor, who lobbies for free air time with the Alliance for Better Campaigns.

When the Ensign-Reid race tightened, Cathy Austin, a buyer for International Communications, placed ads for Reid. "We were getting bumped left and right at the beginning, paying pre-emptible rates," she said. The availability situation was out of control. The limitations were much greater because so much was coming in. It was a tough situation for everyone to be in."

Reid, a member of The Church of Jesus Christ of Latter-day Saints, spent nearly $5 million. Half of it went for advertising, including 148 spots the last day of the campaign alone. That was none too few, it turned out. Reid beat Ensign by just 401 votes.

"We said here's our rate card, here's what's available, buy what you want," said KVBC's Greenberg. "We offered them pre-emptible, but for the candidates that can't take that chance as it gets closer to Election Day, they were buying fixed." Records show that KVBC booked $429,450 from a single issue advertiser. Nevada hotel magnate Sheldon Adelson's committee spent a total of $2 million in an effort to unseat two Democratic members of the county commission.

"The stations are salivating," said one media buyer. A few years ago candidates were satisfied with 700 rating points in the final week of an election. "Now candidates feel they need 1,200 point in the last week to burn their message in...You have to keep pace," said Republican Tom Edmonds of Edmonds Associates, a Washington media consulting firm.

"There's a whole new world that's exploding out there, and that, taken together with a vibrant economy, means higher prices and less capacity to have all the choices you'd like to have," said Democrat Jim Margolis of the Washington consulting firm Greer, Margolis,Mitchell and Burns.

According to Jon Hutchens of Colorado-based Media Strategies &Research, "Politicians are no different from Coke and Nike." "Even though viewership habits change, the requirement for politicians to reach half the audience doesn't."

The National Association of Broadcasters argues that requiring stations to provide free air time would be unconstitutional and wouldn't end the race in paid advertisements. "Someday we may look back on these ads as a relic," Taylor believes, "the way we look back at torchlight parades in a past era in American politics."


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