Out Of The TV News Business p.15

By: M.L. STEIN FREEDOM COMMUNICATIONS IS unloading its pioneering Orange County NewsChannel, which failed to show a profit after more than five years of operation, according to a company official.
Freedom has signed a preliminary agreement to sell the cable channel to Century Communications Corp. of New Canaan, Conn., one of the nation's largest cable operators. Terms were not disclosed.
"We were prepared for five years of losses, but we never imagined they would run so deep or that they would continue after that," Alan J. Bell, president of Freedom's broadcast division, told E&P.
He said that OCN, which began operating in 1990 as the second newspaper company cable news channel, "never turned a dime."
Compounding the problem, he continued, has been the sagging local economy and the fact that OCN has been unable to generate revenue from other cable companies. Typically, he noted, such stations as CNN and ESPN get as much as 25? a month per subscriber, a major source of their revenue. OCN, Bell explained, could not induce other cable companies to come up with extra money.
OCN drew "millions" in advertising revenue, according to Bell, but not enough to keep it going.
Freedom's figures show that OCN is watched for at least some time every week by viewers in 400,000 of Orange County's 525,000 households with a cable connection.
OCN, which is housed in the main offices of the Orange County Register, Freedom's flagship newspaper, has its own staff, but Register reporters have been contributing to its content with news reports and as hosts for regular shows on such topics as aging and home improvement.
Bell said the Register's input enriched the channel's broadcasts as the "icing on the cake, but was not the cake itself."
He said he did not know if Century will continue to use Register staffers, but he opined that the arrangement would be to the new owner's advantage.
He noted that Freedom's cable channel in Providence, R.I., maintains a similar news link with the Providence Journal-Bulletin.
However, his main concern, he said, is whether OCN's 90-plus employees will be retained by Century, which has 1.1 million subscribers in 25 states and sales of $416.7 million in 1995 with losses totaling $82.6 million.
Register publisher R. David Threshie said the issue of the paper's continued contribution to OCN is yet to be resolved.
Bell said Century is buying OCN "for what you see on the tube, not for any hardware that might be involved."
None of the regional cable services operating by newspaper companies are making money, Bell said, including the channels owned by the Chicago Tribune and the Hearst Corp.
"The cost of making this product is not cheap if you do it right," Bell observed. "But we're glad OCN will continue."
Times Mirror Co., whose Los Angeles Times is the Register's arch rival in Orange County, recently sold its cable channel there to Dimension Cable.