Weather Channel forecast: Lucrative

Janet Babin Jan 3, 2008
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Weather Channel forecast: Lucrative

Janet Babin Jan 3, 2008
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KAI RYSSDAL: The Weather Channel could conceivably be worth $5 billion. The cable channel’s parent company, Landmark Communications, confirmed today it’s exploring a possible sale of its holdings. From North Carolina Public Radio, Marketplace’s Janet Babin has more.


JANET BABIN: Landmark Communications owns more than 50 community newspapers and nine dailies. But these days, the gods of the media world are indifferent to print. Their Holy Grail is The Weather Channel.

Let’s face it. Even in this digital age, the weather is one of the few things that still affects everyone. And The Weather Channel is one of the last independently owned cable channels.

Porter Bibb owns MediaTech Capital Partners. He tried to buy The Weather Channel back in the 90s for $600 million. But like lots of other suitors, Landmark turned him down. Now, Bibb thinks the channel’s worth more than $5 billion, especially because it comes with a great website property.

Porter Bibb: Weather.com is one of the top-rated sites that’s visited of any on the Internet. It has more daily visitors than Facebook, almost as many as MySpace and YouTube.

On TV, the channel’s expanded its programming to include shows about global warming. Brian Steinberg writes for Advertising Age. He says fans these days aren’t just vacationers stuck in hotel rooms.

Brian Steinberg: There are people who won’t leave the house until they watch that channel for five minutes.

Cable advertisers love The Weather Channel for other reasons too. Paul Bond with the Hollywood Reporter says, like live sports, the weather happens now.

Paul Bond: A lot of people watch live. They don’t Tivo the TV shows and then skip through the commercials.

But the Weather Channel can sometimes look a bit rough around the edges. Commercials can cut into live shots, and anchors get stuck with the wrong graphics. But Bond says skimping on staff and equipment reigns in costs.

Bond: That makes it all the more profitable. And people don’t seem to mind that it looks amateurish.

Landmark wouldn’t say why it’s considering a sale now. But the core of its business is newspapers, an industry that’s struggling for profitability.

I’m Janet Babin for Marketplace.

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