Re: No wonder CBS keeps two All-News Stations in NYC

[Dan Strassberg <dan.strassberg@worldnet.att.net>]

At 10:40 AM 6/20/98 -0700, you wrote:
>Dan Strassberg wrote:
>
> I would be surprised to learn that the cost of running either station
>(not including depreciation, ammortization, and debt service) came to
>much over $5 million per year. If I'm right, $55 million of that $65
>million is gross profit.
>
>
>Having once been on the management team (and involved in the yearly
>budget process) of a major market talk and news station, I would
>estimate that your expenses of $5 mil a year is low by a factor of at
>least three.
>
>
Isn't payroll the major expense? I suspect that the budget for a talk
station is higher than for a news station. Talk stations employ a lot of
high-priced talent. Except for network feeds, news stations, such as WINS
and WCBS, don't use talent with recognizable names. I figured that salaries
and fringes came to half of the total expenses, that the staff headcount was
20, and that the average salary, with fringes, came to $125,000. That
translates to an average salary, without fringes, in the neighborhood of
$100,000. All of the sales people and the GM must make more than that
(though in the case of sales folks, it's mostly commission, not base). But
who else makes that much? Is the headcount off? Rent on the offices/studios
and taxes on the TX site can be a major expense in a large market, but I
allowed $2.5 million for those items (and everything else except salaries).

With talk hosts who pull down in excess of $300k annually per person, I can
see a payroll of $4 million, but that still wouldn't translate to total
expenses (excluding, depreciation, amortization, interest, and taxes) of
over $10 million. Where did I go wrong?

- -------------------------------
Dan Strassberg (Note: Address is CASE SENSITIVE!)
ALL _LOWER_ CASE!!!--> dan.strassberg@worldnet.att.net
(617) 558-4205; Fax (617) 928-4205

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