It's TV station equipment buying season...........................
tvbroadcast.com
Stations Spend Most Equipment Dollars In Second Quarter
The 'After-NAB' Buying Season
By Douglas I. Sheer
(May 17, 1999) America's TV stations tend to spend most of their equipment purchase dollars in the second calendar quarter of each year, generally in the period immediately following the National Association of Broadcasters Convention, in Las Vegas, which most attend. Thus, most expenditures occur during April, May, and June of each year.
This information was revealed in an informal survey conducted by Television Broadcast among a number of station chief engineers, asking them when stations tended to spend the most money on new gear each year, by quarters. The answers we found highlighted the importance of the NAB convention as a place where equipment purchases are "virtually" finalized on the show floor.
Leonard Smith, chief engineer at WTOV-TV (NBC) in Steubenville, OH, said, "Usually, we spend most of our money in the second quarter. That varies from year to year, however, depending upon what our [equipment budget] allocations are."
Jim Brady, chief engineer at WTVQ-TV (ABC) in Lexington, KY, agreed that most of his station's spending is "typically second quarter. It kind of overlaps NAB because there are some [technology] issues that we won't make a move on until after we've been to NAB," he said. "In the first quarter we are getting quotes and doing our research, but, there are times when I'd like to put my hands on it, see it, look it over, do some talking and some comparison shopping before we place the order.
According to some of the TV stations we spoke with such as those that are part of the Public Broadcasting System, often, no quarter is a good quarter. Speaking for many PBS stations, Chief Engineer Ron Smith, of WBRA-TV, in Roanoke, VA, sounded a conservative note saying, "We are a PBS station with three transmitters and we don't plan any major purchase for the next two to three years."
As to when the station buys everyday items, like videotape, computer discs and other "replenishables," Smith said they purchase them "whenever we need to," but not on a fixed quarterly schedule.
For some though, no quarter dominates at all. "Buying is spread throughout the year" according to Bertie Cartwright, chief engineer of WNCT-TV (CBS) in Greenville, NC. And, he added, "There's not really a significant bounce after NAB for us."
As for replenishable items, "They are covered as a monthly budgeted item, so it kind of goes that way," Cartwright added.
Echoing his colleague to the south, Ted Teffner, CE of Burlington, VT's WCAX-TV, said, "There's really no specific quarter" that purchases get made.
Teffner indicated that WCAX is a family-owned station that spends-roughly-about $800,000 to $900,000, spread throughout the year. "I have projects that I work on and if I can get the research done and the [competitive] bids in, the decision-making is done on a sooner-the-better basis," he said. "Some years the research really requires us to make a schedule of appointments with vendors and have a real schedule of visits at NAB, but this year I'm not tying so much to the show," he added.
As to replenishables, Teffner said they are handled on "an as-needed basis, with different departments like news or production making independent decisions. Some decisions developed out of last year's NAB and I'm just pulling it together now."
Fred Lass, CE at CBS affiliate WRGB-TV, in Schenectady, NY, said: "Electronic products are probably going to be purchased around NAB time. Non-electronic items, like a re-modeling of the lobby, would tend to occur in the fourth quarter.
"Research activity is ongoing," he added. "We do research for making the budget, which in our case means July and August of the prior year."
Yet, despite the price-driven nature of his planning, Lass cautioned, "You don't want to plug in a $50,000 editing system unless you know that somebody makes one at that price that is adequate for you."
Talking about the annualized nature of the planning that his station does, regardless of the second quarter importance, Lass stated, "We try to spread the cash flow throughout the year," even though he agreed that NAB factors heavily into his buying plans.
As to the important role of computer products, like servers and automation devices, Lass said, "It's so unusual, in 1998 we did two big things with computers, put in a video server for commercials-an ASC300 system-whose viability I discovered at NAB '97. When Fibre Channel drives were added and we put in an EditStar for non-linear news editing, that was a two- to three-year decision process."
So, station planning goes on year-round and yet most big purchases happen after NAB, in the second quarter, once buyers are convinced that nothing has eclipsed what they saw and liked earlier on.
Douglas I. Sheer is a business developement consultant and researcher, having served over 650, mostly manufacturer clients, since 1982. He can be contact at dougsheer@aol.com.
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