NBC: Our Local Stations Are Killing Us

Local television stations used to be money machines for the big media conglomerates. No more.

GE’s NBC Universal says its revenues dropped three percent and that its operating profits were down six percent for the last three months of 2008, primarily because of weakness at its local TV stations. [Update: NBC says local station revenue was down 25 percent and operating profit down 55 percent, according to paidContent's David Kaplan, who listened to the morning earnings call.]

Look out below: Meredith Corp. (MDP), which owns a handful of local stations in major markets, says its ad sales are down 40 percent this quarter.

The upside: Cable TV was strong, GE says–because cable systems operators have to pay cable networks like NBCU a fixed fee for each subscriber, regardless of the ad market.

And the real upside: GE shareholders don’t really care that much about NBC’s performance–they’re much more concerned about the company’s huge finance business. The one exception here would be Vivendi, which has already said its going to be writing down its stake in NBCU.