STATEMENT CONCERNING CANCELLATION OF PEPPER AND FRIENDS

August 5th, 2009

One of the most difficult tasks any employer faces is the elimination of staff positions. This is as true at MU as it is in the private sector. And certainly, it is true with regard to the decision to end the production of KOMU-TV’s Pepper & Friends.

It is understandable that some in the community feel a real sense of loss as we move closer to the last broadcast of Pepper & Friends in September. The show has provided a venue for them and the causes that are close to their hearts. The University community feels that loss as well.

This course of action was entered into with a great deal of thought and deliberation. All of us at the University have witnessed the wonderful contribution Pepper & Friends has made to KOMU’s community services efforts. We are grateful for those efforts, and we celebrate the dedicated service of Paul Pepper and James Mouser.

The decision to cancel the show, while difficult, was the culmination of a process of carefully analyzing all aspects of station operations in this challenging economic environment. It was not made by one individual, and certainly not made in a vacuum.

There are two primary criteria that are used when we make operational decisions regarding KOMU:

First and foremost, is the imperative to protect the academic mission of the station and to maintain a high-quality academic experience for our students. This is critical if we are to continue to attract and train the nation’s-and indeed the world’s-finest broadcast journalism students. Part of the allure for students is that KOMU operates as a commercial television station and NBC network affiliate. It is that commercial and network status that provides our students with one-of-a-kind, real-world experience as reporters, videographers and producers. Successful operation as a commercial station requires making sound financial decisions.

This is important, because it is KOMU’s continued financial viability that allows us to provide the necessary technology and learning opportunities for these students. As you may know, station operations and investments in broadcast technology are funded entirely by the advertising revenues the station generates. No funding from the University or the state is used to support KOMU.

The second point is directly related to the first. Simply stated, continuing to operate in the black is not an option for KOMU-it is an imperative. This is the fundamental basis for any successful enterprise, and it is the unfortunate reality facing Pepper & Friends.

For some time, the cost of producing Pepper & Friends has exceeded the advertising revenues generated by the show. Over the years, station management, understanding the deep feelings many have for the show, and enjoying the benefits of a healthy economy, made a conscious decision to look past the losses and keep the show on the air by covering the shortfall with revenue generated by other programming. Given the current economy and reduced advertising revenues, underwriting those losses is no longer tenable.

It requires approximately $222,000 per year to produce Pepper & Friends. In the most recent fiscal year, the show generated advertising revenues of approximately $148,000. This revenue shortfall is not a new phenomenon: For at least 10 years, show revenues have failed to cover production costs. That’s a cumulative total in the past decade of several hundreds of thousands of dollars. Factor in the opportunity for profitable programming during the current Pepper & Friends time slot, and margin of lost revenues widens still further. We simply cannot continue to draw resources away from our students’ academic experience.

Some additional background: In the just-completed fiscal year, Pepper & Friends had a total of 122 advertisers. That number may sound impressive until you examine it more closely. The show’s largest advertiser paid $12,215 last year. The smallest paid $6. The top 10 advertisers averaged $5,911 last year. And the average for all advertisers was $1,276. Paul and James and the entire KOMU sales team worked hard to generate this advertising support. Despite these efforts, however, the show simply does not generate revenues adequate to support its continued production.

It is also important to remember that harsh economic realities are not limited to Pepper & Friends. Weeks prior to the announcement to end the show, 13 jobs at KOMU were eliminated because the station no longer had the advertising revenues to support them. In fact, positions across our campus have been eliminated and new hiring has been significantly curtailed. These actions represent very difficult decisions for everyone involved.

KOMU’s longstanding commitment to community service endures. A number of elements of the Pepper & Friends show will continue in other locally originated programming. For example, beginning this fall KOMU will feature a segment within its morning programming that will include issues and events that have been regularly covered during the talk segments of Pepper & Friends. The station will also continue the “Pet Corner” segment in its 5:00 p.m. newscast. Given the significantly higher viewing levels at these time periods, KOMU’s ability to support its community service commitment will actually be expanded.

These program changes are in addition to KOMU’s substantial, ongoing support of the Central Missouri Food Bank, Heart of Missouri United Way, American Heart Association, University Concert Series, MDA, Ronald McDonald House, Susan B. Komen Foundation, and many more.

Be assured that KOMU will continue to be the media leader in actively sustaining and generating public awareness and support for many worthy community efforts.

Additionally, as we recently announced, the University is pleased that Paul Pepper will continue to have a public presence on KBIA. This is good news for both Paul and his show’s supporters. We are happy to have helped facilitate this move.

The University is grateful to Paul Pepper and James Mouser for all they and their co-workers have contributed to mid-Missouri over the last 27 years. We, and we hope the community, will spend the show’s remaining weeks celebrating and honoring the significant accomplishments of these two remarkable men and everyone associated with the production of this memorable show.