Betting big bucks on Imus shock talk
A rural indie channel is paying $25 million to pair the shock jock's chatter with tractor pulls and Christian cowboys.
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| Patrick Gottsch, president and CEO of the Rural Media Group Inc., and some of his magazine staff. |
OMAHA (Fortune Small Business) -- When Don Imus made his controversial remark about Dallas Cowboy Adam Jones on Monday, there was only one cable channel broadcasting his show as live TV.
No, not MSNBC, which cancelled its Imus contract after his infamous "nappy-headed hos" comment about the Rutgers University women's basketball team in April 2007. The Imus show is now simulcast by an unlikely small business: Rural Free Delivery TV, a 33-employee company headquartered in a log cabin office overlooking the Elkhorn valley near Omaha.
RFD-TV usually broadcasts shows such as National Tractor Pulling, Equestrian Nation, and Cowboy Church (hosted by a gospel singer and a calf-roper turned pastor).
"We're the only channel serving the 27 million homes of rural America," says Patrick Gottsch, 54, the soft-spoken, denim-clad founder and CEO.
So how did Gottsch come to spend $25 million on a five-year deal to simulcast WABC's "Imus in the Morning" show - which is based in New York City, covers the urban world of politics, sports and celebrity, and couldn't be further from his usual rural fare?
The unlikely pairing began in July last year, when Gottsch shot a documentary at the Imus Ranch, a 4,000-acre cattle ranch in New Mexico where Imus and his wife provide horse-riding vacations for children with cancer.
"We had a lot of respect for what Don and his wife did, but no one had done a TV story about it," says Gottsch. "My visit started a relationship."
After the Imus Ranch documentary aired on RFD-TV on Labor Day 2007, emails poured in from viewers who loved the story of the do-gooder shock jock.
"They all said 'why don't you bring Don Imus back on RFD-TV?'" says Gottsch. "It was one of those 'duh' moments."
Gottsch knew that Imus was working on a contract with ABC Radio. So in September, the entrepreneur wrote Imus, simply asking to simulcast the show. By November, the deal had been sealed.
It seemed to fit nicely into RFD-TV's long-term strategy. The station aims to reach 50 million households - nearly 20 million more than its current total - in order to attract the attention of national advertisers. At the 50 million mark, the network would be distributed to half the country and could expect ad revenue to increase by 30%, according to Jeff Stevens, managing director of Petry International, a New York advertising firm that was recently contracted by RFD-TV to work on national sales.
"Imus is a magnet for political commentary, and has an appeal across the entire country," says Stevens. "There are many advertisers who might not even consider RFD-TV, but will buy time during the Imus show."
Even before the latest Imus controversy, however, industry experts doubted whether the shock jock's show would be the flagship RFD-TV needs to break out of the pack.
"They have an uphill battle," says Thomas Umstead, programming editor at Multichannel News, a cable industry trade publication. "This is a very difficult time to gain distribution. Most of the cable systems are at their capacity in terms of the number of channels they can carry."
Only about 5% of RFD's airtime is devoted to shows the channel itself produces, none of which have stood out enough to put the network on the map.
"If Gottsch doesn't break out an original show, he will be marginalized," warns an agricultural media executive who works for a company that has dealt with RFD-TV. "What RFD-TV has done so far has trended towards the cheap and cheerful. Patrick's seen as a dilettante in the industry."
In March this year, RFD-TV was picked up by Nashville's local Comcast (CMCSA, Fortune 500) system. The network is currently in discussions with other local systems across the country. Meanwhile, Gottsch is working on something he's dreamt of for the past twenty years: producing a rural evening news show with bureaus in Washington D.C. and Chicago.
That's exactly the kind of flagship product RFD-TV needs. At around $10 million a year it will be an expensive venture for the network, which plans to finance it using its own funds. Gottsch hopes to get it off the ground within a year.
"He doesn't know what he can't do," says industry veteran Ed Frazier, RFD's COO. (Frazier was CEO of Liberty Sports before Fox Sports acquired it in 1996.) "That allows him to charge into places people wouldn't go in the industry."
Just like Don Imus, in other words. 
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