News a viable Multicast option

Implications: NBC Universal owned and operated WNBC-TV (New York) will launch a local 24 hour news channel on one of its digital channels as part of its multicasting strategy.

Analysis: Local TV stations, including the major market stations like WNBC, are making plans for how to use their additional digital channels available under the digital TV transition set for next February.  WNBC is investing in a local news channel to serve the greater NYC area.

News is a viable strategic option for any local station with a strong commitment to news, especially if they already broadcast several local hours of news on their main channel.  The economies of scale already exist to add more news content to one of the digital sub-channels.

The challenge with any multicasting strategyis how to monetize the digital spectrum and gain audience and ultimately advertisers.  Distribution is not guaranteed from cable, satellite and telco providers, so stations must engage in partnerships and negotiations to make this happen.  There are also concerns about the sub-channels siphoning off audience from the "main" channel.  Still, the digital channels represent a lot of upscale opportunities for local TV broadcasters to generate new revenue streams and build audiences.  Adding a local news channel where a strong news operation is already in place is a good idea--even better if you have the resources of NBC news available.