Big Four May Sit Out Station Consolidation

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This topic contains 0 replies, has 1 voice, and was last updated by  Bill Recto 7 months, 1 week ago.

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    Bill Recto

    An editorial on TV station consolidation.

    Of course, there are nine other top 30 markets where CBS doesn’t have O&Os. I’m sure CBS would like the prestige and news synergies that would come from owning Tegna’s CBS affiliate in Washington, WUSA.

    In addition to the current ownership cap, what restrains CBS, NBC and Fox is that collecting new O&Os is a messy affair. It can generate a lot of bad blood within the affiliate ranks.

    To gain a new O&O, the network has to buy out an existing affiliate who may not want to sell. And if rebuffed, it has to buy another station in the market and snatch away the affiliation — affiliation contracts permitting, of course.

    The CBS affiliates in those four AFC market I mentioned before — Houston, Cleveland, Indianapolis and Nashville — are owned by Tegna, Raycom, Tribune and Scripps, respectively.

    Tribune may welcome a call from CBS about Indianapolis. I’m not sure how the others would react. I don’t see any of them as willing sellers, although they may sell if the deal is sweet enough or they thought CBS was going to run them over if they refused.

    I’ve indulged in a bit of speculation here and it’s all based on the notion that Ajit Pai will follow through and restore the UHF discount in calculating groups’ reach under the national cap. I’m not entirely sure he will, despite the high expectations.

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    For all the dereg talk out of Chairman Pai since he joined the FCC in 2012, I just can’t believe he would make a move that would allow groups like Sinclair, Nexstar, Fox, NBC and CBS that are now stuck just below the current 39% cap to expand to 45%, 50% or even 60%. That’s what restoration of the discount would do. Keep in mind that Ion Media was able to grow to 64.8% because of the discount.

    But maybe Pai will.

    It’s been done before. The Telecommunications Act of 1996 took the national lid off radio, allowing groups to move into as many markets as they want. I’ll leave others to decide whether that was a good idea.

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