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News Corp. to possibly buy Chicago Tribune and L.A. Times


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According to the Los Angeles Times' Business section, in a story published on its website tonight, News Corporation is likely to enter talks with The Tribune Company to buy the Times and the Chicago Tribune once Tribune Co. exits bankruptcy (possibly by the end of the year). Although it doesn't mention specifically whether News Corp. would buy Tribune's TV station group or not, if it were the case, it would pose a potential problem in both Chicago and Los Angeles, where of course News Corp's Fox owns duopolies in both markets, as well as Tribune each owning a TV station in those same markets. Tribune, as we may all know, owns seven Fox-affiliated stations (KSWB San Diego, KTXL Sacramento, KCPQ Seattle, WXIN Indianapolis, WTIC Hartford-New Haven, WXMI Grand Rapids, WPMT Harrisburg, Pa., plus KTVI St. Louis and KDVR Denver via the Local TV LLC partnership).

 

However, there was a story earlier in the spring where Rupert Murdoch was considering splitting up News Corp. into two separate companies; one that would handle the entertainment side (TV, 20th Century Fox, etc.), and the other would be newspapers, books, etc. If Murdoch does follow through with that, then the television situation pretty much becomes a moot point.

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Murdoch isn't the only one interested: KPBS reports that Doug Manchester, a hotelier that also owns the U-T San Diego and North County Times newspapers is also interested in Tribune's properties, but in his case, he wants to take the entire company off of JPMorganChase, Angelo, Gordon & Co. and Oaktree Capital Management's hands. If this pans out, he'd probably need a waiver to acquire KSWB to create a TV/newspaper combo in San Diego with the two papers that he already owns, much like Rupert Murdoch would need one to acquire the Los Angeles Times and the Chicago Tribune to form newspaper/TV combos with KTTV (which by the way, was originally owned by the times, first in a joint venture with CBS and then owned outright until selling it to Fox Television Stations predecessor Metromedia) and WFLD.

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Murdoch isn't the only one interested: KPBS reports that Doug Manchester, a hotelier that also owns the U-T San Diego and North County Times newspapers is also interested in Tribune's properties, but in his case, he wants to take the entire company off of JPMorganChase, Angelo, Gordon & Co. and Oaktree Capital Management's hands. If this pans out, he'd probably need a waiver to acquire KSWB to create a TV/newspaper combo in San Diego with the two papers that he already owns, much like Rupert Murdoch would need one to acquire the Los Angeles Times and the Chicago Tribune to form newspaper/TV combos with KTTV (which by the way, was originally owned by the times, first in a joint venture with CBS and then owned outright until selling it to Fox Television Stations predecessor Metromedia) and WFLD.

The last thing Tribune or the L.A. Times needs is someone like Doug Manchester to buy up more media properties. Just a few weeks ago he purchased the North County Times (a local newspaper serving northern San Diego county), so now he owns the two major daily newspapers in the county. Not to mention that he bought the San Diego Union Tribune last year. The U-T has become a complete joke since he took it over. Manchester likes to run his own editorials shilling for politicians that support his ambitions for his Downtown development plans. He has also been a vocal supporter of building a football stadium for the Chargers in Downtown San Diego, even publishing several front page articles on it. There was also talk that he let go one of the U-T's sports columnists Tim Sullivan earlier this summer because Sullivan was not a supporter of Manchester's downtown stadium plan. Sullivan mentioned on twitter (months ago) that he was told that he was being let go because he was not embracing of new media. Hopefully the Tribune company will be sold to someone who would care about company and its legacy and not to someone who has his employees call him "Papa Doug."

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I can't see Tribune selling off their flagship paper, at least not until they've sold off every other newspaper they own. It'd be like the New York Times company selling off the New York Times but keeping its other properties, or a pre-Comcast NBC selling off WNBC but keeping the rest of its stations.

 

Wasn't there an LA-based group that wanted to buy the LA Times a few years ago and make it a locally-owned paper?

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According to the Los Angeles Times' Business section, in a story published on its website tonight, News Corporation is likely to enter talks with The Tribune Company to buy the Times and the Chicago Tribune once Tribune Co. exits bankruptcy (possibly by the end of the year). Although it doesn't mention specifically whether News Corp. would buy Tribune's TV station group or not, if it were the case, it would pose a potential problem in both Chicago and Los Angeles, where of course News Corp's Fox owns duopolies in both markets, as well as Tribune each owning a TV station in those same markets. Tribune, as we may all know, owns seven Fox-affiliated stations (KSWB San Diego, KTXL Sacramento, KCPQ Seattle, WXIN Indianapolis, WTIC Hartford-New Haven, WXMI Grand Rapids, WPMT Harrisburg, Pa., plus KTVI St. Louis and KDVR Denver via the Local TV LLC partnership).

 

However, there was a story earlier in the spring where Rupert Murdoch was considering splitting up News Corp. into two separate companies; one that would handle the entertainment side (TV, 20th Century Fox, etc.), and the other would be newspapers, books, etc. If Murdoch does follow through with that, then the television situation pretty much becomes a moot point.

 

So News Corp wants to do to the LA Times and Chicago Tribune what it did to the Wall Street Journal?

 

Sad day for the newspaper industry if that happens.

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If these stations went to News Corp, it would be disastrous for Denver. 5 things could happen. Either KWGN would continue the SSA with KDVR (why would FOX want a CW affiliate?). KWGN and KDVR would separate and FOX affiliation would switch to KWGN (this would mean KDVR would have to let go at least half their news department). KWGN and KDVR would separate and My Network TV affiliation would switch to KWGN leaving Gannett holding an empty bag. Finally, and most likely, News Corp would buy the group and immediately spin off KWGN to Local TV (They already have a good relationship with OakHill). Thoughts? I know this is all speculation, but even if it is, I don't like the possible direction.

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If these stations went to News Corp, it would be disastrous for Denver. 5 things could happen. Either KWGN would continue the SSA with KDVR (why would FOX want a CW affiliate?). KWGN and KDVR would separate and FOX affiliation would switch to KWGN (this would mean KDVR would have to let go at least half their news department). KWGN and KDVR would separate and My Network TV affiliation would switch to KWGN leaving Gannett holding an empty bag. Finally, and most likely, News Corp would buy the group and immediately spin off KWGN to Local TV (They already have a good relationship with OakHill). Thoughts? I know this is all speculation, but even if it is, I don't like the possible direction.

 

As far as I know, News Corp was only interested in the LA Times and Chicago Tribune.

 

I can't imagine News Corp wanting to expand its local O&O portfolio to places like Grand Rapids, Sacramento and Indianapolis after selling its stations in its smaller markets like St. Louis and Denver. Plus Tribune has TV properties in places like Chicago, New York, and LA where News Corp already owns 2 TV stations per market. Even if News Corp wanted the Tribune TV properties, legally they can't. Plus owning the LA Times and Chicago Tribune would bar News Corp from gaining anymore TV properties I think (I forget how the FCC rules work with that stuff).

 

So long story short, I wouldn't worry too much about the Tribunes local TV properties.

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As far as I know, News Corp was only interested in the LA Times and Chicago Tribune.

 

I can't imagine News Corp wanting to expand its local O&O portfolio to places like Grand Rapids, Sacramento and Indianapolis after selling its stations in its smaller markets like St. Louis and Denver. Plus Tribune has TV properties in places like Chicago, New York, and LA where News Corp already owns 2 TV stations per market. Even if News Corp wanted the Tribune TV properties, legally they can't. Plus owning the LA Times and Chicago Tribune would bar News Corp from gaining anymore TV properties I think (I forget how the FCC rules work with that stuff).

 

So long story short, I wouldn't worry too much about the Tribunes local TV properties.

 

I don't worry. It just the start to a really interesting decomp of Tribune. It's not even a valid hypothesis. Let me see KWGN picked-up by CBS, INC and I'm happy.

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Guest EyeWatcher

I could see CBS taking KWGN to make a duopoly w/ KCNC and WGN a duopoly w/ WBBM from News Corp if they did this. Dunn has always had a fondness for duops.

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Okay, I know alot of the activity on TVNT is dedicated to the art of speculation (which I completely support, encourage, and take part in), but I think we all are getting WAAAAAY ahead of ourselves on this one:

 

1. This is merely exploring the idea that News Corp. wants to purchase the Chicago Tribune and LA Times.

2. News Corp. has denied these rumors.

3. They may not want the Trib TV entities at this point or ever.

4. You do not spell News Corp. with the letters C-B-S.

 

Just sayin'...

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Okay, I know alot of the activity on TVNT is dedicated to the art of speculation (which I completely support, encourage, and take part in), but I think we all are getting WAAAAAY ahead of ourselves on this one:

 

1. This is merely exploring the idea that News Corp. wants to purchase the Chicago Tribune and LA Times.

2. News Corp. has denied these rumors.

3. They may not want the Trib TV entities at this point or ever.

4. You do not spell News Corp. with the letters C-B-S.

 

Just sayin'...

 

I'm not thinking any of this is going to happen. This is firmly stated.

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I think the best situation for Tribune would be for the entire company to be acquired by someone else who can run it as is. That's where the Manchester interest comes back into play here, if he or some other person bought Tribune, the company would have a future. But they'd have to run it right and have ideas that would work to improve the underperforming properties and steadily absolve its outstanding debt. It would seem that the company would be a ripe takeover target by someone else. The reason why Tribune ended up in bankruptcy in the first place is because Sam Zell chose to purchase the company through a leveraged buyout and took the company private after acquiring it, both factors incurred the $12 billion in debt (which according to the Bloomberg article shown above, was only $5 billion more than the company's present net worth). Whomever purchases the entire company intact should not make that same mistakes that Zell did.

 

As far as the thing about WGN being bought by CBS, if Tribune's station group was sold in pieces, a duopoly between WGN-TV and WBBM-TV would be impossible if both fell within the two-of-the-four-highest-rated-stations guideline that is part of the duopoly rules; even if it was, there would be such public uproar over it, because for many Chicagoans (and those outside the area, like myself), it would feel like tossing out six decades of history. It's better for WGN to stand as a competitor, rather than a sister station. Chicago, like New York and Los Angeles, can support five English-language news outlets, and WGN has held its own for years amongst the Big Three stations, it helps the fact that WFLD's news ratings are in the pooper. The sports more than likely do well, and its syndicated shows probably do respectably well also, which might put that station out of that danger zone. WGN's only weak link is the CW primetime programs, which are usually outperformed by the station's newscasts (particularly the 9 p.m. program).

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It's more probable that Tribune's stations and newspapers get sold off piece by piece. They might get more money that way (which is what the creditors want). But I bet that CBS and FOX are sniffing around Tribune's tv properties to see which might fit into their plans.

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It's more probable that Tribune's stations and newspapers get sold off piece by piece. They might get more money that way (which is what the creditors want). But I bet that CBS and FOX are sniffing around Tribune's tv properties to see which might fit into their plans.

 

Any thought that Local TV could be sniffing? Or is it strictly a Network O&O opportunity? Tribune does own 1 ABC affilate (WGNO) which Local could snatch up. I could also see Local taking any number of properties that CBS nor FOX want. Obviously all we can do is speculate now, but I do see the primary buyers at CBS and News Corp and secondary buyers as Local and maybe even BELO. My two cents.

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It's more probable that Tribune's stations and newspapers get sold off piece by piece. They might get more money that way (which is what the creditors want). But I bet that CBS and FOX are sniffing around Tribune's tv properties to see which might fit into their plans.

 

But if that did happen Time Warner might want to look at Tribune's CW affiliates, too. Keep in mind the fact that CBS already owns duopolies in New York and Los Angeles, I have never heard of a legal duopoly being broken up for anything other than the 2-of-the-top-4 ratings issues playing a factor... and even then, the duopoly was kept together through an LMA or SSA (see WAWS and WTEV for reference). Time Warner also owns The CW as well, and they're already in the station business (to an extent). The company's Turner Broadcasting System subsidiary owns Atlanta's WPCH. I should point out that stations owned by Chris-Craft/United Television and Paramount Pictures (prior to their stations being folded into Fox and CBS, respectively) both served as owned-and-operated stations of UPN, when that network was a joint venture between the two companies.

 

The issue is that Tribune is the only station group in modern times that has actually bothered to pay attention to these non-"Big Four" outlets. Tribune has, and if CBS bought any of the stations, don't bet the farm that they would invest in the news on the standalones. CBS hasn't bothered to give WTOG ot KSTW back the news departments they lost under Viacom ownership. KTLA, WGN and WPIX's news departments would go under if CBS did buy them and swapped out KCAL and WLNY in L.A. and New York to get the two other stations (which IMO, would be unfortunate). Again, the duopoly rules are the deciding factor, if any of the Tribune CW stations fall within the FCC's ratings threshold that bars duopolies between the highest-rated stations in a city, CBS may be out of the running.

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But if that did happen Time Warner might want to look at Tribune's CW affiliates, too. Keep in mind the fact that CBS already owns duopolies in New York and Los Angeles, I have never heard of a legal duopoly being broken up for anything other than the 2-of-the-top-4 ratings issues playing a factor. Time Warner also owns The CW as well, and they're already in the station business (to an extent). The company's Turner Broadcasting System owns Atlanta's WPCH. I should point out that stations owned by Chris-Craft/United Television and Paramount Pictures (prior to their stations being folded into Fox and CBS, respectively) both served as owned-and-operated stations of UPN, when that network was a joint venture between the two companies.

 

The issue is that Tribune is the only station group in modern times that has actually bothered to pay attention to these non-"Big Four" outlets. Tribune has, and if CBS bought any of the stations, don't bet the farm that they would invest in the news on the standalones. CBS hasn't bothered to give WTOG ot KSTW back the news departments they lost under Viacom ownership. KTLA, WGN and WPIX's news departments would go under if CBS did buy them and swapped out KCAL and WLNY in L.A. and New York to get the two other stations (which IMO, would be unfortunate). Again, the duopoly rules are the deciding factor, if none of the Tribune CW stations fall outside the FCC's ratings threshold that bars duopolies between the highest-rated stations in a city, CBS may be out of the running.

There are too many variables in the Tribune situation, but I'm sure CBS would sell off WLNY in a heartbeat if that allowed them to get WPIX. The thing about Tribune is that the company has some really good pieces, so there won't be any shortage of interest. Also the smaller stations run a pretty lean operation, which would be enticing to any potential buyer.

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