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Sinclair, Tribune Close to Merger Deal


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Different story from when CBS famously refused to give WTVJ's NBC-appointed management the time of day at their 1988 affiliate conference/upfronts.

 

Maybe Les Moonves thinks Rupert Murdoch, like Trump, can be "damn good for CBS," or more specifically, WTTV and the CW.

 

I think its money. Les doesn't care who or what pays him, as long as they do, and knowing that a Fox-backed venture will be semi-flush with cash, he simply sees an opportunity for cash.

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They probably realize they would be stuck there, at least for a little while until all the affiliation agreements expire. I do agree that if Fox acquires them, WISH would likely get CBS back at the next opportunity (2019?). Unless they mutually agree...after all, Nexstar didn't create the mess as they didn't own WISH/WNDY in 2014.

 

I'd expect most of the other Big 3 affiliates to be sold off again, since they are in too small markets for O&O's and/or Fox already has a strong affiliate there that creating an affiliation battle has more losers than winners.

It would be funny if WTTV became a CBS O&O and WISH becomes a FOX affiliate...I would laugh if that happen.

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Well, no surprise on what's in today's Jessell's weekly editorial.

 

I think the real surprise in all of this was when folks were trying to convince Fox to thwart Sinclair on their ambitions. Whereever happened to them trying to stop Sinclair from Allbritton, Fisher, Barrington, and the others?

 

Now Fox appears to have taking their heed. Now this sets up to become one of biggest M&A news in modern time. A true shocking headline would be if Sinclair gets it and Fox doesn't. And with the negative press against Fox right now, this would be a massive blow for the Murdochs. And let's not forget the "silencer" is not out of the woods yet, either. Nexstar.

 

But whoever gets it (and if the Trib contemplates on selling), would be a sad day for the industry sad day for Chicago. 93 years. I wished the Trib would take it on their own and not sell at all, because neither one of them are good in my book. But too little, too late huh?

 

Tribune is expected to releasing its Q1 earnings next week.

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I think its money. Les doesn't care who or what pays him, as long as they do, and knowing that a Fox-backed venture will be semi-flush with cash, he simply sees an opportunity for cash.

If Fox can make more money running a CBS affiliate in Norfolk than a Fox O&O in Norfolk; why sell or change affiliations?

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If Fox can make more money running a CBS affiliate in Norfolk than a Fox O&O in Norfolk; why sell or change affiliations?

 

The problem is that each affiliate has some say in the operations of the network. The potential for competitive secrets to be stolen is there.

 

I'm reading the KEYE (2007-14, truncated from 2017?) CBS affiliation agreement, which states...

 

"In the event that CBS shall reasonably disapprove of the proposed transferee [of the station], CBS shall have the right to terminate this Agreement effective as of the effective date of any such transfer ... by giving Broadcaster notice thereof, and of its reasons for disapproving of the proposed transferee, within fifteen days after the date on which Broadcaster gives CBS notice of the making of such application." There is the potential for such a dispute to be arbitrated.

 

ABC's agreement, as seen with WLOS, is more restrictive:

 

"This affiliation agreement cannot be assigned or transferred without timely written notice to ABC and without the consent of ABC, which consent may be withheld only: (a) if the assignee or transferee controls or is controlled by or is under common control with an entity that distributes 10 or more hours of primetime television programming per week to at least 25 affiliated television licensees in 10 or more states ..." [items (b) and © relate to qualifications or to potential parties with other commercial dealings, though ABC cannot unreasonably withhold consent in those two cases.]

 

WTWC's NBC affiliation agreement requires the station to notify the network, gives the network the right to terminate the agreement, and requires the station to set up a meeting between the network and the proposed new ownership.

 

Given the hypothetical acquirer, there is definitely a question mark in the network affiliation agreement. ABC stations in particular could be disquieting because Fox obviously distributes 10 or more hours of primetime television programming to a couple hundred affiliates nationwide.

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Well, no surprise on what's in today's Jessell's weekly editorial.

 

I think the real surprise in all of this was when folks were trying to convince Fox to thwart Sinclair on their ambitions. Whereever happened to them trying to stop Sinclair from Allbritton, Fisher, Barrington, and the others?

 

Now Fox appears to have taking their heed. Now this sets up to become one of biggest M&A news in modern time. A true shocking headline would be if Sinclair gets it and Fox doesn't. And with the negative press against Fox right now, this would be a massive blow for the Murdochs. And let's not forget the "silencer" is not out of the woods yet, either. Nexstar.

 

But whoever gets it (and if the Trib contemplates on selling), would be a sad day for the industry sad day for Chicago. 93 years. I wished the Trib would take it on their own and not sell at all, because neither one of them are good in my book. But too little, too late huh?

 

Tribune is expected to releasing its Q1 earnings next week.

Different situation. In this case, FOX is trying to block Sinclair from acquiring Tribune's FOX affiliates since that would give them HUGE leverage against the network come time for affiliation renewals/rev. comp, etc. The other M&A's by Sinclair did not have have that much of an impact on FOX, compared to what a sale of Tribune could.

 

The problem is that each affiliate has some say in the operations of the network. The potential for competitive secrets to be stolen is there.

 

I'm reading the KEYE (2007-14, truncated from 2017?) CBS affiliation agreement, which states...

 

"In the event that CBS shall reasonably disapprove of the proposed transferee [of the station], CBS shall have the right to terminate this Agreement effective as of the effective date of any such transfer ... by giving Broadcaster notice thereof, and of its reasons for disapproving of the proposed transferee, within fifteen days after the date on which Broadcaster gives CBS notice of the making of such application." There is the potential for such a dispute to be arbitrated.

 

ABC's agreement, as seen with WLOS, is more restrictive:

 

"This affiliation agreement cannot be assigned or transferred without timely written notice to ABC and without the consent of ABC, which consent may be withheld only: (a) if the assignee or transferee controls or is controlled by or is under common control with an entity that distributes 10 or more hours of primetime television programming per week to at least 25 affiliated television licensees in 10 or more states ..." [items (b) and © relate to qualifications or to potential parties with other commercial dealings, though ABC cannot unreasonably withhold consent in those two cases.]

 

WTWC's NBC affiliation agreement requires the station to notify the network, gives the network the right to terminate the agreement, and requires the station to set up a meeting between the network and the proposed new ownership.

 

Given the hypothetical acquirer, there is definitely a question mark in the network affiliation agreement. ABC stations in particular could be disquieting because Fox obviously distributes 10 or more hours of primetime television programming to a couple hundred affiliates nationwide.

Spot on Raymie.

 

Les is no dummy. He knows what line to toe. I'm sure that his offer to have Murdoch up on stage during any affiliate meeting, etc. is legit.

 

That being said, when it comes down to business, does anyone really think Les wants Rupert to know what goes on behind the scenes at the affiliate meetings? I'm sure Les knows that this is just all hot air, and that if Rupert/Blackstone were to acquire the Tribune stations, that it's not Murdoch that would be leading the station group, it will be someone from Blackstone. Plus, Les puts himself/CBS in a prime position to acquire any stations that Blackstone may want to spin off.

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Most commentators have said that if Fox is successful, other than perhaps reshuffling due to stronger stations, they will not keep non Fox affiliates. I could not see any network wanting Fox to operate their affiliate. Everything points to this being a way for Fox to 1) block Sinclair from having so many Fox affiliates they have to much control over the network; 2) Fox's willingness to keep all retrans consent money and 3) broadening their reach with O&Os for future streaming business opportunities. I would also assume selling the CW Tribune stations in Markets 1, 2 and 3 would result in a significant payday. Although many point to CBS, they operate duopolies in each of those market already. I'd keep an eye on Hearst, Tegna and Scripps. One other rumor would be Sunbeam. Not sure Ansin has the money unless he sold one of his stations (and imagine that scenario in Boston!)

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Being originally from the Chicago area, I do not want to see WGN owned by Ansin. The tabloid-y style used by WHDH and WSVN might work in LA and New York, but it wouldn't work in Chicago, and imposing it on a station such as WGN would just suck.

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It's going to be so interesting to watch in 4 or 8 years if the Democrats retake the executive branch and a new FCC admin re-institutes the 39% cap--if for no other reason than to stick it to FOX and/or Sinclair. We may well be witnessing the beginning of a big media bubble not unlike Clear Channel in the 2000s (and that bubble, as iHeart Media, may burst again real soon.)

 

The funny thing with FOX / Rupert is that it's sort of a no-win situation for him. If FOX/Blackstone emerge as the winner of Tribune, the optics may look bad to Ofcom in the UK as 21CF tries to buy SKY Television outright. But if Sinclair wins, it has more leverage in retrans negotiations, and especially when you're staring down the execs of a firmly cemented fourth place network that was in first or second not that long ago, that's huge. (Also, as Jessell's op-ed suggests, could you imagine Sinclair bidding on NFL rights 10 years ago?)

 

Something else to consider: There are legally operating triopolies and quadropolies. If Uncle Rupert talks to President Trump on a daily basis (as has been suggested today) what's to stop him from getting in his ear about relaxing FCC duopoly/triopoly regulations? Absent that, WWOR, KCOP, and WPWR would absolutely be sold...

 

...I would bet, to ABC. Hear me out. I know ABC does not buy TV stations ever. But we are getting to a point where they may have to just to keep pace with the rest of the consolidation going on, or they could end up on the wrong side of a bargaining table with a Sinclair or Nexstar. NBC has duopolies in those markets, CBS could maybe pick up WPWR if they wanted but that's it. It definitely makes sense in NY, LA, Chicago if the option's there, and Houston to do it if they can get a good deal...I'm just saying.

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Absent that, WWOR, KCOP, and WPWR would absolutely be sold...

 

...I would bet, to ABC. Hear me out. I know ABC does not buy TV stations ever. But we are getting to a point where they may have to just to keep pace with the rest of the consolidation going on, or they could end up on the wrong side of a bargaining table with a Sinclair or Nexstar. NBC has duopolies in those markets, CBS could maybe pick up WPWR if they wanted but that's it. It definitely makes sense in NY, LA, Chicago if the option's there, and Houston to do it if they can get a good deal...I'm just saying.

I mean, at this point, why the hell not?

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Is Disney willing to drop billions on Tribune? It does seem like they have at least run out of big-name IPs to buy (unless they somehow buy Sesame Workshop or something)...

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One other rumor would be Sunbeam. Not sure Ansin has the money unless he sold one of his stations (and imagine that scenario in Boston!)

...I would bet, to ABC. Hear me out. I know ABC does not buy TV stations ever. But we are getting to a point where they may have to just to keep pace with the rest of the consolidation going on, or they could end up on the wrong side of a bargaining table with a Sinclair or Nexstar.

 

post-24400-Seinfeld-thats-enough-gif-nHrW.gif

I think that's enough internet for today.

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Is Disney willing to drop billions on Tribune? It does seem like they have at least run out of big-name IPs to buy (unless they somehow buy Sesame Workshop or something)...

 

Definitely not the whole thing, but in places where it makes sense to have a duopoly, I could see them picking pieces up if FOX/Blackstone have to sell big market stations off.

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It would be funny if WTTV became a CBS O&O and WISH becomes a FOX affiliate...I would laugh if that happen.

It wouldn't surprise me to see Fox swap WTTV/WXIN to Nexstar in exchange for WISH/WNDY... and the CW and Fox affiliations get traded between WISH and WXIN.

 

The only conceivable way that Fox would want to be in a market like Indianapolis is if they could get a Fox-My duopoly. Plus Nexstar automatically upgrades their standing in the market with a CBS-CW duopoly.

 

That again is predicated on 1) Fox wanting to stay in Indy, 2) the length and terms of the CBS contract on WTTV, and 3) whether or not CBS wants to buy into Indy (logically, it would have to be WTTV/WXIN, with the concurrent WXIN/WISH affiliation switch, relieving Nexstar from having to make a transaction) and solve the dilemma for Fox.

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Definitely not the whole thing, but in places where it makes sense to have a duopoly, I could see them picking pieces up if FOX/Blackstone have to sell big market stations off.

We wondered the same thing about the Allbritton sale... offering to buy that group's highest profile station, WJLA. Disney didn't do anything then. Why would they now?

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One other thing I wonder - if Sinclair LOSES, what will the reaction be like in Hunt Valley? Will they get aggressive to try to acquire someone else despite the fact their pathways to the top 10 markets (remaining) are very limited?

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We wondered the same thing about the Allbritton sale... offering to buy that group's highest profile station, WJLA. Disney didn't do anything then. Why would they now?

 

Because Allbritton was an all-or-nothing deal, and Disney had no business planting roots anywhere except DC. We're still in the all-or-nothing phase of this deal, but I wouldn't be surprised to see Disney swoop in on at least a couple of the orphaned big-market stations when the dust settles on who owns what and who needs to get rid of what.

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I'd love to see Raycom or Hearst enter Michigan and take WXMI -- still shudder to think if Sinclair took over.. Although having WXMI be a Fox O&O would be interesting too...

 

Same here would be interesting to see WXMI as FOX O&O never saw that coming having a major O&O in West Michigan market. I don't want Sinclair buying Tribune since there shell Cunningham would take the FOX17 license once Sinclair gives up the FOX17 license I'm fine with Nexstar since they would have to sell FOX17. I think Gray would be interested in buying WXMI as well with the other station you said.

 

Anyone but Sinclair buying Tribune mainly since I don't want to see FOX17 being a de facto Sinclair station run by there shell Cunningham. I'm rooting for Fox buying Tribune be interesting to see WXMI as a Fox O&O never thought that West Michigan market ever having a major O&O owning a station. I'm fine with Nexstar as well since they would have to sell WXMI to a third party which I could see Gray, Scripps, Meredith etc buying FOX17.

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I'm pretty sure KFSN is basically their lab rat, and its geographical proximity to KABC and KGO helps.

 

Disney has no pressing need to get rid of it.

 

...and it's dominated its market for decades.

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