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Nexstar buying The CW?


The Frog

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AT&T Inc.’s T -0.40% WarnerMedia and ViacomCBS Inc. VIAC -0.08% are exploring a possible sale of a significant stake or all of the CW Network, which they jointly own, according to people familiar with the matter.

 

Among the suitors is Nexstar Media Group Inc., NXST +0.48% the nation’s biggest broadcaster and a large owner of affiliates of the network, the people close to the talks said. 

 

People close to the talks said they are far along and an agreement could be reached soon, though the talks could still fall apart. There are other interested parties as well, but the discussions with Nexstar are most advanced, they said.

 

The most prevalent scenario is Nexstar’s taking a controlling stake in the CW, with CBS and WarnerMedia remaining as minority owners and receiving commitments to be the primary program suppliers for the network, the people said.

 

WarnerMedia and ViacomCBS Are Exploring Possible Sale of CW Network

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Taking a majority stake in the CW would also mean having an increased sway over the network’s programming strategy, as well as how it’s positioned in the marketplace, what gets preempted and when, and the amount of local programming and local news the network airs.

 

A new majority owner like Nexstar could shift the CW programming target away from the 18-34 and 18-49 demographics. Focusing on an older demo or changing up CW’s focus to a more homey-heartland direction as the way to boost ratings and viewership, and thus ad sales.

 

What’s Driving Nexstar’s Interest in the CW Network — and Why Now?

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18 minutes ago, Yankees4life said:

Yeah...good luck with that. Tough to compete against the big 4 and their content there. I'll remain skeptical of this deal if it goes through 

I still remember when Pax tried to go it alone as "i" without any studio partners...it took at least eight years to undo the damage from that "i for infomercial' era pre-Ion where they had one original production that was gone after eight weeks.

 

In 2022, the last thing broadcast needs is another older-centric network where they only take the 'safe' Associated Television "World's Cheapest Viral Video We Could License" filler on the CW that's the lowest in every weekly ratings report or just grab everything cheap Canadian networks offer. If Nexstar (or God forbid, Sinclair) buys the majority stake in the network, they both need guaranteed studio partners and high-profile programming, because slumming it only imperils both their entire affiliate base, and independent/MyNetworkTV stations in general.

 

There's also The CW+ to consider in this deal; you still have to market a full 168 hours per week to your smaller market affiliates along with those existing syndication deals, and the other station groups will simply walk away if you switch that to "NewsNation Annex" or "The National Desk+" outside network hours or worse, get an anti-trust case slapped on you because you swipe it from other station groups wholesale for your own. This isn't ditching MeTV for Antenna TV because it's in-house, but something that needs to be navigated with care.

 

Also...in before anyone else goes 'finally they can restore cartoons to broadcast TV and ditch the E/I block'...no, nothing will change there no matter who buys it. Litton/Hearst will throw money at whoever buys out the network to keep the E/I deal for One Magnificent Morning and its elderly demo happy, along with their monopoly on the market, plus Hearst has CW affiliates so they have that leverage on the new owner.

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How are the other networks going to react to the whole CW/Nexstar deal and would Nexstar have its stations in some markets switch to the CW or make it a subchannel?  (The ones that are not affiliated with the network)

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1 hour ago, CLETVFan said:

How are the other networks going to react to the whole CW/Nexstar deal and would Nexstar have its stations in some markets switch to the CW or make it a subchannel?  (The ones that are not affiliated with the network)

I just started a thread in the Speculatron for predictions on the matter......

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Well this will be interesting. Nexstar is in my market. KRON could take the CW affiliation from KBCW.

 

KTVU Plus could take the MyNetwork affiliation with KTVU’s duopoly. 

 

KBCW could be the new KCAL for the Bay Area with its duopoly with KPIX.

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Should Nextar actually buy the CW, is a broadcast television network allowed to own 199 affiliates that would in turn become O&Os?

 

Furthermore, is the CW anymore successful than the WB or even UPN?

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42 minutes ago, iron_lion said:

Should Nextar actually buy the CW, is a broadcast television network allowed to own 199 affiliates that would in turn become O&Os?

 

Furthermore, is the CW anymore successful than the WB or even UPN?

 

Not legally no, there is pretty much no way they can own stations in 199 markets. It might be a benefit though for Nexstar since they would have full control of it and could place their own programming on it.

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Posted (edited)

Looks like a combination of streaming and corporate housekeeping led to the 'For Sale' sign hanging on the network.

It's amazing that a few short years of changes in the industry led to The CW's lucrative business model drying up. 

 

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WarnerMedia and ViacomCBS Inc.’s decision to ponder a sale of some or all of the CW Network is a reflection of dramatic changes within the two companies and the entertainment industry, people familiar with the matter said.

 

The CW Network has long been a valuable outlet for the programming of joint owners WarnerMedia and ViacomCBS and a healthy source of licensing fees from Netflix Inc., which frequently has streamed CW shows once they have aired.

 

Now, both AT&T Inc.’s WarnerMedia and ViacomCBS have their own content-hungry streaming platforms—HBO Max and Paramount+, respectively—making CW less of a priority for either company, the people said.

 

Some interesting information revealed about the network's financials:

 

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People with knowledge of its operations say the CW has been losing more than $100 million annually in recent years. According to financial information sent to would-be suitors, the CW had $272 million in revenue in 2020, which was down from $366 million in 2019, largely because of the pandemic limiting the amount of fresh content available on the network. That figure doesn’t include $129 million of revenue in 2020 from its cut of fees Netflix pays to stream CW shows after they have aired on the network.

 

With ViacomCBS and WarnerMedia now giving priority to their own streaming services, the deal with Netflix wasn’t renewed in 2019. Warner Bros.-produced content will land on HBO Max going forward.

 

Confirmation that Nexstar is moving full speed ahead into the content business:

 

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For Nexstar, moving deeper into the content business is part of its long-term strategy.

 

“I think you’ll see us do more content acquisitions and less technical acquisitions or the actual plumbing,” said Thomas Carter, Nexstar’s president and chief operating officer, during the company’s third-quarter earnings call with investors in November.

 

If a deal goes through, Nexstar may try to create a broader programming slate for the CW, a person familiar with the broadcaster’s thinking said. The network’s young-skewing shows aren’t a fit with the older audiences that watch local TV.

 

Tangentially related in the article is Sook saying that NewsNation is profitable in its current form. I think when all is said and done, it's inevitable that we'll see some form of NewsNation content on The CW.

 

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While NewsNation typically averages less than 50,000 prime-time viewers, Nexstar CEO Perry Sook said in the November earnings call with investors that the network is “seeing new rating highs every week,” and that it is profitable.

 

Source: In Streaming Era, CW Network’s Value to Its Owners Has Diminished

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1 hour ago, The Frog said:

“I think you’ll see us do more content acquisitions and less technical acquisitions or the actual plumbing,” said Thomas Carter, Nexstar’s president and chief operating officer, during the company’s third-quarter earnings call with investors in November

Nexstar has basically implied that they are content with the number of full power TV stations they have, and will not acquire any more besides any potential sale of the smaller market CW O&Os. 

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3 hours ago, TheSpeedKing said:

Nexstar has basically implied that they are content with the number of full power TV stations they have, and will not acquire any more besides any potential sale of the smaller market CW O&Os. 

If CBS starting chopping their standalone CW O&Os, it woudn't surprise me to see Mission step in and grab them.  Aside from Boston,  Atlanta is the next largest market without any Nexstar owned or controlled stations.

And if CBS decides to dump them from their owned stations,  Nexstar would benefit from getting them, especially in Philadelphia (WPHL), San Francisco (KRON) and Tampa (WTTA).

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Nexstar already owns a lot of duopolies, even here in Colorado: CW2 KWGN and FOX31 KDVR in Denver; FOX21 KXRM and SOCO CW in Colorado Springs/Pueblo. The question is how will Nexstar's purchase of the CW gonna impact its affiliates that are part of the duopolies?

 

Moreover, Nexstar has a news network called NewsNation. Will the CW have itself a news division by way of NewsNation?

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8 hours ago, newsteam13 said:

Will the CW have itself a news division by way of NewsNation?

That will probably happen. NewsNation can put a seperate 6-7pm news magazine without ads similar to PBS NewsHour, and that could lure some viewers away to The CW.

9 hours ago, tyrannical bastard said:

And if CBS decides to dump them from their owned stations,  Nexstar would benefit from getting them, especially in Philadelphia (WPHL), San Francisco (KRON) and Tampa (WTTA).

I don't think CBS will get rid of ALL of their CW O&Os, just some. 

Edited by TheSpeedKing
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19 hours ago, newsteam13 said:

Nexstar already owns a lot of duopolies, even here in Colorado: CW2 KWGN and FOX31 KDVR in Denver; FOX21 KXRM and SOCO CW in Colorado Springs/Pueblo. The question is how will Nexstar's purchase of the CW gonna impact its affiliates that are part of the duopolies?

 

Moreover, Nexstar has a news network called NewsNation. Will the CW have itself a news division by way of NewsNation?

 

I wouldn't be surprised if some of the non-primetime NewsNation newscasts end up being simulcasted on CW affiliates, particularly the morning news. 

 

I can see Nexstar turning the CW into its version of the big four possibly with entertainment, news and even sports.  It would be a lot different than what the network is today.  I can also see a lot of the current CW shows getting the boot as well.

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I also smell the possible return of the CW channel number branding on affiliates owned by Nexstar.

We already got TWO Texas affiliates that went back to the CW # branding. KIAH Houston put the CW39 branding on hiatus from 2008 until March 2011 when it returned with the strong punch (CW39 HOUUUSSTONNNN). Same story with KDAF Dallas/Fort Worth, where it was called CW33 for the first few years starting in 2006, then took a break from the branding for a few years, then came back to CW33.

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I see CBS still having a stake in The CW as I think Nexstar will have a 51% stake in network just my opinion, I think Warnermedia would have the stake maybe they sell all of it since Warnermedia is going to Discovery and maybe Discovery doesn't want a stake with The CW. I wonder who else is interested in The CW it makes sense that Nexstar buys The CW as they own a lot of CW's in bigger cities, I think Tribune had a stake in The WB when that launched in 95 sold it before The WB folded so Tribune didn't have to pay money when it shutdown.

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