I’ve avoided writing much about Sinclair Broadcast Group trying to buy Tribune Media because I’ve been busy and I don’t want to jinx any possibility the merger will fall through.
But there has been some news, and the biggest for a local TV market could be Miami/Fort Lauderdale (of course!).
Youâ€™ll remember, one of the biggest, nastiest TV station groups has been trying to buy another biggie. (Click here for the official Federal Communications Commission docket.)
Of course, Iâ€™m referring to Sinclair Broadcast Group doing everything it can to spread its conservative information campaign to most of the U.S. that the company doesnâ€™t already reach.
One week ago, TVNewsCheck‘s Harry Jessell noted,
â€œFor nearly a year, Sinclair has been screwing around, working every angle in its grim determination to hang on to every Tribune station it could in the face of FCC ownership caps and Justice Department antitrust limits.â€
But the deal announced in May, 2017, still hasn’t happened.
To follow through, it would need government approval: from the Justice Department for antitrust worries and the FCC to approve ownership limits. (And Sinclair may have already gotten â€œhelpâ€ from FCC chairman Ajit Pai, who was selected by President Trump. Pai is now under investigation by his own agencyâ€™s inspector general. Keep reading.)
— UPDATE: The FCC inspector general cleared Chairman Ajit Pai of being unfairly biased in favor of the Sinclair Broadcast Groupâ€“Tribune Media merger. —
The $3.9 billion deal would still require a number of stations to be sold. The questions partially responsible for holding things up were how many, and in which cities? About six weeks ago, I explained TV ownership limits are very complicated, with four rules in play: 1. national TV ownership, 2. local TV multiple ownership, 3. the number of independently owned â€œmedia voicesâ€ â€“ 4. and at least one of the stations is not ranked among the top four stations in the DMA (thatâ€™s the â€œdesignated market areaâ€ or city, and ranking based on audience share), and at least eight independently owned TV stations would remain in the market after the proposed combination.
Plus, there have been literally thousands of complaints from activists who know how important this is. Click here to see 4,497 total FCC filings since July 5, 2017, including 891 in the past 30 days. THANK YOU if your name is on the list! Keep reading for directions on how to say no.
Now, click here to see some of the â€œ33 concurrently filed applications on FCC Form 315 that seek the Commissionâ€™s consent to a transaction,â€ back in July, 2017, and what the companies consider â€œPublic interest benefits of the transaction.â€ Youâ€™ll soon know better if you actually believe there are public interest benefits! Youâ€™ll also notice the companies fighting for every last station they could, to grow even larger.
On April 24, The Wall Street Journal reported Sinclair â€œreached deals to sell nearly two dozen television stations as it works to get regulators to sign off on its purchase of Tribune.â€
Sinclair said itâ€™ll spin off 23 stations in 18 markets â€“ some owned by Sinclair and others by Tribune.
Also on April 24, Deadline magazine reported, â€œSinclair expects the transactions for the station sales to close the same day the Tribune deal is approved, and now estimates it all will be wrapped up by June.â€
Folks, thatâ€™s next month!
So letâ€™s take a look at the â€œList of stations to be divested,â€ filed with the FCC in April. Click here for the complete 138 pages.
These are the stations currently owned by Sinclair that would be divested only if the merger goes throughâ€¦
and these are the stations currently owned by Tribune.
So now we know who is expected to own the stations a Sinclair-Tribune combination would not be allowed to keep. Unfortunately, itâ€™s not as clear as the charts above that list call letters and cities.
First, the official licensee could have a different name but we know weâ€™re dealing with stations owned by Sinclair and Tribune.
More importantly and suspiciously is the last column, called Buyer. Thatâ€™s because Sinclair has been the king of using shell companies to get around ownership rules. These corporations are either owned by the Smith family that owns Sinclair, or others that let Sinclair program them through local marketing agreements. Sinclair doesnâ€™t technically own all those stations, but operates them as if they do.
So letâ€™s take a look.
Cunningham Broadcasting Corporation is the most controversial. It calls itself â€œan independent television broadcast company that, together with its subsidiaries, owns and/or operates 20 television stations in 18 markets across the United States.â€
First, notice â€œowns and/or operates.â€
As for independent, Wednesday, Forbes magazine (not a liberal publication) put out an article called â€œMeet the Billionaire Clan Behind the Media Outlet Liberals Love To Hateâ€ and it described Sinclairâ€™s owners and their ties to Cunningham.
â€œThe Smith family, which includes brothers David, Robert, Frederick, J. Duncan and a flurry of family trusts, is worth a combined $1.2 billion, Forbes estimates, based on the family membersâ€™ ownership of stock in publicly traded Sinclair Broadcasting, share sales over the past 15 years, dividends and some private assets,â€ it read.
â€œRevenues have increased 281% over the last decade to $2.7 billion in 2017, while Sinclairâ€™s share price has increased 367% over the same period, pushing its market capitalization up to a recent $3 billion. All of this growth has occurred under the control and oversight of David Smith, 67, the chairman and former CEO of the company, as well as the son of the companyâ€™s founder Julian Sinclair Smith,â€ it continued.
Jessell of TVNewsCheck reported, â€œIts financials are consolidated with Sinclair’s in its SEC filings and earnings reports.â€
Forbes quoted Daniel Kurnos, an analyst at Benchmark Capital, as saying, â€œSinclair plays some of the hardest ball of anyone,â€ from acquiring stations to negotiating advertisement pricing and retransmission fees, which are some of the highest in the business.
SIDEBAR: Wednesday, The TV Answer Man Phillip Swann reported PlayStation Vue removed Sinclair-owned local stations affiliated with Big 4 networks from its streaming lineup without an explanation. Just Tuesday, subscribers got an e-mail that live channels would be replaced May 1 (that day) with an On-Demand version.
Sinclair said it pulled the stations and blamed â€œSony (for) failing to comply with certain contractual provisions.â€ It didnâ€™t elaborate but urged Sony subscribers to consider other video distributor options, including Sony competitor YouTube TV.
Sony hasnâ€™t commented.
The Baltimore Sun reports, â€œSony describes PlayStation Vue as a live streaming TV service for up to five devices at once that offers sports, news and other programs along with premium channels and a cloud DVR.â€
BACK TO THE STORY: Under David Smith, who wouldnâ€™t comment for the article, Sinclair went from three cities â€“ Baltimore, Pittsburgh and Columbus â€“ to what it is today.
â€œTo â€˜purely make moneyâ€™ in a scale-oriented business, David bought up as many broadcast stations as possible. First he concentrated on secondary markets, like Memphis, St. Louis and San Antonio, where operation costs were cheaper than in places like New York or Chicago.
â€œâ€˜I believed that certain things were going to happen in the television industry, the most important being consolidation,â€™â€ David told Forbes in 1996.
So much for public service!
But then came the controversial Cunningham, arguably rigging the system.
â€œIn the 1990s, the company pioneered a technique to circumvent an FCC rule limiting ownership of more than one TV station per metro area. Davidâ€™s mother, Carolyn Smith, started another business, Cunningham Broadcasting. Following Carolynâ€™s death in 2012, most of the ownership of Cunningham Broadcasting shifted to a family trust, which is included in the overall Smith family valuation.â€
So Cunningham really isnâ€™t independent, as its website claims!
Known as â€œGlencairn, Ltd. prior to 2002,â€ it got into some trouble back in 1998. In July of that year, Broadcasting & Cable magazine reported,
PUSH pushing FCC over Sinclair/Glencairn
â€œThe Rainbow/PUSH Coalition is raising questions at the FCC about whether Sinclair Broadcasting is exercising control over a minority-headed TV group with which it has struck a series of local marketing agreements (LMAs).
â€œIn a July 1 filing at the FCC, Rainbow/PUSH said it plans to study whether the LMA deal between Sinclair’s KABB(TV) San Antonio and Glencairn’s KRRT(TV) Kerrville, Tex., violates the commission’s prohibition against common ownership of two local stations. (The rules were more strict then.)
â€œâ€˜Rainbow/PUSH has not had an opportunity to fully research this matter, and thus preserves here the question of whether Glencaim is the alter ego of Sinclair,â€™ the group told the FCC.â€
More than three years later, in Dec., 2001, Broadcasting & Cable was finally able to report the decision.
FCC fines Sinclair for Glencairn control
â€œSinclair Broadcasting exercised illegal control of business partner Glencairn Ltd., the FCC found Monday after three years of investigating the companies’ relationship.
â€œEach company was fined $40,000 but escaped tougher sanction sought by civil rights groups-a government rejection of Sinclair’s request to buy 14 stations from Sullivan Broadcasting.
â€œThe commission’s three Republicans judged that the companies were liable for misinterpreting FCC policies, but found they did not intentionally mislead the agency about compliance.
â€œDemocratic Commissioner Michael Copps wanted the FCC to pursue a tougher sanction and voted to designate the station sales for hearing in front of an administrative law judge.
â€œSinclair has repeatedly ‘stretched the limits’ of FCC ownership rules, he said.â€
Back to the Forbes article, last year, Cunningham paid Sinclair more than $120 million for running its stations. Also, Cunningham admits its treasurer and chief financial officer, Lisa Asher, worked as Sinclairâ€™s assistant controller before moving over in 2002.
So we know Cunningham, set to buy Tribune stations in Dallas and Houston, appears to be a shell company, and we can make bets who will operate and control it if the Sinclair-Tribune deal ever comes to fruition.
But thereâ€™s a lot more evidence.
Cunningham is headquartered near Sinclair in Maryland, which is very convenient since
â€œCunningham Broadcasting owns the FCC broadcast licenses and operates through various management agreements with Sinclair Broadcast Group, Inc. WNUV-TV in Baltimore, Maryland; WTTE-TV in Columbus, Ohio; WMYA-TV in Anderson, South Carolina; WRGT-TV in Dayton, Ohio; WVAH-TV in Charleston, West Virginia; WDBB-TV in Bessemer, Alabama; WBSF-TV in Flint, Michigan; WGTU-TV in Traverse City, Michigan; KBVU-TV in Eureka, California; KCVU-TV in Chico-Redding, California; WEMT-TV in Greeneville, Tennessee; WPFO-TV in Portland, Maine; WYDO-TV in Greenville, North Carolina; and KRNV-TV & KENV-TV in Reno, Nevada.â€
Looking at its list of stations â€” something the Fox Television Stations Group never posted on its own website despite me calling them out for it here, here, here, here (so far in no particular order, although I may have missed a couple), and my favorite, here â€” you may realize Sinclair recently bought Bonten Media Group (Disclosure: I used to be Digital Media Manager at the former Bontenâ€™s WCYB but left before the sale.) but Cunningham bought the stations Bonten operated. Notice those stations listed on the website have no websites of their own. And I’ll get back to Fox later. I’ll bet they can’t wait!
Another dead giveaway is that Cunningham is based at 2000 W. 41st Street, Baltimore MD 21211 and coincidentally, Sinclair flagship WBFF-45 (Fox affiliate) has the same address!
But not just WBFF.
So is WNUV-54 (CW affiliate), which says itâ€™s â€œowned and operated by Cunningham Broadcasting Corporation and receives certain services from an affiliation of Sinclair Broadcast Group.â€
(Sinclair, the corporation, is based in nearby Hunt Valley, MD.)
But thatâ€™s not all, folks!
Thereâ€™s still WUTV-24 (MyNetworkTV affiliate), with the same look as the other websites, which says itâ€™s â€œa SBG Television affiliate owned and operated by Deerfield Media, Inc and receives certain services from an affiliation of Sinclair Broadcast Group.â€
Deerfield, with apparently no website of its own (so see Wikipedia’s take), is another of the shell companies, formed in 2012 but not involved in the proposed Tribune transaction.
Howâ€™d that happen?
In Nov., 2012, TVNewsCheck reported,
â€œFor years (before 2012), Fox Television Stations’ WUTB Baltimore gave Fox considerable leverage in its sometime contentious affiliation negotiations with Sinclair Broadcast Group.
â€œIf Sinclair ever got out of line, Fox could threaten to yank its affiliation from Sinclair’s flagship station WBFF Baltimore and move it to WUTB.
â€œBut last May, Fox relinquished that leverage when it extended its affiliation with WBFF and 18 other Sinclair stations for five years starting Jan. 1, 2013, and granted Sinclair an option to buy WUTB.
â€œSinclair is now exercising that option by assigning it to a third party, Deerfield LLC.
â€œAccording to an FCC filing seeking approval of the deal, Deerfield is buying WUTB and allowing Sinclair to run the MNT affiliate through joint sales and shared services agreements.
â€œThe deal gives Sinclair a virtual triopoly in Baltimore where it also operates CW affiliate WNUV, which is owned by Cunningham Broadcasting, Sinclair’s longtime duopoly partner that is controlled by trusts for the children of Sinclair’s controlling shareholders.â€
But Sinclair and Deerfield were already in cahoots.
Months earlier, in July, 2012, MarketWatch reported Sinclair intended
â€œto buy six television stations from Newport Television LLC for $412.5 million and agreed to buy Bay Television Inc. for $40 million. â€¦ Sinclair also agreed to sell the license assets of its San Antonio station KMYS and its WSTR station in Cincinnati to Deerfield Media Inc. Sinclair will also assign Deerfield the right to buy the license assets of WPMI and WJTC in the Mobile/Pensacola market, after which Sinclair will provide sales and other non-programming services to each of these four stations under shared services and joint sales agreements.â€
â€œSinclair Broadcast is getting six stations in five markets for $412.5 million:
— Cincinnati (DMA 35) â€” WKRC (CBS)
— San Antonio, Texas (DMA 36) â€” WOAI (NBC)
— Harrisburg-Lancaster (DMA 41) â€” WHP (CBS)
— Mobile, Ala.-Pensacola, Fla. (DMA 60) â€” WPMI (NBC) and WJTC (Ind.)
— Wichita, Kan. (DMA 67) â€” KSAS (Fox)
â€œSinclair is also acquiring Newport’s rights to operate third-party duopoly stations in Harrisburg, Pa. (CW affiliate WLYH), and Wichita, Kan. (MNT affiliate KMTW). Those rights include options to buy the stations. â€¦
â€œWhile Sinclair was buying, it was also selling.
â€œIt said it would spin off its CW affiliate in San Antonio (KMYS) and its MNT affiliate in Cincinnati (WSTR) to Deerfield Media Inc., presumably to comply with the FCC ownership limits. In the deal, Deerfield also picks up an option to buy two of the stations it is acquiring from Newport, WPMI-WJTC Mobile, Ala.-Pensacola, Fla.
â€œSinclair said it intends to â€˜provide sales and other non-programming services to each of these four stations pursuant to shared services and joint sales agreements.â€™
â€œIn yet another deal, Sinclair said it is buying WTTA Tampa-St. Petersburg from Bay Television Inc. for $40 million. Since 1998, Sinclair has operated WTTA pursuant to a local marketing agreement.â€
And that was the start of the Deerfield connection!
Even more telling is that Deerfieldâ€™s WUTV moved from Channel 24 (24.1) to 45.2, which is a subchannel of Sinclairâ€™s WBFF! The website doesnâ€™t tell why. It just explains to viewers watching over the air with an antenna how to rescan, but the reason is really the FCCâ€™s recent spectrum auction.
With three stations realistically (unless you prefer names over control), Sinclair was in a great position to sell off some spectrum space and make even more money. This website shows Channel 24 will go off the air and the owner (or operator?) will get $122,912,964 for its spectrum.
SIDEBAR: The purpose of the reverse auction is â€œbroadcaster licensees bid (low price) to relinquish spectrum usage rights.â€ Then, â€œthe FCC will reauthorize and relicense the facilities of the remaining broadcast television stations that receive new channel assignments in the repackingâ€ so the remaining stations are close together and that will happen in waves because there are so many. And finally the FCC will sell that spectrum to commercial wireless service providers (high price) to expand mobile broadband services. (That has all happened already except for stations moving to their new assignments.)
It looks like stations sold $10 billion of spectrum and wireless providers bought $19 billion, so the FCC made money.
BACK TO OUR STORY: So for those of you in Baltimore, do you need to reach the newsroom, are you looking for a job (Would they hire me for my investigative work?), or interested in inspecting the FCC public file of any of the three stations? All the information is the same, from address to phone numbers, and we already established three stations in one city are not allowed!
To the next perspective buyer…
HSH stands for Howard Stirk Holdings, and is owned by conservative journalist, entrepreneur and producer Armstrong Williams. Wikipedia described Howard Stirk Holdings as â€œa media company affiliated with Sinclair Broadcasting that has made numerous television station purchases.â€
Donâ€™t believe it? It’s somewhat true, after a controversial beginning.
In a Broadcasting & Cable article on the news section of HSHâ€™s website dated July, 2013, and was written in first-person, Williams mentions suing the FCC for not reviewing
â€œits broadcast ownership rules every four years. â€¦
â€œThis is one of the reasons why my company, Howard Stirk Holdings, LLC (HSH), has sued the FCC. As an African American licensee of two television stations, I believe that by refusing to complete its 2010 quadrennial review, the FCC has unlawfully withheld taking an action required by Congress and the law, and thus is arbitrarily and capriciously retaining burdensome regulations that are no longer in the public interest.â€
Williams was angry the FCC â€œadopted a new rule restricting joint sales agreements (JSAs) between television broadcasters in the same market.â€
He claimed, â€œIt effectively slams the door shut on an important gateway to enhancing localism, viewpoint diversity, and opportunities in broadcast television ownership by minorities and underrepresented groups.â€
But there’s more.
â€œArmstrong Williams talked about the impact of a March 31, 2014, Federal Communications Commission (FCC) ruling that television station owners cannot control more than one station in the same local market via the use of joint sales agreements and shared services agreements, often known as â€œsidecarâ€ deals. Mr. Armstrong, who owns two TV stations through a sidecar agreement with Sinclair Broadcasting, argued that the ruling could cause minority owners, and small station owners more generally, to be forced out of existence.â€
Thatâ€™s from a C-SPAN article on the news section of HSHâ€™s website dated April, 2014, where you can watch the whole interview.
A Washington Times article from a few weeks earlier, on the same News page as the others on HSHâ€™s website, said,
â€œThe FCC, backed by the Obama administration Justice Department, argues that broadcasters have used the shared-service, or â€œsidecar,â€ arrangements to circumvent long-standing rules against owning multiple television stations in a single market, allowing them to raise ad prices and weaken market competition.â€
Williams and his supporters suggest a more partisan motive: his conservative views.
In fact, it seems every article in HSHâ€™s News section mentions Sinclair or those joint sales agreements designed to get by without abiding by the FCCâ€™s ownership rules!
In other words, he was a great partner for Sinclair since heâ€™s a minority (but without the views of most other minorities) and theyâ€™re both making money by using each other!
But I found it eventually gets somewhat better.
Something was obviously wrong, so I turned to the FCC and found no entities or file names from before 2012.
Then I went to Wikipedia and read Williams helped Sinclair buy Barrington Broadcasting in late 2013, so he got stations in Flint, MI, and Myrtle Beach, SC, but they remain operated by Sinclair. Theyâ€™re actually his only stations run by Sinclair and remember, at the time, his company was accused of â€œacting as a â€˜sidecarâ€™ of Sinclair to skirt FCC ownership rules.â€
But that was then.
A year later, he actually, really bought three stations from Sinclair: one in Charleston and two in Alabama.
Charleston wasn’t planned. The first two paragraphs from a Sept., 2014, Broadcasting & Cable magazine article is posted on HSHâ€™s website’s News section.
Howard Stirk Holdings Grabs WCIV for $50,000
â€œHoward Stirk Holdings, run by Armstrong Williams, has agreed to acquire WCIV Charleston for $50,000. Sinclair picked up WCIV, an ABC affiliate, when it acquired Allbritton. While Howard Stirk is acquiring the license, among other assets, it and Sinclair will share some aspects related to the station, and Sinclair will provide services.
â€œâ€˜Weâ€™ll continue some of the wonderful business relationships we have with them,â€™ said Armstrong Williams, principal at Howard Stirk Holdings.â€
WCIV’s services came up because of a tangled web of local marketing agreements. There were ownership conflicts over licenses and other assets of three stations.
Sinclair owned MyNetworkTV affiliate WMMP-36 for years. Then, in 2001, it bought and spun off Fox affiliate WTAT-24 to Glencairn (to become Cunningham) and crafted a local marketing agreement between the two stations. That got Sinclair fined Sinclair $40,000 for illegally controlling a duopoly.
But in 2013, Allbritton sold its entire television group, including ABC affiliate WCIV-4, to Sinclair, which intended to sell WMMP’s license but still control it. Thus, three stations!
Unfortunately for Sinclair, WMMP had that local marketing agreement with WTAT. So Sinclair decided to cut ties from WTAT, keep the more established WCIV and sell WMMP.
But Sinclair told the FCC it couldn’t find a buyer for WMMP, so it would shut down WCIV and keep WMMP because its facilities were better â€” but move WCIV’s affiliation and all its programming to WMMP. Then, WMMP’s programming including MyNetworkTV would move to a subchannel.
Instead, Sinclair filed to have WCIV’s license sold to HSH to avoid shutting it down. Thus, the low price of $50,000. Then, the two stations swapped licenses, Sinclair let Williams’ WCIV share studio space at WMMP’s facilities and Williams explained he hoped to â€œcontinue some of the wonderful business relationships we have with [Sinclair]â€ through the deal â€” but operated independently from Sinclair.
Shortly after, this page on the companyâ€™s websiteâ€™s News section lifts the first four paragraphs from a Feb., 2015, Broadcasting & Cable magazine article.
Howard Stirk Acquires KVMY Las Vegas
â€œHoward Stirk Holdings has agreed to acquire KVMY, the Las Vegas MyNetworkTV affiliate, for $150,000. Armstrong Williams is the principal at Howard Stirk, which is closely aligned with Sinclair. The price reflects $25,000 for the equity assets, including the FCC license, and $125,000 for the transmission assets.
â€œAccording to the following, Howard Stirk â€˜acknowledges that it is not buying the Business of KVMY-TV as a going concern.â€™â€ (There was a call letter and affiliation change, but Howard Stirk Holdings runs several digital subchannel networks on the signal.)
â€œIn September, Sinclair agreed to acquire NBC affiliate KSNV Las Vegas for $120 million. It also owns CW outlet KVCW.
â€œLast year, Howard Stirk Holdings acquired the license and other assets to WCIV Charleston from Sinclair for $50,000.â€
So they’ve been in business several times, and it may not be over.
Some more about Williams: In 2004, the Bush administration paid him $240,000 to promote the No Child Left Behind (NCLB) law on his nationally syndicated TV show and urge other black journalists to do the same. USA Today reported the campaign was part of an effort to build support among black families and Williams was â€œto regularly comment on NCLB during the course of his broadcastsâ€ and interview Education Secretary Rod Paige for TV and radio spots that aired during the show. Williams said he understood critics could find the arrangement unethical, but â€œI wanted to do it because it’s something I believe in.â€
Two years ago, The Washington Post reported Williams settled a sexual harassment and retaliation suit filed by a former salesman at a DC Jos. A. Bank. Court records reportedly showed the complaint alleged Williams had sought sexual favors after befriending and mentoring the other man. That man did get jobs at the Washington Times and then at a Howard Stirk Holdings TV station, but he lost that job.
It wasnâ€™t Williamsâ€™ first such situation.
In 1997, Williams’ former personal trainer-turned-producer sued him, contending he â€œrepeatedly kissed and fondled him for almost two years,â€ before being fired. Williams claimed he was fired for incompetence. That case was also settled.
Bottom line: As of now, Howard Stirk Holdings owns seven stations. Two are in the same Anniston-Tuscaloosa-Birmingham, Ala., market, and Williams’ first two are still run by Sinclair. Now, after other purchases, heâ€™s expecting to buy three more if the Sinclair-Tribune merger happens.
Then thereâ€™s Standard Media Group. I hadnâ€™t heard of them either. Its website says Standard General was founded in 2007 and is pretty much an investment advisor, but getting into the broadcasting business. We’ll see how long that lasts. Investment firms are more likely to sell than others with broadcasting in their blood, especially ones who invest in their communities.
Now, if the deal goes through, itâ€™ll fulfill its â€œgoal of swiftly building a substantial broadcast television group with a strong and diverse voiceâ€ that includes four state capitals.
The stations are Fox affiliates except where noted: Oklahoma City, Grand Rapids, York PA, Greensboro NC (ABC), Richmond, Sinclairâ€™s role in a Wilkes Barre Fox-CW-MyNetworkTV triopoly, and Des Moines.
You may have noticed Meredith Corp. on the list of buyers. TVSpy noted Meredith â€œhas signed a deal to acquire KPLR (CW) from Tribune for $65 million, pairing it with KMOV (CBS) which Meredith has owned since 2013. â€¦ Sinclair already owns KDNL (ABC) and will also own KTVI (FOX) in the market.â€ Great for ownersâ€™ synergies. Bad for the number of independent voices in such a big city. Which do you care more about?
Of the other big city stations, Tribune’s legendary WGN-TV9 is supposed to go to WGN TV LLC but that’s really code for Steven Fader, a Maryland auto dealer and business associate to Sinclair chairman David Smith, for a mere $60 million. Sinclair would also have an option to buy WGN-TV outright within eight years and you know it’s counting on the FCC to relax its ownership rules even more within that time frame!
Concerning WGN, there are now plans for a Sinclair news channel. Yesterday, Politico reported,
â€œSinclair Broadcast Group, which for months has denied any interest in challenging Fox News while awaiting approval of a merger with Tribune Co., is gearing up to do just that.â€
â€œEven though Sinclair CEO Chris Ripley has said a 24-hour national news network is not in the works, his boss (David) Smith seems to like the idea of a few hours of prime time opinion programming to challenge Fox News.â€
Fox News is carried in more than 90 million homes, compared to 80 million for WGN America which Sinclair would own if regulators approve, and 55 million for the Tennis Channel which Sinclair already owns.
If your cable or satellite company doesn’t offer either of those last two, then expect it to get a call when any deal with Sinclair is about to expire.
Politico quotes â€œa person familiarâ€ saying â€œSmith has been holding meetings with potential future employees, including former Fox News staff members, and laying out a vision for an evening block of opinion and news programming that would compete with Foxâ€™s top-rated lineup.â€
So, the discussions are over â€œa block of at least three hours, but also potentially up to six. Smith is settled, though, on basing his new operation in Washington, D.C.â€ Thatâ€™s because the company already owns local station WJLA-7, where it produces some of its national content.
One apparent Sinclair target is former Fox News host Greta Van Susteren, who left the network in Sept., 2016, and then had a short stint at MSNBC before signing on with Voice of America. Van Susteren wrote in an email she has spoken with Smith.
â€œIf the Sinclair deal happens, I might talk to him further. … but it would have to be something that would not take me from VOA,â€ Van Susteren said.
â€œOther potential hires are former Fox anchor Eric Bolling and reporter James Rosen,â€ who both left Fox under sexual harassment allegations. Neither admitted whether they met with Smith or other Sinclair executives.
Talks with former Fox host Bill Oâ€™Reilly reportedly fell apart.
The slant of a national news block hasn’t been decided. We know where Sinclair stands, politically, but TVNewser notes, â€œThere are already national challengers from the right, including Newsmax TV and OAN.â€
And in the nation’s largest market, Tribune’s WPIX-11 is now off the market. It was supposed to go to Cunningham for a mere $15 million. Thatâ€™s pennies on the dollar, and it would’ve been run by Sinclair. Now, it’ll just go to Sinclair so it’s not on the list.
But what about those TBDs (to be determined)? They are all owned by Tribune: the Fox affiliates in San Diego, Seattle/Tacoma, Cleveland, Sacramento, Salt Lake City and Denver, and the CW affiliate in Miami/Fort Lauderdale.
And you may have noticed Rupert Murdochâ€™s Fox conglomerate was not listed as one of the buyers, but thatâ€™s sure to change.
The Hollywood Reporter wrote, â€œSinclair and Tribune have been negotiating a sale of up to 10 stations to 21st Century Fox, and those talks are still proceeding.â€
Jessell of TVNewsCheck was more direct, saying all Sinclair
â€œhas to do now is wrap up its negotiations with Fox. I donâ€™t know whatâ€™s delaying that deal, except that neither Fox nor Sinclair is famous for making concessions. Once Sinclair does that, it can finalize its application and the FCC can complete it long-stalled review.â€
Those greedy bastards are going to end up screwing everything up for themselves (which I’d love to see happen), and you’ve only read about half of the plans, so far!
First, Fox actually used to own the Cleveland, Salt Lake City and Denver stations but sold them to a company called Local TV which sold itself to Tribune. So much for Fox â€” selling stations and then buying them back later â€” caring about communities. IMHO, that company can’t make a case for a second chance at ownership.
But now, 21st Century Fox plans to sell off most of its assets like its studio, cable networks and regional sports networks to Disney â€“ keeping just its Fox News Channel, Fox Business Network, its FS1/FS2 cable sports channels, adding to its TV stations, and its network, which will focus on live events, especially NFL Football. The new, smaller company is being referred to as New Fox.
Thatâ€™s the reason Fox has tried to own stations in cities that have NFC conference football teams since it got the rights to most of their away games in 1994 â€“ and even trade or sell other stations for them â€“ despite the fact a regular season of 16 games could mean the home audience would see its team play about 12 games a year on its local Fox station, unless the team makes the playoffs.
Whether paying a fortune for NFL rights that keep skyrocketing is questionable. It wasn’t questionable in 1994 when Fox arguably overpaid the NFL to get the New World stations to switch away from the Big 3 networks. We’ll see about Fox doing the same on Thursdays, when it doesn’t have popular programming.
Fox even got its hands on Cox’s KTVU in San Francisco (with an NFC team, the 49ers, and the AFC Oakland Raiders across the bay will now be moving to Las Vegas in 2020) and give Cox its own stations in Boston (the New England Patriots are AFC) and Memphis (no NFL team).
What has changed is Fox bought the rights to Thursday Night Football, which should split games between NFC and AFC teams. That means Fox has become more interested in AFC team cities, even though thereâ€™s no pattern as to which teams play on Thursdays.
Football teams have moved, but the cities Fox wants are Seattle (especially because it’s NFC), and Cleveland, Denver and Miami (because they have AFC teams). San Diego and St. Louis no longer have teams, so Fox isn’t interested in Tribune’s Fox affiliates in those cities.
Seattle, Cleveland and Denver should be easy. The stations are already Fox affiliates so prime-time programming and the amount of news shouldn’t change. And Fox has leverage because it can threaten to take away its affiliation from those stations, lowering their value, if they’re sold to another company.
Remember what Fox did in Charlotte? It dropped a good affiliate, WCCB-Channel 18, because it wanted to own a station where the NFC Carolina Panthers play. Instead, it bought a nothing station, WJZY-Channel 46, and started it from scratch. And it had to do that a second time when it tried to be too different and less traditional the first time! (And, for disclosure: It got a great new news director who is a former colleague.) Remember, Charlotte pretty much sits on the North Carolina-South Carolina line. Old timers are pretty traditional. Was the move worth it for Fox?
Miami is a different story. Fox has a very good affiliate, WSVN-7, owned by Ed Ansin’s Sunbeam Television. (Disclosure: I got my start in journalism there.) It gives Fox great coverage of breaking news in South Florida. Several people at Fox News Channel used to work there. The ratings are great. So what’s the problem?
The Miami Dolphins play there, and as an AFC team, they show up on Fox on a few Sundays and may now also be seen on Fox on Thursdays.
But the station that’s available is Tribune’s WSFL-39, a CW affiliate without a news department despite a few morning attempts. WSVN owner Ansin has shown he’ll probably take the station to his grave, with or without any affiliation, so there’s no realistic possibility there.
Should Fox dump WSVN and start from scratch with WSFL? Would it be worth the effort?
Unlike Charlotte, WSVN is a #1 station. And Miami is a very different place. There’s big news regularly and the two main Spanish stations do better than most of the English! People who aren’t bilingual can’t watch all the available stations, which really limits its size, making it actually smaller than the 16th largest market. We’ll have to see who wants WSFL, since a Sinclair-Tribune merger can’t include it due to FCC ownership rules.
One thing I’d say for sure is that WSFL loses its CW affiliation because CBS and Warner Brothers (Time Warner) own the network, and CBS doesn’t only own WFOR-4 (CBS station) and but also WBFS-33 (MyNetworkTV affiliate) and the CW does better.
Staying with this possibility, WSFL could become the new MyNetworkTV affiliate, and MyNetworkTV is owned by Fox.
It’s not so unusual for a network to own stations but not air the network on them.
Letâ€™s take CBS, for example. It owns independents in New York (WLNY-55) and Los Angeles (KCAL-9). In Dallas, WTXA-21 is also independent.
In Miami, WBFS ended up with MyNetworkTV to please Tribune since CBS got the CW in so many other cities when the WB and UPN combined. Itâ€™s similar in Boston where WSBK-38 airs MyNetworkTV, but thatâ€™s expected to change since Sunbeamâ€™s WLVI-56, which used to be owned by Tribune, airs the CW.
Single CBS-owned stations in Atlanta, Seattle and Tampa air the CW while affiliates owned by other companies air CBS programming.
And in Indianapolis, CBSâ€™ WBXI-47 airs Decades, while the actual CBS affiliation changed from one outside company to another. CBS dumped a strong WISH-8 and went to half of Tribuneâ€™s duopoly, independent WTTV-4, over a disagreement with the former Media General.
A last possibility if Fox is determined to buy a Miami station is ABC affiliate WPLG-10. That station, stable under Post-Newsweek (now Graham Media) for decades, was sold to Berkshire Hathaway as its only broadcast property. We’ve talked about synergies (BH, as an â€œonly child,â€ has none) and know Warren Buffett wants to turn a profit, so we can imagine Fox dumping WSVN for WPLG, but can’t assume ABC will take its affiliation to WSVN. Remember how CBS didn’t do that in 1989? But that’s highly unlikely.
And somebody will end up with WSFL.
A lot of the information on which stations would be sold was expected since Sinclair hinted in a February filing which stations it planned to sell, to avoid owning more than allowed.
Deadline noted, â€œFor decades, the maximum reach by one single owner has been 39 percent, but the Federal Communications Commission has been re-evaluating the cap.â€
More specifically, rather than gutting rules like a good conservative would ordinarily do, the FCC under Pai brought the UHF discount is back. That rule started because it used to matter whether a local TV station was VHF or UHF, due to antennas and how old TV sets were not made for the UHF band. So the FCC decided the amount towards a companyâ€™s ownership cap should only be half for those stations, compared to VHF stations. It was ended because todayâ€™s technology means it doesnâ€™t matter anymore.
Regarding the UHF discountâ€™s revival, The New York Times wrote, â€œA few weeks later, Sinclair Broadcasting announced a blockbuster $3.9 billion deal to buy Tribune Media â€” a deal those new rules made possible.â€ (Oh, and led to Paiâ€™s investigation. But luckily, Harry Jessell of TVNewsCheck wrote critics of station consolidation say it â€œnow serves only to allow groups to circumvent the intent of Congress, which was to limit groups to 39%â€ and they’ve â€œchallenged the perpetuation of the UHF discount in court (D.C. Appeals Court), and seem to have made some headway in their oral arguments.â€)
It also wrote,
â€œA New York Times investigation published in August found that Mr. Pai and his staff members had met and corresponded with Sinclair executives several times. One meeting, with Sinclairâ€™s executive chairman, took place days before Mr. Pai, who was appointed by President Trump, took over as F.C.C. chairman.
â€œSinclairâ€™s top lobbyist, a former F.C.C. official, also communicated frequently with former agency colleagues and pushed for the relaxation of media ownership rules. And language the lobbyist used about loosening rules has tracked closely to analysis and language used by Mr. Pai in speeches favoring such changes.â€
An FCC spokesman representing Mr. Pai countered the allegations of favoritism were â€œbaseless,â€ and
â€œFor many years, Chairman Pai has called on the F.C.C. to update its media ownership regulations. â€¦ The chairman is sticking to his long-held views, and given the strong case for modernizing these rules, itâ€™s not surprising that those who disagree with him would prefer to do whatever they can to distract from the merits of his proposals.â€
However, â€œPai said he would factor the potential court decision into the FCC’s decisionmaking.â€
Rep. Mike Quigley (D-IL) told Pai the spin-off of WGN-TV Chicago to the owner of a car dealership owned by Sinclair’s executive chair, â€œstretches the definition of divestiture under the plan to something unrecognizableâ€ and the planned divestitures make a mockery of FCC rules.
Author Eggerton suggested, â€œOne thing the FCC could do would be to condition the deal on the court upholding the UHF discountâ€ and Jessell expects a decision to come in August or September.
Pai denied Rep. Quigleyâ€™s request to hold off on a decision on Sinclair until the UHF discount court decision, saying that was a case of clashing hypotheticals â€” both what the court would do with the discount and what the FCC would do with the proposed merger.
The nerve, since Congress controls the FCC!
Jessell of TVNewsCheck brought up the old saying, â€œPossession is nine-tenths of the law, and that is no less true when the thing being possessed is a broadcast license.â€ He also had a lot more details on the court case.
In another article, Jessell analyzed the ownership numbers in this case, and you try to figure out what’s true.
â€œSinclair is telling the FCC that its coverage after spinoffs from its merger with Tribune will be just 58.7%. But that’s for regulatory purposes. (In other words, with the revived UHF discount that only counts channels 14 and up as half the audience of the market.) In the real world, where it matters, Sinclairâ€™s national reach will be 66.3% â€” a full two-thirds of TV homes.â€
But he said Sinclair is telling the FCC
â€œthe coverage of the group will be just 58.7% and, with the UHF discount, below the statutory 39% cap. But those percentages are for regulatory consumption, not the real world.â€
So thereâ€™s a 7.6-point disparity, the difference between 58.7% and 66.3%. Howâ€™d that happen? And donâ€™t forget about the part, â€œwith the UHF discount, below the statutory 39% cap.â€
Jessell explained Sinclair
â€œis claiming 58% because it is not counting stations in three big markets â€” WGN Chicago, KDAF Dallas, KIAH Houston â€” that it is spinning off to closely affiliated companies. Without those markets and the discount in effect, Sinclairâ€™s reach will be just 37.39%, safely below the 39% cap.â€
Plus, with Dallas and Houston (but not Chicago), â€œSinclair has put additional distance between itself and Cunninghamâ€ but will â€œhave an option to buy the stations should the FCC ever ease the rules to allow it.â€
So this is Jessellâ€™s bottom line:
â€œSo, again, for regulatory purposes, Sinclairâ€™s reach will be 58.7% without the discount and 37.39% with it.
â€œBut I donâ€™t think that is reality. Those are not the numbers that Sinclair will be showing national advertisers, MVPDs, vendors and others with which it does business.
â€œIn the real world, Sinclair will have a lot of control over Chicago and some control over Dallas and Houston, and its effective national reach will be 66.3%. (For the record, its reach with the UHF discount will be 41.1%, two points over the cap, but that will not matter because regulators will not be counting the three markets.)â€
Then Jessell questioned Foxâ€™s counting, assuming itâ€™ll buy Miami, Cleveland, Sacramento as well as Seattle, Denver, Salt Lake City and possibly San Diego.
He calculated Fox reaches 36.8% of homes, but just 24.3% with the UHF discount. If it buys up all seven stations, its reach will grow to 45.9% but, well below the cap at just 30.4% with the discount.
But where will Fox find the money to buy the stations it wants? Thatâ€™s another story!
Last year, Disney made a $52.4 billion offer to buy most of Fox, including its stake in the European pay TV company Sky.
But The Hollywood Reporter said on Wednesday, â€œBack in 2004, Comcast CEO Brian Roberts bid $54 billion to acquire The Walt Disney Co.â€ At the time, Comcast hadnâ€™t bought NBCUniversal but Disney did own ABC. It was a 22 percent more than Disney was worth then, but former CEO Michael Eisner said no anyway.
Now, even though NBCUniversal has performed well, some say Roberts wants revenge by offering the same $52.4 billion as Disney for most of 21st Century Fox.
There could also be a bidding war overseas. Sky had agreed to let Fox, a 39 percent shareholder, buy the portion it doesn’t already own â€“ and that Disney agreed to buy from Fox in December. Comcast could ruin those companiesâ€™ plans.
CNN reports, â€œIt pledged … to maintain investment in Sky News for 10 years, and ensure the division’s editorial independence.â€
Then, in January, a UK regulator advised the government to block Fox’s bid to buy the remaining 61 percent of Sky because it would give one family â€“ the Murdochs â€“ too much control over media in Britain.
So Murdoch had preferred Disney as the buyer, afraid the Comcast offer came with more regulatory risks. Then, Disney offered to buy Sky News just to help Murdoch buy full control of Sky Newsâ€™ parent company, the broadcaster Sky. But CNN reported Fox made a new pitch to win approval for Sky by selling Sky News to Disney, and another proposal that wouldâ€™ve legally separated Sky News from the rest of Sky to ensure its editorial independence.
Then, last month, The Hollywood Reporter reported, â€œThe U.K. Takeover Panel â€¦ ruled that Walt Disney must make a mandatory offer to buy full 100 percent control of Sky if and when it completes its planned acquisition of large parts of 21st Century Fox, including Fox’s stake in Sky.â€
Then, according to Deadline, â€œDisney will have 28 days from the completion of its $66 billion acquisition of Fox to make a $15 offer for all the shares of Sky if Foxâ€™s own $15.7 billion takeover of Sky is not complete by then, or if Comcastâ€™s rival offer has not been accepted. It also (decided) this would not be required if another third party has acquired 50 percent of Sky by then.â€
But last week Comcast made its $31 billion bid for Sky official and thatâ€™s 16 percent higher. Deadline reported that caused Sky directors to withdraw their recommendation of a Fox takeover bid.
This all comes along with many mergers and acquisitions across the industry.
In fact, a decision on this may not come until a judge determines whether to let AT&T buy Time Warner. The Justice Department has been fighting against it with an antitrust case. Closing arguments just finished and a decision is expected June 12.
According to The Hollywood Reporter, last week Fox said itâ€™s â€œconsidering its optionsâ€ on Sky and is believed to be prepping a sweetened bid. But Comcast is known for (usually) getting what it wants.
But back to Sinclair, which hasn’t been doing itself any favors.
Deadline noted Sinclair â€œhas faced further attention in recent weeks over a push to have local anchors at its stations read company-scripted messages, including a recent prohibition against fake news. The spots â€¦ struck many in media as too closely aligned with the dismissive rhetoric of President Donald Trump.â€
So much for localism at a company that already owns or operates an astounding 193 TV stations, in 89 cities, covering a huge part of the American population. (You’ve read the different takes on the numbers.)
This is criticism from The New York Times…
from the PBS NewsHour…
from USA Today…
and even Russia Today…
and Al Jazeera English.
FTVLive’s Scott Jones showed a memo from Portland, OR â€“ I’m sure one of many around the country â€“ ordering employees not to complain.
Notice KyAnn’s name. KyAnn Lewis was the news director until Scott reported today she was fired. No details why, especially in the middle of the May ratings period.
Donâ€™t forget, at least for now, local news organizations remain the most trusted source of information in Pew Research Centerâ€™s polling on trust in media â€“ even though in January, a Pew Research Center report announced fewer Americans regularly rely on TV news.
â€œmany TV local news stations are focusing more on national politics and have taken a rightward slant over the past year. And that move is stemming from ownership of the stations, not the demands of a local audience.â€
Poynter noted, â€œThe study comes just as many are raising concerns about a coordinated effort by one major owner of TV stations that forces its anchors to record a segment about â€˜the troubling trend of irresponsible, one-sided news stories plaguing our country.â€™â€ And you know who that is.
The researchers examined 7.5 million transcript segments from 743 local news stations and saw huge differences between other stations, and outlets owned by the nationâ€™s largest local broadcasting chain, Sinclair Broadcast Group.
â€œThe authors found Sinclair stations, on average, carried about a third less local politics coverage and a quarter more national politics â€¦ (including) commentaries the stations are forced to run by former Trump official Boris Epshteyn.â€
â€œThe â€˜slant scores,â€™ based on repetition of ideologically linked phrases, increased by about one standard deviation after acquisition by Sinclair as compared to other stations in the same markets. â€¦ And this programming could spur nationalistic and polarizing movements, â€˜be expected to reduce viewersâ€™ knowledge of the activities of local officialsâ€™ â€” and hurt accountability, especially â€œgiven the decline of local print media.â€
So while everything plays out, from fighting the UHF discount in court, to negotiating spinning off stations, to Fox getting money to buy stations (while keeping its Sinclair affiliates), to counting how long the deal has taken (since May, 2017), to counting how long the steps still to be taken will last, the two companies’ bosses have no public complaints or worries.
Sinclair president and CEO Chris Ripley:
â€œAfter a very robust divestiture process, with strong interest from many parties, we have achieved healthy multiples on the stations we are divesting. â€¦While we continue to believe that we had a strong and supportable rationale for not having to divest stations, we are happy to announce this significant step forward in our plan to create a leading broadcast platform with local focus and national reach. The combined company will continue to advance industry technology, including the Next Generation Broadcast Platform, and to benefit from significant revenue and expense synergies.â€
Tribune CEO Peter Kern to employees:
â€œThere is no reason to assume that this change wonâ€™t be for the better. â€¦ So try to focus, as you have always done, on the business at handâ€”delivering outstanding local journalism and great content for our audiences and communities, collaborating with your colleagues, and driving results for our customers.â€
Click here for a look at many other Sinclair sins, from must-runs, to forced network preemptions, to the script the local anchors where you may live were forced to read, plus John Oliver’s take on the man in charge of Sinclair holding more licenses than anyone else to broadcast over the public airwaves (at least in TV) despite being â€œcharged with committing a perverted sex act in a company-owned Mercedesâ€ in 1996, according to The Baltimore Sun â€” and also how to have your say and influence the FCC to deny Sinclair the chance to buy Tribune. Plus, get updates from StopSinclair.com.
Other stories of interest:
- Big changes when Sinclair bought Seattle station
- Veteran reporter fired after report on climate change
- April 18 report DOJ days away from clearing the deal
- Sinclair ABC station with no news fires commentator for threatening Parkland teen
- Sinclair president/CEO email after forcing anchors to read the script
- Top journalism schools voice displeasure with Sinclair
- Sinclair allows paid ads attacking it, but sandwiched inside its opinion
- Sinclair boss Smithâ€™s response to criticism: â€˜You canâ€™t be serious!â€™
- Confessions of a former Sinclair news director
- Trump: â€œSo funny to watch Fake News Networks … criticize Sinclair Broadcasting for being biasedâ€
- Cincy Councilman says he’s boycotting local Sinclair station
- Nick Clooney: ‘I have no idea what these folks are doing for a living, but it isnâ€™t news’
- Sinclair Chairman Claims Entire Print Media Has â€˜No Credibilityâ€™
- Sinclairâ€™s â€œTerrorism Alert Deskâ€ segments are designed to gin up xenophobia
- Tom DeLay: Why Trump should block the Sinclair merger
- Sinclair TV boss donated to Montana congressman who attacked reporter
Enough of big media controlling everything from corporate headquarters! This is what happens when it does. Locals should be in charge of local programming, following the rules of the FCC for using OUR public airwaves!
OK, since you read everything, I’ll give you John Oliver here!
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