MediaTalk | Season 4 | Ep. 17 - From Second Fiddle to First Screen: Inside Broadcast’s Big Media Comeback

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Mike Reynolds: Hi, I'm Mike Reynolds, a senior reporter covering the media industry with the S&P Global Market Intelligence Tech, Media, and Telecom news team. Welcome to "MediaTalk," a podcast hosted by S&P Global Market Intelligence, where the news and research staff explore issues in the ever-evolving media landscape. Today I'm joined by Justin Nielson, head of research at S&P Global Market Intelligence Kagan, and Kagan principal analyst Scott Robson, both of whom recently attended the NAB Show in Las Vegas. Justin, how are you doing? That's No. 17 NAB Show for you.

Justin Nielson: I believe so, yes. Thanks, Mike. Always good to spend some time in Vegas for a few days talking with broadcasters and a lot of takeaways that we can talk about.

Reynolds: Scott, how about you? How often have you been out there for the NAB?

Scott Robson: Yeah, thanks, Mike. I'm doing well. Yeah, it was a great time in Las Vegas. It was my first NAB Show.

Reynolds: Oh really? Okay.

Robson: Yeah. And I also attended a newer sports technology conference called Peak while I was there. So I was a frequent user of the Vegas Loop as I bounced back and forth between events.

Reynolds: Okay. Alright, guys, again, Justin, attendance good? Are things in good shape these days, in terms of these live events? Are we back to pre-pandemic levels?

Nielson: Yeah, I think attendance was good. I don't know if we'll ever be back to pre-COVID days, but it was good to see that both the West and North halls were very busy with action. It seemed like most of the construction had been completed. And it was interesting that WrestleMania was in the South Hall, so a lot of crossover.

Reynolds: Okay. Alright. Scott, were you overwhelmed? A lot of people, it would sound like.

Robson: Yes, it was a bit of a whirlwind experience. A lot of people out there. There are fewer cable industry events these days than there once were, but the sports media industry remains pretty strong. So nice to see that on the agenda.

Reynolds: Alright. Justin, when we talk about NAB, I think the general idea is that it's about broadcast and TV stations, but radio's a big player too. Why don't we start there? What's your takeaway? What did you hear on the radio front out there?

Nielson: Yeah, the radio show used to be a separate conference and used to rotate around the hubs of some of the major radio broadcasters. But it was combined after COVID with the NAB Show. And it always has good attendance in terms of radio broadcasters and those podcasters and small- to mid-market owners. It was interesting to hear from them and then also from the national side — where the state of the business was. What's going to happen with some of these broadcasters in terms of Cumulus going through a debt restructuring event — its second in the last 10 years. Also looking at Audacy, which just re-emerged from bankruptcy proceedings.

So it was a situation that really focused in on the digital assets — where they're putting some emphasis on podcasting, building up their talent base, and then really being as lean as possible in terms of their production and their marketing and sales staff. The business has been very stagnant in terms of the advertising arena, but they do see some uptick in political this year. And then the recent news is about a potential tie-up with iHeartMedia and SiriusXM, which would create a major audio advertising and subscription business.

Reynolds: Yeah, that news just came out recently, so we'll see if there is much to that, and if it happens, that definitely could change things around a little bit. Justin, you mentioned advertising. Scott, what's the advertising picture for this year? I know there's a little event in June, July that's going to have a lot of people's attention.

Robson: Yes. So I think, if you look at 2026 as a whole, the cable networks and national broadcast networks are getting a boost from the Winter Olympics that have come and gone, and then the FIFA World Cup in Q3. I think it's also expected to bring in around $850 million in advertising in the US alone. So it should be a bright spot alongside political. The national networks will see less political ad revenue than the stations, given the localized nature, but it should be another bright spot — something to look forward to there.

Reynolds: Kagan, I think you guys are looking at $4 billion for the stations this year. Am I correct in saying that?

Nielson: Yeah, just over $4 billion, which would be a record for a midterm election cycle. We saw a little over $4 billion in the last presidential election. This year we're seeing about a double-digit uptick in terms of fundraising as well as expected political advertising spend in some hotly contested markets. You've got some big governor races like in California. You've got Georgia, North Carolina, all those states that have turned purple. And even in Texas, you've got some congressional districts that may flip.

Reynolds: Yeah, unlike in the presidential cycle, a lot of this kind of comes much later. Granted, most of the spending is in third and fourth quarter, but this time around, mm-hmm, again, we still don't know how some things are going to shape out — redistricting aspects and all the rest — and the conflict in Iran continues, at least at this stage. So we'll see where things happen.

I wanted to change gears a little bit. Sports betting, again, legalized now in 39 states and in D.C. and in Puerto Rico. As states came on board, the sports betting operators spent a lot of money to let people know — introductory promotions, all the rest of that. But Scott, sports prediction markets — prediction markets in general and sports in particular — can you bring us up to speed there?

Robson: Yes. Kalshi had a big presence at the NAB. Prediction markets are definitely on the rise and expected to be a billion-dollar industry by the end of this decade. I attended an interesting panel session at the NAB, which featured the head of partnerships at Kalshi, Will Brackett, along with Will McIntosh of VERSANT and MoviePass CEO Stacy Spikes.

And so it's an interesting space because Kalshi's now partnering with Rotten Tomatoes to introduce markets where users can bet on movie scores, things like that.

Reynolds: Oh, interesting.

Robson: And then MoviePass is launching its own prediction app called Mogul, where you can bet on box office performance, award show outcomes, things tied to the film industry. So these apps are really growing in scope to cover much more than sports. There are, however, a lot of active lawsuits in place. Yes, and it's an interesting space because I think Kalshi's managing 19 lawsuits right now, and they tend to have come away the victor in many cases. They won an appeals court victory in New Jersey just a few weeks ago. And so, while I think that this space is likely primed for a bit of regulation and disruption and possible change in the future, it seems to be chugging along as of now.

Reynolds: We just did a MediaTalk on the prediction markets, and my colleague Stefan Modrich just did another great piece on the prediction markets. Like you said, there's a lot of legal activity; it's definitely going to bear watching. And again, if we're talking films and all the rest of that, that's going to make it even more mainstream for people to get involved. We'll keep close tabs on that.

Justin, FCC Commissioner Olivia Trustee was at NAB. What did she have to say?

Nielson: With the FCC at only three members, it is always good to hear from one of the members in terms of what their regulatory outlook is and then what their methodology is. And Olivia Trustee had some prepared remarks, and she really harkened back to her mentor, FCC Commissioner and Chairperson Michael Powell. Broadcasters remember that time quite fondly in terms of a light-touch regulatory environment and a real focus on localism.

And Olivia Trustee did mention in her prepared remarks that localism was a big aspect of broadcasting and to continue to have a competitive marketplace to support those local initiatives. Broadcasters are best suited in most cases to have that conduit in terms of advising the public on news events, being there in terms of any type of weather-related actions, or anything that needs to be broadcast to the public in terms of news and events.

The other aspect that she did mention was on the pending litigation or proceeding on sports rights and specifically the NFL and their exemption in terms of antitrust. With these rights deals now including streamers, does that change that light-touch regulation on basically small monopolies, in the case of the NFL, where they have all the national rights to the product? So that was very interesting.

She didn't really delve into the Nexstar–TEGNA deal.

Reynolds: No, I was going to ask you about that.

Nielson: Yeah, so Perry Sook was there. He had talked about it in a separate session, but from a lot of people that I talked to, they felt like this temporary injunction would not be extended and they would be able to merge the operation. So it's basically a done deal at the FCC and DOJ level. And I'm not entirely sure — and I'm not a lawyer — how much standing the state AGs have in this case.

Reynolds: Yeah, again, it would just seem, yes, you've got approbation from the top, so we'll see. We'll keep our eyes on that. Alright. That's a huge consolidation, but one thing that's definitely happening on the broadcast side is that station groups, in the wake of the transformation of the regional sports network business, are definitely getting involved with various packages with NBA, MLB and NHL teams — whether that's 10 games, in some cases there's full-season kinds of things. Scott, what's your sensibility here? Main Street Sports is just weeks away from being defunct. What kind of action do you anticipate we're going to see?

Robson: Yes. So it's been a slow, drawn-out process — the demise of the RSN industry, if you will. But this year things became more real, in a sense, which is a good opportunity for local broadcast. But it does mean near-term pain for teams in terms of taking a hit on overall revenues. And so MLB has launched 14 team-branded channels, and I think that's a short-term solution that other leagues might follow.

But yeah, as you’re right, they're also putting 10–20 games on local broadcast stations, which is a good opportunity. Justin just mentioned how they were so focused on localization, and I think that those local sports teams finding a home on those stations really highlights that locality.

Reynolds: Okay. I guess in a bigger-picture sense, both NBA Commissioner Adam Silver and MLB Commissioner Rob Manfred have been advocating for, for lack of a better term, centralization of local teams' streaming rights — could happen next season or the following season. Justin, what do you make of that? And if that does come to pass, are the broadcast stations still going to be in the game?

Nielson: I believe so. And it was very interesting — there was a keynote session that I attended with John Miller from NBCUniversal, and he talked about how he's been in the sports rights negotiations for decades now. He remembers back when NBC had lost baseball to the cable outlets at ESPN. So he sees it almost like a cyclical approach, where broadcast is now at the forefront in terms of some of these rights deals.

And I think that will perpetuate in terms of streaming operators coming in and maybe getting some sections of the national rights deals, but the broadcast stations still being part of the major events like the Super Bowl and the like, as well as some of these local games.

Reynolds: Okay. We haven't mentioned the cable guys here. Obviously, ESPN is synonymous with sports. Fox Sports 1 and all. Scott, there's a new player in terms of VERSANT, the cable spinoff from NBC. And USA is a major player, right?

Robson: Yes. VERSANT has become a big investor in golf media rights. And so I'll be hosting a panel discussion with a sports focus at our Kagan Summit, and we'll have an industry cross-section of experts to weigh in, including Celia Cole from VERSANT. And so it'll be good to pick her brain and hear about their longer-term strategy. They also have Premier League, NASCAR and a few others aside from golf, but that seems to be their main focus, having the Golf Channel and whatnot.

But it's interesting because both VERSANT and Comcast are still very connected in terms of sports rights, with NBC Sports handling ad sales and production for golf events and the two companies splitting up some of those rights. I think, overall, cable has been a bigger loser of sports rights in recent years than broadcast when it comes to what's migrating to streaming. Cable is also a paid service, so it's like substituting one paid pipe for another.

Reynolds: Okay. I guess, you know, the other thing that's going on now: the NFL is in renegotiations, opted out of the contract early. Reportedly, speaking of Paramount–Skydance, maybe Fox is next. Scott, these are big monies. The networks need NFL, right? And in turn, Justin, the stations need NFL, right?

Robson: From what I've heard at the conference from NBC was that the NFL is engaging with CBS currently on a new deal. They have not approached NBC yet. I'm not sure where Fox lies on that timeline. But the provision to rework the current deal that is in place until 2032 seems likely to be triggered in the next two years or so. I don't think it's happening before the 2026 season.

I do think it will result in a lot more money for the league. How much of a bump will we see? Not 100% sure, but I think there are discussions happening right now that the NFL's looking for an increase of 50%, bringing that annual total from those deals from $10 billion to $15 billion. So I think that the broadcasters will be willing to pay this, but it might result in them trimming spending in other areas, especially some of the niche sports.

Reynolds: Makes sense. Justin, how important is the NFL to the local stations?

Nielson: Extremely important for those big four broadcasters. And honestly, from a perspective of retrans, it really moves the needle in terms of those negotiations, and most of those negotiations happen in the fall when the NFL season starts or during the NFL playoffs.

You look at the tie-up with Nexstar and TEGNA — a lot of that deal is based on the fact of scale and getting better negotiations in terms of retrans renewals and then also on the localism aspect. So going back to what the FCC Commissioner had said in her prepared remarks, the Sports Broadcasting Act was created so that you would have access to these big events, especially sports.

Reynolds: Alright. Scott, you'd mentioned the World Cup. Again, one of the top soccer nations, football nations, Brazil — Justin, they're going with next-gen technology with the upcoming tournament as a showcase event.

Nielson: Yeah, absolutely. There was a big contingent and delegates from the government of Brazil. The Ministry of Communications had some prepared remarks about the launch. So they're going all in, in terms of what they're calling TV 3.0, with the support and technology of ATSC 3.0, and they're actually creating an entire spectrum band of 300 megahertz for that deployment. So they've got the device manufacturers, they've got the towers, they've got the networks and the stations to deploy that technology ahead of the World Cup. And they're going all in.

The other country that was also represented was Korea. There was a delegate there talking about their experience — they had launched ahead of the Winter Olympics in Seoul not too long ago. So they've had some time to live with the technology, and it's created a lot of opportunities for them in terms of the hybrid broadcast-IP nature of the standard, the ability to do some targeting, do some on-demand content, and really the tracking and the audience tracking and the ability to see that return-path data of who's viewing those stations and that content.

The other new entrants in terms of ATSC 3.0 are some of the Caribbean countries — Jamaica, Barbados and others in The Bahamas. There was a delegate from ATSC that's helped as a consultant in those markets, which is interesting in the fact that Jamaica went through a very devastating hurricane, and they were able to support the rebuilding and upgrading of their infrastructure, including ATSC 3.0.

And then finally, which was very interesting, a delegate from India talked about how they're using ATSC 3.0, but instead of going to a TV screen, it’s going to mobile devices.

Reynolds: Really. Okay. Scott, as you mentioned, there was a parallel sports conference out in Vegas. Sports technology, I'm sure, came to the forefront. Anything interesting that we should be keeping our eye on as sports fans and sports business writers?

Robson: Yeah, so a few things here. I think, in terms of the live broadcast, we are going to start to see a lot more alternative casts become available. We've seen this already with things like the ManningCast on Monday Night Football and with alternative camera options on Amazon Video for Thursday Night Football. But I think these leagues, especially emerging ones, are going to be more flexible in having watch parties featuring influencers and things like that. And then you'll have more camera options available.

Another big focus, I think, is on reducing latency in streaming. This is big for live gamblers, as there's a pretty big edge to attending a game and live betting versus making decisions while watching the broadcast at home.

Aside from that, on the fan experience, it sounds like many leagues and venues are looking towards a ticketless live experience where facial recognition replaces the ticket, and then once inside the stadium, you're using your face to purchase merchandise and concessions. And this will all result in just more data collection on fan behavior.

Reynolds: Interesting. Alright, we're getting to the end here, guys. I just wanted to say we've covered a fair amount of things. What didn't I touch on at all that, Scott, you're going to be looking at, because you went to the shows and some of the key takeaways that we haven't talked about yet?

Robson: Yeah, so we have talked about the World Cup. We have not talked about the other World Cup, which wrapped up in March, which is the Cricket World Cup. And what I saw at these conferences was a pretty big push from cricket to try and grow the sport in the United States. There was a panel with the CEO of the International Cricket Council who discussed just how big this sport is on a global scale. They have an estimated 2.5 billion fans, and the reality is that there are only around 10 million fans in the US, so it seems to be a huge opportunity to grow that game here.

Another topic that we didn't really touch on was the growing importance of sports-adjacent and sports shoulder programming in retaining subscribers — if you're looking at streaming services — and also, just if you're a sports league, growing the game. You're seeing that happen through Netflix with programs like Quarterback and Receiver, and then also how Apple is pushing the F1 movie and things like that.

Reynolds: Yeah, programs like that definitely are, for some folks, introductory points and, for those who are fans, it only reinforces why you enjoy them so much. Justin, how about you? What were some of the other things that we haven't touched on that you'll be keeping an eye on out of this current NAB experience?

Nielson: We covered a lot, but the one aspect that always comes up is AI. And I felt like there were a few keynote sessions and panels that were talking about how AI is changing the creative process. There were individuals from Microsoft and Nvidia and some film producers overseas. They did a trailer of an AI-generated feature film that's being launched in India. So I don't know if the US is quite there yet. If the Super Bowl is any indication on the advertising side, a lot of AI is being used in terms of the creation of advertising content, as well as targeted content.

Reynolds: Yeah. No, in the workflow from the ad market — media planning and buying — and then definitely creative is becoming more of a factor. And some people are saying that the money that's being saved on creative is being reinvested in buying more media. So I guess that's a good thing.

Anyway, yeah. Guys, I wanted to thank you. That concludes this episode of MediaTalk. Justin and Scott, we appreciate you taking time with us and sharing your tales and travels from NAB. We appreciate it, guys.

Nielson: Thank you, Mike.

Robson: Yeah, thanks, Mike.

Reynolds: And this is Mike Reynolds. As always, thanks to all of you for listening. We'll catch up soon on the next installment of MediaTalk.