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Tribune Media terminates Sinclair deal; Comcast wins patent ruling against TiVo


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Tribune Media terminates Sinclair deal; Comcast wins patent ruling against TiVo

Top News

* Tribune Media Co. terminated its merger agreement with Sinclair Broadcast Group Inc., and simultaneously sued Sinclair in the Delaware Chancery Court for an alleged breach of the merger agreement between the companies, according to a news release. "Sinclair committed to use its reasonable best efforts to obtain regulatory approval as promptly as possible, including agreeing in advance to divest stations in certain markets as necessary or advisable for regulatory approval," Tribune wrote. "Instead, in an effort to maintain control over stations it was obligated to sell, Sinclair engaged in unnecessarily aggressive and protracted negotiations with the Department of Justice and the Federal Communications Commission over regulatory requirements, refused to sell stations in the markets as required to obtain approval, and proposed aggressive divestment structures and related-party sales that were either rejected outright or posed a high risk of rejection and delay—all in derogation of Sinclair's contractual obligations."

* Comcast Corp. won a ruling from the Patent Trial and Appeal Board in its patent dispute with TiVo Corp., Multichannel News reports. Invalidating a patent owned by TiVo's Rovi Corp. unit, the board rejected TiVo's claim that a Comcast X1 feature allowing users to watch a channel while recording a show from another network violated the Rovi patent. The ruling stated that the technology would be "obvious" to any company that designs DVRs.

* Viacom Inc. reported a 23.6% year-over-year drop in fiscal third-quarter net earnings attributable to the company to $522.0 million, or $1.29 per share, from net income of $683.0 million, or $1.70 per share. The normalized S&P Global Market Intelligence consensus estimate for the quarter was $1.07 per share. Viacom attributed the year-over-year decline in its bottom line in part to a gain on the sale of an investment in EPIX in the prior-year quarter.

* 21st Century Fox Inc. Executive Co-Chairman Lachlan Murdoch, noting that the deal with Walt Disney Co. is slated to be completed in the first half of 2019, outlined New Fox's strengths in sports and news on the company's earnings call.

Film & TV

* DreamWorks Animation SKG is working with cloud-based data services company NetApp Inc. to develop predictive analytics tools that could help the company cut costs when developing animated films, The Wall Street Journal reports. The new tool would allow artists to render and prototype animated scenes rapidly. DreamWorks' tech chief Jeff Wike says creating an animated feature currently requires about half a billion files, or about 600 terabytes of storage and 120 million core hours of rendering.

* Time Warner Inc.'s HBO (US) teamed up with new media company Axios for a limited documentary series of news-oriented specials. The series, which will be directed and produced by Matthew O'Neill and Perri Peltz, will debut on HBO this fall.

Internet & OTT

* Roku Inc.'s The Roku Channel is now available to web users in the U.S., according to a news release. The company also launched a "Featured Free" navigation change to the Roku home screen, which offers users direct links to free content, including latest in-season episodes of various network shows and full past-season catchups.

* Apple Inc. said it has not pulled the Infowars app from its App Store because the app belonging to conspiracy theorist Alex Jones has not violated any of the company's content policies, Reuters reports. The Infowars Official app became the App Store's third most-downloaded news app for the week of Aug. 6. The iPhone maker has removed some of Jones' podcasts from its digital store.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng climbed 0.88% to 28,607.30, while the Nikkei 225 fell 0.20% to 22,598.39.

In Europe, around midday, the FTSE 100 fell 0.72% to 7,721.01, and the Euronext 100 was down 0.31% to 1,074.53.

On the macro front

The jobless claims report, the PPI-FD report, the wholesale trade report, the EIA natural gas report, the fed balance sheet and the money supply report are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

Featured news

The Daily Dose Europe: Sky Ireland trials broadband service; Disney's Sky bid ruling appealed: Sky Ireland is trialing a consumer broadband service via Eir's fiber network, while several parties have filed appeals against the U.K. Takeover Panel's decision related to Disney's mandatory bid for the pay TV giant.

The Daily Dose Asia-Pacific: Samsung to boost AI, 5G investments; NTT setting up new holding company: Samsung Group plans to invest 180 trillion won in CapEx and businesses that will drive growth, while Nippon Telegraph & Telephone Corp. is setting up a new holding company and a global innovation fund of up to US$500 million.

Featured research

Economics of TV & Film: DVD, Blu-ray spending down $1B-plus for 11th year in a row: The DVD and Blu-ray rental and retail market continued its freefall in 2017 as consumer spending dropped by more than $1 billion for the 11th year in a row. Total revenue declined $1.14 billion in 2017, down 14.3% to nearly $6.84 billion.

Global Multichannel: Mobile broadband drives bundled services in Poland: In Poland, 2017 was another year of dynamic growth of bundled services caused by a dramatic rise in mobile broadband. Over the last five years, the number of subscribers using bundled services went up from 2.4 million in 2013 to 10.15 million in 2017.

Economics of Internet: State of South Korean online video: subscription: The South Korean over-the-top market is dominated by virtual multichannel and mobile IPTV services offered by incumbent multichannel and mobile operators.

Multichannel Trends: See it in charts: US Multichannel, July 2018: View U.S. multichannel trends at a glance in PowerPoint format. Key charts summarize the status of video subscribers, broadband competition, virtual service providers and impacts on the total segment.

Broadcast Investor: Economics of Broadcast TV Retransmission Revenue: Although TV station owners have successfully secured higher retransmission fees in each renewal period, net retrans margins have compressed due to the rising cost of live sports rights.

Recent earnings

CenturyLink grows its bottom line, moves away from 'empty calorie revenue': Speaking during an Aug. 8 earnings conference call, CenturyLink Inc. CEO Jeffrey Storey said, "We do not focus ... on empty calorie revenue — that is, contracts or services with very low or no margin."

Sinclair still analyzing options for Tribune; eyeing RSNs also: The station groups are still analyzing approaches to keep their merger ambitions alive, but Sinclair is also looking at other acquisition targets like regional sports networks.

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