trending Market Intelligence /marketintelligence/en/news-insights/trending/c7kkidgbqmqelpw0vyvuig2 content esgSubNav
In This List

Station group CEOs not worried about losing NFL to tech, Tribune merger fallout

Case Study

Central European Broadcaster Monetizes Content with a New Online Streaming Service

Blog

Debt Ceiling Debate: IR Teams Should Prepare for Potential Market Downturns

Blog

Insight Weekly: Loan-to-deposit ratio rises; inventory turnovers ebb; miners add female leaders

Blog

Insight Weekly: Sustainable bonds face hurdles; bad loans among landlords; AI investments up


Station group CEOs not worried about losing NFL to tech, Tribune merger fallout

C-level executives from TV station groups discussed the future of broadcast at a recent industry conference, touching on topics such as consolidation and the growing importance of sports and news.

Fox Television Stations CEO Jack Abernethy told attendees on Oct. 17 that New Fox, the corporate entity that will emerge when Walt Disney Co. completes the acquisition of most assets from 21st Century Fox Inc., will place a heavy interest on live programming with a strategy rooted in news and sports.

"The basis of it is that live viewing is still the best opportunity for advertisers; people watch the commercials," he said. "It creates an opportunity for broader distribution. ... [T]hose ratings have held up pretty well recently, as some of the entertainment properties have dropped."

The potential power of New Fox was on display Oct. 4, Abernethy said, when FOX (US) televised the "Thursday Night Football" game between the Philadelphia Eagles and the New York Giants, while FOX News Channel (US) was covering the contentious [Supreme Court Justice] Brett Kavanaugh hearings.

"We had a 70% share of live viewing on television, and who knows what we got online," Abernethy said. "So that's what we're about."

Nexstar Media Group Inc. Chairman, President and CEO Perry Sook agreed, noting the importance of news to his company's 171 stations.

"If you look at the 100 markets we're in, the amount of local news we're doing today is about 30% greater than the amount of local news those stations were doing at the time we acquired them," Sook said.

Asked if the other broadcast networks should follow New Fox's lead and present more news and sports, Gray Television Inc. Chairman, President and CEO Hilton Howell Jr., whose company recently moved to purchase fellow broadcaster Raycom Media Inc., said live sports are essential.

"I think CBS (US) and NBC (US) do a great job. I'd like to see ABC (US) pick it up a little bit," he said, alluding to the fact that most Disney sports fare airs on ESPN (US) and its family of networks. Howell is "sublimely confident" that the broadcast networks will reach deals with the NFL when rights contracts come up for renewal early in the next decade, even if the big tech companies make a play for primary Sunday packages.

Twitter Inc. and now Amazon.com Inc.'s Prime Video have held streaming simulcast rights to "Thursday Night Football" in recent seasons, and some analysts think these large tech companies may try to secure even more rights.

"The large marketing footprint we have as TV stations" provides promotional benefits, Abernethy said. "That marketing ability is something the NFL or any league will not get if they're streaming to someone's phone through an app."

As for M&A ahead in the sector, none of the CEOs said they see a widespread regulatory overhang stemming from the failed deal between Sinclair Broadcast Group Inc. and Tribune Media Co. The merger fell apart after the U.S. Federal Communications Commission referred the deal to an administrative law judge to review the credibility of proposed station divestitures from Sinclair.

Under current ownership rules, a TV group owner's household reach can extend to 39% of U.S. households.

Nexstar's Sook anticipates that the FCC will turn its attention to the ownership cap after the midterm elections, with an eye toward raising the limit. Howell, however, warned that if the Democrats assume control of the U.S. House of Representatives "more liberal views toward a higher cap" could be delayed.