TV broadcasters are positioning for a wave of deals in anticipation of changes to FCC limits on broadcast ownership, according to broadcasters, media brokers and recent announcements from station groups. Sinclair Broadcast announced in a release Monday that it's evaluating “all value-enhancing opportunities,” and Nexstar and Tegna are reportedly negotiating a possible deal. The rumors are likely an indication of pent-up demand but could also be aimed at mollifying shareholders, said broadcasters and media brokers.
Lawmakers and others are accusing the FCC of being involved in corruption and seeking to chill free speech after the agency’s approval of Skydance's $8 billion purchase of Paramount Global and the commission's retention of an open news distortion proceeding against CBS.
The FCC approved Skydance’s $8 billion purchase of Paramount Global in a 2-1 vote, said a release late Thursday. In a statement released with the order, FCC Chairman Brendan Carr praised Skydance for making written commitments “to ensure that the new company’s programming embodies a diversity of viewpoints from across the political and ideological spectrum” and “measures that can root out the bias that has undermined trust in the national news media.” Skydance has committed to not establishing diversity programs, hiring an ombudsman to evaluate bias at the company, and working closely with its network affiliates, said the FCC release. Commissioner Anna Gomez dissented from the order. “After months of cowardly capitulation to this Administration, Paramount finally got what it wanted. Unfortunately, it is the American public who will ultimately pay the price for its actions,” she said in her own statement. “In an unprecedented move, this once-independent FCC used its vast power to pressure Paramount to broker a private legal settlement and further erode press freedom,” Gomez said. “Even more alarming, it is now imposing never-before-seen controls over newsroom decisions and editorial judgment, in direct violation of the First Amendment and the law.” Despite condemning the arrangement, Gomez praised Carr for bringing the matter to a full commission vote. “Granting approval behind closed doors, under the cover of bureaucratic process, would have been an inappropriate way to shield this Administration’s coordinated campaign to censor speech, control narratives, and silence dissent.” According to the order, the news distortion proceeding against CBS stemming from a Center of American Rights (CAR) complaint remains open. “Our action today does not pre-judge or in any way prejudice any actions we may take in that proceeding,” the order said. “We note that the matter has not been set for hearing and CAR has not alleged that CBS or its parent are unfit to hold Commission licenses.” CAR instead asked the FCC to require CBS to release a transcript of its interview with former Vice President Kamala Harris and commit to viewpoint diversity, the order said. “CBS/Skydance has done both.”
The 8th U.S. Circuit Court of Appeals vacated the FCC’s top-four prohibition and its extension to low-power TV stations and multicast streams but upheld the agency’s other broadcast ownership rules in a unanimous three-judge decision Wednesday on the 2018 quadrennial review.
President Donald Trump said in a post Tuesday that his settlement with Paramount over a 60 Minutes interview has been paid and includes $20 million in ads, public service announcements and programming, on top of the $16 million donation to his presidential library that Paramount previously announced (see 2507020053). The company had denied that the settlement included PSAs or any payout beyond the $16 million, and it appeared to reaffirm that denial Tuesday.
Gray Media and E.W. Scripps have agreed to a swap of TV stations that would involve seven stations in five markets and create new duopolies for both companies, said a Gray release Monday. Media brokers told us that a wave of such swaps has been anticipated (see 2505150056) since the FCC signaled in March a new willingness to waive its prohibition against top-four duopolies (see 2503120066). The Media Bureau approved a Sinclair deal involving a top-four waiver last week (see 2507010073).
FCC Chairman Brendan Carr said Thursday that he's “open-minded” about the result of the agency’s proceeding on modifying the national broadcast-ownership cap (see 2506180082), while Commissioner Anna Gomez denounced it as “a sweeping effort to tip the scales even further in favor of a handful of powerful corporations.” Gomez said she knows broadcasters are facing economic pressures and the FCC may need to provide relief, “but this is where we need a scalpel, not a chain saw.” Broadcast officials told us that keeping the ownership cap in place only for network-owned stations -- as the public notice suggests -- could make the rule change more vulnerable in court.
Broadcasters are poised to execute a rush of mergers and acquisitions if the FCC relaxes ownership rules, but uncertainty about markets, the direction regulators may take and the future of broadcast networks could influence deal-making, broadcast brokers said in interviews this week. The agency's failure to relax ownership rules could spur a wave of bankruptcies, they said. “The industry is crying out for some relief, and it really deserves some relief, because we can't compete with the giant companies that we're forced to compete with now,” Media Services Group co-founder George Reed said. Tideline Partners Managing Partner Gregory Guy said “2025 is the most fundamentally important year for broadcasters in decades.”
An ATSC 3.0 tuner mandate and a set date for the switch to the new standard are necessary for TV broadcasting to survive and compete with streaming, said Sinclair, Scripps, Gray and others in comments filed in response to NAB’s 3.0 petition in docket 16-142 by Wednesday’s deadline. The Consumer Technology Association, public interest organizations and multichannel video programming distributor (MVPD) groups disagreed, arguing that a mandatory transition would increase costs for consumers and MVPDs, all to provide broadcasters with a new revenue stream.
The FCC Media Bureau has approved another TV deal that involves a top-four duopoly, according to an order in Friday’s Daily Digest. The deal involves Marquee Broadcasting’s proposed purchase from Imagicomm of KIEM-TV Eureka, California (NBC), and low-power KVIQ-LD Eureka (CBS). “The evidence in the record demonstrates that splitting up the two top-four network affiliations would likely lead to a reduction in network programming and local news in the Eureka [designated market area], which would not serve the public interest,” the order said. Although the top-four prohibition historically hasn’t applied to LPTV stations, the FCC’s 2018 quadrennial review order extended it to those stations and multicast streams. Oral argument in the broadcaster legal challenge of that order was held in the 8th U.S. Circuit Court of Appeals last month (see 2503190064). The bureau approved another top-four deal by Gray Media earlier this year (see 2503120066), and media brokers told us they expect to see an increase in such deals being proposed since the agency now seems more open to them.