With a possible nationwide coverage of 72% in combining the two TV station groups -- in addition to Tribune Media-owned cable network WGN America -- it could mean far more national ad revenues.
Traditionally, having TV station coverage of more than 70% of U.S. TV homes has meant the ability to attract national/network TV media dollars.
To be fair, Sinclair executives didn’t talk specifically about creating a new national TV network -- only other ways of attracting new advertising dollars. For example, the new broadcast technology standard, ATSC 3.0 is poised to allow TV stations to develop all kinds of new products -- including national TV platforms.
Chris Ripley, president/CEO of Sinclair Broadcast Group, says the new technology will bring the company closer to having a national footprint. "It's that sort of [national] network that opens up all the incremental revenue that are beyond core broadcasting,” in speaking at a press conference about the deal.
But national advertisers might be cautious when considering other remarks -- especially it pertains to WGN America.
Ripley believes this network needs to cut back on high-cost programming in favor or low-budget originals and reruns. "WGNA does not have a revenue problem. It's got lots of revenues. It's got a nice contractual ramp of affiliates over the next couple of years and a nice base of advertising revenue.”
Trouble comes when national TV advertisers make choices, they look increasingly at what is “premium” TV programming and what isn’t -- especially against some of the swill that exists on digital media.
Reruns, low-budget originals? Are we talking the early days of U.S. syndication or cable TV?
Against a fast-growing TV-video world, TV networks now continually try to distinguish themselves as the producers of high-quality programming, which also goes for top established cable TV networks (TNT, USA, FX, etc.), and other cable networks.
Sending a signal to investors and other potential business partners you want to cut costs is financially prudent. But also telling them you want to program TV networks/platforms on the cheap -- in a world of $6 billion TV production budgets from Netflix -- doesn’t offer up much TV confidence.
A low-rent TV network? A guess it depends on the neighborhood.