There are too many local TV newscasts out there -- at least as it concerns Sinclair Broadcast Group.
Chris Ripley, president/CEO of Sinclair, doesn’t think four, five or six local TV stations with news operations per market does anyone any good. “We think the industry needs to consolidate to two or three large broadcasters, and really just one to two strong local players in each market.”
All that makes sense as Sinclair -- the biggest local TV station group -- wants to get bigger with its proposed deal for Tribune Media.
You can be sure other competing TV station groups' news directors -- who compete with either Sinclair and/or Tribune -- would disagree. But for future business/advertising side local TV newscasts, it could mean massive leverage to command top CPMs from local and national spot advertisers.
Is Sinclair leaning toward more national TV services? Not at all. Recently, Ripley said in an interview the company doesn’t want to create a national TV news network/service that would compete in part with Fox News Channel.
But Sinclair still wants to see better advertising returns from a scaled-down local TV ad marketplace -- one that is trying to transition to more digital/automated and efficient systems.
For remaining TV stations' ownership, it would smooth out the periodic spikes local TV advertisers endure with the ups and down of Olympics and political advertising.
Ripley said during Wednesday’s second-quarter earnings call: “There's significant savings to be had putting local content players together on a local level. We're talking anywhere from 20% to 50% of the expense load that can be synergized and made more efficient.”
In addition to media-buying agency executives' concerns over higher TV ad rates, this kind of talk could raise concerns from federal regulatory agencies as it relates to anti-trust, anti-competitive issues.
Sinclair might counter that bigger local TV news groups would -- in theory -- give local market consumers stronger news coverage with better news-gathering resources.
But you need to go deeper to get real value: Would those loyal local news viewers be any better informed and smarter?