TV station buying will not slow down, despite the demise of Sinclair Broadcast Group-Tribune Media mega deal. But will the TV station future really be that different?
Expect Sinclair to make an attempt to buy other stations in whatever way it can, given current federal regulations. Also look for the Nexstar Media Group, another big TV station owner, to try and buy Tribune, per the New York Post.
If that isn’t enough, private-equity companies -- such as Apollo Global Management, Providence Equity Partners and Blackstone Group LP -- may be interested in buying local TV stations, according to CNBC.
It sounds like great news for potential buyers and sellers. But where is this headed in the long-term?
Consolidation may sound like a positive business plan. However, it comes with some necessary cost-cutting.
Does that mean fewer anchors, reporters at TV station newscasts, more station-wide national content, and thus less compelling local news coverage? Will new syndication program deals also slow down, making it harder for new shows on TV stations?
Sounds like increasingly stale on-air content to come.
TV station executives will say the new ATSC 3.0 broadcast standard means a whole new world for TV stations -- complete with new interactive, digital, and programming opportunities to come.
Remember, this is the same industry that primarily works in a slow-moving, analog world when it comes to local TV advertising. How many years have we heard about the TV station industry giving major media agencies what they long demanded: more automation for media buying?
Sure, TV stations have made some digital media inroads. But that comes from TV stations' efforts around their own digital platforms, not from their linear TV business.
When it comes to providing a more efficient media buying-selling operation for national TV marketers' ad spend on local TV, it's weak at best.
In the end, TV stations can only count on what predominately exists right now: Buying more TV stations, grabbing onto growing retransmission revenues and sharp every-other-year spikes in political ad revenues.
True TV station business innovation will be left to the next guy -- or worse.
Here’s a warning earlier this year from Frank Friedman, former Publicis Media local TV media buying executive:
“If we don’t push [spot automation] forward, we see a conflict coming our way, which is extinction,” he says. “If we don’t make these changes, we’ll continue to live on reduced [spot] budgets year after year, and we will not succeed.”