Commentary
Nexstar Media Group -- Looking For The Next Big Thing: A Broadcast TV Network
- by Wayne Friedman , Staff Writer, June 14, 2022
Nexstar has been rumored to be considering a majority stake in The CW -- which is 50-50 co-owned by Paramount Global and Warner Bros. Discovery. The station group has major affiliate stations as part of this network.
This, of course, would not be the first time a big TV station group has angled to buy a broadcast TV network. Capital Cities bought ABC back in 1985. A year later, Fox famously started up after News Corp. bought a 50% interest in 20th Century Fox and then six major market TV stations from Metromedia.
advertisement
advertisement
To achieve more growth, independent TV stations have naturally looked at other TV distribution businesses such as networks, as well as cable TV and local digitally based over-the-air TV networks, for expansion.
Nexstar bought WGN America in 2019, and then turned into a 24/7 cable news channel -- NewsNation -- in 2021.
But ask yourself whether big TV station groups should be more focused on streaming and digital media businesses.
As a possible bridge to this, many TV station groups started a relatively easy digital-media synergistic effort to support their core over-the-air TV stations, which have been losing audiences over the years.
That plan is to start up a digital advertising business, including selling local and regional ad inventory of needy streaming/OTT apps -- to be packaged with TV station inventory to boost reach and effectiveness of their core local TV advertisers.
But those businesses are still tiny in size compared to the retransmission, core TV station advertising, and the political advertising business.
Should their focus be on other things -- like owning or starting up broader-reaching premium streaming platforms -- as their bigger network partners are doing?
Well, it's an increasingly crowded and competitive market. So what remains are perhaps older TV broadcast and cable networks that need other media business financial connections.While linking up the largest owner of TV stations in the U.S. would be a good first step, one would again need to ask what the future for a modest-sized legacy TV network would be, say, ten years from now?
The question always comes back to how to compete with growing digital media and digital-first businesses.
Wayne Friedman is West Coast Editor of MediaPost. You can reach Wayne at wayne@mediapost.com.
Wayne, as you may know, the original motive for Fox, Paramout and Warner Brothers launching their own "broadcast TV networks" was their fear that as producers of lucrative prime time sitcoms and dramas---profitable mainly via rerunsin syndication---they might be shut out of producing many more of these shows if three big networks---ABC, CBS and NBC----continued their virtual monopoly over prime time original series productions. So each one set up its own prime time network---based on independent stations mainly---so they could produce more shows for their own networks as well as the three biggies.
The problem was that the biggies had always made their profits via low cost early AM, daytime and late night fare, while prime time shows usually lost money for the networks. But none of the independent station based networks had any early AM, daytime( or news) offerings and Fox stumbled badly in several late night efforts. As a result, they tended to be money losers---even when using cheaper prime time entries for once a show like "Married With Children" or "The Simpsons" attained "hit" ratings their producers and actors demanded hefty compensation increases in compensation---just like those that supplied shows to the big networks.
I doubt that The WB makes a meaningful profit---if any, so if it was acquired by a station group its main function would be to draw network caliber advertisers to the network in prime time and this would, no doubt, spill over to the news and other fare that the stations would add to the mix, creating what would amount to a hybrid "network" with unique profit centers in its news department---I'm assuming that they would launch a national news service. It might just work.