Fox has notified Tribune that it is terminating its affiliation with Tribune’s KCPQ Seattle and, according to sources, it has offered to swap its MNT affiliate in Chicago, WPWR, for KCPQ. The move is the latest evidence of Fox’s desire to to own stations in top markets with NFC teams to take full advantage of the Fox network’s rights to broadcast the NFC games every Sunday.
As part of its effort to get the most from its NFL TV rights contract, Fox has notified Tribune that it is terminating its affiliation with Tribune’s KCPQ Seattle and, according to sources, it has offered to swap its MNT affiliate in Chicago, WPWR, for KCPQ. (Editor’s note: The original posting got the call letters of Fox’s Chicago MNT affiliate wrong.)
The story was first reported in the New York Post this morning.
Tribune, in a press release, confirmed that it had received the termination notice, but said that it had no deal with Fox for a swap or anything else. “We are continuing to engage in discussions with Fox and, moreover, have prepared for all operational and economic possibilities for our Seattle Fox stations.”
Tribune noted that KCPQ generates about $13 million in EBITDA.
Fox Television Stations President Jack Abernethy has long made clear the company’s desire to own stations in top markets with NFC teams to take full advantage of the Fox network’s rights to broadcast the NFC games every Sunday.
Over the past two years, Fox has added two NFC markets to its lineup. In one case, the network dropped an existing afffiliate to pave the way for the acquisition.
In early 2013, Fox terminated a 27-year affiliation with Bahakel’s WCCB Charlotte, N.C., before acquiring Capitol Broadcasting’s WJZY and WMYT. Charlotte (DMA 25) is home to the NFC’s Carolina Panthers.
Earlier this year, Fox swapped stations in Memphis and Boston for Cox’s Fox affiliate in San Francisco, KTVU, and its duopoly station there. San Francisco is the home of the NFC’s 49ers.
Abernethy explained Fox’s interest in NFC markets last year in an interview with TVNewsCheck.
“The company spends an enormous amount of money on rights with the NFL,” he said.”So we need to monetize that. A TV station in a market with an NFL franchise has tremendous opportunities for shoulder programming, tremendous opportunities to promote when and if the team gets into playoffs. Particularly in a smaller market like Charlotte, it galvanizes the area.
“The other thing is when the issue of retransmission consent comes up, football is the single biggest intensely demanded product by the consumers. Therefore, it allows us to get what we deserve in our negotiations.”
Other than Seattle, the only NFC markets where Fox doesn’t have O&Os are New Orleans (Saints), Milwaukee (Packers), Green Bay (Packers) and St. Louis (Rams). Tribune is also the owner of the Fox affiliate in Milwaukee and St. Louis.
In a story full of ironic angles, here’s another one: In 2008 Fox sold to Oak Hill Capital, a private equity firm, eight stations, including the Fox affiliates in St. Louis (KTVI) and Milwaukee (WITI). Last year, Tribune acquired those stations, operated by Local TV LLC, as part of a $2.73 billion deal.
However, Fox may not be able to pursue its NFC strategy beyond Seattle. If it is successful in getting an O&O there, the group’s national reach will grow to 38.95%, which puts it right up against the FCC cap. Fox could spin off O&Os in markets without NFC teams like Orlando and Austin to give itself some headroom under the cap.
If Tribune is being muscled into giving up KCPQ, it will get little sympathy from other Fox affiliates.
Last month, CBS pulled its affiliation from LIN Media’s WISH Indianapolis amid a dispute over reverse compensation and found a willing alternative affiliate — Tribune’s WTTV.
CBS’s move in Indianapolis was widely viewed as a warning shot across the bow not only of LIN, but of all its affiliates. CBS let it be known that LIN lost the affiliates because it refused to meet CBS’s demands for reverse compensation.