2013 In Biz, D.C., Programming, New Media

M&A was unquestionably the defining characteristic of the broadcast business in 2013. In fact, 2013 was among the biggest years ever, if not the biggest, for broadcast mergers and acquisitions, with a total of $8 billion in deals done, according to BIA/Kelsey.

Tribune’s $2.725 billion acquisition of 19 Local TV-FoxCo. stations was the single biggest sale.

“M&A is our night job,” Peter Liguori, Tribune president-CEO, said during a conference call with analysts following the deal’s announcement on July 1. “You know what our day job is.”

The FCC is signaling it may move to enforce the 39% ownership cap, which means that Tribune — at just under 44% pending closing of the deal — might get to sleep nights for a while.

Other mega-deals include Gannett’s Belo buy and the Media General-Young merger.

If Tribune gets the Single Biggest Deal award, Sinclair and Nexstar certainly rank No. 1 and 2 for volume of deals.

In the past year, Sinclair announced six deals totaling $2.03 billion and encompassing 56 stations. The single biggest was the $985 million acquisition of Allbritton Communications including the 24-hour cable news operation NewsChannel 8.

The FCC jury is still out on that deal, however, as regulators allege that the sidecar transactions that Sinclair Broadcast Group has proposed in three markets as part of the acquisition — Charleston, S.C., Birmingham, Ala., and Harrisburg, Pa. — would violate agency ownership rules.

Next up on the most-active list: Nexstar Broadcasting Group. Nexstar inked five deals totaling $504.15 million encompassing 34 stations. The biggest of the bunch: The $270 million acquisition of 19 CCA-White Knight stations.

It seems only fitting that the year is ending the way it began — rumors of another deal. Granite Broadcasting has been the subject of sale speculation since its owner, Silver Point Capital, cashed out of CCA. Rumored potential buyers have included Sinclair and Nexstar, to no one’s surprise.

The latest development, reported by Buffalo Business First writer James Fink in mid-December, was that E.W. Scripps representatives were checking out Granite’s ABC affiliate in Buffalo, N.Y., WKBW.

Deals may have dominated the business story hit parade in 2013, but retrans, TV Everywhere and spectrum put in strong showings.

On the retrans front, CBS boss Les Moonves grabbed the limelight, and the headlines, when he didn’t blink despite a month-long shutdown by Time Warner Cable in August.

CBS wasn’t the only broadcaster battling Time Warner — Journal Broadcast pulled stations in four of its markets from the cable operator for nearly two months.

Both Journal and CBS reportedly got what they wanted in the end. In CBS’s case, that was reportedly $2 a sub and full retention of digital rights, a major win in an era when television programming increasingly is migrating to IP distribution.

Indeed, TV Everywhere, the generic term for digitally streaming broadcast television to all screens, including smaller, portable ones, gained momentum in 2013 as Disney/ABC and Fox forged ahead with their initiatives.

NBC Universal and CBS have been slow to jump on the streaming trend but Moonves’ digital rights retention move suggests he’s keeping his options open.

Spectrum speculators continued their push to buy up so-called beachfront property in 2013. While NRJ TV, Michael Dell’s OTA and Locus Point have emerged as the key spectrum speculators, there’s been considerable, um, speculation about who some of the other players might be.

All this assumes that there’s sufficient interest for there to actually be a voluntary incentive auction, something new FCC Chairman Thomas Wheeler is urging.

Now that the FCC has pushed the auction to mid-2015, the agency will have more time to use its bully pulpit to nudge undecided potential sellers off the fence. The delay also means more time for speculators to keep buying up real estate.

WASHINGTON

Despite a major change in FCC leadership during 2013, a plan to use an incentive auction to repurpose broadcast TV spectrum for smartphones and other wireless services remains at the top of the agency’s agenda—even though the auctions themselves have been postponed by a year.

The new agency leader is Tom Wheeler, the former cable TV and wireless industry lobbyist, who officially stepped in as the FCC’s chairman on Nov. 4).

In his first interview with TVNewsCheck, Wheeler, made clear that the incentive auctions were at the very top of his priority list.

In his first official policy speech, the chairman also urged commercial and noncommercial broadcasters alike to cash in existing channels during the upcoming incentive auction — then continue operations through channel-sharing arrangements with other broadcasters. “That to me seems to be a pretty good deal,” Wheeler said.

But early during his new administration, Wheeler also announced that he had postponed the incentive auction by one year — from 2014 to 2015 — after concluding that the agency needed more time to ensure that the auction works out right.

The broadcast industry came out the winner on one major legislative battle last year, after House Communications and Technology Subcommittee Chairman Greg Walden (R-Ore.), announced his opposition to the pay TV industry’s effort to get a quick legislative fix that would gut the retransmission consent rights of broadcasters.

That news followed quickly on the heels of the word that Walden and House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) are planning an ambitious multi-year update of the Communications Act.

Walden’s retransmission consent announcement did not leave broadcasters worry-free, because Wheeler has made clear that he is planning to review the FCC’s retransmission consent options. In addition, in one of his first official actions, Wheeler hired a prominent retrans reform advocate for his personal staff.

Also on the retrans front, the National Cable & Telecommunications Association, which had previously been sidelined on retrans lobbying due to the conflicts of its member companies, announced that it will be raising its lobbying profile on the issue.

In another request from Congress to the FCC, Senate Commerce Committee Chairman John D. (Jay) Rockefeller IV (D-W.Va.) asked Wheeler to take a close look at the use of shared services agreements in proposed sales and mergers of television stations. In particular, Rockefeller wants the FCC to collect the information needed to understand the effect of SSAs on competition and consumers.

The FCC’s Media Bureau soon thereafter alleged that the sidecar transactions that Sinclair Broadcast Group has proposed in three markets as part of its $985-million pending acquisition of Allbritton Communications — Charleston, S.C., Birmingham, Ala., and Harrisburg, Pa.— would violate agency ownership rules.

In an effort to preclude broadcasters from acquiring new virtual duopolies enhancing their negotiating leverage over retransmission consent, pay TV industry representatives have been petitioning to deny TV transactions at the FCC, including several Sinclair deals.

In one of her last moves as the FCC’s acting chair before Wheeler was sworn in, Mignon Clyburn announced in early November that she had circulated a notice of proposed rulemaking to eliminate the commission’s sports blackout rules.

The Clyburn FCC also proposed to eliminate the UHF discount — a long-time loophole in the agency’s national ownership rules that some broadcasters have been relying upon to beef up their station portfolios.

President Barack Obama announced in May that Wheeler would be the FCC’s new chairman — succeeding Julius Genachowski in that post — and that Clyburn would be acting chair, pending Wheeler’s Senate confirmation. But Clyburn wound up with a six-month tour in the agency’s top slot, in part because Sen. Ted Cruz (R-Texas) put a long-time hold on Wheeler’s confirmation.

SYNDICATED PROGRAMMING

2013 is the year of comedian Steve Harvey. His syndicated talk show Steve Harvey from NBCUniversal Domestic Television Distribution has improved on its strong rookie season last year and his game show, Family Feud from Debmar-Mercury, continues to post ratings increases in his fourth season as host.

His Chicago-based talk show, which will have President Barack Obama as a guest on Friday, Dec. 20, is tied this season with Debmar-Mercury’s Wendy Williams at No. 6 among talk shows in women 25-54. (Both shows posted double-digit increases in November.) NBCU this year renewed Steve through 2016.

Among game shows, Feud is tied at No. 2 with Jeopardy from CBS Television Distribution in adults 25-54, trailing only CTD’s Wheel of Fortune. It ranks No. 2 among women 25-54 and No. 1 in key demographics, including adults 18-49, adults 18-34 and women 18-49.

Speaking of good years, Wendy Williams is having one. The show that had languished for a few years is up 25% year-to-year, tied with Harvey among women 25-54. Debmar-Mercury this year renewed Wendy through 2016-17.

Meantime, the biggest mystery of 2013 is whether Disney-ABC will cancel Katie Couric’s modest-rated sophomore talk show Katie. Couric parted ways this year with ABC News for a global anchor job in 2014 at Yahoo. More revealing about Katie’s fate, though, is that some stations have canceled it, despite no official word from Disney-ABC.

As for the year’s two new daytime talk shows, Sony Pictures Television’s Queen Latifah and Warner Bros.’ Bethenny with Bethenny Frankel, neither has set Nielsen ratings on fire. But both shows, and CTD’s and Tribune Broadcasting’s Arsenio in latenight, are expected to return, according to TV station executives.

Judge Judy continues to dominate the court genre at No. 1, well ahead of Warner Bros.’ People’s Court, Twentieth Television’s Judge Alex and its recently renewed Divorce Court, and Warner Brother’s Judge Mathis.

Newcomer Paternity Court from MGM’s Orion Television Productions got off to a slow start but has been perking up.

Off-network sitcoms got a jolt in 2013 with Twentieth Television’s Modern Family becoming the first single-camera-comedy to become a top-rated show in broadcast syndication. In the November sweeps, it ranked No. 2 behind only Warner Bros.’ The Big Bang Theory.

Meantime, new syndicated shows will have a tough time finding open time slots in fall 2014.

Several long-running talk shows were renewed in 2013, including CTD’s Dr. Phil and Rachael Ray. Warner Bros. renewed Ellen and Sony renewed Dr. Oz. NBCU will likely soon renew Trisha, according to sources.

Warner Bros. will continue its gradual rollout of entertainment newsmagazine TMZ Live. Twentieth Television renewed its radio-DJ-hosted newsmagazine Dish Nation. Trifecta Entertainment is expected to soon renew entertainment newsmagazines America Now and OK! TV, according to station executives.

Other time slots in 2014 are earmarked for cleared shows, NBCU’s Meredith Vieira Show and Warner Bros.’ panel talk show The Real, which had a successful test run over the summer.

Among game shows, Debmar-Mercury is building on the success of Feud with Celebrity Name Game, hosted by Craig Ferguson, which is a firm go for 2014. And MGM is handling the national rollout of Scripps’ second-year game show Let’s Ask America that Warner Bros.’ Telepictures produces.

Still, several shows are in development for 2014, including Serch with MC Serch from CTD, which Tribune stations will test in January. Station group E. W. Scripps has a legal panel show with Star Jones.

PPI Distributing is selling Canadian panel talk show The Social; Telco is shopping panel show The Balancing Act; and former Entertainment Tonight co-host John Tesh is selling Intelligence For Your Life, based on his radio show.

In the court genre, CBS Television Distribution is selling panel-judge show Hot Bench from Judge Judy’s Judith Sheindlin; Entertainment Studios is shopping Justice with Judge Mablean for 2014; and Trifecta is selling Judge Faith with New York City prosecutor Faith Jenkins.

BROADCAST NETWORK PROGRAMMING

As the 2012-13 TV season ended in May, CBS was the nation’s most-watched network for the 10^th time in 11 years. CBS’ margin of victory was wider than any other network in 24 years and it won among 18-to-49-year-old viewers, a group coveted by advertisers, for the first time in 21 years. In primetime through May 19, CBS averaged 11.85 million viewers this season. ABC was its closest competitor, at a full 3 million viewers behind. Fox finished third and NBC was fourth.

Now, however, after 12 weeks of the 2013-14 season (through Sunday, Dec. 15, 2013), NBC is in first place among adults 18-49, with a 3.2 rating average, up a tenth from last season. CBS is second with a 2.7, down two tenths from last season. Fox took third with a 2.5, up a tenth from last season, and ABC is in fourth with a 2.4, down a tenth from last season. Univsion is fifth with a 1.2, down three tenths from last season. The CW finished sixth with a 0.9, up a tenth from the previous season.

Among total viewers, CBS is once again ahead for the season, averaging 11.75 million viewers. NBC is second with 9.90 million, followed by ABC with 8.49 million, Fox with 7.31 million, Univision with 3.21 million and CW with 2.07 million.

CBS won its first February sweep since 1998 in the adults 18-49 demo and then decided it wasn’t going to cede the summer audiences to cable. The opening ratings for its sci-fi Under the Dome were spectacular: more than 13.5 million viewers for the premiere, the biggest audience for a summer drama in more than 20 years. It was no surprise then, when less than a month later, CBS renewed Dome for a summer 2014 return.

On the down side for CBS was the news in May that the 2014 and 2015 NCAA men’s basketball tournament games will air on TBS as yet another major sporting event jumps from broadcast to cable.

Over at ABC, it’s new Marvel comic book-based Agents of S.H.I.E.L.D. took off fast and was the first fall 2013 freshman show to get a full-season order after opening as TV’s highest-rated drama debut since 2009.

And ABC had some success with in daytime as well. In April, General Hospital marked its 50^th birthday and the The Chew cooked up its 500^th episode.

In February, ABC’s presentation of the Academy Awards was the most-watched Oscars telecast in three years, with 39.3 million viewers.

NBC took the vital November sweeps, a big improvement from the February version, in which it finished fifth in the 18-49 demo.

The Peacock network said goodbye to The Office in May, with the iconic sitcom closing the doors on the Dunder Mifflin paper company after nine years. It also closed up shop at 30 Rock in February after seven seasons.

NBC said hello to Jimmy Fallon and Lorne Michaels in the spring, when it announced that Fallon would succeed Jay Leno as Tonight Show host under the watchful eye of Michaels as producer, with the show moving back to New York. The network also said hello to NASCAR in July when it won the rights back from ESPN to air Sprint Cup Series and other races in a 10-year deal.

Over at Fox, there was good news both old and new this October. The Simpsons was renewed for a 26^th season and the freshman hit Sleepy Hollow got a fast green light for season two next year.

Fox’s sad news was the death of Glee star Cory Monteith, which the show addressed in a tribute episode.

CBS wasn’t the only network to focus on summer programming. Fox said it would schedule “event series” like those that have performed well on cable. Among the event series in development is a remake of Shogun, an NBC miniseries that aired over five days in 1980.

NEW MEDIA

The threat to broadcasters from online streaming services led by Aereo continued in 2013, with the Barry Diller-backed service that distributes TV stations’ signals via the Internet to paying subscribers expanding to at least 10 cities, the latest being Baltimore, which launched Dec. 16.

Broadcasters continued to claim copyright infringement in the courts and earlier this month, Aereo announced that it would not fight broadcasters’ motion to have the Supreme Court hear their case. Aereo’s founder and CEO Chet Kanojia said he hoped the Supreme Court would decide the case on its merits. The court has not yet decided whether it will hear the networks’ case.

When they weren’t thinking about Aereo, broadcasters were thinking about TV Everywhere and other streaming strategies of their own. All four of the major broadcast networks are beginning to launch streaming stategies that will bring their local and network programming to mobile devices. ABC is pressing its Watch ABC service; CBS launched full-episode streaming apps and is also using Syncbak in New York and Los Angeles; NBC announced that in 2014 its O&Os and affiliates will begin streaming their broadcast signals so they can be received by authenticated cable subscribers on their mobile devices; and Fox unveiled a TV Everywhere plan that will let affiliates stream network content, in addition to their local content, through a dedicated Fox mobile app and on the Web.

And station groups were in the act too. At Gray, consumers who download the mobile Syncbak app to their tablets or smartphones may now watch their local Gray stations’ programming, except for network fare. Belo is preparing its newsrooms to create content for mobile devices.

In September, Nielsen said that in one year, it hopes to add viewership on smartphones and tablets to its national TV ratings.

Many groups and stations put renewed emphasis on the digital side of their businesses in 2013. LIN Media created LIN Digital to encompass its growing digital efforts and acquisitions. Tribune Broadcasting overhauled its digital strategy, rebooting its approach to content, jetisoning superfluous information and scaling down to the bare essentials of largely home-grown news on its home pages.

Progress was slow on the mobile DTV front. But in October, a joint-venture of 12 major broadcast groups across 12 markets announced plans to launch a number of on-air, digital and live interactive events to promote Dyle’s mobile TV service and new Audiovox wireless receiver.

In the world of social media, KABC Los Angeles claimed in September that it has more Facebook “Likes” than any other TV station in the country — over 600,000.

This is Part II of our four-part 2013 Year In Review special report. Read the other parts here.