Nexstar Jumps To No. 3 In Annual Ranking

TV’s Top 30 Group Owners

Reflecting on this year’ big moves, Mark Fratrik, BIA/Kelsey SVP and chief economist, identifies one trend among the Top 30’s makeup. “There used to be a lot more medium-size groups. Because of the economics of local television and the competitive nature of the wider media marketplace, we are seeing some consolidation — not with the largest ones —but a lot of the medium ones are being combined” as evidenced in Nexstar-Media General and Gray-Schurz.

“Much as we saw the consolidation in 2013 caused by the economics of the marketplace, Fratrik continues: “I think the most recent combinations are also being driven by the economics of it — and what I mean is the retransmission consent aspect, the efficiencies of having multiple outlets and all those synergies involved in that.

“Local television is competitive, it’s in decent shape — obviously it’s an even-numbered year [with political ad revenue] — but I think this marketplace is finding a new equilibrium of some sort.”

Looking ahead to next year, Fratrik doesn’t see “much if anything [in terms of M&A] happening until the [FCC’s incentive] auction is over.” The FCC “isn’t ready to grant new licenses; they’re still dealing with Nexstar-Media General,” he points out.

“I believe the auction will end sometime in October, November so there may be a flurry of acquisitions afterwards in the last month, but my suspicion is it will be relatively quiet next year because of that.”

“It will be interesting to see how the various markets evolve after the auction. There are going to be hundreds fewer television stations on the air — a lot will be Class As, but there will be some full-power television stations that are no longer on the air. But fewer stations may make the remaining ones a little healthier.

“So there may be situations where an acquisition maybe didn’t look so attractive prior to the auction, but now because of fewer competitors it may make it more worthwhile.”

Another factor Fratrik sees on the horizon is the proposed next-generation TV transmission standard ATSC 3.0.

“I think it is really a significant advancement, both in the quality and what it offers local television broadcasters. And if that develops as the proponents hope it will this year — with the FCC adopting it — there may be some renewed interest in acquisitions because they may be more avenues for revenue.”

BIA/Kelsey, an investment and research firm based in Chantilly, Va., tracks station group ownership and uses information from individual stations and markets, in addition to historical data, to generate its station and market ad revenue estimates. It checks its estimates against whatever public information is available.

BIA/Kelsey ranks Cunningham Broadcasting and stations owned by Stephen Mumblow as distinct groups with distinct ownership. But because they function essentially as subsidiaries — duopoly partners — of Sinclair, TVNewsCheck lumps their revenues together with Sinclair’s.

The same holds true for Raycom, which includes the revenue of American Spirit; Tribune, which includes the revenue of Dreamcatcher Broadcasting; and Nexstar, which includes the revenue of Mission Broadcasting.