Less than a year after first announcing the deal, Nexstar Media Group said it has completed its $7.2 billion purchase of Tribune Media, creating the largest TV station group in the country, with 197 owned and operated properties in 115 markets covering 39% of U.S. television homes.

Nexstar and Tribune first announced the merger in December 2018. Also as part of the transaction, Nexstar gets Tribune’s 31% stake in the Food Network and its full ownership of WGN America.

The closing comes days after the merger received approval from the Federal Communications Commission. 

“The completion of our accretive acquisition of Tribune Media increases Nexstar’s geographic diversity and audience reach with national coverage and an expanded presence in top 50 DMAs, while offering complementary media assets and investments, scale driven synergies and further cash flow diversification,” Nexstar CEO Perry Sook said in a press release. “Nexstar Media Group is now the nation’s leading creator and distributor of local news, entertainment, sports, lifestyle and network programming through its broadcast and digital media platforms.”

Nexstar also announced that it will take three top Tribune executives into the fold, effective immediately: Sean Compton has been named EVP of WGN America, WGN Radio and director of content acquisition; Dana Zimmer was tapped as EVP and chief distribution and strategy officer and Gary Weitman has been named EVP and chief communications officer.

“Today, the Nexstar team is comprised of more than 13,000 talented team members across America united by a common vision focused on localism, innovation and growth as well as a passion for professional excellence,” Sook said in the press release. “Sean, Dana and Gary are recognized leaders in their respective fields and we welcome them to the Nexstar senior management team.

BofA Merrill Lynch acted as financial adviser and Kirkland & Ellis LLP and Wiley Rein LLP acted as legal counsel to Nexstar in connection with the transaction. Moelis & Company and Guggenheim Securities acted as financial advisors to Tribune Media and Debevoise & Plimpton LLP and Covington & Burling LLP acted as its legal counsel. 

As part of the deal, Nexstar spun 11 stations off to Tegna, which also announced Thursday it had closed on that purchase.

The $740 million deal ups Tegna's portfolio to 62 TV stations in 51 markets.

Dismiss, deny and reject. That was Nexstar and Tribune's advice to the FCC related to the various parties that petitioned the FCC to block their merger as not in the public interest.

They were responding to petitions to deny filed by Common Cause, Public Knowledge, United Church of Christ, Sports Fans Coalition, Frontier Communications, and Dish, and concerns raised by NCTA—The Internet & Television Association and the American Television Alliance, both of which said that without various conditions the deal should be denied.

In their response to the petitions and those other critics, the broadcasters said those parties allege remote, speculative, conjectural, or hypothetical risks of conduct the company "might" engage in.

They told the FCC that those petitions were defective because none had presented specific facts or allegations to warrant a finding that the deal was not in the public interest or identified a single FCC rule the deal would be breaking or "a single direct, non-speculative injury they would suffer."

Related: Tribune Media Shareholders Approve Nexstar Deal

That, said Nexstar/Tribune, meant they lacked standing to seek the merger's denial.

"At bottom, the Petitioners’ assertion that Applicants have failed to satisfy a general 'public interest' test that they claim the Commission has applied in some transactions is an effort to distract from their own inability to present specific allegations of fact sufficient to make a prima facie case against the Applications," they said. "Moreover, and as demonstrated below, their remaining arguments boil down to a desire for more stringent regulation [of local ownership, of retrans negotiations, and more] that is more appropriately addressed by rulemaking than in this adjudicatory proceeding."

Related: ACA Says Without Conditions, Nexstar-Tribune Should Not Be Approved

Nextsar and Tribune pointed to the stations they were spinning off to comply with the FCC's rules, and their "fulsome and persuasive showing" that the merger would permit the delivery "of enhanced local service" and would "improve competition."

They say the petitioners are evaluating the transaction according to rules that don't exist or are not in effect, suggesting the deal be conditioned on requirements "of their own making."

The broadcasters point out that the FCC has a history of not trying to regulate the industry generally through deal conditions that "end-run the rulemaking process."

Despite an extension that pushed the expiration of their retransmission consent deal to Jan. 2 at 5 p.m., Charter Communications and Tribune Media failed to reach a retransmission consent deal Wednesday.

About 33 Tribune stations in 24 Charter markets, including New York (WPIX) and Los Angeles (KTLA), went dark at 5 p.m. Wednesday. Tribune’s original retrans deal was set to expire at 12:01 a.m. Jan. 1, but the parties agreed to extend that deal to Jan. 2 at 5 p.m. while they continued to negotiate. The extra time, however, did not prove fruitful.

In a statement, Charter said it was “unfortunate” that it could not reach an agreement with Tribune, adding that the broadcaster is demanding an increase of more than double the rate it is currently paying for the same programming.

“That is more than we pay any other broadcaster,” Charter said in a statement. “They’re not being reasonable.”

According to Tribune, the blackout will affect about 6 million Charter customers across the country, and comes around the time of some major sporting events -- the NFL playoffs begin Saturday, Jan. 5 with the Wildcard Weekend, pitting the Indianapolis Colts against the Houston Texans at 4:35 p.m. on ESPN/ABC and the Seattle Seahawks vs. the Dallas Cowboys at 8:15 p.m. on Fox. The WGNA America cable channel also is off.

Charter has suggested customers can watch the NFL games for free on the NFL and Yahoo Sports mobile apps. Broadcast streaming app Locast also is available on Roku and online in Dallas, Denver, Houston and New York. Charter added that customers can find additional information at GetTheFactsaboutTribune.com and TribuneFairDeal.com.

“We’re extremely disappointed that we do not have an agreement on the renewal of our contract with Spectrum,” said Tribune Media’s senior vice president for corporate relations Gary Weitman in a statement. “The NFL playoffs are in jeopardy—beginning this weekend with critical games in some key markets like Indianapolis and Seattle. We don’t want Spectrum subscribers to miss these games.”

“We’ve offered Spectrum fair market rates for our top-rated local news, live sports and high-quality entertainment programming, and similarly fair rates for our cable network, WGN America,” Weitman continued. “Spectrum has refused our offer and failed to negotiate in a meaningful fashion.”

WASHINGTON — Sinclair Broadcast Group’s troubles may not be over at the Federal Communications Commission, despite efforts to drop its Tribune Media deal and move on.

By most accounts — including the one detailed in Tribune’s $1 billion breach-of-contract lawsuit — Sinclair’s hard line stand on leveraging FCC deregulation to hold onto as many stations as it could, created ripples of annoyance and outrage, including at the FCC and the Justice Department.

As its $3.9 billion deal to buy Tribune’s 42 stations was under review, Sinclair recrafted the terms to try to satisfy Justice’s concerns about market concentration, but it was also trying to capitalize on ownership deregulation at the FCC while retaining relationships with ostensibly spun off stations, a move Tribune said unreasonably complicated a deal that should have, and could have, been done.

Issues of character and candor could continue to be investigated, either by an FCC judge or a bureau. That would be OK with cable operators, who have long criticized Sinclair’s retransmission-consent negotiating tactics and the power that stems from its portfolio of 173 stations.

At press time, the office of the FCC’s administrative law judge, Richard Sippel, had not returned calls for comment on what he plans to do about the Sinclair-Tribune hearing he has been charged with conducting. His decision could have a major impact on Sinclair’s expansion ambitions.

Sinclair withdrew the Tribune deal and wants the hearing terminated, but it is up to Sippel to pull the plug, a spokesperson for FCC chairman Ajit Pai told Multichannel News. The FCC voted unanimously to refer allegations of Sinclair’s lack of candor and misrepresentation to the ALJ, issues involving how the deal was presented that don’t go away just because the license transfers were withdrawn.

The commission unanimously directed the ALJ to resolve four questions. Though three were mooted by the deal’s withdrawal, the fourth — and the first the FCC cited in its hearing designation order — was “whether, in light of the issues presented above, Sinclair was the real party-in-interest to the WGN-TV, KDAF and KIAH applications, and, if so, whether Sinclair engaged in misrepresentation and/or lack of candor in its applications with the Commission.” Sinclair said it did not misrepresent the deal for Tribune’s Chicago, Dallas and Houston stations, or their potential buyers.

Settling the issue of whether Sinclair represented “sham” transactions as genuine ones, one way or the other, could serve to speed any challenges to Sinclair’s existing licenses on fitness grounds by critics of the company who want to use candor issues. One former top FCC official said Sippel is expected to terminate the hearing, but the FCC’s Media Bureau could, and likely would, still launch its own investigation of the allegations. The FCC takes character issues very seriously, he said.

One party that could benefit from the ALJ hearing, if it goes against Sinclair, is Tribune in its breach-of-contract suit. While Tribune will be making its case for misrepresentation in court, that would be made a lot easier by an ALJ decision doing the spadework for it.

The early consensus after Tribune Media terminated its $3.9 billion merger with Sinclair Broadcast Group is probably what most would have expected – most industry groups are happy that the deal, which would have created a powerful and conservative voice in American Broadcasting, is officially dead.

That the deal, which early on in the process was expected to cruise through the approval process – President Donald Trump himself was a big cheerleader for the merger – ended up on the cutting room floor is a bit of a surprise. But anyone who has been keeping a n eye on recent developments could probably see the handwriting on the wall.

“The decision by Tribune not renew its merger transaction with Sinclair ends a merger that posed serious risks for diverse and balanced news in America’s heartland,” said NewsMax CEO Christopher Ruddy in a statement. “When NewsMax began its opposition to this merger, we were told it was virtually ‘guaranteed’ and could not be stopped. I like taking on hopeless causes, especially when I believe the facts and good sense argue for such a cause. Tribune’s statement today withdrawing from the merger confirms what NewsMax and others have been saying: Sinclair had failed to respect the regulatory review process and the rule of law, as it relates to market concentration and media ownership.”

President Trump has been a big fan of Sinclair during his term in office, defending the company’s conservative stance in contrast to what he calls liberal-slanting “fake news.” 

When FCC chair Ajit Pai and the DOJ expressed some concerns last month with the merger, Trump tweeted that while liberal media outlets have been allowed to get bigger, that wasn’t the case for conservative voices like Sinclair’s.

[embed]https://twitter.com/realDonaldTrump/status/1021917767467982854[/embed]

The cable industry has been against the deal since its inception, claiming that the combined company would exert tremendous power on the retransmission consent front, with more than 200 stations covering more than 70% of U.S. television households. But most operators, who maybe are keeping in mind that they will still have retrans negotiations with Sinclair in the future, decided to keep quiet on the deal’s failure.

America Cable Association CEO Matt Polka, who has been cable’s voice against the merger since the beginning, said the

“Tribune's decision to pull the plug on the Sinclair merger is great news for consumers who will avoid paying the higher pay-TV rates the deal would have caused," Polka said in a statement. "It is especially great news for those consumers served by smaller video providers that have been victimized in the past by outrageous retransmission consent fee hikes and scurrilous signal blackouts by large corporate broadcasters.

Polka also took to Twitter to express some surprise at Tribune’s decision to sue Sinclair over the deal, tweeting that the suit was “incredibly ironic.”

[embed]https://twitter.com/MATTatACA/status/1027525470982758400[/embed]

At the American Civil Liberties Union, which came out early against the merger, the credit was given to individual citizens who came out in numbers to oppose the deal.

“The Sinclair deal would have trampled on First Amendment principles, crippled the future of journalism, and disproportionately harmed communities of color,” The ACLU said in a statement. “But thousands of activists raised their voices — and it worked.”

[embed]https://twitter.com/ACLU/status/1027555551297847300[/embed]

Legislators also came out to support Tribune’s decision.

Sen. Tom Udall (D-NM) tweeted that the termination is good news for consumers that depend on reliable news sources.

“The termination of the Sinclair-Tribune merger is good news for people who depend on reliable local news to stay informed. Proud to have worked with @SenatorCantwell & countless Americans who spoke up & helped stop this unprecedented corporate consolidation of local broadcasting.”

[embed]https://twitter.com/SenatorTomUdall/status/1027569469739200513[/embed]

For Sen. Richard Blumenthal (D-Conn.), reaction was short and sweet.

[embed]https://twitter.com/SenBlumenthal/status/1027604674881277952[/embed]

Sinclair is changing the name of its NewsChannel 8 regional cable news network to WJLA 24/7 News.

Sinclair bought the news channel when it bought the Allbritton stations, including WJLA Washington, back in 2014, a deal that went a little smoother than Sinclair's current effort to add the Tribune stations and their cable outlets to the company fold.

NewsChannel 8 has long shared the TV station's news resources, including reporter and anchor teams, so now the branding will match up with that reality, as well as spotlighting the TV station's news resources at a time when Sinclair has been pointing out that commitment to Washington.

"[T]he new name is a logical brand evolution for the nearly 30-year-old Washington-area cable news institution," the station said in announcing the change.

That change is effective Tuesday, July 24, four years to the day from when the FCC approved Sinclair's purchase of the station and cable news outlet.

The Coalition to Save Local Media, a group trying to block the Sinclair-Tribune merger, has added six new members, according to organizers, including a big union and leased access advocates.

The new members are the United Church of Christ (UCC), NABET-CWA (representing some 10,000 broadcast employees), the Parents Television Council, Asian Americans Advancing Justice, Herndon-Reston Indivisible, and the Leased Access Programmers Association.

"The proposed Sinclair-Tribune merger would result in job cuts at dozens of stations across the country and would harm the ability of local stations to broadcast information vital to their communities in a responsible and unbiased manner," said NABET-CWA president Charlie Braico. "This merger is not in the interest of broadcast industry employees and is not in the interest of the American people."

Related: Tech Companies Ask Feds to Hit 'Delete" on Sinclair-Tribune

"The broad swath of organizations opposing this new proposed Sinclair merger demonstrates that people do not need to agree on policy to agree that a vibrantly competitive local media market place is essential for our society," said Cheryl Leanza, policy advisor to UCC

The Coalition to Save Local Media, whose founding members include the American Cable Association and Dish, has opened various fronts against the deal, including drumming up congressional opponents, calling on state attorneys general to weigh in against the deal, launching a national ad campaign and issuing periodic e-mail updates on the national opinion shows and commentary Sinclair stations are required to air.

Related: Four States' AGs Ask FCC to Deny Sinclair-Tribune Merger

Reps. David Price (D-N.C.) and Jared Huffman (D-Calif.) had been scheduled to join other members of the coalition, which includes cable and satellite operators worried about the retrans muscle of a combined Sinclair-Tribune, on Capitol Hill Tuesday (Nov. 7) to criticize the merger, which the coalition maintains jeopardizes localism, competition and viewpoint diversity, but the event was postponed "due to rain," according to the coalition.

Sinclair has said it needs to heavy up to compete with other, larger program distributors -- like cable and satellite and the Internet -- with less, or no, comparable regulatory constraints.

The FCC is on day 108 of its informal 180-day shot clock on merger reviews, having restarted that clock last week after pausing it to collect more comment on Sinclair's defense and explanation of the deal, including from NCTA-The Internet & Television Association, which did not give that defense good reviews.

NCTA-The Internet & Television Association, has told the FCC that Sinclair's response to the commission's request for more information on how it would comply with its rules in the Tribune merger was insufficient and that without that added info the deal must be denied.

That came in comments to the FCC filed Nov. 2.

"Unless and until Sinclair presents a definitive plan for complying with the rules and the public has had an adequate opportunity to review and comment on that plan," NCTA said, "the Commission cannot approve this transaction and should immediately cease conducting its review."

Sinclair suggested to analysts in an earnings call this week that it may do some station swaps rather than divestitures in some markets, and that it was premature to talk about divesting any stations.

NCTA said the FCC can't properly vet the deal until Sinclair says exactly how it will comply with the existing rules, not as they might be modified in the proposed media ownership deregulation item, though that deregulation is expected to be voted on and approved at the FCC's Nov. 16 meeting.

"Sinclair should be required to show that it will comply with existing ownership rules without surreptitiously divesting stations to sidecars that they manage and control in all respects except on paper, or by carrying multiple “top four” affiliate signals on the same broadcast station as multicast signals," NCTA said.

If the FCC does approve the ownership rule changes, which would allow for smaller market duopolies and, at least potentially, owning two of the top four-rated stations in a market, and Sinclair amends the application to reflect that, NCTA also says that is the kind of substantial change that should prompt the FCC to re-notice the application, seek comment, and start a new shot clock. "Anything less would be a violation of the Administrative Procedures Act and the Commission’s public interest standard," NCTA said.

In in earlier comments, the FCC said Sinclair needed to provide more details, something the FCC also asked for.

The FCC's informal clock on the deal is at day 104, having restarted Nov. 2 after the commission paused it to give commenters, like NCTA, a chance to weigh in on Sinclair's response to the request for those details.

Attorneys general from four states have teamed up to ask the FCC to block the merger of Sinclair and Tribune.

The states are Illinois, Maryland, Massachusetts and Rhode Island. The joint filing comes at the same time the Coalition to Save Local Media was urging all the state AGs to weigh in against the deal.

Related: Sinclair Foes Try to Enlist AGs in Pushback

The AGs' principal beef appears to be the size of the deal, which would create the largest TV station group in the country reaching more than 70% of the national audience.

Saying they are the chief consumer protection officers in their states, the AGs argued that the deal "fails to further the public interest by allowing for increased consolidation that will decrease consumer choices and voices in the marketplace."

Because the deal will reduce consumer choices and threatens the "diversity of voices," they said, the FCC should block it, or at the least postpone a decision until the U.S. Court of Appeals rules on Free Press's legal challenge to the FCC's reinstatement of the UHF discount.

The AGs say they are looking out for consumers and that the deal will exacerbate problems they already see through thousands of complaints about video, internet and telecommunications services, including allegations of high prices and poor service.

Under FCC chair Ajit Pai, the FCC reversed a decision by the previous Democratic majority and reinstated the discount, which allows Sinclair or any other broadcaster to count only half of the audience of its UHF TV stations toward the 39% national audience reach cap.

Pai, who has suggested the discount may indeed by outdated -- it dates from analog days, when UHF signals were weaker than VHF -- has said it needs to be considered in concert with the 39% cap, which is why he says it was restored. Critics say it was to pave the way for the Sinclair deal, but Pai has consistently indicated broadcasters need fewer ownership restrictions in a digital world of rampant video competition from online, cable, satellite and telcos.

The four AGs clearly disagreed.

"To ensure that consumers have access to a variety of content, services and stations, the commission should reject this order or, at a minimum, allow the D.C. Circuit to conclude its review...before considering the proposed application."

Initial briefs in that case were filed in September.

The FCC has actually been considering the application for 104 days now. It stopped its informal 180-day review shot clock two weeks ago to allow for further comment, with the new deadline Nov. 2, the date of the AG's filing.

The Coalition to Save Local Media, which could as easily be called the "Coalition to Block the Sinclair-Tribune Merger," said it will be sending letters to attorneys general in every state that has a Sinclair or Tribune TV station, asking them to probe the deal.

The merger would result in the largest broadcast TV group at over 200 stations reaching over 70% of the country.

In the letter to California AG Xavier Becerra, for example (an example the coalition highlighted), the group said: "If the proposed merger goes through, Sinclair would own 14 stations across nine markets including acquiring new stations in Los Angeles, San Diego and Sacramento. In Reno, Eureka, and Chico, the combined company would own more than one 'Big Four' station."

FCC rules prevent owning two of the Big Four affiliates in any market but FCC chair Ajit Pai has proposed allowing it on a case-by-case basis, and in any event the coalition cites a Sinclair executive saying the company did not expect to have to sell any stations.

Related: FCC Takes Wraps Off Media Ownership Proposal

"There are very serious issues surrounding the competitive effects of the Sinclair-Tribune transaction, and we urge the state of California to join DOJ’s investigation into the merger," the letter said. 

The coalition's members include cable and satellite operators and programmers that don't want Sinclair's retrans muscle to get any stronger or its footprint any larger, plus those who criticize the conservative bent of its national programming offerings and commentary, or oppose more media consolidation in general.

The other states getting their own versions of the letter are Alabama, Arkansas, Colorado, Connecticut, District of Columbia, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Washington, Tennessee, Virginia, West Virginia and Wisconsin.

FCC chair Ajit Pai says there has been no inappropriate coordination between the Donald Trump White House, Sinclair and the FCC over the Sinclair-Tribune merger, and that there has been no pattern of preferential treatment shown Sinclair in a deal whose vetting has been by the book and on a timetable common to such transactions, including under other regimes.

That came in a Sept. 15 letter in response to the House Energy & Commerce Committee Democrat’s own letter last month expressing concern that that was the case.

Pai said his meeting with the President—there have been two of them—were on the order of a job interview in one instance and a second meeting after he had the job, at neither of which was any issue involving Sinclair Broadcast Group discussed.

Related: FCC Seeks More Evidence for Sinclair-Tribune Deal Claims

He did say he had met with Sinclair three times since the November election, but in only one meeting were pending issues discussed and that one was followed by the requisite ex parte notification.

Pai also said two members of his staff had met with Sinclair execs as well, with an ex parte filed for the one meeting for which it was required.

Citing various news stories about rule changes, White House meetings, and more that the legislators suggest add up to big questions about whether the independent agency has been truly independent, the Democrats, led by House Energy & Commerce Committee ranking member Frank Pallone (D-N.J.), had suggested that the chairman had expedited the review of the Sinclair-Tribune merger to allow Sinclair to grow quickly, despite calls for extension of time and for Sinclair to provide more information to quantify or validate its public interest claims for the deal.

They also pointed to the FCC's approval of Sinclair's purchase of Bonten stations shortly after revoking a 2014 Media Bureau guidance on the FCC's close scrutiny of deals involving sharing agreements.

As to the timeline for the deal review, Pai said the FCC established the same comment period as for other significant TV station mergers, including the $4.6 billion merger of Nexstar and Media General approved under his Democratic predecessor, Tom Wheeler.

Related: Wheeler Says FCC Bent Rules to Help Sinclair

He called the pleading cycle consistent with precedent and not expedited. He also said that, in regard to the suggestion that his restoration of the UHF discount was an effort to facilitate the deal, no one at Sinclair or Tribune or their representatives informed him of a possible deal before the vote to reinstate the discount. He also pointed out that the Media Bureau on Sept. 14 had sought further information on the deal. he did not mention, though he could have, that the request was essentially to provide that hard evidence of public interest benefits that critics, including Pallone, said was lacking.

Sinclair's response isn't due until Oct. 5, after which the public will have an opportunity to comment on that information. The Sinclair deal was filed in June.

NCTA-The Internet & Television Association, has stopped short of seeking outright denial of the Sinclair-Tribune merger, but it has major problems with it and suggests the FCC should consider disallowing new duopolies, even where they don't violate rules, and joint retrans negotiations among commonly owned Sinclair-Tribune stations.

That came in its response this week to Sinclair's lengthy defense of the public interest benefits filed with the FCC Aug. 22.

NCTA says the FCC should, at a minimum, review the deal under current media ownership limits, not hoped-for changes to the rules, and "consider" conditions based on "past conduct and unprecedented size.

NCTA said the deal would create a broadcast colossus with "exceptional leverage in business dealings with multichannel video programming distributors."

One potential sore spot with MPVDs could be the after-acquired clauses that would allow Sinclair to boost the retrans payments to Tribune stations to the level of Sinclair stations, which would mean MVPDs ponying up more for stations they already argue are inflating their prices.

The FCC is currently considering petitions to deny the $3.9 billion deal, which would give Sinclair over 200 stations and over 70% national audience reach. Sinclair says that scale will help it compete against large and largely les regulated MVPDs and over-the-top providers.

But NCTA says that size requires regulatory "guardrails" to protect consumers and competition, and not just the FCC-required divestitures to square with current ownership rules.

Among those guardrails would be: "(1) Extend the ban on joint retrans negotiations [among noncommonly owned TV stations in a market] to the commonly owned Sinclair-Tribune stations, or, alternately, force it to divest where the deal would create a new duopoly [not just where that duopoly would violate the current duopoly rules]; (2) prevent Sinclair-Tribune from negotiating retrans on behalf of multiple stations in a DMA; (3) require Sinclair to give up a top-four network affiliation where it currently carries a second network on a multicast stream; (4) extend the FCC's consent decree with Sinclair another seven years and apply it to the combined company.

In July 2016, Sinclair agreed to pay almost $10 million to settle FCC investigations into whether it violated prohibitions on coordinated retransmission consent negotiations. The FCC said that nothing in the record raised substantial questions about Sinclair's basic qualifications to be a licensee and the company did not admit to any liability.

NCTA said the FCC's public interest standard requires it to look at the deal's upstream and downstream impacts -- on programmers and MVPDs -- and consider merger-specific (italics NCTA's, since they have long argued against non-merger-specific conditions in deals).

Sinclair has promised to abide by the FCC rules, but NCTA wants the FCC to make it clear that there be no effort, through waivers or other means, "to exceed the existing ownership rules unless and until the Commission actually changes those rules."

One way NCTA said Sinclair-Tribune could "evade" local duopoly rules is by using the FCC's channel-sharing rules under the incentive auction repack order to let its low-power TV's--more than 25-- in markets where it also owns a full-power to share spectrum and thus boost their reach to that of the full-power. LPTVs don't count towards duopoly restrictions.

NCTA also wants Sinclair to have to refile an amended application for the transfer of licenses if the FCC changes the ownership rules, which would mean a new comment period and restarting the FCC's 180-day shot clock on the deal vetting (currently the clock is on day 56).

A new breed of TV distributors that’s wreaking havoc in the industry is now on its way to upending the retransmission-consent business model for both pay TV distributors and TV station groups.

Over-the-top subscription services such as Sony’s PlayStation Vue, Dish Network’s Sling TV and a planned offering from Hulu — known as virtual multichannel video programming distributors — aren’t just disrupting the way Americans consume content.

These new players are also forcing new business models on time-honored carriage negotiations between TV distributors that want to carry broadcast networks and those networks’ broadcast-station affiliates.

Virtual MVPDs are one of the hottest segments in distribution. As younger viewers continue to devote more time to watching content on mobile devices and online, they could become a force in the distribution sector, especially as the traditional pay TV universe declines.

Overall, pay TV subscriptions have dipped between 1.5% and 2% per year over the past two years. Although cable is expected to continue to improve its losses, ongoing subscriber losses at satellite TV and telco TV could push the annual declines higher in the future.

Those subscribers are going to have to go somewhere. And though many may cut the cord all together, opting for a broadband connection and a Netflix, Hulu Plus or Amazon Prime subscription, a good portion could go to vMVPDs.

That could create a sense of urgency for the station groups; 3 million vMVPD subscribers in 2017 could quickly escalate under the right market conditions, morphing into a serious source of revenue.

As vMVPDs are launched, they are hammering out new deals with broadcasters, but with a catch — the deals are on a national basis, unlike the market-by-market negotiations of the past.

Traditionally, broadcast networks took a laissez faire attitude toward retransmission consent. They negotiated deals with the distributors for only their owned-and-operated stations, leaving affiliate station groups to negotiate their own, separate deals.

But with vMVPDs, the strategy has been different. Networks have been striking their own, broad deals with OTT distributors, offering owned-and-operated stations in their local markets and next-day national network feeds in areas where they don’t own affiliate stations.

The idea is to bring the independent station groups on later, with those broadcasters receiving a percentage of the fee the network has negotiated. For example, if a network negotiated a fee of $3 per subscriber per month for its O&O stations and an additional $3 for its network feed, it would offer a percentage of that latter fee to station groups for its network affiliate stations. The share varies by market size, according to sources in the broadcast community.

For station groups, that could mean a substantially smaller piece of the pie. According to some cable executives, retrans fees for local stations from the likes of Sinclair Broadcast Group, Nexstar Broadcasting Group and Tribune Media could top $2 per subscriber per month. And some are holding out for more, to the chagrin of some broadcasters, who warn that if the station groups overplay their hands, they could end up with nothing.

From the station perspective, accepting the lower fee could mean they would have to squeeze even more money out of their existing retransmission- consent base — the cable, satellite and telco TV operators who are already complaining they are paying too much.

Revenue from retransmission consent, a product of the 1992 Cable Act, has been the savior of some broadcasters, taking up the slack during a depressed advertising market and in some cases representing more than 30% of a station’s total revenue.

At the same time, it has been the bane of cable, satellite and telco TV operators who have complained they are paying increasingly higher fees for content that is available over the air for free.

Regardless of the partisan claims, retransmission consent is a large part of the TV business, expected to top $7.7 billion in 2016 and growing to $11.6 billion in 2022, according to research firm SNL Kagan.

According to Kagan, more than half of that revenue is from local broadcast groups like Sinclair and Nexstar, which made up about $4.6 billion of the $7.7 billion generated in 2016. In contrast, owned and operated network stations accounted for about $2.9 billion of the estimated 2016 retrans haul.

Virtual MVPDs are new to the TV scene — Sling TV, the oldest, launched in 2015 — and still have relatively few subscribers. Sling TV leads the pack with about 900,000 customers, and the segment as a whole is expected to have between 2.5 million and 3 million subscribers by the end of 2017, according to Morgan Stanley media analyst Ben Swinburne.

Of the major vMVPDs, so far only Sony PlayStation Vue has a deal with local station groups, specifically Sinclair and Raycom Media for certain CBS affiliates. The other major vMVPDs — Sling TV, DirecTV Now and Hulu — have deals with national broadcast networks, but no station groups yet.

Not all of the national broadcasters have signed on, either. Hulu, which plans to launch its vMVPD service later this year, signed a carriage deal with CBS earlier this month, and has agreements with ABC and Fox, but not with NBC. NBC, a partner in the Hulu consortium, is expected to sign on at some point.

CBS, which has its own OTT service CBS All Access, a tough negotiator in vMVPD deals, still hasn’t reached a pact with the largest vMVPD, Sling TV.

NICHE NETS AT ISSUE

Adding to the confusion, some station groups want carriage of niche cable networks — such as Sinclair’s Tennis Channel and Tribune’s WGN America — to be included in their deals. That’s caused some bumps in more traditional negotiations: Tribune’s stations went dark to Dish Network subscribers last year, in part because Tribune insisted on including carriage of WGN America in the negotiations.

While the parties eventually worked out a deal that included carriage of the stations and the cable channel, the networks were dark to Dish’s 13.6 million customers for nearly three months between June 13 and Sept. 3. Other spats are expected as Sinclair, one of the more aggressive broadcasters on the retrans front, begins to bundle Tennis Channel, purchased in March of 2016, into future negotiations.

According to sources familiar with their thinking, broadcasters believe including the cable networks adds unnecessary friction to vMVPD negotiations. They prefer the deals to remain pure broadcast plays.

All this makes for a sticky situation for station groups, which rely on the networks for primetime content but have seen their revenue dwindle as the advertising market has declined and networks — through reverse compensation — are taking a large chunk of their retrans fees.

At least publicly, the stations have said they are trying to work out deals with new distributors as they come up.

At Tribune, that includes carriage on devices like Roku, Amazon Fire TV, Apple TV and Google’s Android TV. Three of its stations — The CW affiliate WPIX in New York and Fox affiliates KTSU in Salt Lake City and WGHP in Greensboro, N.C. — launched on those services in December. Tribune’s remaining 39 stations are expected to roll out in 2017.

“Our strategy is to get our live linear content carried on new distribution platforms in an economically sensible and sustainable way,” Tribune Media senior vice president of corporate relations Gary Weitman said in a statement. “We’re deep in discussions with all the major players and we are confident that we will make good progress on this front in 2017 … As everyone knows, solving the Rubik’s Cube of OTT requires coordination and negotiation with both OTT providers and our network partners. It’s a complicated situation, but we believe that the interests of consumers in having more ways to access the content they want will ultimately win out and that economic benefits will flow to all the parties involved.”

Sinclair and Nexstar representatives did not respond to requests for comment.

BTIG media analyst Rich Greenfield wrote in a note to clients that as more viewers leave linear TV for cheaper vMVPD services, they don’t miss local broadcast channels. If they did, a digital antenna would solve that dilemma.

But the analyst sees a fundamental change in the way vMVPD deals are being negotiated.

“We believe broadcast networks are creating a framework to bring affiliates into each vMVPD on terms set by the network, with the affiliates unable to negotiate directly with the vMVPD themselves,” Greenfield wrote in a recent note to clients. “Essentially, take it or leave it affiliate deals structured by the broadcast network” will “significantly reduce the net payments offered to affiliates.”

The broadcasters see the situation as a natural evolution. According to sources familiar with their thinking, most believe that the current structure is similar to deals struck for video-on-demand and TV Everywhere content. Local affiliates were kept out of those deals to ensure that the scope of programming was consistent.

The absence of station groups from many virtual MVPD deals is largely a matter of convenience, Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said.

‘LIKE HERDING CATS’

“It’s like herding cats to get these local affiliates to agree to deals — very complex and time-consuming,” Wlodarczak said. “It is easier to sign a broad deal and to throw in the O&Os.”

The issue, Wlodarczak said, is that the cable operators will likely pass through most of these costs. “Given that the expense of pay TV is the No. 1 reason people leave, it will exacerbate the media players pay TV subscriber issues. Betting on a slightly cheaper skinny bundle is not going to solve that issue, and it will not be good for less popular networks.”

As far as increased retrans fees for pay TV, Wlodarczak said that anything can happen, but to “expect more fireworks.”

That may be an understatement, given how the last big battle between networks and affiliates was resolved. Affiliates first resisted when networks demanded back in the early 2000s that they turn over up to half of their retrans haul to them in the form of reverse compensation. That was resolved simply by the affiliates stepping up their retrans fees.

Traditional MVPDs have grown used to rising retrans costs and fickle stations who raise the ante for carriage on a whim, but the breaking point could be looming near, especially as skinny bundles and virtual MVPDs proliferate.

“They’re pushing the envelope,” said one cable executive who asked not to be named. “They’re trying to get to a certain number that is not sustainable. And kids don’t care as much about local news.”

Rep. Tony Cárdenas (D-Calif.) was beside himself at the news that Charter and Tribune had come to an agreement that puts the Dodgers back on KTLA TV Los Angeles.

Following the news, the congressman even penned a song in honor of the occasion.

"PLAY BALL! Charter Communications takes a swing at Congressman Tony Cárdenas’ (CA-29) pitch to end Dodgers TV blackout," Cárdenas’ office crowed in a statement pitched to journalists Friday (Sept. 2).

In 2014, Cárdenas and some of his L.A. delegation colleagues wrote Wheeler asking him to mediate the stalemate between TWC and other operators.

Pointing out that the first game back on air will be a Vin Scully Appreciation Day, Cárdenas quipped. “Game on! Man have I missed Vin Scully. “He’s the reason I signed up for the Congressional baseball team again this year and why I will be watching the games that will air on KTLA 5. As a legislator, I do not always get to take a swing at fun topics, but if there is anything I am proud of it is my efforts to end the Dodgers blackout in L.A. This may not be the home run my colleagues and I had been writing to FCC Chairman [Tom] Wheeler about, but it certainly gets us on base."

Then he broke into song, at least remotely, adding that for the next month he would be singing his own rendition of 'Take Me Out to the Ball Game':

Take me out to the ball game,

The Dodgers are finally on.

Buy me a TV that airs the games.

After Vin leaves it will not be the same.

Let’s root, root, root for broadcast negotiations;

If they don’t agree it’s a shame.

For it’s 1! 2! 3!... 4,5,6 games

And we’re back on in L.A!”

Dish customers in 33 markets across the country lost access to 42 Tribune Media stations at 7 p.m. Sunday after the two couldn’t reach a retransmission consent agreement.

Tribune began warning Dish customers of the possibility they could lose the stations on Saturday. In addition, about 7 million Dish customers across the country also lost cable channel WGN America. Dish claimed that Tribune is asking for an exorbitant retrans rate hike and is forcing it to carry the cable network in all of its markets.

Dish has argued WGN America has declined about 20% in the ratings ever since its conversion from a superstation to a cable network in 2014,  and has much of the same programming available on other networks.

“Consumers shouldn’t have to pay twice for the same programming,” said Dish EVP of programming Warren Schlichting in a statement. Dish is offering customers free over the air antennas to capture the Tribune local broadcast stations while negotiations continue.

Tribune countered that WGN America shows like Outsiders and Underground have increased the network’s total prime-time audience by more than 50% since last year and that both shows consistently ranked among the Top 15 scripted cable shows for the 2015-16 TV season.

The Tribune stations involved include ABC, CBS, Fox and NBC affiliates in New Orleans, Indianapolis, San Diego and Oklahoma City as well as stations in Chicago, New York and Los Angeles.  Dish customers in Indianapolis; Richmond, Va.; Memphis and three other markets are missing tonight’s CBS broadcast of the Tony Awards, as subscribers in New Orleans; Scranton/Wilkes Barre, Pa.; and the Quad Cities will miss Game 5 of the NBA Championship Finals on CBS and customers in Des Moines, Ia.; and Oklahoma City won't see Game 6 of the NHL Stanley Cup Finals on NBC.

Tribune has said it offered Dish a 60-day extension while it tried to hammer out a deal, but the satellite TV company declined.

“We want to reach an agreement, just as we have with every one of our other cable, satellite and telco distributors, but Dish refuses to reach an agreement based on fair-market value,” said Tribune Media senior vice president for corporate relations Gary Weitman in a statement.  “We want to keep servicing our local communities and we have repeatedly offered Dish a lengthy extension to continue negotiations—unfortunately, Dish rejected these offers.”

Dish has countered that it offered a short-term extension with a retroactive true-up to the new rates once a deal was reached, but that offer was rejected by Tribune.

Tribune has disputed Dish’s claims that its rates are too high, adding that it is offering the satellite TV service provider the same deal it offers other distributors.

“We’ve offered the same kind of fair market rates that Dish already pays other local station groups with ABC, CBS, NBC and CW affiliates with top-rated local news, and other similarly valued cable networks,” said Weitman in a statement.  “At the same time, we’re willing to accept the same rates for our local stations and WGN America that others are currently paying us.”

Dish said in a statement that the dispute highlights the need for real retransmission consent reform.

“Actions like these are precisely the reason that Congress has mandated, and the FCC has opened, a formal process to investigate tactics like this,” said Dish EVP and general counsel Stanton Dodge in a statement. “We also believe the FCC has the opportunity to investigate remedies like arbitration with interim carriage which could end broadcaster blackouts while preserving the interests of all parties.

Nielsen and Tribune Media Co.'s Tribune Broadcasting said they have reached a long-term renewal agreement for Tribune Broadcasting to subscribe to Nielsen TV ratings for all of its stations in every market.

The new arrangement will provide Tribune Broadcasting with a comprehensive view of how consumers watch TV in the changing media landscape, the companies said. Tribune Broadcasting will be licensed to use Nielsen’s Out of Home (OOH) TV measurement and Return Path Data when introduced, as well as Nielsen’s new Mobile TV Ratings in Local People Meter markets. 

“We are very pleased to have Tribune as a highly engaged, long-term partner,” Matt O’Grady, EVP and managing director for Local Media at Nielsen, said in a release. “We look forward to their continued collaboration as we incorporate key service enhancements such as measuring the out of home audience, capturing viewing on mobile devices, and incorporating Return Path Data from set top boxes into the ratings and calibrating the data using our projectable panels.”

“Expanding our access to more detailed audience research and analytics is extremely important to our company,” Larry Wert, Tribune Media’s president for broadcast media, said in the release. “We use Nielsen data regularly, and we are glad to have them as partners as video viewing habits continue to rapidly evolve.” 

Set-top box measurement company Rentrak said it had reached an agreement with Tribune Broadcasting to furnish its full suite of local market ratings services, including its automotive and political Advanced Demographics, for Tribune stations in 33 markets. Rentrak has been furnishing ratings information to Tribune’s stations in Cleveland and Des Moines since 2012, and renews them as part of this agreement.

“In today’s rapidly changing media landscape, our partnership with Rentrak will provide us with consumer behavior insight from a significant measurement footprint in each market,” said Larry Wert, said Tribune Broadcasting president of broadcast media Larry Wert ina statement. “Rentrak’s data will help our stations make more informed decisions and provide our clients with detailed audience viewing information.”

Tribune Broadcasting is part of Tribune Media and owns and operates 42 television stations in 33 markets across the country, including WPIX in New York, KTLA in Los Angeles and WGN in Chicago.

“We are very excited by our new partnership with Tribune Broadcasting and are eager to work closely with all of their stations in accurately measuring their strong and varied audiences,” said Rentrak’s executive vice president of local television Steve Walsh in a statement.