NEW YORK — Despite the number of available stations dwindling as the industry continues to consolidate, a panel of top broadcast executives at the NAB Show New York said there is still room for more deals.
Nexstar Media Group, which completed its $7.2 billion purchase of Tribune Media in September — making it the largest group in the country with nearly 200 stations — sees some opportunities to add scale. Chairman, president and CEO Perry Sook said M&A prospects are limited by federal ownership regulations, but added that other station groups are expected to seek additional scale.
Sook noted that the available pool of stations is shrinking: In 2001 there were 36 companies in local TV that had a national reach of 2% or greater. Now that has dwindled to about a dozen companies.
“I don’t know what’s on the horizon, but I predict there will be M&A,” Sook said.
Meredith Local Media Group president Patrick McCreery said he expects outside money, particularly from private-equity groups, will continue to flow into the sector, beefing up M&A opportunities.
Panelists seemed to take exception to analysts that have predicted that one of the more consistent growth engines in the business — retransmission consent revenue — is on the decline.
Sook said that he still sees double-digit percentage growth on the retrans front, with McCreery and Gray TV president and co-CEO Patrick LaPlatney in agreement.
Driving that optimism is the belief broadcasters account for about 35% of TV viewership while capturing just 18% of the revenue. And though achieving total parity — which Wolfe Research analyst Marci Ryvicker has predicted would mean a consumer’s retrans bill would rise to $28 per month — isn’t necessarily in the cards, the panelists believe there is room to get closer.
“The numbers are rough, but we think there is some runway there,” LaPlatney said.
