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Media Companies Are Ready to Sell. Does Anyone Want to Buy?
- Thread starter davideduardo
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If you've been following the Trump trial in NYC, everyone has an opinion about value.
To me one of the most challenging things about selling ABC is their sports rights. Do those rights belong to ESPN or ABC (or both)? Similarly, do The Oscars belong to ABC or Disney? Would Byron Allen be offering $10 billion for a network that doesn’t include sports rights? Who/what would Byron use to stream his ABC network programming? Hulu? Other?
There should be a VHF discount.
ABC Sports was merged into ESPN back in 2006. Disney would keep it.
ABC bought the rights to the Oscars telecast through 2028. The live broadcast rights would likely go to a new owner.
Whoever buys ABC, if there is a sale, would get to shop for a streamer when any contractual obligation is settled. Disney makes money selling other networks next-day streaming on Hulu.
And the Marvel franchise already jumped the shark with Endgame.
The Disney-21st Century Fox deal will assuredly go down as one of the biggest merger disasters in recent history, even bigger than when Coca-Cola bought Columbia Studios or AOL bought Time Warner.
What are you talking about?
I disagree. Either impose a hard 39% cap and ban on any discount or shell operators like Mission, Cunningham, American Spirit and Inyo, or have no cap at all.
Neither is likely to happen.
Assuming Byron is only interested in ABC, ABC O&O's, or both, that wouldn't include ESPN with sports rights.
ABC individually gave up most of the sports rights years ago. It all got moved to ESPN.
The UHF discount was from the era when UHF signals were inferior. Now, people have more trouble with VHF signals if they are a long way from the tower. And lightning causes problems with low VHF.
Fifty years ago. Doesn't apply today.
Doesn’t ESPN contract with ABC anyway for sports programming (including the current MNF simulcasts and the Super Bowl in a few years) and has since the ESPN-ABC Sports merger?
There’s no reason to assume it doesn’t continue, only Byron Allen or whomever could also contract with another programmer for additional sports rights… like how the CW currently contracts with Gray Television for ACC football/basketball.
Assuming Disney retains control of ESPN (Iger has only mentioned strategic partnerships, not a sale), it would be up to them as to whether they wanted to do a deal with a new owner of ABC to continue linear carriage of their games. Doing so would provide revenue until the point comes where Disney thinks live sports works best in a pure streaming environment.
The whole discussion of who owns what becomes very complicated when one talks about WDC. For example, the El Capitan Theater, where the Jimmy Kimmel Show originates, is owned by WDC, not ABC. The company at one time had a top level executive in charge of synergies, so they sought ways to improve the value of the company by combining resources. I think when they look at splitting off ABC from WDC, it won't be simple.
I actually think that works to Disney's advantage in a sale. "You get the network and Jimmy Kimmel, and you rent the El Capitan Theater from us until Jimmy retires."
I'm sure there are some messy exceptions in an organization that big, but there are also several places where there's a lump-sum payday followed by a years-long revenue stream from leases.
Since MNF moved years ago, ESPN technically has all the broadcast rights, but allowances were set up to broadcast games on ABC O&O stations and affiliates. I believe there is a limit on how many games can be simulcast though.
I'm sure that would be part of the deal. But, if Disney retains ESPN, or ESPN is sold off to someone else past the time ABC O&O's were sold off, then my guess is everything resets. If I paid however many billion for ESPN by itself, including all the broadcast rights therein, I wouldn't be so generous as to give those game broadcasts away to another company with ABC stations.
Assuming the new owner agrees.
And if they don't, Disney can find a different revenue-producing use for the El Capitan, or a buyer.
As I said in my post, the whole issue becomes complicated.
Let's clarify this: the FCC's current "UHF discount" isn't even really a "UHF" discount. What they did when DTV arrived was simply (and ridiculously) to retain the analog-era discount (which counted a UHF station with only 50% of its actual population count against the national ownership cap of 39%), but to use virtual channels to calculate the discount.
So it didn't matter if you were on RF channel 2 or RF channel 51 - if your VIRTUAL channel was 2-13, your signal counted with 100% coverage against the cap, while 14-69 counted with only 50% coverage. And that rule still applies now, 14 years after the last analog signals left the air. With channel sharing, you can (and do) have situations where the same transmitter is broadcasting streams from two different stations, and if one is on 8.x it counts twice as much toward the national ownership cap as the other stream that might be 52.x. And because it's the virtual channels that matter, that same distinction-without-a-difference applies whether the underlying RF channel is V or U.
(And let's not even get started with the ATSC 3 world, where a station can be on VHF for ATSC 1 and UHF for ATSC 3, and vice versa)
I suspect the real reason the FCC can't/won't revisit the "UHF" discount is the mess it would make of everything that's now baked in. Groups like the old Ion/Scripps used it to get real-world coverage of 60-70% of the country, even if it only showed as "39%" based on the discount. Fox got a big break with UHF signals in Chicago, Philadelphia and Houston to build its coverage, and same later on for Tribune/Nexstar in Philly and elsewhere.
How do you even start to undo that now in any way that's even remotely fair?
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