Tag Archives: media consolidation

Peoria ‘one of the worst cases of covert media consolidation in the country’

The media reform group FreePress has a campaign called Change the Channels, and it is currently profiling our fair city, saying, “Peoria, Illinois is suffering from one of the worst cases of covert consolidation in the country; all five of its commercial TV stations produce just two distinct newscasts and are controlled by only two companies.” Those two companies, of course, are:

  • Granite Broadcasting, which owns and operates WEEK (channel 25) and, through a local marketing agreement (LMA), operates WHOI (channel 19) and WAOE (channel 59)
  • Nexstar Broadcasting Group, which owns and operates WMBD (channel 31) and, through an LMA, operates WYZZ (channel 43)

They go on to say, “This situation is unacceptable. Two newsrooms simply cannot provide Peoria…with the amount of local news coverage and diversity of perspectives that residents need to stay informed.”

Of course, most of this isn’t news to the residents here in Peoria, but they did have one other claim that I hadn’t heard before: “Three of those stations, WEEK, WHOI and WAOE, are part of an anti-competitive conspiracy that spans two states.” They explain:

Granite’s Shared Services Agreement with Barrington Broadcasters is a particularly outrageous anti-competitive conspiracy between the two companies. Each company owned one station in the Peoria market, as well as one station in the Syracuse, N.Y., market. In order to avoid competing with one another in both markets, they simply “swapped” control of the stations, yielding these comparable markets completely to their former competition. This shady deal cost more than 30 jobs in Peoria (along with 45 in Syracuse), destroyed competition and left viewers in both communities with less local news.

Note that phrase: “to avoid competing with one another.” Barrington Broadcasting owns WHOI in Peoria, and when they were producing their own news program, it was unique in the Peoria area, often including investigative reports and stories that the other stations weren’t covering. Once Barrington and Granite entered into an LMA, the reporters were fired and the anchors moved to a set in the same building as WEEK. Now the WEEK and WHOI news programs are nearly identical.

Granite is now in a dispute with the Peoria chapter of the American Federation of Television and Radio Artists (AFTRA) over contract language that would give Granite “jurisdictional flexibility” — something they could use to move the anchor jobs to their central broadcasting hub in Ft. Wayne, Indiana, for example. The local general manager denies the company has any plans to do so, but he won’t explain why the company insists on having the “jurisdictional flexibility” language in the contract. Granite imposed the contract, and AFTRA has filed a grievance.

The Change the Channels campaign is asking those opposed to these kinds of shared services agreements (which they call “covert media consolidation”) to write to the Federal Communications Commission and ask them to put an end to the practice.

The rules are supposed to protect localism, diversity and competition on the public airwaves, but in almost 80 markets across the country, these rules have been circumvented. Media companies have taken advantage of loopholes to covertly consolidate more than 200 stations, colluding rather than competing in order to cut costs.

As a result, communities are getting less local news than ever before. When the exact same news is aired on several stations, fewer stories told, fewer viewpoints are presented, and the public airwaves are wasted on copycat broadcasts.

Continue reading Peoria ‘one of the worst cases of covert media consolidation in the country’

WMBD-TV parent company for sale

Nexstar Broadcasting Group, Inc., the parent company of WMBD channel 31 and the operator of WYZZ channel 43 here in Peoria, is for sale. The company issued a press release on July 21 that stated:

Nexstar Broadcasting Group, Inc. (NASDAQ: NXST) announced today that its Board of Directors has decided to explore and evaluate strategic alternatives intended to maximize shareholder value, including a possible sale of the Company. The Company has retained Moelis & Company as its financial advisor and Kirkland & Ellis LLP as its legal counsel.

The Company has not made a decision to pursue any specific strategic transaction or other strategic alternative and there is no set timetable for the process, so there can be no assurance that the exploration of strategic alternatives will result in a sale of the Company or any other transaction. The Company does not intend to disclose developments with respect to the progress of its strategic review until such time as the Board has approved a transaction or otherwise deems disclosure appropriate.

RBR.com notes that “It is the second time that Nexstar has been on the auction block, with a previous sale attempt called off in 2007 after the market soured.” They also report that the Wall Street Journal Online expects the company to sell for over a billion dollars. These kinds of transactions are called (positively) “mergers and acquisitions,” or “M&A,” by the industry, and (negatively) “media consolidation” by media watchdog groups and concerned citizens.

The website TVNewsCheck.com defends big media:

With each deal, there will be an outcry from those opposed to “media consolidation” as if bigness were in and of itself a bad thing. Bigness can be a good thing. It can provide the resources and legal backing that enterprise and investigative journalism often requires, job security and perks that are disappearing from small companies.

What matters is not how big the new owner is, but who the new owner is. Is it a company that measures the value of a TV stations only in dollars and cents or one that respects the special role TV stations occupy in their communities? Is it one that is in for the long haul or one that will look to flip the group in five to seven years?

That all sounds great in theory, but we’ve yet to see any of these benefits of bigness in Peoria. GateHouse Media and Granite Broadcasting have not improved journalism, nor offered its employees better job security or perks. Quite the opposite.