Petitions to deny Sinclair buying Tribune are either “naive” or transparently self-serving, the two companies said in a partially redacted opposition filing Tuesday. It punched back at accusations from opponents such as Dish Network, Newsmax and Free Press that the deal would slow the incentive auction repacking, hurt broadcast localism, squeeze out independent programmers or break FCC ownership regulations. “None of the petitioners provides a shred of evidence demonstrating that the post-merger company will violate any Commission rule,” Sinclair and Tribune said. “Each of the petitioners is either trying to use this proceeding to stifle competition for its own economic interests or is still living in a pre-cable, pre-internet, pre-smartphone world, untethered from the economic realities of the current media market.” Despite the diverse opposition, the deal is expected to be approved (see 1708150063).
The FCC should require broadcasters to simulcast content using the current standard during the ATSC 3.0 transition, said Verizon in a meeting with Chief Michelle Carey and other Media Bureau staff Wednesday, an ex parte filing said Friday in docket 16-142. “Just as broadcast TV stations should have the flexibility to choose whether and when to implement ATSC 3.0, other affected parties should similarly have the option of deciding whether and when to invest in new equipment to view and deploy ATSC 3.0, particularly consumers.” Rules governing simulcasting and quality of the 1.0 signal would be more efficient than other ways of easing the burden on MVPDs, and can have time limits for when 3.0 is more widespread, the telco-TV provider said. “The Commission can review and sunset any such restrictions as appropriate based on its evaluation of ATSC 3.0 penetration in the video market.” Broadcasters proposed simulcasting in initial filings on the transition, and have said repeatedly it should be allowed, not required (see 1707060060).
The DVB Steering Board approved a new next-generation subtitling delivery specification based on the World Wide Web Consortium’s Timed Text Markup Language (TTML) platform, DVB said in a Monday announcement. The new spec complements “bitmap”-based subtitling, which has been in use for more than 20 years, DVB said. TTML subtitles are “increasingly being adopted” by standards bodies, including ATSC and SMPTE, it said. The new spec “will allow service providers to transition over time to a common TTML subtitle format for both broadcast and internet delivered services,” it said. TTML subtitling for ATSC 3.0 is defined in the A/343 document, approved as a final ATSC 3.0 standard in December (see 1707180040).
House Commerce Committee ranking member Frank Pallone, D-N.J., and two other House Democrats in top FCC oversight roles warned FCC Chairman Ajit Pai Monday they are concerned restoration of the UHF discount and other commission actions since his chairmanship began in January may indicate a “pattern of preferential treatment” for Sinclair. House Communications Subcommittee ranking member Mike Doyle, D-Pa., and House Commerce Oversight Subcommittee ranking member Diana DeGette, D-Colo., also signed Pallone’s letter to Pai. They also asked Pai whether his office engaged in “inappropriate coordination” with Sinclair, President Donald Trump’s administration and Trump’s 2016 presidential campaign. They cited the FCC process for evaluating Sinclair’s proposed buy of Tribune, commission’s earlier approval of Sinclair’s $240 million purchase of TV stations from Bonten Media (see 1707050042) and the ATSC 3.0 standard NPRM as pro-Sinclair actions. Sinclair owns 12 patents related to the standard. The lawmakers sought answers from Pai by Aug. 28 on a range of questions about the FCC’s Sinclair/Tribune evaluation process and the ATSC 3.0 NPRM, including whether “any White House official in the current Administration discussed Sinclair at all with you.” The lawmakers also sought any correspondence between Pai’s office and Sinclair. Pai said during a late July House Communications FCC oversight hearing that no one in the Trump administration contacted the commission about pending media transactions and the UHF discount reinstatement and other FCC actions are aimed at the whole market rather than any specific company (see 1707250059). "These FCC rulemakings apply to the entire broadcast industry, not just us," said Sinclair Senior Vice President-Legal Affairs Rebecca Hanson in a statement. The FCC didn't comment.
The FCC should include requirements for simulcasting and signal quality in rules for the ATSC 3.0 transition and require that negotiations to carry the transmissions using the new standard be held separately from retransmission consent negotiations, said representatives of the American TV Alliance in meetings Monday and Tuesday with aides to Chairman Ajit Pai and Commissioner Mike O’Rielly, according to an ex parte filing in docket 16-142. The ATVA contingent included representatives from AT&T, Charter Communications, Dish Network, Verizon and the American Cable Association, the filing said.
Sinclair and Tribune received “second requests” from DOJ last week for additional information about the first buying the second broadcaster, the buyer announced in a Q2 earnings release. Tribune consolidated operating revenue fell 2 percent to $469.5 million. Wells Fargo analyst Marci Ryvicker called results “mixed” in an email to investors, and she and CEO Peter Kern blamed costs associated with a programming shift at WGN America. “Those changes are now behind us, and we expect a much more profitable 2018 with more original hours than the network has ever carried,” Kern said. The deal with Sinclair is “on track,” Kern said. Tribune didn't hold a Q2 earnings call. Some think the move to ATSC 3.0 (see 1706070063) could be helped by the deal and others fear the reshuffling of TV stations' frequencies now that the incentive auction is over could be delayed (see 1708080067).
Allowing broadcasters temporarily to deploy ATSC 3.0 on vacant channels would ease the transition to the new standard, said Pearl TV, One Media, Sinclair and NAB in a meeting with Media Bureau Chief Michelle Carey and bureau staff Thursday, according to an FCC ex parte filing posted Tuesday in docket 16-142. “Allowing broadcasters to use available channels where available during Next Gen deployments will help both broadcasters and consumers.” Full-power broadcasters won’t “seek to displace” low-power stations that were given new channels through FCC displacement windows in favor of 3.0 facilities, the broadcasters said, though “full-power licensees' use of unoccupied channels to help assure continued service should be entitled to a higher priority than low power television stations and TV translators as a matter of policy.” The FCC also should adopt only ATSC's A/321 document on system discovery and signaling architecture into its rules, the broadcasters said. “Adopting additional components of the ATSC standard into the FCC’s rules could risk stifling innovation and forcing broadcasters to return to the Commission repeatedly for permission to make changes,” the filing said. LG and others support proposals for the commission to also incorporate the A/322 document on ohysical layer protocol into the 3.0 rules (see 1707040001).
Some opponents of Sinclair buying Tribune argue in petitions to deny posted by the FCC Tuesday that the new company would have unprecedented ability to drag the post-incentive auction repacking to a halt, and would want to do so because of its massive investment in ATSC 3.0. “Sinclair’s ‘all-in’ posture on ATSC 3.0 gives it a strong self-interest in using whatever leverage it has to promote the adoption of this standard,” petitioned T-Mobile. A delay in repacking would give Sinclair more time to lobby the commission to devote more reimbursement funds to paying for stations to buy 3.0 equipment, said the filing in docket 17-179.
When Univision and Northwest Broadcasting in June joined the ATSC 3.0-based broadcaster spectrum consortium started by Sinclair and Nexstar (see 1706200084), it brought the consortium’s “reach” to 90 percent of the U.S., said Sinclair CEO Chris Ripley on a Wednesday earnings call. “The consortium’s mission is to promote spectrum aggregation, innovation and monetization, and we are continuing to invite other broadcasters to join, as we enhance our industry’s ability to compete in the wireless data transmissions sector.” Sinclair also is working with Nexstar to “coordinate the transition” to 3.0 in 97 designated market areas, he said. That work is “an important step to ensuring a speedy rollout of the next-generation advanced services for our viewers and advertisers,” he said. “More broadcasters will be added to this planning process” as they join the spectrum consortium, he said. Sinclair is “quite excited” about the prospects for FCC "relaxation" of local media ownership rules, Ripley said in Q&A. “Overall, we think the industry needs to consolidate to two or three large broadcasters and really just one to two strong local players in each market,” he said. “In some of the larger, and even medium-sized markets, you’ve got anywhere from three to five local players,” and that “doesn’t make sense,” he said. “If there’s relaxation, there’ll be a consolidation at the local level, greater scale at the national level, and there’s significant savings to be had putting local content players together on a local level.” That will give way to “stronger local content producers, which will be able to spread their content and their resources across multiple platforms,” he said. “We see that as the evolution of the industry as dereg sets in here, and you end up with more consolidated, stronger local content players that are more efficient, and so the economics will be great and the strategic output will also be great.”
The LPTV Spectrum Rights Coalition said it's “declaring a truce” in the debate over a proposal to reserve vacant channels in the TV bands for unlicensed use (see 1707110015). The declaration came in an email newsletter Tuesday. Though NAB and Microsoft have been actively pressing the FCC on the matter, a broadcast industry official told us the two sides remain far apart, and the coalition announcement doesn’t indicate any of the other parties active in the vacant channel proceeding have reached an agreement with the coalition. The group is working on a plan under which licensees would be offered “economic opportunities to utilize their spectrum rights to participate in the solving of national problems,” the email said. LPTV spectrum could be used for rural broadband, and to assist in the rollout of ATSC 3.0, the email said. Microsoft didn’t comment. NAB "remains strongly opposed to the Microsoft proposal," a spokesman said in response to the coalition announcement. "Microsoft’s proposal could damage TV reception for tens of millions of people living in both rural and urban America.”