Interesting take on the (still) potential NBCU/Comcast deal by John Malone. The conventional wisdom of what Comcast might do did seem to be negative for the local NBC affiliates, but it had not occurred to me that they might try and hold up the deal approval politically in exchange for concessions.
To win government approval of its takeover of NBC Universal, Comcast may first have to win the approval of the NBC affiliates, Liberty Media Chairman John Malone said in an interview with John Faber on CNBC.
“That is going to be the biggest political issue in this whole thing: What will the broadcast affiliates of NBC say they want to not fight this transaction?” he said.
And Malone’s not too keen on the broadcast affiliate business in general.
“The big issue is localism,” he said. “It’s about broadcast affiliates locally, whether or not that model is viable.”
According to Malone, the model is not viable: “Don’t work,” he said.
The networks will have to either subsidize their affiliates or dump them and become cable networks, he said.
via TVNewsCheck
“The networks will have to either subsidize their affiliates or dump them and become cable networks, he said.”
Probably the biggest issue out there in the ten to twenty year timeframe. It’ll be interesting (in the chinese sense of the phrase) to see how it all shakes out.
I still think The CW folds in the near term (18-42 months) and Warner Bros recreates The WB as a cable net, starting the trend.
Razorblade Suitcase sucks.
Bush’s second album?
What will the broadcast affiliates of NBC say they want [in order] to not fight this transaction?
What power do affiliate owners have?
I suppose they can threaten to bail when the current deal run out. and become MNT affiliates or independents and broadcast local morning news from 4am-11am…and be a shadow of their former financial selves:
http://en.wikipedia.org/wiki/KRON-TV
(read the section on “the end of the NBC era”)
But I think the power they do actually have here is the power to squeak. Whether that gets them any/much grease or not, I’m not sure.
Could the affiliates us this to put pressure on NBC to drop Jay?
John Malone is a dummy.
As Malone says, this is a political fight, which means that normal business logic does not really apply. The local affiliates can stir up a lot of local anger very easily, which the local politicians would then have to deal with, which then would mean that Comcast and NBCU would have to dance.
Politics are not business, and anyone who tries to treat them as such ultimately loses every time.
I’ve been saying that there is an affiliate war coming for a while now. This is just the first of many issues that you will see them shouting about in the years to come. Eventually, maybe they do go the way of the dodo–but until the networks do decide to become cable nets, they do need the affiliates as much as the affiliates need them. You are right, Robert, that the affiliates wouldn’t be anything without their nets, but the nets wouldn’t have anywhere to broadcast (unless they go the cable route and program 24/7) without their affiliates.
And it may not even take a “strike” by the affiliates, or some such. Don’t be surprised to see some very big affiliates go under in the next five years if something doesn’t change. Quite a few are losing money right now, and many more are projecting to lose money in the next handful of years.
What exactly do the NBC affiliates plan to do once they drop network affiliation? The best syndication options (Seinfeld, Oprah, Judge Judy, Dr. Phil, etc.) have already been claimed by one station or another in every local market.
Affiliates would have a hole from 7 to 11 a.m. every weekend morning. I guess an expanded local newscast would do the trick. What about primetime? Or weekends? They’ll have to make do without Sunday Night Football next fall. Local stations are screaming bloody murder about losing money. They generally don’t have the cash to create lots of original shows.
It will be interesting to see what NBC affiliates want/get to not cause trouble with the politicians on the deal. If it’s good enough for the affiliates t could put NBC at a disadvantage vs. the other broadcast networks in the future.
And since this will have to be approved by at least the Justice Dept. antitrust folks, and maybe the FCC or others, the local affiliates could very definitely cause them political trouble if they want to.
In all my life I’ve never seen the words “Razorblade Suitcase” together in a sentence or even with either word in the same sentence. Now at this site I see it once a week or so. I hear it sucks.
I have a feeling that in primetime syndicated dramas, like Legend of the Seeker. Morning shows will become extended newscasts. My FOX affiliate runs from 4:30AM-9:00AM. Local programing is the way of the future not just local news. But local scripted programs local comedy etc…. The Broadcast networks like CBS ABC NBC will still exstist as a shell of their formers self and full 24/7 O and O’s stations and Cable.
I just cannot see the FCC or the Justice Deptment allowing this deal to go through. Also Vivendi wants more money that Comcast is paying per share. This means GE would have to buy out Vivendi’s 20% share and lower the value GE recieves per share from Comcast for their portion of NBC/Universal.
Comcast will destroy a national broadcaster and its affiliates to get a handful of cable channels, as they have mentioned they only value those channels. And mentioning that a local affiliate will have to become a cable channel means Comcast is looking to bully these small stations into falling into their hands for cheap once NBC stops nationally boradcasting. This deal will lead to a good many lawsuits I believe.