Setback For Sinclair


The Sinclair/Tribune deal is not dead yet, but it is taking on water. 

FCC Chairman Ajit Pai tweeted out that he has "serious concerns" about Sinclair Broadcast Group's acquisition of Tribune Media, saying he would send the transaction through a lengthy administrative process.

Some think it could be a deal killer. 

Pai said, "Based on a thorough review of the record, I have serious concerns about the Sinclair/Tribune transaction," he said. "The evidence we’ve received suggests that certain station divestitures that have been proposed to the FCC would allow Sinclair to control those stations in practice, even if not in name, in violation of the law."

In other words, the stations that Sinclair was hoping to pass off to close allies but still run, is not cool with the FCC. 

News of the deal going south dropped Sinclair's stock around 5%. 

Politico writes that the FCC's decision is a significant blow for Sinclair, which has been been a frequent target for Democrats and liberal groups disturbed by reports that it favors President Donald Trump in its coverage via "must-run" segments pumped to its network of stations.

It’s also a surprising turn of events for Pai, who was nominated for the agency's top post by Trump. The chairman had earlier revived a regulatory loophole known as the UHF discount seen as critical to the Sinclair deal. It permits broadcasters to count only half the reach of some stations when calculating their national reach — and allowed Sinclair to avoid vastly exceeding federal limits on media ownership with the deal.

While some are saying this could kill the deal, look for Sinclair to try and resurrect the deal with some more finagling of stations. 

This also has an impact on Fox Television, buying some stations from Sinclair if/when the Sinclair/Tribune deal goes through. 

Look for Fox, to possibly reach out and try to make their own deal if the Sinclair/Tribune deal implodes.  

Many anti Sinclair people are hailing this as a major victory. But, I don't think you should count Sinclair out just yet. 

Stay tuned...