Tribune’s $1 billion breach of contract lawsuit against Sinclair (see 1808090042) is expected to end with a settlement, and Sinclair would seek to conclude it relatively quickly, said analysts, attorneys and academics in interviews. Since Sinclair/Tribune deal was valued at $3.9 billion, Tribune’s seeking more than a quarter of the value as damages is likely “posturing,” leading to a much smaller payout, said George Mason University School of Business assistant finance professor Derek Horstmeyer.
More than 100 small radio broadcasters want the FCC to create a new C4 class of full-power FM stations, which NAB and some larger groups oppose. C4 will "increase congestion on the already crowded FM band and escalate the risk of interference to other FM services, especially FM translators,” NAB commented in docket 18-184 in response to a notice of inquiry. “There is no chance of increased interference as a result of the proposal,” said SSR Communications, the petitioner behind the C4 proposal. The plan would consume only “previously-unused, available bandwidth,” SSR said.
Tribune filed a $1 billion breach of contract complaint against Sinclair Broadcast in the wee hours of Thursday morning, and the collapse of their deal could mean the end of the FCC’s administrative law judge proceeding against Sinclair but likely won’t put to rest all the consequences of the agency’s hearing designation order, attorneys and broadcasters said in Thursday interviews.
Sinclair’s proposed deal with Tribune is expected to break up Thursday, but Sinclair executives didn’t comment on the transaction during an earnings call Wednesday, though Sinclair CEO Chris Ripley said an update would be coming “soon.” Under Tribune’s agreement with Sinclair, passing Wednesday’s deadline allows Tribune to walk away from the deal without suffering a breakup fee, attorneys and analysts told us. Wednesday was also the deadline for parties to file notices of appearance in the administrative law judge proceeding, and those filings could provide a clue to whether Sinclair intends to battle the allegations against it, attorneys said. Tribune announced Wednesday it was set to hold an 8 a.m. conference call Thursday, before the opening of the stock market.
An FCC proposal to limit the distance at which full-power FM stations can complain of interference from an FM translator stirred up the most reaction from radio broadcasters, in comments in docket 18-119. Most commenters and large radio groups including iHeartMedia and Beasley object to limiting interference complaints to within a station's 54 dBu contour, but other broadcasters, including Cumulus Media, support the contour limit. Commenters also were divided over a proposed minimum number for listener complaints but widely receptive to relaxing rules on where on the dial translators can relocate if bumped.
The likely unwinding of Sinclair’s buy of Tribune and the related FCC hearing designation order are unlikely to derail rollout of ATSC 3.0 but might cause it to take longer, said supporters and critics of the new broadcast standard (see 1807270002). Sinclair/Tribune would have given the standard backing of a broadcaster reaching 60 percent of the U.S., but the entire industry is now heavily invested in ATSC 3.0, said broadcasters, industry officials and lawyers. Sinclair’s plans for the new standard predate its plan to buy Tribune, said Mark Aitken, Sinclair vice president-advanced technology. “NextGen TV will move forward regardless,” said New America Wireless Future Program Director Michael Calabrese, a frequent opponent of 3.0.
Commissioners approved a radio incubator order 3-1 Thursday, with Commissioner Jessica Rosenworcel dissenting and calling the item “modest” and muddled. “There is nothing bold here,” she said. “I fail to see how it will make a material difference in the diversity of media ownership.” The final version of the order adhered to NAB’s positions on comparable markets and that ownership waivers be transferable, as expected (see 1807310072).
Likely changes to the draft incubator order are being worked out, said FCC and industry officials in interviews. Requests from the Advisory Committee on Diversity and Digital Empowerment (ACDDE) that provisions on what constitutes a comparable market be restricted (see 1807260058) are seen less likely to be included. The item is to be voted at Thursday’s commissioners’ meeting, and forms the basis for a report to the 3rd U.S. Circuit Court of Appeals due Aug. 6 in Prometheus Radio Project’s challenge of a media ownership reconsideration order (see 1806290039).
The wording of the draft NPRM on reimbursing low-power TV stations, translators and FM stations for expenses caused by the post-incentive auction repacking will be changed to address concerns about repacking expenses and eligibility raised by NAB, T-Mobile and Microsoft, FCC and industry officials told us. The commission has a March deadline to create a reimbursement policy under legislation that granted the funds, the NPRM said. The notice is set for a vote at Thursday's commissioners' meeting.
The anticipated unwinding of Sinclair's planned buy of Tribune and last week’s court decision upholding the UHF discount aren’t considered likely to affect what the FCC eventually does to the national cap (see 1807250050). They could affect timing, said broadcasters, attorneys and industry officials in interviews.