The
CEO of Ticketmaster/Live
Nation just finished
testifying.
If
you remember, last
week I told you that
our antitrust case
against them had hit
a rough patch.
The
USDOJ, which had
been leading the
case alongside 40
state AGs, suddenly
cut a cheap deal
behind closed doors
and bailed.
On
their way out the
door, they said we
could join their
deal if we wanted. I
declined. So did the
vast majority of the
other AGs. We told
Ticketmaster we’d
see them back in
court, and the trial
resumed a few days
later. It’s still
going on, and I’ll
report back on it
soon.
Nexstar + Tegna =
Largest TV Company
Ever
Now
from one antitrust
case to another.
We
started this case
last week. My bet is
you haven’t heard
about it, but it’s a
big one.
Here’s the situation:
The
biggest TV company
in the country is
trying to buy one of
its biggest
competitors. If it
does, it’s going to
raise prices,
downsize a lot of
local news, and
control a huge chunk
of the news our
country sees every
day.
The
big company here is
called Nexstar. You
probably haven’t
heard of it, but it
owns about 200
stations, including
Fox, ABC, CBS, and
NBC stations all
across the country.
The
second biggest TV
company is Sinclair.
It’s got about 180
stations.
The
third biggest is
Tegna, and that’s
the one Nexstar is
trying to buy. If it
does, it will become
the biggest TV
company in American
history and will
reach 80% of
American homes.
No
single company has
ever controlled that
much of American
broadcast television,
and North Carolina
would be the
second-most impacted
state in the
country, especially
in Charlotte,
Greensboro, and our
northeastern
counties.
Take
a look:
Why
does this matter?
Say
Nexstar owns both
the Fox and CBS
stations where you
live. Now they can
go to your cable
company and say,
“Pay our new price
or we pull both
channels.” Your
cable company is
going to pay. And
you’re going to see
it on your next bill.
Nexstar knows that
once it buys out one
of its biggest
competitors, if you
want to watch local
news or football on
the weekend, you’re
going to have to pay
more.
Nexstar has already
told its investors
that if this deal
goes through, it’s
going to make $135m
by raising prices
and another $165m by
finding “synergies,”
which is another way
of saying, “laying
off local reporters.”
Higher bills are not
the only consequence.
When Nexstar buys a
competitor in the
same city, it
“consolidates” the
newsrooms,
effectively removing
one of them. The
company has an
internal name for
this: the
“Consolidation
Playbook.”
In
Indianapolis, for
example, Nexstar
owns both the FOX
and CBS affiliates.
Two stations that
are supposedly
competitors now
share the same
anchors, the same
reporting team, the
same news director,
and the same website.
If
all this sounds like
it should trigger
some antitrust laws, it
does.
The
federal government
has a standard index
to measure whether a
merger concentrates
too much power in
one company. The
USDOJ and the FTC
have used it for
decades. Courts rely
on it.
When
a merger pushes
concentration past a
certain threshold
and increases it by
more than 100 points,
it’s presumed
illegal. In every
single NC market
affected by this
deal, the merger
doesn’t just cross
the legal threshold, it
obliterates it.
So
last week, I joined
a number of AGs and
we filed a lawsuit
to block the merger.
Then
things took a quick
turn.
As
soon as we filed,
Nexstar hit the gas
to try to close the
deal before a court
could stop them.
It
was remarkable. Less
than 24 hours after
we filed our lawsuit,
the FCC, which would
normally block a
merger like this,
suddenly waived its
rules and let it
happen. Then the
USDOJ reportedly
dropped its
investigation and
basically said, “Go
right ahead.”
For
all of that to
happen in 24 hours
is very strange. Now
Nexstar is declaring
victory and saying
the deal is done.
Not so fast.
We
have now filed an
emergency motion
that basically says,
“Hey judge, they’re
trying to get around
you. They know the
law is not on their
side, and the last
thing they want is
for you to hear our
case. That’s
exactly why you
should. Let’s
take a breath before
they’re allowed to
walk off the field
as the biggest TV
company in American
history. Let’s see
if these antitrust
rules were written
for a reason,
because I bet they
were.”
We
used more formal
language than that,
but that’s the gist
of it.
Our
motion is pending
right now. Will
update you soon.
Best,
Jeff
Share
