April 2016

Gannett Co., which owns USA TODAY and more than 100 other media properties across the country, said it offered to buy Tribune Publishing for about $815 million, its second big expansion move since spinning off from its former parent less than a year ago. In a letter to Justin Dearborn, CEO of Tribune, which owns the Los Angeles Times, Chicago Tribune and nine other dailies, Gannett CEO Robert Dickey reiterated a private April 12 offer to pay $12.25 per share, a 63% premium to Tribune’s closing stock price on April 22. Gannett’s deal includes assuming $390 million of Tribune’s debt outstanding as of Dec. 31, 2015.

The offer price is about 5.6 times Tribune’s estimated 2016 earnings before interest, taxes and other items (EBITDA). Gannett estimates about $50 million a year in “synergies” savings. Gannett owns USA TODAY plus 107 local news organizations including the Detroit Free Press, Cincinnati Enquirer, Des Moines Register, the Milwaukee Journal Sentinel and Arizona Republic. Shares of Tribune closed April 22 at $7.52, up 2.6%, and shot up 58% to $11.84 in early trading April 25.

The Commission on Presidential Debates will start discussions on the formats of the four general election debates fall 2016 (three presidential, one vice presidential). And while the commission, made up of former party officials, politicians and some academics, is keen to incorporate new technologies and even open debate formats, they’re grappling with the question of how to seamlessly weave together the traditional role of a moderator, as both writer and presenter of questions, and that of a voting public that is used to having its voices heard on social media.

"We have had over the years what we call the town hall formats. So we’ve had a format in which average citizens ask questions of the candidates,” said Mike McCurry, former White House press secretary under President Bill Clinton and co-chair (along with former Republican National Committee Chair Frank Fahrenkopf) of the CPD. "But social media gives you many more possibilities to engage more people in that sort of conversation. So we’ve been thinking how do we incorporate that into format of the debate. So we’ve had some good conversations on that." One of the possibilities the commission is watching is the “open debate format” proposed by the bipartisan Open Debate Coalition in which the questions are crowdsourced. Everyday, voters submit questions in advance, with the moderators choosing from the 30 questions with the greatest number of votes. The format is being tested April 25 in a debate for a senate race between Reps David Jolly (R-FL) and Alan Grayson (D-FL).

The MEGABYTE Act of 2015 (S 2340) would amend federal laws related to managing the federal government’s licenses for information technology software. The bill would require the Office of Management and Budget (OMB) to issue a directive to each federal agency to develop a comprehensive policy for software licensing including a complete inventory of software licenses and to develop a mechanism to track, maintain, and analyze software use. Most of the provisions of the bill would codify and expand current policies and practices of the federal government. OMB has reported that agencies spent about $9 billion in 2015 on software licenses. Because efforts to better manage software licenses are already underway, the Congressional Budget Office estimates that the bill would not substantially change those efforts, and that implementing S. 2340 would have no significant net impact on the federal budget over the next five years. The bill could affect direct spending by agencies not funded through annual appropriations; therefore, pay-as-you-go procedures apply.

CBO estimates, however, that any net change in spending by those agencies would not be significant. Enacting S. 2340 would not affect revenues. Some agencies have reported that they have spent less to acquire software by more effectively analyzing data on software licenses and the Government Accountability Office expects that there is the potential for even greater savings government-wide through more efficient spending to acquire software. CBO expects that by improving software purchasing decisions implementing S. 2340 could lead to lower federal costs. However, we expect most of the savings in this area will probably be achieved through current efforts to make cost effective decisions when acquiring software.

[Commentary] Many in the television industry have long predicted eventual death for the box, driven in part by a rapid migration by pay TV providers (including fiber and satellite-based companies) to Internet standards for both video content and services, and by the enthusiastic response of consumers to a growing number of Internet-based alternatives. These include Roku, as well as Amazon, Apple, Google, Netflix, Hulu, YouTube, SlingTV, Sony, HBO and many others. Consumers, especially younger ones, are interested in defining their own video experience, mixing traditional and self-produced content and enjoying it not just on televisions but on every connected device, including tablets, smartphones and other mobile gadgets.

The rapid evolution of video stands in sharp relief to an increasingly embattled Federal Communications Commission proposal from earlier in 2016, which would force pay TV providers to develop a new, “open” set-top box within a year, and deploy replacement devices to millions of their subscribers within two years. The FCC’s plan to unlock the set-top box, as it did for Pandora, may do little more than release a lot of powerful demons trapped inside. Meanwhile, as so often happens, innovation in computing and communications technology is crafting its own separate peace, forging a new video ecosystem for consumers in the process.

[Larry Downes is a project director at the Georgetown Center for Business and Public Policy]