Report: TV Stations Face Cash Flow Woes As Networks Demand Rising Payments

Station groups including Belo, Gray Television, LIN Media, NexStar Broadcasting, and Sinclair Broadcast face a big problem after next year’s elections when the cash from political ads evaporates: Their revenues and cash flow could plummet as they’re forced to turn as much as half of the money they collect from cable and satellite retransmission consent agreements over to ABC, CBS, Fox, and NBC, according to a report from Moody’s Investors Service. The debt rating firm warned that the networks, by virtue of their popular prime time shows — and growing ability to distribute shows over the Web — “have the upper hand” over local station owners. And they’re using that to demand growing payments, known as “reverse compensation.”