Sinclair Broadcast Group: Big Plans, Big Role

The last five years have been a heckuva stretch for the Sinclair Broadcast Group. After nearly collapsing under the weight of the economic downturn in 2009, the Baltimore-based station group has roared back, leading a consolidation surge that’s restored local TV broadcasting’s luster on Wall Street even as it reshapes the industry. With the great expansion, Sinclair has moved to the top ranks of TV broadcasting. And Sinclair is big.

By number of stations (owned or operated), it ranks first with 162 stations in 77 markets, assuming all pending deals close. By TV homes reached, it is second with coverage of 38.7% of the US. By 2012 revenue, it is sixth with nearly $1.3 billion, behind only Fox, CBS, Gannett, NBC and Tribune. But Sinclair’s impact goes beyond its sheer size. Lately, it has begun leading the charge for a new broadcast standard that it believes will open up new business opportunities and provide broadcasters with the tools to mine a rich future. Through operational allies -- so-called sidecar companies like Cunningham Broadcasting -- that technically own the stations, Sinclair achieves the financial benefit of multiple properties without violating Federal Communications Commission rules. Now, of the 77 markets Sinclair is in, it has multiple stations in 49, or more than 60%. Consolidation -- locally and nationally -- has given Sinclair tremendous clout in its dealings with the Hollywood syndicators. After all, with Sinclair, a syndicator can clear nearly 40% of TV homes. Retransmission is a key element in Sinclair’s growth formula. When it buys stations, it gets an immediate uptick in revenues from the newly acquired properties by locking in its most-favored-nation status on retransmission payments. Followers of Sinclair in the financial markets see programming as a logical next step.