Byron Allen’s back in the news cycle again, and yet again there seems to be shock that he’s mentioned in the same breath as some of America’s largest media monoliths as a serious candidate for the ownership of a conglomerate as storied as ABC (not to mention a few other significant Disney assets).
Google some of the more prominent templates of publications crowing about this and you’ll come across this rehashing of the obvious from the likes of FORTUNE’s Greg Doherty.
It’s hidden behind a paywall, FYI, and at least for now that’s beyond my budget. Your choice if you actually think you need it explained to you why he’s anything but a question mark to run these legacy businesses. I don’t need a refresher course.
Besides, there are more equitable recaps of this news available for free, such as this one from CBS NEWS’ Elizabeth Napolitano:
Media mogul Byron Allen has offered $10 billion to the Walt Disney Co. to purchase its ABC television network, in addition to the cable networks FX and National Geographic.
The bid, which Allen’s representative confirmed to CBS MoneyWatch, would include ABC’s national TV network as well as several regional stations. The offer is “preliminary” and “could change” at any time, a source with knowledge of the matter told Bloomberg.
The $10 billion figure is based on an estimation that the networks accrued $1.25 billion in earnings before interest, taxes, depreciation and amortization within the past year, the publication reported. Disney CEO Bob Iger signaled in July that Disney was open to selling some of its television assets as consumers continue to flock to streaming networks, eclipsing traditional television and cable. Since then, the company has been in talks with potential buyers including local broadcaster Nexstar, Bloomberg reported.
Disney is facing financial pressures as its fledgling streaming business continues to lose money. The company’s streaming unit has lost more than $11 billion since it debuted Disney+ in 2019, and during the most recent quarter alone it reported $512 million in losses, according to an August earnings report.
Byron Allen is the founder and CEO of Allen Media Group, a global media production and distribution company that owns the Weather Channel, along with several regional sports networks and broadcast TV stations.
And while Disney has hemorraged those kinds of losses chasing the tail of tech companies, Allen has doubled down on legacy media, focusing his initial broadcast efforts primarily on smaller market stations that serve communities with minimal local competition, primarily from print, which has deteroriated to a far greater extent than has broadcast. Nexstar actually built its own prowess through that route, expanding into larger markets as opportunties presented themselves as legacy media businesses, many with family roots in print journalism, threw in their towels.
Indeed, Nexstar has struggled with some more recent purchases, including the bankrupt Tribune stations that, until an act of football-related divine intervention occurred earlier this morning, were off DIRECTV since August 1st. Nexstar already owns stations in most of the ABC owned-and-operated markets, and would likely take the same kind of approach in those cities that they have done in smaller ones—combine back-office resources and staffing to create duopolies that would ultimately result in fewer jobs, let alone a less broad reflection of demography. One only need look at some of the first moves Nexstar management made when they took over Los Angeles’ storied KTLA, including the non-renewal of 24-year veteran anchor Lynette Romero, as evidence as to how tone-deaf they are capable of being.
Allen, by contrast, owns only one station in each of his markets, but utilizes corporate efficiencies much like most broadcasters do in this era to help his bottom line. Senior management runs multiple stations in similar geographic regions. The stations’ 24/7 Local Now digital platforms share content and templates across the group. And it’s working.
In fact, not only is Allen eminently qualified to take over ABC stations and compete effectively with Nexstar, he already has.
In Flint, Michigan, Allen Media owns ABC affiliate WJRT-TV, which from 1995-2011 was a Disney owned-and-operated station. They compete most directly with a long-dominant station based in Saginaw, WNEM-TV, which I had the chance to work with early in my career when it was an NBC station. It was an overachiever at a time when NBC was especially weak. They are now a CBS affiliate, whose audience profile is ideally suited to a large portion of the market.
Yet, in the August Nielsen rating period, WJRT is rising year/year in the crucial local news time periods–at the direct expense of WNEM. At 6 PM weeknights, they’re +18% while WNEM is -6%, and at 11 PM, they’ve improved +59% while WNEM is up just +5%. A gap of more than 4 rating points is now down to just about 2.5.
And in another one of Allen’s larger markets, Honolulu, Allen owns another ABC affiliate, KITV, which competes with a Nexstar-owned FOX affiliate KHON. For decades, KHON was far and away the dominant station in the Islands, an NBC affiiate that offered a late news broadcast so popular it ran more than 40 minutes to accommodate local demand and pushed a tape-delayed TONIGHT SHOW deep into the night. These days, it features the market’s most popular and outspoken news anchor Joe Moore as its lead.
And yet, despite all of this, KITV had a pretty stellar August rating period. Even allowing for the fact that the Maui fires naturally raised local news viewing across the board, KITV’s 6 PM newscast rose +29% vs. 2022’s levels, while KHON and Moore dropped -3%.
And all of this at a time when ABC’s prime time lineup was almost completely comprised on reruns, and with virtually no live sports of consequence anywhere on the schedule.
So you go right ahead and be shocked by the thought of the guy who has given the world a whole lot of semi-scripted courtroom shows and seven seasons of FUNNY YOU SHOULD ASK taking over Eyewitness News. Then check out the facts.
Would you rather have this man as the face of the ABC network?
Or this one?
You tell me.
Until next time…