Broadcast TV Stations Missed Opportunity?

[Mike Jackson]

  The link is for a Forbes article from 2019.   I would believe now that the value for local stations has decreased.   Stations that don't have a strong viewership are problaby really cheap.  I came to this conclusion scrolling through free broadcast channels today.  There were a host of foreign language, religious and sales channels.  Now a conference like the Pac 12 today definitely couldn't afford to buy stations in the top 40 markets in the USA because of their Pac 12 Network debacle.  However,  if their financial house was in order I believe purchasing 40 stations and maybe paying a 3rd party to operate it would be a viable option for the Pac 12 in their present state (without their existing debt).  I am assuming that if they paid a 3rd party to operate the conference would still turn a significant profit that the member institutions would share in and likely tax free.  

Consider what I found with very little internet research.   Innovate Corp own over 200 stations in 106 US TV markets and is worth about 150 million dollars.   With that valuation it would appear that a P5 conference could buy broadcast stations in the top 40 markets in the US for around 100 million dollars.   Now if the powers that be would allow them to do so if they wanted to is the question.  With their value being on a downward trend I would tend to believe they could get a majority ownership deal done for 40-100 stations.   The only risk involved is your product not being desirable long term.   Which is exactly were they are now and why the Pac 12 doesn't have a media rights deal.   The value of these stations would only benefit by having P5 conference games (Basketball and Football).   Also the stations should have more filler compelling content for younger audiences.  Each station using the nearest local university in within the conference geographic footprint for content relevant for local younger viewers.  And several Pac 12 schools (and most large public institutions in FBS) probably already have television studios for their channels usually carried on local cable as a public service. 

It is a huge lift I am sure.   But it seems very plausible to me that there a over hundred millionaire alumni of the Pac 12 schools that could afford a 1 time extra donation of 1 million dollars to make a deal like this happen for the Pac 12.   The problem is the conference is in the hole financially and have to pay off debt before considering something this big.   But once the media contract for the AAC is expires and are lowballed like the Pac 12 perceives they are, I think it is an idea the AAC should visit.  

FYI the example station owner I used Innovate Corp,  their value is down from a price of over $5.00 per share Jan 2019 to slightly below $2.00 per share today.  

https://www.forbes.com/sites/bradadgate/2019/03/05/why-are-tv-stations-up-for-sale/?sh=3621539844a4

 

Edited July 16, 2023 by Mike Jackson
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