×
You will be redirected back to your article in seconds

Trump’s Reliance on Free Media Coverage Puts Strain on Local Stations

How much poorer will we, as a nation, be at the end of this presidential election? In terms of emotional or psychological cost, it’s impossible to know. But in terms of lost television advertising dollars, we will be $300 million to $400 million poorer — give or take a hundred million.

With the race winding up, projections on how much will be spent on political advertising this year are being tamped down. The culprit is Donald Trump, whose campaign has relied far more on free media coverage than on paid advertising. The impact is being felt by local television stations, which rely heavily on political spending and are already struggling against significant pressure elsewhere in their business.

S&P Global predicted last November that political ad spending on TV in 2016 would reach $3.3 billion, accounting for 14.1% of all TV ad spending for the year. Analyst Peter Leitzinger says the company will adjust that projection in November, likely to $2.9 billion or $3 billion — roughly the level of 2012. In September, Kantar Media downgraded its projection from $3.1 billion to $2.8 billion.

Trump, Leitzinger says, “is relying on real media to get his message out there. He’s just not spending what would normally be spent on TV advertising.”

Ex-Trump advisor Barry Bennett bragged to Fox News in April about free media coverage, saying, “No other candidate can talk when everybody is talking about you.”

Indeed, Trump’s campaign has proved effective at manipulating the media into handing him screen time. In September, when he promised a “major announcement” about his crusade to spread misinformation about President Obama’s birthplace, cable news outlets went live to the candidate, who spent half an hour extolling his new hotel and introducing veterans to speak on his be- half before addressing the promised subject.

“We got played again by the Trump campaign, which is what they do,” CNN’s John King said on the air afterward.

The lack of spending by Trump puts less pressure on Hillary Clinton, whose outlay is less than that of President Obama’s campaign at this time in 2012. And with Trump confirming last week that he would no longer participate in fundraisers for the Republican Party, the GOP will have a tough time raising money to pump into last-minute ads for races up and down the ballot.

The impact of the shortfall will be felt primarily at the local-station level. “Local TV is still the primary vehicle that politicians and PACs and the third-party groups will use to reach voters,” notes Kantar’s Steve Passwaiter. He identified 10 swing states that are hot spots for political spending: Colorado, Florida, Iowa, Nevada, New Hampshire, North Carolina, Ohio, Pennsylvania, Virginia, and Wisconsin. “If you’ve got a whole bunch of stations in battleground states, and you were expecting this onslaught of presidential dollars and a bunch of PAC dollars supporting presidential candidates, then you’re going to be sorely disappointed,” he says.

The companies with the most stations in those states are Sinclair Broadcast Group, with 18, and Nexstar, which is awaiting FCC approval on a proposed merger with Media General, with 16. Among broadcast-network owned-and-operated groups, Fox has the most stations in battleground states, with six, followed by CBS, with five.

But lower-margin businesses like pure-play local-station groups remain most vulnerable to a downward shift in political ad spending. Steve Schwaid of media consultancy CJ&N points out that 2017 will have few of the special events local stations count on to boost revenue, such as elections or the Olympics. Stations that had looked forward to a boon in 2016 had also been expecting a lean year to follow. “We’re starting to see stations getting ready for budget cuts,” Schwaid says. “The impact of this election and the lack of money coming from the Republican side is actually starting to have an impact in 2016. Stations are saying, ‘Wait a second, I’m not going to make my budget.’”

The shortfall comes against an already tough landscape for local stations. NFL games, television’s top draw, have seen ratings decline every week this season. NBC’s Summer Olympics coverage drew lower- than-expected linear TV ratings that trickled down to affiliates.

And primetime broadcast viewing this fall remains on a downward trend. This has had an outsize effect on local stations, which pay to run syndicated programming in daytime and to produce morning, afternoon, and evening newscasts. Primetime yields big audiences that come with no costs other than retransmission fees; the ad revenue is close to pure profit. But the ratings to which that revenue is pegged are winnowing amid media fragmentation.

“What’s happening now in the broader business is what happened in the print industry years ago — the bottom fell out,” says Schwaid.

If there’s an upside, it’s how Clinton’s lead over Trump has changed the electoral map, shifting money to states that are not used to seeing spending from presidential campaigns. Recent polls have seen traditional red states such as Indiana and Texas become competitive. Meanwhile, Trump’s appeal to white, working-class voters, even if it has proved too narrow to sustain a national campaign, has thrown into competition markets long considered solidly blue. Passwaiter points to recent buys by Trump in Michigan and parts of Maine.

“I think it’s probably been a while since Michigan has seen ads for a presidential election,” he says.

Popular on Variety

More Biz

  • Felicity Huffman

    Felicity Huffman Issues Apology After Receiving Prison Sentence: 'There Are No Excuses'

    Felicity Huffman issued a long statement of apology on Friday after receiving a two-week prison sentence for paying to illegally boost her daughter’s SAT score. In the statement, Huffman, in addition to saying  she accepts the court’s decision, acknowledges and apologizes to other parents fighting to get their children into college. Along with the prison [...]

  • Actress Felicity Huffman (C-L) and her

    Felicity Huffman Sentenced to 14 Days in Prison in SAT Cheating Case

    Felicity Huffman was sentenced on Friday to 14 days in prison for the crime of paying $15,000 to boost her daughter’s SAT score. Judge Indira Talwani also ordered her to serve 250 hours of community service and a year of probation, and pay a $30,000 fine. The sentence came as a surprise, as Talwani had [...]

  • NEW YORK, NEW YORK - SEPTEMBER

    Rihanna Sings (Briefly), Pharrell and DJ Khaled Rock the Mic at Star-Studded Diamond Ball

    In just five years, Rihanna’s Diamond Ball has become one of the music industry’s biggest events of its kind, nearly on the level of the Clive Davis Pre-Grammy Gala. While there are several dazzling charity events with equal starpower and often-unique performances, what makes the Diamond Ball different is, obviously enough, Rihanna’s supernova aura and [...]

  • Amber Heard Seeks Info on Johnny

    Amber Heard Seeks Info on Johnny Depp's Arrests and Substance Abuse

    Amber Heard is asking Johnny Depp to turn over records related to his arrests and drug treatment, as her lawyers defend her from a $50 million defamation suit. Depp filed suit in March, accusing his ex-wife of tanking his career by writing a Washington Post op/ed alluding to her domestic violence allegations against him. Heard [...]

  • David Nevins, Chief Creative Officer, CBS

    David Nevins: CBS-Viacom Merger to Create 'Virtuous Eco-System' for Content

    CBS and Viacom leaders are looking for opportunities to create a “virtuous eco-system” for content that can prosper across the various platforms of the two companies that are set to merge by year’s end. That was the sentiment shared by David Nevins, chief creative officer of CBS and chairman-CEO of Showtime Networks, during a Q&A [...]

  • 'Resident Evil' Stuntwoman Files Suit Over

    'Resident Evil' Stuntwoman Files Suit Over Horrific Motorcycle Crash

    A stuntwoman who suffered severe injuries on the set of “Resident Evil: The Final Chapter” in 2015 has filed a lawsuit alleging that the film’s producers reneged on a promise to cover her medical costs. Olivia Jackson was driving a motorcycle that collided head-on with a camera rig during the shoot in South Africa. According [...]

More From Our Brands

Access exclusive content