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Local TV News Feels Squeeze Amid Station Consolidation

The state of local TV news is sure to be a flash point when public debate over Sinclair Broadcast Group’s $3.9 billion purchase of Tribune Media heats up next month as the FCC fields comments on the proposed merger.

By many accounts, the wave of consolidation among TV stations over the past few years has been brutal for TV newsrooms across the country. The emergence of mega-groups such as Sinclair and Nexstar has put bottom-line pressure on stations to cut costs to help owners manage ballooning debt loads. At the same time, local TV has been grappling with ratings erosion, particularly in the daytime hours, which adds to pressure on profit margins.

The aggregation of stations in regional clusters has become vital to big broadcast groups because viewership of local TV news is generally on the decline. Ratings for late local newscasts, which used to be a license to print money for successful stations, are down 31% since 2007, according to Pew Research Center’s just-released Local TV News Fact Sheet.

Viewership of local morning news has fallen 12%, and early-evening newscasts have slumped 19% since 2007, according to Pew. Younger viewers, in particular, have drifted away from local TV outlets to digital and cable news providers — a troubling long-term trend. For now, local news is still a huge revenue driver for stations, but it’s not as profitable as it once was.

Broadcast executives counter that only by having increased scale will companies be able to invest in the kind of news-gathering facilities and reporting resources that support coverage of local news and stem viewer loss. Perry Sook, CEO of Nexstar, points to the growth in the number of bureaus in state capitals that Nexstar has established to feed all of its outlets in a given state.

“No one station could afford to have a reporter and photographer there full-time,” Sook says. “We can enhance our local offerings by having much larger scale.” He also touts the recent doubling in size of Nexstar’s Washington, D.C., bureau to 10 people.

Industry veterans say one of the most dramatic changes in local news has come in the area of salaries for on-air talent. The days of prominent anchors in large markets making $1 million a year are over. “If you have a client making $300,000 [a year], that’s like the $1 million anchor of 10 years ago,” says a veteran talent agent.

The most desirable editorial employees these days are not anchors with decades of experience but youthful recruits who are known as “multimedia journalists.” That means they can shoot, edit, produce and report on air, thanks to advances in broadcast technology and digital video tools. But that also means a reduction in newsroom producers and editors, particularly in markets that are not heavily unionized.

The talent agent notes that nowadays he’s placing promising on-air reporters as young as 25 in large markets; the old hierarchy of paying dues by working in smaller markets is becoming compressed for those with multimedia skills.

Sinclair has a well-earned reputation for slashing costs and newsroom head count at stations it acquires. The exodus of six seasoned anchors from ABC affiliate WJLA-TV Washington, D.C., since Sinclair acquired the station in 2014 is a prime example.

Sinclair counters that it has invested nearly $40 million in facilities upgrades during the past few years in its recent acquisitions of Fisher Communications and Allbritton Communications (home of WJLA). And some see a positive in the fact that Sinclair is not a private equity firm looking for a quick flip of assets but rather a family-run company with deep roots in broadcasting.

Still, all of this has produced great trepidation among employees at Tribune outlets known for the depth and breadth of their news operations, notably WPIX-TV New York, KTLA-TV Los Angeles and WGN-TV Chicago.

“We have all grown up with this station,” says a WGN-TV news production staffer. “We’ve all worked here together for a long time. We are afraid [Sinclair is] just going to dismantle all of that.”

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