In order to inoculate regions from excessive influence, the Federal Communication Commission (FCC) and Department of Justice (DOJ) have regulations that prevent media companies from owning too many properties in any one area. In the case of Sinclair Broadcast Group, which made a $985 million bid to purchase several Allbritton Communication Company properties, the DOJ raised concerns, slapping the deal with a lawsuit in 2013 and halting it pending further investigation.
But the DOJ’s concerns are now one step closer to being assuaged, as the regulator and Sinclair have tentatively agreed to a settlement that divests some stations in the area that Allbritton and Sinclair shared, ensuring there is no communications or advertising monopoly in the region.
Sinclair currently owns both a CBS and CW affiliate in Harrisburg Pa.; its acquisition of the Allbritton property Perpetual Corp. would also give it control over the region’s ABC affiliate. However, in a deal reach in May, Sinclair agreed to sell the ABC affiliate to Media General Inc. once the deal with Allbritton has been finalized.
Those terms have been deemed acceptable by the DOJ, and the deal is expected to be approved within the next few months. Sinclair will still need to garner the FCC’s approval to complete the transaction.
In a statement released by the DOJ on July 16, Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division said, “Perpetual’s WHTM-TV competes directly with WHP-TV and WLYH-TV, two stations owned or operated by Sinclair, in the sale of broadcast television spot advertising in parts of central Pennsylvania. The rivalry between the stations has helped to constrain advertising rates, and without the divestiture, advertisers on stations in this area would likely have paid higher prices.”
The settlement terms, along with competitive analysis on the impact of the deal will be published in the Federal Register, giving those with concerns up to 60 days to add opinions and comments.