Why a Few Derailments Won’t Stop the Media Merger Train

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The Trump era has now seen two major media mergers halted or almost stopped — Sinclair Broadcast Group’s combination with Tribune Media, and AT&T’s acquisition of Time Warner. Both transactions met with turbulence from the feds, but that does not signal that media consolidation will be slowed in the coming years — far from it. In fact, getting far less attention are moves that likely will encourage more media mergers and acquisitions down the road. Here are a few examples: 

  • Broadcasters still may find it easier to get bigger. Despite the Sinclair fiasco, the Federal Communications Commission is still considering proposals to revise the national ownership cap, which currently limits TV station groups to holdings that reach no more than 39% of the country. 
  • Film studios may be able to get stronger. The Justice Department recently launched a review of the Paramount consent decrees, the 70-year-old restrictions that prohibit major studios from owning theater chains and disallow a number of business practices between distributors and exhibitors.
  • There’s a way to get a greenlight quickly. The friction between big media and the feds in many ways overshadowed one of the most consequential actions — the DOJs approval of the Walt Disney’s purchase of much of 21st Century Fox in June. Many expected that the merger process would take a year; instead, it cleared in about six months.
  • Tribune is still for sale. The Sinclair deal may be dead, but that doesn’t mean Tribune isn’t on the block. 

Why a Few Derailments Won’t Stop the Media Merger Train