As Fox completes its station swap in the San Francisco market, the station group turns its focus to consolidating its grip on another lucrative NFL market: Seattle.
Fox has been playing hardball for months with Tribune Media in an effort to acquire Tribune's KCPQ-TV Seattle. The Fox Television Stations group is taking steps to purchase a small indie broadcast station that serves the Seattle market, KBCB-TV, in a bid to add pressure to Tribune to agree to a station swap that would result in the Fox O&O group acquiring KCPQ. Word of Fox's plan to purchase KBCB was first reported Wednesday by the Wall Street Journal.
Seattle is an attractive market to Fox because it its home to the Seattle Seahawks NFL franchise, which is part of the NFC conference game package for which Fox pays billions of dollars every year. Owning the hometown Seattle Fox affiliate would help 21st Century Fox wring more profits out of its NFL rights deal.
The Seattle scenario that Fox has put to Tribune is similar to the deal it just closed in the San Francisco market. Fox and Cox Media Group completed a swap in which Fox acquired Cox's KTVU-TV, a longstanding Fox affiliate, and KICU-TV in exchange for Fox's O&O stations in Memphis (WHBQ) and Boston (WFXT). Both Memphis and Boston have teams in the NFL's AFC conference, which means they are not as valuable to Fox as stations in NFC markets.
In exchange for Cox agreeing to the swap, Fox has ensured that the Memphis and Boston stations will remain Fox affils. Had Cox balked about giving up San Francisco, Fox surely would have threatened to yank the network affiliation from KTVU. The loss of a Big Four affiliation deal amounts to a major financial wallop for a broadcast station at a time when local outlets are already struggling to compete in a crowded media landscape.
One industry veteran noted that Fox is on a mission to grab as much turf in NFL markets as possible simply because it has the clout and the club to do so as station owners fear the loss of network affiliation deals.
Tribune Media, headed by former Fox and FX exec Peter Liguori, is said to be balking at the Seattle swap offer, even after Fox informed the company that KCPQ would lose its Fox affiliation on Jan. 17. Owning KBCB gives Fox an alternative in the Seattle market if Tribune holds fast on KCPQ, even though moving the Fox affiliation would require a major marketing effort as KBCB is a much more low-profile outlet that now carries home-shopping programming.
Tribune declined comment on Seattle other than to point to a statement issued Sept. 23 after it received the formal affiliation termination notice from Fox.
"We are continuing to engage in discussions with Fox and moreover have prepared for all operational and economic possibilities for our Seattle Fox station," Tribune said. Tribune has 13 other Fox affils. The Seattle station contributed $13 million in fiscal 2013 earnings, Tribune said.
In announcing the completion of the San Francisco deal, Fox Television Stations noted that it now has stations in 12 NFC markets "allowing it to further leverage the company's NFC broadcast package." With the San Francisco stations in place, Fox also now has duopolies in the seven of the top 10 TV markets.
© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC
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