The long, strange saga surrounding the abrupt departure of Jimmy Kimmel Live! from 63 affiliate stations owned by the companies Sinclair and Nexstar is just beginning. In fact, the back and forth between these companies may be best understood as the latest skirmish in a broader campaign.
As of Wednesday, the show is still pre-empted on Sinclair and Nexstar’s networks. And even if they return Kimmel to their airwaves tonight (the broadcasters say they’ve had “productive discussions” with ABC-owner Disney), it would not mark the end of this particular storyline.
FOR Scoops, Sharp Analysis, and Insider Context
By submitting your email, you agree to our Terms of Use and Privacy Policy . You may opt-out anytime by clicking ‘unsubscribe’ from the newsletter or from your account.
Subscribe
Loading…
Depending on whom you ask, this ordeal could have begun under the Biden administration, whose FCC chair Jessica Rosenworcel delayed the renewal of a broadcast license owned by Fox to be delayed, rankling conservatives who accused the FCC of political overreach. Sound familiar?
But most media analysts will tell you this began last December, when ABC settled a lawsuit brought against it by President Trump by paying $15 million to the president.
The concession was the first accommodation from a news media company to the Trump administration, and it set a precedent that would soon repeat itself several times over. Since then, Trump and his appointees have taken or provoked legal action against a handful of news outlets, including The Associated Press, News Corp., and The New York Times.
No matter what point you pin as the specific origin, though, the more important consideration is that this issue will in no way conclude if Kimmel returns to ABC’s affiliates. Instead, the ramifications of this particular episode will simply shape the outlines of the next one, whose contours are already coming into focus.
So, rather than focus on what resolution looks like in the short term, here are four questions I have as this saga unfolds.
When will Sinclair and Nexstar resume airing Jimmy Kimmel Live, if they ever do?
On Tuesday, a tactfully contrite Kimmel offered more than enough of an elegy for Sinclair and Nexstar to plausibly consider the issue resolved.
Still, as of Wednesday afternoon, neither affiliate network has given any indication that they plan to resume airing the show. Nexstar told ADWEEK in a statement that the company is “still evaluating” the show, which will be “preempted while we do so.”
The smart money would suggest that this issue is resolved shortly. It is exceedingly rare for affiliate stations to preempt content from their broadcasters, and they can only do so a limited number of times before they breach their contracts, according to media analyst Paul Farhi.
But there are other, salient timelines to consider here.
Nexstar is in the midst of a merger that requires FCC approval. That merger, announced in August, would see Nexstar acquire Tegna, another local TV operator, for $6.2 billion.
Critically, an FCC rule prevents any affiliate network from owning more than 39% of the market. With this merger, Nexstar may vastly exceed the limit, entering 80% of U.S. households. For the merger to clear then, the FCC would have to rewrite its rules to change this cap.
While Nexstar has not acknowledged this dynamic, it made the decision to preempt Kimmel hours after FCC chair Brendan Carr suggested on a podcast that licensed broadcasters should do so in light of the comments Kimmel made on his show about Charlie Kirk.
It just so happens that Nexstar is due to submit the relevant filings for this merger to the FCC by the end of September. Given the delicacy of the situation, Nexstar might be uninterested in bringing Kimmel back on air while the FCC evaluates its bid.
Are there still more concessions to be made, from Nexstar, Sinclair, or Disney?
The analysts I spoke to are split as to which party has the upper hand here. But one thing is clear: Disney has made the concessions it understood to be necessary, but Sinclair and Nexstar have not yielded.
That introduces the question, as analyst Michael Rosen put it: What do they want? On that front, there are several potential explanations.
Disney, which still has a sizable linear business, is reliant on viewership from its affiliates to meet advertising commitments. The longer it’s without Nexstar’s and Sinclair’s audiences, the greater the likelihood becomes that it will have to issue make-goods to compensate for the depressed viewership.
As mentioned above, Nexstar wants its deal with Tegna to be approved by the FCC. Mostly, that means staying in the good graces of the agency, according to media analyst Peter Naylor.
At Skydance Paramount, another media company whose recent merger also required FCC approval, the company made—and continues to make—a number of changes designed to bring more conservative sensibilities into the organization. In recent months, it has pursued an acquisition of the conservative outlet The Free Press, appointed conservative think-tanker Kenneth R. Weinstein as ombudsman, and announced plans to sunset The Late Show With Stephen Colbert.
Perhaps Sinclair and Nexstar, in alignment with the FCC, could squeeze Disney to implement similar measures to bring more political parity to its content? Or, more prosaically, the networks might simply use this opportunity to push for lower retransmission fees. Never let a good crisis go to waste!
How will this standoff affect the blockbuster deals these companies are in the midst of?
Nexstar is not the only company involved with a deal on the line.
Disney has two separate deals of its own, both of which will be subject to governmental approval to some degree.
In August, ESPN announced an equity deal with the NFL, through which the league would take a 10% stake in ESPN in exchange for ESPN taking ownership of the NFL Network and its RedZone Channel, among other media assets.
ESPN, which is owned by Disney, expects to encounter regulatory hurdles as part of this deal, given that it will give Disney greater control over televised sports carriage and reduce competition.
Critically, antitrust scrutiny would come from the Department of Justice, not the FCC, meaning Disney is beyond the long arm of the Carr on this one. But given the recent history of President Trump co-opting any division of the government to serve his whims, Disney may like to minimize any opportunity the DOJ might have for opposing the transaction.
Similarly, Disney has a second deal in the works that might require federal approval. The company announced in January that it was acquiring a 70% stake in Fubo, which has similar hurdles as its ESPN deal with the NFL. Antitrust concerns have already arisen given how much control the merger would give Disney over the distribution of sports rights, especially given that it has a similar offering already in Hulu+ Live TV.
What does this mean for the future of Disney’s broadcast TV versus streaming?
Virtually every element of this melodrama will hasten the move of audiences and attention from linear television to streaming.
Disney is stuck negotiating with Sinclair and Nexstar because its broadcast channel, ABC, offers it a key point of differentiation compared to other media companies, as well as a large viewership that helps it secure the rights to valuable packages, like sports broadcasts. Yes, broadcast audiences are the smallest they have ever been, but it is still better to have one than not.
Still, this headache has undoubtedly made Disney weigh just how valuable that broadcast audience is, according to media analyst Evan Shapiro. Streaming is beyond the purview of the FCC, meaning that content on Disney+, Hulu, and the ESPN app is subject to none of the oversight that its broadcast channel is. Were Disney to simply yank Kimmel from ABC and air his show on Hulu, these problems would disappear.
As the entertainment industry shifts slowly from linear to streaming, affiliate networks like Sinclair and Nexstar will have to account for these dwindling linear numbers, while Disney will focus on growing its streaming audience. In the future, the two parties might have little to do with one another.
But for now Disney’s linear business is still a sizable part of its operations, and continues to subsidize the growth of its streaming operation. Until that is no longer the case, Sinclair and Nexstar will have an outsize influence on its decisionmaking.
