The Poynter Institutereports Federal Communications Commission Chair Ajit Pai questioned whether Sinclair Broadcast Group's deal to purchase Tribune Media involved a "possible sham transaction."
Pai suspects Sinclair of trying to skirt the government's rules on how much of the country a TV owner can serve by selling some stations to friends but keeping control of the stations.
The commission has tabled the $3.9 billion merger and sent it to a federal administrative judge, which could doom the deal because that action will take more time -- maybe a lot more time -- and adds to the chances that the deal might fall apart.
Shop Talk panelist Jasmine Crighton believes many industry observers did not see this coming. She said most thought the FCC would push through the transaction because Sinclair has cozied up to the Trump administration.
Crighton is glad to see the deal delayed. She feels it would have given Sinclair control of stations in too many markets. She prefers to see a greater diversity in ownership of TV stations.
Panelist Rich Egger said the Poynter article indicated Sinclair was prepared to sell WGN to friends for a fraction of what it is probably worth, which added to concerns about the deal.
He also questioned whether the ownership rules for TV stations are antiquated. He pointed out cable TV and newspaper chains face no such restrictions.
Panelist Will Buss said the proposed sale faced a lot of pushback. He feels the deal deserved a closer look and hopes that is why the FCC took its action.
Buss said large newspaper chains usually strip out newsrooms when they acquire local papers. He’s concerned Sinclair would do the same if it acquired Tribune Media.
Jasmine Crighton is News Director of NEWS3 at Western Illinois University and Will Buss is the Director of Student Publications at WIU.
