Executives with Atlanta-based Gray Television said they believe the government will loosen regulations within the broadcasting industry as Donald Trump returns to the White House, an action that could ease competition in an industry battling for consumers’ attention.
During the media company’s third-quarter earnings call Friday, executives fielded questions from analysts about expected regulatory changes under the new administration. Trump’s wide-ranging agenda has promised lowering regulations across many industries. Analysts expect to see more merger and acquisition activity under Trump compared to more rigorous antitrust enforcement under the Biden administration.
Gray owns local television stations across 113 markets. In Georgia, it owns Atlanta News First (Channel 46) in Atlanta and stations in Albany, Augusta and Savannah. It is also the largest Telemundo affiliate group.
Gray Chief Legal Officer Kevin Latek said he expects the Federal Communications Commission will address some of the rules around ownership, which prohibits station groups from owning more than two stations ranked in the top four within the same local market and limits their total reach across all U.S. households to 39%.
“But I don’t know who has that crystal ball,” Latek said. “If so, I wish they would’ve told us the results of the election a couple days ago.”
Gray is one of several broadcasting companies that addressed the possibility of deregulation during earnings calls in the days following Trump’s reelection.
On Wednesday, conservative-leaning TV station giant Sinclair Broadcasting said it believes a “much-needed modernization” of broadcasting regulations is forthcoming. One day later, both TEGNA, which owns or operates about 70 stations, and Nexstar Media Group, which owns about 200 stations, expressed similar sentiments.
The FCC regulations around ownership haven’t been updated in two decades. And much has changed since then, Nexstar CEO Perry Sook said during the earnings call.
“When you step back and look at it, our industry’s real competition comes from Big Tech companies who have unfettered access to every screen in America — from phones, desktops to the TV in the living room — yet our ability to compete with those behemoths is stymied by regulations that were last updated in 2004,” Sook said.
Though Trump was generally more accommodating to business during his first term in office, his Department of Justice sued to stop the merger of AT&T and Time Warner in 2017. The companies eventually merged, but a few years later parted ways with Discovery buying Time Warner assets, including HBO, CNN and the Warner Bros. studio.
David Zaslav, CEO of what is now called Warner Bros. Discovery, said Trump’s victory may offer an opportunity for consolidation that could “provide a real positive and accelerated impact on this industry that’s needed.”
When asked by an analyst about Gray’s willingness to merge, buy or sell stations to increase value of its stock, CEO Hilton Howell said, “I’d be very open to consider anything.”
Gray reported revenue of $950 million, up 18% from the third quarter of 2023. Revenue for most broadcasting companies was up significantly year-over-year, boosted by political advertising. Gray’s political advertising totaled $173 million in the third quarter, which fell below its 2020 levels of $190 million.
Still, Gray is in cost-cutting mode. The company also said it is taking measures to save at least $60 million a year, including eliminating workers at undisclosed stations.
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