Key Points
- Nexstar laid off at least nine employees at Chicago station WGN-TV amid restructuring, even as it seeks FCC approval for its $6 billion TEGNA acquisition.
- The company argues consolidation is needed to compete with streaming rivals, but critics cite prior newsroom cuts and market consolidation.
- The proposed deal exceeds the FCC’s 39 percent ownership cap, which Nexstar has urged regulators to eliminate.
Nexstar Media Group has issued sweeping layoffs at its television station in Chicago, even as the company continues to lobby federal regulators for permission to acquire peer broadcasters through the promise of more local news investments.
On Monday, at least nine workers at WGN-TV (Channel 9) were given pink slips, part of an ongoing restructuring effort at the station that once served as the flagship broadcaster of Tribune Media, which Nexstar acquired in 2019.
Among the reporters and on-air talent who were let go were reporters Julian Grews and Bronagh Tumulty, news anchors Judy Wang, Sean Lewis and Ray Cortopassi, meteorologist Mike Janssen and political analyst Paul Lisnek.
A spokesperson for Nexstar told the Chicago Sun-Times newsroom that the layoffs were necessary due to “unprecedented change” in the broadcast industry. The newspaper said the layoffs were likely intended to help offset a sizable amount of debt that Nexstar expects to incur from its proposed $6 billion purchase of peer broadcaster TEGNA, which was announced last summer.
That acquisition requires the approval of the Federal Communications Commission (FCC). Ordinarily, a transaction at that size would be rubber-stamped for rejection: Under current FCC rules, one company may not hold broadcast licenses for TV stations that reach more than 39 percent of the American viewing audience.
Nexstar already exceeds this cap by engaging in sharing agreements with shell companies that hold broadcast licenses on paper, but otherwise cede all operational control of its stations to the Texas-based media enterprise. In marketing materials, Nexstar says its owned and partner stations reach more than 80 percent of American TV viewers, while it ownership stake of the CW Network increases that reach to nearly 100 percent.
Nexstar is one of several broadcasters that has pushed the FCC to eliminate its ownership cap, saying mass-media consolidation is necessary to better compete against major streaming services like Netflix and Google-owned YouTube, which have started to license lucrative sports programming in an effort to capture a larger share of TV advertising dollars.
Streaming services are not hamstrung by arguably-onerous limitations imposed by the FCC, the broadcasters complain, which means they are allowed to scale their operations without restraint. Few streaming services make investments in local news and community-oriented programming; broadcasters do because their government-issued licenses to transmit on the air waves require them to serve the public interest, a term that isn’t defined.
Without mass-media consolidation, Nexstar and others warn their investments in local news will become challenged, since streaming services are siphoning away ad dollars. But Nexstar’s prior acquisitions have already resulted in newsroom consolidations, including in Denver, where co-owned KDVR (Channel 31, Fox) and KWGN (Channel 2) merged their newsrooms after Nexstar bought Tribune.
Other broadcasters, including TEGNA, Sinclair and Allen Media, have implemented layoffs and winnowed away their local newsrooms, primarily in small and rural markets where local news is already difficult to come by given the erosion of the local newspaper and radio industries.
In 2023, Sinclair closed a handful of its small-market newsrooms, consolidating some into regional news hubs and replacing a few newscasts with “The National News Desk,” a news shows that is produced out of Washington, D.C. (Sinclair previously announced its support for Nexstar’s acquisition of TEGNA. Last week, FCC Chairman Brendan Carr said Nexstar’s acquisition is moving forward, though the companies are still working through a customary period of review by the U.S. Department of Justice, according to a source.)
Two years later, Allen Media announced a plan to centralize weather forecasting at its local TV stations from its studios in Atlanta, where its cable network The Weather Channel is based. The move was met with strong opposition from local TV viewers and advertisers in several cities where meteorologists had already received layoff notices, and the plan was temporarily reversed. Allen Media quietly moved forward with laying off some meteorologists a few months later.
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