Nexstar, Mission Separate Companies in Eyes of FCC Despite Appearances

by Kate Knable  on Monday, Feb. 4, 2013 12:00 am  

By Federal Communications Commission standards, Nexstar Broadcasting of Irving, Texas, doesn’t own Mission Broadcasting.

The FCC allows media companies to own two television stations in a market under certain conditions, but the FCC does not permit ownership of more than two.

However, recent developments make Mission and Nexstar look a lot like a single entity. And if they were a single entity, that entity would now own four TV stations in Little Rock.

Mission, of Westlake, Ohio, bought Little Rock TV stations KLRT-TV, Channel 16, and KASN-TV, Channel 38, about a month ago from Newport Television of Kansas City, Mo.

The move continued a business model established by the two companies over several years: Mission owns a television station, and Nexstar provides certain services — sales support, shared newsgathering resources and staff — to that Mission station, even when Nexstar owns competing television stations in the same market.

While Nexstar doesn’t officially own Mission, it does hold a controlling interest in the company, according to generally accepted accounting principles. Publicly traded Nexstar acknowledges this in its annual reports, noting that it has “power over significant activities affecting Mission’s economic performance, including budgeting for advertising revenue, advertising and hiring and firing of sales force personnel.”

Evidence of that power has played out in the weeks since Mission officially closed on its purchase of KLRT and KASN. Mission and Nexstar have been consolidating station operations, collapsing both operations into one, with Mission’s new holdings appearing to take the brunt of the cuts.

For example, on Jan. 3, Mission laid off Chuck Spohn, KLRT’s long-time general manager. Mike Vaughn, general manager of Nexstar’s Little Rock stations —KARK-TV, Channel 4, and KARZ-TV, Channel 42 — is now GM of both Nexstar’s and Mission’s Little Rock stations.

The Mission stations no longer have their own offices on Colonel Glenn Road, but have been moved into Nexstar’s Victory Building space on Capitol Avenue downtown, which continues to be headquarters for KARK and KARZ.

And last Tuesday, when KLRT saw about 20 of its employees laid off, Nexstar’s KARK laid off around eight people.

The same day, Vaughn said two Nexstar employees, Deedra Wilson and Greg Dee, would be the anchors of the new morning news show on Mission’s KLRT.

“We will be looking to allocate the resources that we have to protect both brands — both NBC’s and Fox’s,” Vaughn said.

 

 

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