Nexstar-Tegna Merger Approved Amid Antitrust Lawsuits: What to Know
Nexstar-Tegna Merger Clears Regulatory Hurdles, Faces Legal Challenge
The Federal Communications Commission (FCC) approved Nexstar Media Group’s $6.2 billion acquisition of Tegna on Thursday, , a deal poised to create the nation’s largest local television station owner. However, the approval was immediately met with legal opposition, as attorneys general from eight states and DirecTV filed lawsuits seeking to block the merger, alleging it will lead to higher prices for consumers and harm local journalism.
The combined company will own or operate almost 260 stations across the country, surpassing the FCC’s previous ownership cap of 39%. To gain approval, Nexstar agreed to divest six stations, a concession that FCC Chairman Brendan Carr framed as ensuring continued investment in local broadcasting. “The FCC has been focused on empowering broadcast TV stations to serve their local communities,” Carr stated. The Justice Department also signed off on the deal, though independent confirmation of that approval was not immediately available.
The lawsuits, filed in U.S. District Court in Sacramento, California, represent a significant challenge to the merger. The states – California, Colorado, Connecticut, Illinois, New York, North Carolina, Oregon and Virginia – argue the consolidation will stifle competition and ultimately harm viewers. New York Attorney General Letitia James asserted the merger would “spike cable prices for consumers in New York and across the country.” DirecTV echoed these concerns, predicting Nexstar would leverage its increased market power to demand higher fees from distributors, costs that would likely be passed on to subscribers.
Beyond pricing concerns, the lawsuits highlight the potential impact on local news. With Nexstar and Tegna stations overlapping in 31 markets, the attorneys general fear further consolidation of newsrooms and a reduction in independent local reporting. This concern reflects a broader trend of declining local news coverage across the United States, a trend the FCC Chairman paradoxically claimed this merger would help reverse.
The approval process wasn’t without internal dissent. FCC Commissioner Anna Gomez condemned the decision, criticizing the lack of a formal vote and arguing the merger would exacerbate the existing challenges facing local journalism. “Local journalism is under extraordinary strain,” Gomez said, warning that the deal would “concentrate broadcast power in fewer corporate hands.”
Nexstar CEO Perry Sook framed the merger as essential for sustaining strong local journalism, stating the combined company would be “a stronger, more dynamic enterprise—better positioned to deliver exceptional journalism and local programming.” However, Nexstar’s past actions raise questions about its commitment to local news. Last fall, the company briefly ordered its ABC stations to pull late-night host Jimmy Kimmel from the air following controversial remarks, a move that sparked public backlash and ultimately led to Kimmel’s reinstatement and Nexstar’s reversal.
The legal battle over the Nexstar-Tegna merger underscores the growing scrutiny of media consolidation. The Biden administration and state attorneys general are increasingly willing to challenge large-scale mergers, particularly in industries where competition is already limited. This case, along with ongoing debates over the power of tech giants and the future of news, suggests a more interventionist approach to antitrust enforcement is taking shape. The outcome of these lawsuits will likely set a precedent for future media mergers and could significantly reshape the landscape of local television news.
Observers should watch for the courts’ response to the states’ arguments regarding anti-competitive practices and the impact on consumer pricing. The case also highlights the ongoing tension between the FCC’s desire to support local broadcasting and concerns about media consolidation. Further developments in this case could signal a shift in regulatory policy towards media ownership and competition.