Sinclair Stock

Sinclair, Inc. operates as a diversified media company. The company provides high-quality content on its local television stations, digital platform. The content, distributed through the company’s broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, other original programming produced by it and its owned networks. Additionally, the company owns digital media products that are complementary to its extensive portfolio of television station related digital properties and it has interests in, own, manage and/or operate technical and software services companies, research and development for the advancement of broadcast technology, and other media and non-media related businesses and assets, including real estate, venture capital, private equity, and direct investments.

Broadcast

As of December 31, 2022, the company’s broadcast segment primarily consisted of its broadcast television stations. The company owns, provides programming and operating services pursuant to local marketing agreements (LMA), or provides sales services and other non-programming operating services pursuant to other outsourcing agreements (such as joint sales agreements (JSA) and shared services agreements (SSA)) to 185 stations in 86 markets. These stations broadcast 636 channels, including 236 channels affiliated with primary networks or program service providers consisted of FOX (55), ABC (40), CBS (30), NBC (25), CW (46), and MyNetworkTV (MNT) (40). The other 400 channels broadcast programming from programming services, including Antenna TV, Bounce, CHARGE!, Comet, Dabl, Decades, Estrella TV, GetTV, MeTV, Quest, Rewind, Stadium, TBD, TCN, Telemundo, This TV, UniMas, Univision, Weather, and two channels broadcasting independent programming.

The company’s broadcast segment provides free over-the-air programming to television viewing audiences in the communities it serves through its local television stations. The programming that the company provides on its primary channels consists of network provided programs, locally-produced news, local sporting events, programming from program service arrangements, syndicated entertainment programs, and internally originated programming. The company provides live, local sporting events on many of its stations by acquiring the local television broadcast rights for these events or through its relationship with national networks.

The company is one of the nation's largest producer of local news. The company produces more than 2,500 hours of news per week at 126 stations in 80 markets. For the year ended December 31, 2022, the company’s stations were awarded with 290 journalism awards, including 24 regional and two National RTDNA Edward R. Murrow awards, and 74 regional Emmy awards.

The company’s broadcast segment derives revenue primarily from the sale of advertising inventory on its television stations and fees received from Distributors, which includes distributors that distribute multiple television channels through the internet without supplying their own data transport infrastructure; as well as other over-the-top (OTT) distributors that deliver live and on-demand programming, for the right to distribute its channels on their distribution platforms. The company also earns revenues by selling digital advertisements on third-party platforms, providing digital content to non-linear devices via websites, mobile, and social media advertisements, and providing digital marketing services. The company attracts most of its national television advertisers through national marketing representation firms. The company’s local television advertisers are primarily attracted through the use of a local sales force at each of its television stations, which consists of approximately 520 marketing consultants and 70 local sales managers company-wide.

The company’s operating results are subject to cyclical fluctuations from political advertising. Political spending has been significantly higher in the even-number years due to the cyclicality of political elections. In addition, every four years, political spending is typically elevated further due to the advertising related to the presidential election. Because of the political election cyclicality, there has been a significant difference in the company’s operating results when comparing even-numbered years’ performance to the odd numbered years’ performance. Additionally, the company’s operating results are impacted by the number and importance of individual political races and issues discussed on a national level as well as those within the local communities it serves.

Television Markets and Stations: The company’s broadcast segment owns and operates or provides programming and/or sales and other shared services to television stations in various markets.

Market

Local Sports

Deconsolidation of Diamond Sports Intermediate Holdings LLC. On March 1, 2022, SBG's subsidiary Diamond Sports Intermediate Holdings, LLC, and certain of its subsidiaries (collectively DSIH) completed a series of transactions (the Transaction).

Other

Owned Networks and Content

The company owns and operates Tennis Channel, a cable network which includes coverage of many of tennis' top tournaments and original professional sport and tennis lifestyle shows; the Tennis Channel International streaming service; Tennis Channel Plus streaming service; T2 FAST, a 24-hours a day free ad-supported streaming television channel; and Tennis.com, the most visited online tennis platform in the world (collectively, Tennis).

The company also owns and operates various networks carried on distribution platforms owned by it or others, including: Comet, its science fiction network; CHARGE!, its adventure and action-based network; and TBD, the first multiscreen TV network in the U.S. market to bring premium internet-first content to TV homes across America. The company also has a majority ownership interest in Stadium, a network that brings together professional sports highlights and college games.

The company’s internally developed content, in addition to its local news, includes its original news program, The National Desk (The National Desk), with a morning edition hosted by Jan Jeffcoat, an evening edition hosted by Meagan O'Halloran, and a weekend edition hosted by Eugene Ramirez, and Full Measure with Sharyl Attkisson (Full Measure), its national Sunday morning investigative and political analysis program. In 2022, the company announced a broad, multi-platform creative partnership with Anthony E. Zuiker, creator of the CSI: Crime Scene Investigation franchise, to create content across a range of formats and subjects. Working with the company’s news teams, Mr. Zuiker will highlight the compelling stories that deserve to be told in a longer, more dynamic format, broadening the appeal for a global audience. Mr. Zuiker will also develop content that can live adjacent to news programming and across ancillary verticals. Potential programming categories include docuseries, game shows, and topical talk.

Digital and Internet

The company earns revenues from Compulse, a marketing technology and managed services company, by licensing the platform to other local media companies and agencies, as well as executing their digital media initiatives across search, social, programmatic, email, and more.

NewsON is a free, ad-supported app that provides instant access to live or on-demand local news broadcasts, including non-Sinclair affiliate partners. Sinclair Digital Ventures focuses on investment in emerging digital technologies, ad tech, and digital content companies that support, complement, or expand the company's businesses.

In November 2020, the company entered into agreements for a long-term, enterprise-wide strategic partnership with Bally's Corporation (Bally's) to combine Bally's vertically integrated, proprietary sports betting technology and expansive market access footprint with its premier portfolio of local broadcast stations, Tennis, digital and over-the-air television network Stadium and the RSN's.

Technical Services

The company owns subsidiaries which are dedicated to providing technical services to the broadcast industry, including: Dielectric, a designer and manufacturer of broadcast systems including all components from transmitter output to antenna; and ONE Media 3.0, whose purpose is to develop business opportunities, products, and services associated with the NextGen TV broadcast transmission standard and TV platform. The company has also partnered with several other companies in the design and deployment of NextGen TV service,s including: Saankhya Labs to develop NextGen TV technologies to be used in consumer devices; CAST.ERA, a joint venture with South Korea’s leading mobile operator, SK Telecom, to develop wireless, cloud infrastructure and artificial intelligence technologies; and BitPath, a joint venture with another broadcaster, to deploy and exploit datacasting models using NextGen capabilities.

Non-Media Investments

The company owns various non-media related investments across multiple asset classes, including real estate, venture capital, private equity, and direct investments in market-defining companies. The company’s investments in real estate include commercial real estate, including office and retail space, and residential real estate, including apartment complexes and development projects. The company’s investments in venture capital and private equity funds include capital for the advertising, marketing, and media technology sectors, sports betting, e-sports, and sports tech, as well as funeral homes, cemeteries, and pet cremation facilities. The company holds direct investments in technology driven companies, including wireless communication and semiconductor solutions, next-gen communication solutions, advertising intelligence and data security.

Customers

In 2022, the broadcast and, prior to the Deconsolidation, local sports segments had three customers that individually exceeded 10% of consolidated revenue.

Strategy

The company seeks to target its programming offerings to attract viewership, to meet the needs of the communities in which it serves, and to meet the needs of its advertising customers by entering into network affiliation agreements that provide it the right to broadcast general entertainment network programming, national news, and sports programming. The company may consider other alternative programming formats that it could air using its multi-channel digital spectrum space with the goal towards achieving higher profits and community service. The company has distribution agreements with Distributors and other OTT distributors who compensate it for the right to retransmit its stations and other offerings on their respective distribution platforms.

The company’s Dielectric subsidiary is a leader in servicing and manufacturing broadcast infrastructure. As a result, the company maintains a strong infrastructure through which it provides high quality uninterrupted content on its stations. This subsidiary is critical in the build-out of the infrastructure behind NextGen TV for both the company’s stations and other broadcasters.

The company strives to develop new business models to complement or enhance its traditional television broadcast business. The company has developed new ways to sell online, mobile text messaging, social media advertising, and audience extension services along with its traditional commercial broadcasting model. The company continues to expand its digital distribution platforms through initiatives, such as its video management system, which simplifies and automates its broadcast-to-digital streaming workflow and allows for dynamic replacement of broadcast ads with digital ads targeted to each individual viewer and allows it to ingest and redistribute content across its platform so that it can break news first.

In 2022, the company announced a broad, multi-platform creative partnership with Anthony E. Zuiker to create content across a range of formats and subjects. Additionally, the company continues to develop business opportunities, products, and services associated with NextGen TV (also known as ATSC 3.0). In November 2020, the company entered into agreements for a long-term strategic partnership with Bally's. The company’s news stations also produce content on digital platforms, such as websites, mobile applications, OTT distributors, social media, digital newsletters, and podcasts. The company routinely reviews potential media acquisitions, dispositions, and swaps, or develop original networks and content.

The company continues to seek additional opportunities to invest in emerging digital technologies, ad tech, and digital content companies that support and expand its digital capabilities and non-linear footprint. The key elements of the company’s strategy are to develop next generation wireless platform; and develop local franchises.

In order to bring this technology to the market, the company has partnered with technology leaders to develop broadcasting solutions and services in the U.S. and globally. The company has also formed BitPath, a joint venture with another broadcaster, to promote spectrum efficiency and innovation, aggregate and monetize underutilized spectrum capacity over which to deliver national services, and create opportunities, such as robust video and data exchange. The company continues to work with other NextGen TV stakeholders to build and test the single frequency network tower infrastructure, develop systems to allow the convergence of NextGen TV and 5G data delivery, and design NextGen TV receiver chips for mobile, portable and fixed devices. In 2020, the company and the industry began deployment of NextGen TV capabilities on some of its own television facilities and in conjunction with other station operators in its markets, as well as non-Sinclair markets. As of December 31, 2022, NextGen TV is broadcasting in more than 60 markets, including 36 of its markets.

The company has developed, through its ONE Media, LLC subsidiary, several NextGen Broadcast-related patents that it intends to monetize directly, through third-party agents, or through a patent pool designed to consolidate similar patents owned by independent licensors for licensing to equipment manufacturers.

Federal Regulation of Television Broadcasting

The company’s articles of incorporation contain limitations on alien ownership and control that are substantially similar to those contained in the Communications Act of 1934, as amended (Communications Act).

History

Sinclair, Inc., a Maryland corporation, was founded in 1986.