The issue of late payments by Byron Allen’s broadcast stations has raised concerns among network owners, leading to frustration and strained relationships. Despite expressing public interest in purchasing various media assets for billions of dollars, Allen Media Group has been consistently late in making payments to networks such as ABC, CBS, and NBC. This has not only angered media allies but has also created distance between Allen and his potential deal partners, as reported by CNBC.
The fact that Allen’s stations have been as much as 90 days past due on payments is uncommon among local broadcasters. Most local broadcasters pay substantial amounts to larger network owners, such as ABC, CBS, and NBC, for carrying their brand and content, especially live sports like the NFL. The frustration from the network owners is evident, even after agreeing to payment plans at Allen’s request. The late payments have been ongoing, with the extent of lateness worsening over time.
It remains unclear why Allen Media Group has repeatedly been late with payments to network owners. While the exact amount of the payments that were made after CNBC reached out to Allen Media could not be immediately determined, it is evident that the network owners’ frustration has been escalating. The sources of the funds to pay the network owners largely come from retransmission fees that cable TV operators pay to the stations.
Various divisions of Allen’s company have reportedly undergone layoffs in recent months, with another round of job cuts expected at the end of August. This further highlights potential financial challenges faced by Allen Media Group, despite Allen’s ambition to expand his media holdings through high-profile acquisitions. The late payments of tens of millions of dollars contrast sharply with Allen’s multibillion-dollar bids for media assets in the past.
Notably, Allen’s frequent pursuit of multibillion-dollar deals that have not materialized has led to investment bankers and financial institutions losing faith in him as a serious buyer for large assets. Recent bids for Paramount Global, ABC, Disney networks, and Paramount’s BET Media Group have not been successful. This has raised questions about Allen’s credibility as a buyer, despite his vocal ambitions to grow his media empire.
Allen has a history of ambitious bids for media properties, often reaching into the billions of dollars. However, failed attempts at acquisitions have cast doubt on his ability to close deals successfully. Allen’s recent interest in bidding on media properties, even for unconfirmed reports of interest, may further contribute to a perception of uncertainty around his acquisition strategy.
Despite the financial challenges and late payments, Allen Media Group has expanded its media empire through acquisitions such as The Weather Channel and a string of smaller deals. The broadcast stations owned by Allen generate revenue through advertising and retransmission fees, like other stations. However, the shift from traditional TV to streaming platforms has impacted broadcast station groups, including Allen’s.
Byron Allen’s late payments to network owners, the financial challenges faced by Allen Media Group, and the strained relationships with potential deal partners have raised questions about the future of his media empire. The contrast between his ambitious bids for media assets and the reality of financial difficulties highlights the challenges of expanding a media company in a rapidly evolving industry landscape.