Nexstar is reportedly among those in talks to acquire The CW, which is currently programmed entirely by shows produced by WarnerMedia and ViacomCBS.
Fifteen years after its creation, The CW remains one of the most unique experiments in television history. Now, the two companies who joined forces to form it from the scraps of The WB and UPN, are reportedly looking to get it go.
According to a report in the Wall Street Journal, the move comes as WarnerMedia is seeking to be bought out by Discovery and after CBS was picked up by Viacom -- and both companies are expanding their own digital footprints with streaming platforms HBO Max and Paramount+, respectively.
The CW has never been profitable as a network, but its owners have found other ways to keep the cash flowing in. In particular, over the past decade, it's become a great content farm, with WarnerMedia and ViacomCBS producing all of its content themselves and then being able to sell distribution rights globally and to streaming platforms.
While ratings on The CW may not be great directly, a deal struck a decade ago with Netflix granted the streamer rights to the network's entire lineup where its shows found even bigger audiences, and the network's parents nabbed $1 billion. And that's just one deal.
Created in-house by WarnerMedia and ViacomCBS, those programs have grown to include the sprawling Arrowverse of DC superhero series as well as "Riverdale," "The Vampire Diaries" franchise," "Jane the Virgin," "Supernatural," "Walker," "The 100" and more.
Now, though, the companies have their own streaming platforms they can build out with these original properties, even as the traditional network model is fading in viewership. So they ended that deal with Netflix, bringing these shows even more in-house by putting them directly onto their own platforms.
On top of that, the people who created the current operating model of The CW are no longer with either company (including Les Moonves), leaving this legacy entity that may not make sound business sense to the current owners.
Is there still value for each company to drop shows on the shared CW network before moving them onto their respective streaming platforms? Should a deal move forward, would WarnerMedia and ViacomCBS remain the sole content providers for the network under new ownership or would the new owners want to flex in a different direction?
All of that remains to be seen, but there is definitely value in the network and the properties it has brought into the world. CW programming skews younger than any of the other major broadcast networks, and has strong social and online imprints. In other words, it caters to advertiser's favorite demographics and those hardest to reach through traditional models.
According to WSJ, Nexstar Media Group is among those interested in picking up the network. After its recent acquisition of Tribune, Nexstar owns more CW affiliates than any other company. The parent companies of the other networks also own more affiliates than any other, so there is a nice industry parallel there, should such a deal come together.
There are, though, other entities interested. For its part, WarnerMedia is awaiting regulatory approval for its acquisition by Discovery, so it may be that divesting its controlling share of a secondary network could make a difference.
According to Deadline, it's possible that WarnerMedia and ViacomCBS will seek to retain a minority stake in the network, though giving up full ownership to the right buyer remains on the table, as well.