D.C. Memo: Nexstar, Gray Media Try Glass-Steagall Repeal Strategy to Gain FCC Merger Approvals
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TV Stations: Do the rules shape the industry or does the industry shape the rules? The answer is evolving at the FCC in a TV station industry power play that looks a lot like the successful effort by Wall Street banks to repeal the foundational Glass-Steagall Act a generation ago. Evidently, FCC Chairman Brendan Carr has dropped enough hints to the point that some TV station owners feel embolden to strike deals that violate current FCC rules on the assumption that Carr will either change the rules or grant waivers. Either way, a consolidated TV station sector is attempting to break contain – and rather quickly. On Friday, the Wall Street Journal and Reuters reported that Nexstar Media Group is in advanced talks to buy TEGNA. The deal would combine No. 1 Nexstar and No. 4 TEGNA by revenue, creating a 264-station giant certain to blow the lid off the FCC’s 39% cap on national TV household reach. Nexstar CEO Perry Sook has been targeting the 39% cap ever since President Trump won election last November, stressing the need for TV stations to bulk up to compete with Big Tech. A merged Nexstar-TEGNA would have $8.36 billion in annual revenue and $8 billion in market capitalization at Friday’s close. Compared to Big Tech, Nexstar-TEGNA would rank as a financially inconsequential minnow: Amazon (market cap $2.3 trillion) collects $8.36 billion in revenue every 4.5 days on average. Gray Media isn’t waiting for new FCC rules to show up, either. In the past five weeks, Gray has announced three deals (one involving stations swaps and two outright station buys) that technically violate FCC rules that ban the common ownership of two or more Top Four stations in a market. Procedurally, Gray looks to be in better shape than Nexstar-TEGNA. The FCC is in the middle of a review of the statutory 39% cap (more comments are due at the FCC by Aug. 22) but on July 23, 2025 a panel of the U.S. Court of Appeals for the Eighth Circuit vacated the Top Four rule. Nexstar and Gray Media appear to be relying on a consolidation strategy that Washington, D.C., has seen before: Repeal of Glass-Steagall, the famous New Deal law that banned commercial banks from engaging in investment banking. (More after paywall.)
