AMG's Strategic Retreat: Selling Linear TV Assets to Survive the Digital Tsunami

The media landscape is in upheaval. Cord-cutting, ad dollars fleeing to streaming platforms, and regulatory shifts are reshaping the industry—and Allen Media Group (AMG) is responding with a bold move: selling its entire portfolio of 28 network-affiliated TV stations. This isn't just a realignment; it's a lifeline. Let's dissect why AMG is offloading linear TV assets—and why buyers might be picking up a diamond in the rough.

The Debt Dilemma: Why AMG Had No Choice

AMG's $1 billion bet on acquiring TV stations between 2019 and 2024 has left it drowning in debt. With a junk credit rating and delayed payments to network owners (up to 90 days overdue in 2024), the company faces existential pressure. The sale—managed by Moelis & Co.—is a calculated move to slash liabilities and avoid insolvency.

But this isn't just about survival. The linear TV model is collapsing. would show how AMG's leverage has skyrocketed compared to rivals who've already divested non-core assets. Buyers, however, see opportunity in AMG's pain.

Buyer's Paradise: Undervalued Assets in a Disrupted Industry

The stations AMG is selling—ABC, CBS, NBC, and Fox affiliates in markets like Honolulu, Madison, and Flint—are no slouches. They generate steady local ad revenue and anchor AMG's Local Now streaming service, which aggregates 300+ channels. Yet their value is discounted due to industry-wide headwinds:

1. Cord-Cutting Carnage: Over 50% of U.S. households now cut the cord, gutting traditional TV's audience.
2. Ad Dollars Fleeing: Digital platforms (Meta, Google) now command 75% of global ad spend, leaving broadcast networks scrambling.
3. Regulatory Tailwinds: The FCC's push to relax ownership rules could allow buyers to consolidate stations, boosting bargaining power with networks.

For strategic buyers like Sinclair Broadcast or Apollo-backed Cox Media, these stations are a steal. They offer:
- Local News Monopolies: Stations in small- to mid-sized markets dominate hyperlocal news, a niche still resistant to streaming.
- Streaming Synergy: Local Now's aggregation model could be leveraged to build a national over-the-top (OTT) network.
- FCC-Friendly Scale: Merging AMG's stations into larger groups could create entities powerful enough to negotiate better terms with networks and tech giants.

The Bigger Picture: Retreat or Pivot?

Critics dismiss this as a “retreat” from linear TV, but that's shortsighted. AMG's move mirrors AT&T's sale of WarnerMedia: a recognition that owning physical assets in a digital age is a losing game. By shedding debt, AMG can pivot to higher-margin ventures—like its bids for Paramount Global or ABC—or invest in Local Now's expansion.

The real question is whether buyers can revive these stations. Those that pair them with streaming infrastructure or ad-tech platforms (e.g., programmatic ad sales) could turn a profit. would underscore why pure-play TV buyers are at risk—without digital integration, these stations are legacy assets.

Investment Takeaway: Act Now or Miss the Bargain

For investors:
- Buy the dip: Stations are undervalued due to industry panic. Their local ad stability and FCC-friendly scale make them a solid bet for buyers with deep pockets.
- Watch AMG's next move: If debt reduction frees up capital for streaming or content bets, AMG could emerge leaner and hungrier.
- Avoid pure-play TV stocks: Unless they have a digital moat (e.g., Nexstar's OTT deals), their days are numbered.

AMG's sale isn't an admission of defeat—it's a ruthless prioritization. The TV industry's next chapter will be written by those who buy low, innovate fast, and don't look back. The time to act is now.