Just so you don’t have to, I subscribe to a dizzying list of news streams about broadcasting. In today’s NAB SmartBrief, I saw a headline that stopped me cold: “Feds could benefit more by letting broadcasters lease spectrum, says Sinclair exec”.

The first part of that headline agrees with what I’ve promoted for years. Broadcast spectrum is precious and finite, and it would be only appropriate for anyone using public airwaves to pay rent for the privilege. If the fee were based on a small percentage of advertising sales, then non-profits (who sell no ads) get a free pass but commercial stations get dinged.

The second part of the headline was the punchline. The Sinclair Broadcast Group is a publicly traded corporation that believes strongly in its fiduciary duty to maximize profits for its shareholders. It’s not afraid to make controversial political moves to make sure that happens. It’s not afraid to get into hard-fought retransmission disputes to make sure that happens. From all appearances, Sinclair would rather be profitable than loved. That’s why I was mystified that someone there would agree with my idea, which would benefit society as a whole at a cost of slightly reduced profits.

Then I clicked through to the original TVNewsCheck article, which included an interview with Mark Aitken, Sinclair’s vice president of advanced technology. Aitken’s proposal is for stations to take some of their allotted bandwidth and lease it to wireless carriers. He says, “Currently, broadcasters are obliged to pay 5% of their revenue from supplying auxiliary data services. When you look at the immense capacity that broadcasters could make available to carriers, it adds up to big dollars in revenues for broadcasters and, as a result, big dollars for the U.S. Treasury.”

So rather than paying a tax on the bandwidth that stations use, the plan is for them to take the bandwidth they’re getting for next to nothing, lease it to a third party, then pocket 95% of the rent? Now that sounds more like a Sinclair Broadcast Group proposal!

What would make a better headline for that plan? Leave a comment if you’ve got a good one.

Folks who have watched satellite free-to-air TV for a long time, or long-time readers of this blog, will recognize the name Equity Broadcasting. The basic business model for Equity was to own a whole lot of little TV stations, create the programming for all of them in one centralized place (Little Rock AR), then beam it out for broadcast via satellite. For FTA viewers, the great thing was that those signals were (almost always) unencrypted, which meant that fun and funky programming from over a dozen stations coast to coast were available for viewing from one satellite position.

Sadly, that didn’t last. In December 2008, Equity Media (as it was known then) filed for bankruptcy. After a few months of negotiations, Equity’s TV stations were sold at auction to various new owners. And within another couple of months, all those stations disappeared from satellite.

One of those stations, KKYK of Little Rock, is one of four being sold to two former Equity executives, Larry Morton and Greg Fess. And according to The Hollywood Reporter, Morton is going to be president of a new network, the Soul of the South Network (SSN), which will use KKYK’s studio and production facilities.

Here’s the surprising news from the Hollywood Reporter story: “The new venture has acquired assets from Equity, including the C.A.S.H. system, which stands for Central Automated Satellite Headend. This allows them to program stations anywhere in the country from a single hub in Little Rock. … However, the signal will not actually be fed by satellite. Instead, it will use a computer server ‘cloud based system’ to deliver its programming 24 hours a day.”

So that means that SSN acquired all the equipment that Equity used when it beamed channels all over the country, but it has decided it won’t use satellite this time. There are at least two possible explanations for this:

1. Satellite TV distribution is slowly dying. Satellites are incredibly expensive, and the internet is pretty darned cheap, so IP-based distribution is the wave of the future.

2. SSN might have trouble finding transponder space for rent. Wikipedia says that Intelsat’s claim on Equity in bankruptcy court was over $580,000. Now SSN isn’t Equity, but some of the people are the same, and the headquarters is the same. Would satellite operators treat SSN the way a new landlord treats a prospective tenant who walked out on last year’s rent? I have no idea.

I hope that SSN succeeds. We can always use more digital sub-channels, and we can always use more diversity. SSN’s birthplace will be the same hub that launched the Retro Television Network (RTV), one of the first and best of the sub-channel breed, so that’s a good omen. It’s too bad that SSN won’t be matching RTV’s satellite distribution.