With the television platform in place, Sinclair turned its efforts to repositioning the Company for future growth, both operationally and technologically. It was during this time that Sinclair launched the country’s first digital sub-channel using syndicated programming, pioneered retransmission consent fees, and led the industry movement for mobility and portability of the broadcast television signal. The decade also gave witness to the transition from analogue to digital television, as well as two of the country’s worst recessions: 9/11 and the Great Recession.
2001 – The country came under direct and horrific attacks from terrorists. As a result of the shock, the national economy, as well as the advertising market, went into a recession seeing the greatest declines in advertising spending in over 50 years.
2004 – With an improving economy, Sinclair’s free cash flow grew, leading to a stronger balance sheet. That same year, the Sinclair Board of Directors approved the Company’s first ever common stock dividend. What began as a $0.10 annual per share dividend rate grew as high as $0.80 before being suspended during the Great Recession.
In that same year, Sinclair was approached by American prisoners of the Vietnam War asking for their voice to be heard through a documentary, “Stolen Honor.” While Sinclair did not air the program, it did dedicate a public interest show discussing both sides of the topics raised in the documentary.
2005 – Sinclair completed the build-out of its digital television platform and quickly realized that there were many opportunities to monetize these assets. Understanding that the digital TV platform, as well as the Company’s regular programming, provided multi-channel video programming distributors (MVPDs), such as cable, satellite and telecommunications companies, with valuable programming, Sinclair became one of the first broadcasters in the country to request compensation from the MVPDs for their right to carry programming aired on our stations and funded by us. This compensation, known as retransmission consent agreement fees, provided a new revenue stream for broadcasters and helped to revitalize the over-the-air broadcast industry.
2006 – Changes in the country’s networks altered the make-up of Sinclair’s affiliation mix. That year, the WB Network and the UPN Network combined to become the CW Network. A sixth network, MyNetworkTV, was launched by FOX. Subsequently, Sinclair became the largest FOX and MyNetworkTV affiliate groups, the second largest ABC affiliate group and the third largest CW affiliate group in the country.
That same year, Sinclair launched its first digital sub-channel on WBFF-TV in Baltimore. The new channel, known then as Good TV, was the first syndicated programming digital sub-channel in the country.
2007 – Sinclair’s vision for utilizing and creating value from its digital TV investment did not stop there. For years, Sinclair advocated for the development of technology that allowed for the portability and mobility of the television signal. In 2006 and 2007, Sinclair once again teamed with consumer electronic manufacturers to test transmission standards to allow broadcasters’ digital signals to be transmitted to and received by portable and mobile devices such as smart phones, laptops, tablets, televisions in cars and other handheld devices. In 2007, Sinclair along with 8 other broadcasters and networks founded the Open Mobile Video Coalition (OMVC) whose purpose it was to promote and evaluate mobile TV technical applications.
This same year, with significant amounts of free cash flow being generated and a strong balance sheet in-hand, Sinclair followed up with a strategy to seek investment opportunities beyond over-the-air television.
2008 – Just as the decade began with a recession, so too did it end. In 2008 and 2009, the country was in the midst of the Great Recession, the worst economic environment the country had experienced since the Great Depression. With high unemployment, financial institutions failing, and homes being foreclosed, the advertising market suffered its greatest losses ever. A few major American automotive manufacturers, which historically have been broadcasters and newspapers largest customers, went bankrupt, contributing to the failure of many long-standing daily newspapers in the country.
2009 – This year was also marked by one of the television broadcast industry’s most historic events. On June 12, the U.S. government officially turned off the analog television signal forever, thereby ushering in the age of digital television. Sinclair, always considered an industry leader for its technical expertise and vision, would continue to play a major leading role in years to come for the development of mobile television and other broadcast spectrum uses.