Axios Pro Media Deals Q&A: Sinclair CEO Chris Ripley

Axios caught up with Sinclair Broadcast Group CEO Chris Ripley to talk about Netflix and the streaming industry's troubles on Wall Street and how Web3 plays into local media's future.

Why he matters: Sinclair is one of the largest TV station groups in the country and is preparing to launch a streaming service version of its Bally Sports regional sports networks.

Axios: What are your thoughts on what's happening to Netflix and the overall streaming growth slowdown?

Ripley: Every momentum story eventually comes to an end. I think they'll continue to have success.

• The notion of building a streaming business around just subscriber growth alone never made sense. If subscriber trend increases continue to increase — and that trend is positive — you get this detachment from fundamentals.
• It's probably most unfortunate for the other companies in the media space that jumped on board the entertainment streaming bandwagon and never got to experience that sort of lift on the momentum side, and are going to be held to account on the fundamental profitability side well ahead of them hitting the scale that they ultimately want.
• The market has turned more rational.

Axios: Has any of this made Sinclair rethink its own streaming strategy?

Ripley: From my perspective, it's positive. When you're in that momentum, hyper-growth stage, people do un-economic things, like pricing their service too low. Pricing of the services will go up, and they won't be massively overloaded with content.

• We really have a unique opportunity in front of us, but we still live within that same ecosystem, and the relative comparisons will be there nonetheless. Those relative comparisons in terms of entertainment value will turn out to be better for us because of the rationalization.

Axios: How much of a priority should it be for sports leagues and teams to figure out in-market streaming?

Ripley: There is significant fandom that is outside the pay-TV bundle. Servicing those fans is really important for the health of not only our business, but the league and teams.

• When you get people onto an experience or a platform where you know who they are, you have their payment information, you know their preferences, and you can deliver interactive experiences to them. That opens up a lot of what we talk about around gamification — e-commerce opportunities, digital collectibles, social sharing.

Axios: How much will streaming play a role in sports rights deals going forward?

Ripley: It's going to be a component of every rights deal. We will live in a hybrid environment for the foreseeable future, potentially forever. The lines between streaming and traditional distributions are blurring.

Axios: In terms of your overall local TV business, do you see streaming playing a bigger role there as well?

Ripley: Absolutely. We already stream all of our newscasts. We have NewsON, we have Stirr. Our CBS stations are part of Paramount+ and our NBC stations are part of Peacock. Streaming and multiple business models will continue to proliferate in this media landscape.

Axios: How do you view opportunities within the Web3 and NFT space?

Ripley: We have launched an NFT store, but that's really just scratching the surface.

• When you look at web3, there's a huge community component. And one of the reasons why these things take off so quickly in web3 is that they have skin in the game inherently built into the structure.
• The other component that I find really interesting, and I think could have big implications as well, is DAOs (Decentralized Autonomous Organizations). It's really just the other side of the coin of incentivization. You can give communities governance rights or the ability to make certain decisions. The notion of giving your community a certain set of governance rights on, say, like, how they like to see the content that we are showing them, or do we have the right talent on our pre- and post-game shows?