Following a relaxation in regulations governing ownership of more than one television broadcaster in a single market, Viacom and NewsCorp have agreed to swap a number of TV stations.

Viacom is handing Houston’s KTXH and WDCA in Washington to its rival in return for KBHK in San Francisco. The deal involves no cash transaction, as Viacom’s two stations are judged to be worth the same as NewsCorp’s one.

Following the swap, Viacom will add San Francisco to the list of markets where it owns two stations (Philadelphia, Boston, Dallas, Miami, Detroit and Pittsburgh). NewsCorp – which already has duopolies in New York, Los Angeles, Dallas and Phoenix, with another imminent in Minneapolis – will do the same in Houston and Washington.

Owning two stations in the same market is attractive because it improves a broadcaster’s position when negotiating programming deals. It also helps Viacom and NewsCorp reduce their reach to comply with federal regulations, since owning extra stations in the same market does not increase the potential number of viewers a media group can access. The deal will reduce the duo’s reach from 41% of the country to 39%, though this is still above the current limit of 35%.

News source: Wall Street Journal