Here's How Trump TV Could Become a Reality

Donald Trump's son-in-law has reportedly put out feelers regarding the launch of a Trump-inspired television network. How might Trump TV actually work?

Jared Kushner, who is married to Trump's daughter, Ivanka, has informally approached one of the media industry's top dealmakers regarding a potential Trump media endeavor, reports The Financial Times. He contacted Aryeh Bourkoff, the founder and chief executive of boutique investment bank LionTree, within the past couple of months. The conversation has not progressed since. Politico's Mike Allen reports Bourkoff never followed up with the Trump team on the matter, telling him he has "no interest in being in business with Trump."

The FT report revives speculation the real estate billionaire may launch his own media empire should he lose the November election -- an increasingly likely prospect, given his current poll numbers. Might Trump become the conservative media world's Oprah Winfrey?

After his campaign hired Breitbart News Chairman Stephen Bannon and was rumored to be getting advice from now-disgraced Fox News founding CEO Roger Ailes, media speculation was that Trump is setting himself up to be a media mogul if his bid for the Presidency doesn't work out.

"Does he have the right people to do something a little different from Fox News?" Moody's Investors Service analyst Neil Begley said. "I would say the answer is 'yes.'"

"Trump TV" has been called the "logical end" to his campaign, but, like Oprah, it could go so far beyond cable TV. Maybe it's better to call Trump's next act "Trump Media." 

But if Trump Media is in the offing, what will it be? How will it get built? Who will join up and who will finance it? 

Getting Trump Media Off the Ground

While Ailes has chops in cable news, Bannon brings experience in online media. Trump's outsized persona seems made for talk radio, if the demanding schedule of live broadcasts didn't put him off (Rush Limbaugh is on the air for three hours a day). TV, digital and radio are all possibilities. 

If the terms of Ailes' separation from Fox don't block him from competing against his former employer, cable TV would seem an obvious place for Trump's media team to start. After his frustrations with NBC over The Apprentice, Trump could covet his own network, bearing his name in large, gilt lettering.

"Trump tends to be a guy who thinks big. Roger Ailes is a guy who likes to think big," Begley said. "They might have enough chutzpah to say they'll build a cable channel but I think it would struggle."

Traditionally, Begley suggested, it would cost about $500 million or so to take a cable network from inception to profitability. 

Fox News sped up the process in the 1990's because it could leverage other broadcast networks, including NFL coverage, and because it paid cable operators to carry the fledgling news service.

"Unless Roger Ailes were willing to pay a couple of bucks per subscriber, with no or minimal subscriber fee, for a couple of years, they'd be hard pressed to be successful from scratch," Begley said. The tab could run $100 million to $200 million per year to buy distribution, he noted, and doesn't even count the satellite TV transponders, staffers, producers and talent for a 24-hour a day, 7-day-a-week network.

Lynne Costantini, President of Costantini Media Advisors, suggested that costs are "easily in excess of $300 million" to set up the infrastructure and talent for a round-the-clock network.

The big pay-TV systems operators, like Comcast (CMCSA) and Charter (CHTR) , and advertisers are the two main sources of revenue for cable networks and entail challenges of their own.

"Distributors are reluctant to pay license fees for new linear television networks," said Constantini, who is a veteran of The Blaze, Scripps Network Interactive (SNI) and Time Warner Cable. "Without a dual revenue stream, new independent networks...must survive on ad sales alone which can be particularly challenging."

One alternative to building a TV network is to buy one.

Conservative news and commentary cable networks One America News Network, Glenn Beck-affiliated TheBlaze and NewsmaxTV could be targets.

"It's possible that Trump or a media company that is backed by him could buy one of those companies or joint venture with them," Costantini said.

Al-Jazeera's $500 million purchase of Al Gore's Current TV provides a cautionary tale, however. After the acquisition, due to contractual clauses, Time Warner Cable dropped the networks from its systems, and the company shut down earlier this year.

If buying a network seems daunting, partnering with one, like Outdoor Network could work. The network already partners with Trump-ally National Rifle Association on programs. Outdoor Network owner Stan Kroenke has donated to Republicans such as George W. Bush. Or any of the above-mentioned conservative channels might work.

An easier option might be following the path of a company like Vice, which has a network now but started in TV creating shows for other networks. 

"You could produce a show or two and sell those shows to other, well distributed networks and then make your bones that way," Costantini said. "Vice has done that very well."

Vice, which sells programming to HBO, joined the cable network fray earlier this year. Even the ultra-hip Brooklyn media group, which raised a whopping $770 million, launched its cable channel with a legacy media partner. The channel, Viceland, is a joint venture with Hearst- and Disney- (DIS) backed A&E Networks.

The same conservative networks that Trump Media could buy or partner with would make ideal syndication partners.

"Their growth has been slow," Costantini said. That makes them great partnership targets. Think of them as underdeveloped real estate properties with potential that Trump Media could activate. "Imagine the Donald Trump show on any one of these networks," Costantini added. "It would put them on the map or breath new life into them."

Talk radio, which has been kind to conservatives, is another option.

Starting a political radio network from scratch would have its own problems, Standard & Poor's analyst Jeanne Shoesmith said, because iHeartMedia's Premiere network and Cumulus's (CMLS) Westwood One already have the marquee names. Limbaugh signed a new deal in August with Premiere, which also has Sean Hannity and Glenn Beck on its roster. Westwood One has Don Imus and Michael Savage.

"To put together a pool of talent and syndicated programming would take a lot of time in some cases you may be waiting until some of those people are out of their contracts," said Shoesmith.

Trump's personality seems made for radio, and an easier path would be for him to launch a show to run alongside other media efforts.

Competing against Hannity, Limbaugh and Beck on the grueling schedule of a talk radio host would be no cake walk, however.

"Would Donald Trump really want a daily radio show?" Costantini asked. "You have to do that at least four days a week live or mostly live."

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