Sinclair is building a streaming video bundle by focusing on local

Stirr’s key pitch, though, is local programming. The centerpiece of the streaming service is the Stirr City channel, which Sinclair said will offer a custom, 24-hour programming lineup based on where the viewer lives. This programming, which will include daily morning and evening news shows, regional sports broadcasts and city-focused lifestyle shows, will come from the local Sinclair TV station in that city or the Sinclair station that’s closest to the market a user is in.

Adam Ware, gm of Stirr, described Stirr City as a national channel that gets paired with the local Sinclair affiliate in a particular market. Stirr City will have a national feed, which will switch to local news, sports and other regional programming that the affiliate has the rights to. Sinclair’s network includes 191 TV stations in 89 markets across the U.S. This includes three of the top-10 OTT markets in terms of video consumption (Washington, D.C., Seattle and Portland), according to a Nielsen research study from late 2017.

In markets where Sinclair does not have a station affiliate, the broadcaster is aiming to sign programming and distribution deals with local newspapers, Ware said. “You don’t necessarily have to have a station partner, just a news partner,” he said.

“Sinclair has one of the most important local footprints of any media company,” said Jon Steinberg, CEO of Cheddar. “People love local news and tune in for it, or seek it out. So companioning our national and business news with that is great distribution.”

Local programming, in general, is scarce in streaming video: In December 2018, CBS News launched a New York-specific offshoot of its streaming network CBSN, with plans for more extensions later in 2019. Meanwhile, some local stations such as NBC affiliate KSL-TV in Salt Lake City are making some programming available to watch on their apps.

“Every so often, there are a bunch of local stations that have their own apps, and they usually offer clips for online viewing, but that’s about it,” said Alan Wolk, co-founder of TVRev. “Plus, a lot [of local broadcasters] are not technologically sophisticated, and OTT, in general, is a big expense. With Sinclair, it’s easier for them to get on board.”

Stirr is also looking to build relationships with studios, publishers and other video programmers that can license movies, TV shows and other non-local content. For instance, when Sinclair’s affiliate is off the air during prime time, that’s a void that Stirr City can fill with licensed movies and TV shows.

“We know that for every single one of the stations we have, we have to put something on in prime time — we have to cover that programming block,” Ware said. “If you’re a content owner or distributor, this is a chance to get on prime time.”

With its 20 current channel partners, Stirr offers an even 50-50 revenue share on ads generated by Stirr. Some of these channel partners are also providing programming for Stirr-branded channels such as Stirr City, Stirr Movies and Stirr Life. Sinclair is also signing deals with studios and distributors for movies and TV shows independent of the content owner having its own channel on Stirr. In all instances, Sinclair is not paying a license fee and is instead sharing ad revenue with all content partners.

Free, ad-supported video streaming is on the rise. Independent services such as Pluto TV, which recently sold to Viacom, Xumo and Tubi TV are capturing millions of monthly viewers on connected TV screens. Amazon and Roku have also launched their own free streaming channels. The question is whether these services can have audiences as big as Netflix, Hulu and other top subscription-based streaming services — or whether they would even need to.

“[Free video streaming services] are not going to get the scale of Netflix,” said Wolk. “But a lot of people are also going to reach the point of no return with subscriptions: ‘I’m paying too much already, so what’s for free?’ For that reason, they have a good shot at succeeding.”