The effect of the U.S. Supreme Court's decision yesterday, April 2, 2014, knocking down "the aggregate limits on an individual’s total contributions to candidates" will likely be a boon to TV stations and cable MSOs, reports Variety.
According to the story, "The court, in a 5-4 decision, invalidated the $48,600 cap that an individual can give to all candidates in an election cycle, as well as the $74,600 limit on contributions to political parties. Donors will still be limited to a $5,200 contribution to any one candidate during a cycle. But the net effect, campaign reform advocates say, will be more money flowing into the system."
The story continues, "Miles Rapoport, president of Common Cause, called the decision 'Citizens United round two, further opening the floodgates for the nation’s wealthiest few to drown out the voices of the rest of us.'"
As noted accurately by Wikipedia, in the Citizens United case, "The United States Supreme Court held that the First Amendment prohibits the government from restricting political independent expenditures by corporations, associations, or labor unions."
The Variety story adds: "Political advertising has accounted for an increasingly more dependable share of broadcasters’ bottom lines. Total political spending on local stations has grown at a rapid pace. According to TVB, a trade association for commercial broadcasters, campaigns spent $2.9 billion on advertising on local stations in 2012, up 38% from $2.1 billion in 2010.
“ 'This news clearly will have an impact, particularly in markets where we have tossup races,' said Stacey Lynn Schulman, chief research officer for TVB. The org has projected $2.5 billion in political spending on local TV in this year’s midterms, and that figure could rise if the Supreme Court’s decision means that more donors are able to 'spread the wealth around,' she said."
Even before yesterday's Supreme Court decision, at least one newsletter was predicting that local cable — primarily through NCC Media — could capture 25% of all political ad spending this year. That could translate to between $680 million and $800 million for cable alone.