Raycom Media: A History of Growth and Strategic Acquisition
Raycom Media established itself as a powerhouse in the American broadcasting landscape through a series of aggressive acquisitions and strategic diversifications. Founded by a trio of industry professionals—lawyer Stephen Burr, general manager Ken Hawkins, and news director William Zortman—the company leveraged funding from the Retirement Systems of Alabama (RSA) to rapidly scale its operations from its inception in 1996.
The company's entry into the market was marked by a massive initial investment, purchasing 15 television stations, two radio stations, and the established Raycom Sports from Ellis Communications for over $700 million. This foundation was quickly expanded with the purchase of eight stations from Federal Enterprises Inc. for $160 million and five TV stations from Aflac's broadcast division. These three groups merged to form the entity known as Raycom Media, with John Hayes serving as the initial leader until 2001.
Key Facts
- Founded: 1996 by Stephen Burr, Ken Hawkins, and William Zortman.
- Major Merger: Acquired by Gray Television on January 2, 2019, for $3.65 billion.
- Market Reach: At its peak, Raycom reached 16% of U.S. television households.
- Diversification: Expanded into digital ad platforms (PureCars), OTT apps (InvestigateTV), and sports production (Tupelo Raycom).
- Key Partnerships: Collaborated with E.W. Scripps and Cox Media for programming like Right This Minute.
Strategic Expansion and Leadership Transitions
As the company entered the late 1990s and early 2000s, it focused on diversifying its portfolio. In 1998, Raycom acquired a 35% stake in Worldnow, an internet publishing provider for broadcast media, and purchased Malrite Communications, which added stations in Puerto Rico, Ohio, and Florida. Leadership shifted in 2001 when Paul McTear succeeded John Hayes as president and CEO.
The early 2000s saw further growth through the acquisition of Fox-affiliated stations from Waitt Broadcasting in 2003. Raycom also experimented with niche programming, serving as the launch station group for The Tube Music Network in 2005, an initiative in which they were also an initial investor.
Corporate Acquisitions and Divestitures
Between 2006 and 2008, Raycom engaged in significant structural changes. The company acquired the Liberty Corporation in 2006 and affiliated its NBC subchannels with NBC Weather Plus. While it expanded, it also streamlined, selling a dozen stations to Barrington Broadcasting in August 2006. A major milestone occurred in 2008 following the $583 million acquisition of television properties from Lincoln Financial Media, which also saw Lincoln Financial Sports merge into Raycom Sports.
Diversification into Content Production and Digital Media
Around 2010, Raycom shifted from being a mere station owner to a content producer. This era saw the launch of several high-profile partnerships and productions:
- Right This Minute: Produced in partnership with E.W. Scripps and Cox Media (2011).
- America Now: A lifestyle news magazine launched with ITV Studios America (2011–2014).
- Specialized Content: Partnered with Bellum Entertainment Group in 2014 for Flip My Food and Fix It and Finish It.
- Automotive Programming: Purchased RTM Productions in 2014 to produce PowerNation shows for networks including CBS Sports Network and NBCSN.
The company also invested heavily in the digital and subchannel space. Raycom was an initial investor in Bounce TV (2011) and Katz Broadcasting (2014). In 2011, it established the Raycom News Network Digital Hub in Montgomery, Alabama, to serve as an online news aggregator.
Sports Production and Digital Platforms
Raycom strengthened its sports presence by acquiring Tupelo-Honey Productions in 2012 and WebStream Sports in 2015. These two entities were merged to create Tupelo Raycom. Further digital expansion occurred in November 2015 with the $125 million purchase of PureCars, a digital advertising platform for automotive sales.
The Final Years and Merger with Gray Television
In the years leading up to its final acquisition, Raycom continued to grow its footprint. It acquired WVUE-TV in New Orleans and stations from Calkins Media, eventually reaching 16% of U.S. television households. In September 2017, Raycom merged with Community Newspaper Holdings (CNHI), though CNHI remained a subsidiary.
The company's final major innovation was the June 2018 launch of InvestigateTV, an OTT (Over-the-Top) app—a streaming service delivered over the internet—featuring content from ProPublica and other journalistic partners.
The era of Raycom as an independent entity ended on January 2, 2019, when Gray Television completed its acquisition of the company for $3.65 billion. This merger created the third-largest television station owner in the U.S., with 142 stations across 92 markets and a 24% market share. Pat LaPlatney, Raycom's CEO, led the combined company.
| Year | Entity/Asset | Transaction Type | Value |
|---|---|---|---|
| 1996 | Ellis Communications Assets | Purchase | >$700 Million |
| 1996 | Federal Enterprises Inc. | Purchase | $160 Million |
| 2008 | Lincoln Financial Media | Purchase | $583 Million |
| 2015 | Drewry Communications | Purchase | $160 Million |
| 2015 | PureCars | Purchase | $125 Million |
| 2019 | Raycom Media (by Gray TV) | Acquisition | $3.65 Billion |
Frequently Asked Questions
Who founded Raycom Media?
Raycom Media was founded in 1996 by Stephen Burr, Ken Hawkins, and William Zortman, with financial backing from the Retirement Systems of Alabama.
What was the result of the Gray Television acquisition?
The acquisition, completed in January 2019 for $3.65 billion, made Gray Television the third-largest owner of television stations in the United States, controlling 142 stations in 92 markets.
What was Tupelo Raycom?
Tupelo Raycom was a sports production entity formed by the merger of Tupelo-Honey Productions (acquired in 2012) and WebStream Sports (acquired in 2015).
Did Raycom Media own newspapers?
Yes, through its 2017 merger with Community Newspaper Holdings (CNHI), although Raycom had to divest newspapers in seven markets to comply with FCC cross-ownership restrictions.
What was InvestigateTV?
Launched in 2018, InvestigateTV was an OTT (Over-the-Top) application that provided long-form investigative content from Raycom and partners like ProPublica and NerdWallet.