Nexstar Media Group, Inc. (NXST) Q3 2020 Earnings Call Transcript @themotleyfool #stocks $NXST
So we will continue to mine that. And we are obviously a lot smaller than CNN or Fox at this point. But therein lies the opportunity, and we’re pleased with the launch and the start, and we think our prospects are good. Again, opening up a whole new category of advertisers that buy news that don’t buy reruns of blue bloods, and then it helps us validate our distribution revenue stream. And quite frankly, when I look at the distribution revenue or affiliate fees that Fox and CNN generate that is our largest opportunity, even greater than the advertising opportunity, which in and of itself will continue to grow. So we’re — as Tom said, we spent 24 years assembling this portfolio. And now we are laser-focused on maximizing organic growth from this portfolio, and this is one example of it. And we think as awareness grows, News Nation will continue to grow. And again, we’ve got a long way to go until we have the operating profit of CNN, let alone Fox News. So I would say just stay tuned.
Jim Goss — Barrington Research — Analyst
Okay. Well, you did say half of your ad spread revenues are from local news. So I guess it would be the same sort of opportunity there. On one other related area, ATSC 3.0, can it have some implication for News Nation in terms of, maybe, having certain very localized content be done and part of a program that is unique to that broadcast area versus all of it be the same across the country?
Perry A. Sook — Chairman and Chief Executive Officer
There is some potential to localize it through either diginets or through the app. Quite frankly, that’s a little further out on the horizon. We just got started two months and four days ago. But yes, I think there is opportunity there. And I’m glad you brought that up because it does bring up another area. But right now, we’ve got folks coming out of the woodwork that would like to partner with us for our distribution potential in linear to develop new diginet concepts. I mentioned sports betting and e-sports, and we made an investment in an e-sports company recently that you probably read about. But there are other folks who are talking to us about our distribution platform. And I bring that up in that right now, we can probably squeeze no more than five streams out of our current signal. But with ATSC 3.0, that could be 3 times that. And not that we need 200 diginets out there, but there are opportunities for ancillary uses of our spectrum in ATSC 3.0. In addition to being the wireless connector of the Internet of Things, which I think is our highest and best value creation opportunity. But there are a lot of things, given the scale that this company has uniquely in linear television to generate ancillary business opportunities. And we have one diginet now that we own. By this time next year, we might have two diginets that we own. And a couple of others we partner with, in addition to the folks that lease spectrum from us to get their diginets distributed throughout the country.