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Welcome to RBR's Daily Epaper
Volume 22, Issue 112, Jim Carnegie, Editor & Publisher
Wednesday Morning June 8th, 2005

Radio News®

SBS charges Emmis with
FCC violation

Emmis Communications may be the tower landlord of KXOL-FM Los Angeles, but Spanish Broadcasting System (SBS) says that doesn't give it the right to say what the station can broadcast. SBS has gone to the FCC with a complaint, charging that Emmis is guilty of anticompetitive behavior by going to federal court (5/30/05 RBR #105) with a lawsuit to force KXOL to drop its new Reggaeton/Hip-Hop "Latino 96.3" format, which Emmis claims competes with KPWR-FM in violation of KXOL's tower lease. "The Commission must stop Emmis's attempt to limit competition in the Los Angeles market. It should impose sanctions and rule that certain language in the Lease Agreement between the parties is unenforceable," attorney Bruce Eisen of Kay Scholer LLP wrote to FCC Chairman Kevin Martin on behalf of SBS. RBR sought a response from Emmis, but hadn't received one by deadline. For its part, Emmis told RBR that the issue is a simple matter of a lease: "SBS requested to come on our tower. We agreed, with the stipulation that that KXOL would not change its format to one that would conflict with any of Emmis' stations in the Los Angeles market. They agreed to the lease, including the provision, and signed the contract. They subsequently violated this provision of the lease. We believe the lease is fully enforceable."

Univision reports cross-selling success
English-language media companies may have had mixed success with cross-platform ad sales, but Univision's new CFO, Andrew Hobson (6/6/05 RBR #110) told a Deutsche Bank Securities conference in New York that the Spanish media giant has been making it work. "We've had some sizeable success. I believe that has led to an increase in the growth rate of the radio business in particular - - of 3-4%. Since we've owned Univision Radio, its growth has outpaced the industry growth by six, seven, eight times. Prior to our owning it, it did one and a half times industry growth. I think a lot of that growth has to do with our ability to cross-sell our advertisers and combine their marketing plans seamlessly, where they're getting the brand development of television and the local promotional support of local radio," Hobson explained. He said Univision is able to make cross-selling work because it doesn't have the level of "turfdom" that other media companies have - - all Univision sales reps have cross-media packages available that they can sell to any customer. Hobson was also upbeat on how this year's upfront will come out for Univision's TV networks. Although Univision doesn't disclose dollar values for its upfront dealings (and he noted that the company's upfront contracts have fewer exit loopholes than those of other networks), he said Univision/TeleFutura/Galavision went into this year's upfront in the strongest position ever. He said Univision's upfront selling will likely continue through July, "selling all dayparts, all networks." Looking back eight years to when Univision began selling in the upfront, Hobson said the company dealt with only 37 advertisers in the upfront back then. Today the number is 140-150.


Disney dissidents win a round
It's only a small victory, but at least dissident ex-directors Roy Disney and Stan Gold will get to present their case that the Walt Disney Company's board of directors defrauded shareholders by conducting a sham search for a new CEO, with no real effort to consider anyone other than Michael Eisner's hand-picked successor, Bob Iger - - but the company will also get to present its rebuttal in open court. In refusing to toss out the lawsuit by the dissidents, Delaware Chancery Court Judge William Chandler noted that the suit claims that after promising a full search for a new CEO, the board interviewed only one other candidate and that board chairman George Mitchell told her that she was not a serious candidate. It also claims that Eisner insisted on being present for any candidate interviews, which the suit claims "was intended to chill and did chill full consideration of qualified external candidates" for the Disney CEO job. "Should these allegations be proven, plaintiffs could be entitled to the relief they seek because the board's statements materially misled plaintiffs with respect to the board's intent to conduct a bona fide executive search process," Judge Chandler said in agreeing to hear the full case. The relief that Roy Disney and Stan Gold are seeking is to have the latest directors' election thrown out, which would allow them an opportunity to field a competing slate of candidates who would presumably reopen the search for a new Disney CEO. Trial is set for August.

Multitudes prefer
multicultural multimedia

A new study from New California Media shows that there are strong preferences for ethnic media outlets, including broadcast and print options, among US minority populations. According to an Associated Press report on the study, 45% of major minorities - - representing some 29M people - - turn to niche options at least several times a week, and 80% - - representing 51M people, or a quarter of the total US population - - are reached by such media outlets. The study found 60% penetration by Black and Arab American services, better than 50% by Hispanic services, and about 25% by Asian American and Native American outlets. Superserving the target demographic is the obvious reason for success. Rapid population growth among minorities, particularly in the Asian and Hispanic categories, is fueling rapid advertising sales growth among their respective media, with Asian outlets growing at a 10% rate and Hispanic outlets picking up steam at a 15% clip.

Pitt-stop? Pitt says celeb news is the pits
Brad Pitt cannot believe that he is big news 24/7 when real news is happening all the time. According to the Associated Press, he was interviewed by Diane Sawyer for an installment of ABC's "Primetime Live," talking about his charitable interests in Africa. "I can't get out of the press. These people can't get in the press," he told Sawyer. "So let's redirect the attention a little bit." Pitt said people are spending enormous amounts of effort and money stalking him - - he offered to willingly set up photos if the money could be redirected towards poverty or AIDs relief. RBR observation: The man has a point.


Adbiz©

Latest RAEL study:
Radio ROI higher than TV

The Radio Ad Effectiveness Lab (RAEL) has released its third study, concluding that radio campaigns show significantly better ROI for advertisers than national television campaigns, and that radio moves products a full 49% better than television. The study looked at 30-second spots on both radio and television. All the television campaigns in this test had received favorable advance testing; none of the radio ads were pre-tested. The study, conducted by Millward Brown, looked at actual purchases of products in four markets over a six-month period. Conducted in four IRI BehaviorScan markets, four controlled test cells were created: one with no television or incremental radio; one with incremental radio only; one with national television only; and one with both national television and incremental radio. After the campaigns, they were able to analyze scanner sales data for each of the test cells. The "real world" study examined four pairs of radio and television campaigns in a range of product categories including Grocery Food, Grocery Non-Food, and two distinct Over-The-Counter drug products. The key finding is that incremental radio campaigns showed significantly better ROI for these advertisers than did their national television campaigns, whether the TV ROI was measured by this test's results or by the advertisers' own historical return estimates for television.

Other findings:
* Radio moves product. Across four different advertisers, incremental radio advertising consistently and significantly increased product sales and delivered meaningful profit for each dollar of advertising. Radio demonstrated in this study that it can function as a primary medium for advertising.
* Radio ads increase sales even when national television is present. Radio was just as potent in the presence of 50-100 TRPs of national TV as it was by itself. In fact, the test results actually suggested slightly more impact for radio when combined with television than when used alone.
* Radio's effects can be measured-when radio is used at sufficient weight. Radio is prepared to be held accountable for its advertising effectiveness. But effectiveness measurement requires that advertising be present at sufficient weight for statistics to accurately capture that result.

See the full study here: www.RadioAdLab.org.

Washington Trust launches new TV campaign
Washington Trust recently began airing a new series of six commercials on local network and cable television stations. The ads present a positive statement about Washington Trust's ability to help people achieve their goals-from young couples, to business owners, to people looking to manage their wealth or plan their retirement. The ads, which are fresh, simple and compelling, invite viewers to see themselves in the images provoked-a couple just starting out building a home and family; taking an idea for a business and growing it into a successful company; being able to retire in comfort; or preserving wealth earned for future generations. The ads include the tagline "Good Things Start Here" and focus on Washington Trusts' capabilities and breadth of services while reinforcing the Banks' brand. Four of the ads focus on the Bank's core lines of business - personal banking, business banking and wealth management. The other ads feature current products and promotions (one of the ads is for the Bank's free checking/free Boston Red Sox jersey promotion, while the other promotes the Banks' special home equity rate). The television ads, produced by Walsh and Associates, are scheduled to run throughout the end of the year and will compliment the Bank's existing multimedia, including radio, print, direct mail and outdoor.


Radio & Television Business Report

Coming in the July issue:
Media Business Report:
"People Make the Difference" -- We've asked our readers to give recognition to the people that are making a difference in today's business environment.
GM Talkback:
Who in your company or stations deserves
a pat on the back and why?
AdBiz:
Carat Americas CEO David Verklin: "Mastering a digital future" from advertising in a digital convergence world to improving metrics to the TV upfront and more.
Special Report:
Part II: "Going Private" - time to loose that chain around your neck. We show you how.
Media Markets & Money:
Mid Year Report -- "Going independent": Not many have taken this road, but in recent years Post-Newsweek's WJXT-TV Jacksonville, FL and Young Broadcasting's KRON-TV San Francisco have gone from being major network affiliates to being independent. RBR/TVBR looks at how they did it.

Reserve your Ad Marketing Space today. Advertising space is limited, contact:
June Barnes [email protected] -- or -- Jim Carnegie [email protected]


Media Markets & MoneyTM
Salva salvo snags Valdosta FM
There's going to be a brand new cluster in one of Arbitron's newest markets when the Salva family's W.G.O.V. Inc. closes on its acquisition of WYZK-FM from Mike Howard's C.D.J. Inc. That event will move a Valdosta GA AM-FM combo up to duopoly status. WYZK is being purchased for 2M dollars, with one/eighth in cash accompanied by a 1.75M promissory note. An LMA began 5/9/05 with somewhat unusual provisions. WGOV is paying 43,650 for six months rent, all up front - - and the seller is obligated to use the payment to settle back rent and other outstanding expenses. If anything is left over, it will be used to help defray payments due on the note. The Salva family already owns WGOV-AM/WAAC-FM in Valdosta, and are a group by virtue of their stewardship of WGUN-AM in the Atlanta market. Valdosta GA was added to the Arbitron roster in time for the fall 2004 survey (9/15/04 RBR #180).

Iger downplays radio spin-off
"I like the sum of the parts right now," Disney CEO-to-be Bob Iger told the Deutsche Bank Securities investment conference in New York. Although he noted that Disney is currently in some "lower growth businesses like radio and TV," he said the company has done a good job of outpacing the marketplace in those businesses the last few years. Iger said there's no balance sheet need to divest anything. Still, he didn't rule out exiting some non-core businesses. "We're going to continue to look at divestiture possibilities...a spin-off of some sort or some other financial arrangement creating more value, we will do that with a non-core business. We talk about radio in that respect. No urgency, but under the right circumstances it's obviously something we feel we should consider seriously," he said.

Emmis says financing is in place
Funding is no longer an issue for the big stock buyback that Emmis Communications announced last month (5/11/05 RBR #93). The company says it has gotten the required amendment to its senior credit facility from a syndicate of lenders led by Bank of America, along with delivering a commitment notice to Banc of America Securities for the sale of 300 million worth of Emmis' floating rate senior notes due 2012. Emmis has already begun the "dutch auction" tender for up to 20.25 million of its Class A common shares at of price of 17.25-19.75. That tender is scheduled to expire next Monday (6/13).


Washington Beat
Phone company wants
Republicans seated quickly
Verizon Communications is said to be pushing the Bush administration for action on the FCC 8th Floor. According to Reuters, the telecom giant is hoping to acquire MCI, and wants three reliable votes in place to approve the merger. Although Republican Kevin Martin has filled the chairman's seat vacated by Michael Powell, Martin's regular commission seat remains empty, meaning any politically divisive decisions coming up on the 8th Floor face the possibility of a two-two stalemate. Compounding the problem is the widely-held belief that Republican Kathleen Abernathy may also soon be out the door.

RBR observation: There is much more on the table than a Verizon M&A. DTV, the ownership rule remand...We have gotten the sense that there is perhaps a bit of stalling taking place right now on the 8th Floor while Martin waits for a majority to work with. How long will he have to wait before the cavalry arrives?


Programming
Sally Jessy Raphael
is about to launch nationwide
Former TV talker and current online radio broadcaster Sally Jesse Raphael is ready to return to her radio roots and launch a new national talk show. She's already decided to lease a channel for about 9600/month and try it alone, say our sources. Launch date will be likely in July and she wants to be live from 4pm-7pm weekdays. She's in talks with XM about carrying the show as well.

CBS Radio News launches podcasting
Beginning this week, CBS Radio News will provide many programs to its affiliates for podcasting or station website use. CBSNews.com will make many CBS Radio News programs available in podcasts. The site currently features audio from CBS Radio News' "Harry Smith Reporting", and tech guru Larry Magid. CBS radio stations will access the podcast material via an affiliate website. Programming will include regularly scheduled programs and features, as well special in-depth series. Podcasting programs include "The CBS Weekend Roundup;" "What's in the News" with correspondent Christopher Glenn;" "Wired Magazine;" "Entertainment Report with People magazine's Lisa Karlin;" and "Larry Magid's Tech Report," among others.


Ratings & Research
Norway signs for PPM
Arbitron announced that Norway is going to use Portable People Meters (PPM) exclusively for commercial radio ratings. A steering committee of the Norwegian National Radio has signed a five-year contract with TNS Gallup, a member of the worldwide TNS group, to install a panel of 400 people equipped with Arbitron's PPM system beginning in the first quarter of 2006. The group said one of its reasons for going with PPM was its ability to measure Internet-based radio, as well as broadcast.

According to Arbitron, Norway is the fourth country to select the PPM technology:
* In 2000, TNS first employed Arbitron's PPM audio encoding technology in its set-top TV meters in Singapore.
* In Belgium, Vlaamse Radio en Televisie (VRT) has used the PPM to measure both radio and TV exposure in a 450-person marketing panel since 2003. VRT recently announced that it will expand its PPM panel to 530 individuals.
* In 2004, BBM Canada, the Canadian industry consortium for audience ratings, adopted the PPM as the official ratings system for buying and selling commercial airtime on French-language television in Quebec and Montreal.


Transactions
1.1M WMTN-AM & WMXK-FM Morristown TN from Horne Radio LLC (Nick W. Drewry) to East Tennessee Radio Group LP (Gilbert H. Watts Jr,. Paul G. Fink). 55K escrow, balance in cash at closing. LMA until closing. [File date 5/2/05.]

900K WZXI-FM Buffalo Gap VA from Easy Radio Inc. (Jason D. Cave) to Vox Communications Group LP (Bruce G. Danziger, Burton K. Barlow). 50K escrow, 400K cash at closing, 450K note. [File date 5/2/05.]


Stock Talk
Dueling feds confuse markets
First, Fed chief Alan Greenspan said yesterday morning that the US economy was doing well and the central bank might ease off on rate hikes. Then Fed governor Jack Guynn said the Fed was not ready to halt rate hikes. So, stock prices jumped, then fell back, ending in a mixed market. The Dow Industrials were up 16 points to 10,483, while the S&P 500 and Nasdaq Composite were lower.

Radio stocks were also mixed. The Radio Index edged up 0.792, or 0.4%, to 206.763. Entravision was strongest, up 2.6%. Beasley was the day's poorest performer, down 1.4%.


Radio Stocks

Here's how stocks fared on Tuesday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

42.04

-0.11

Jeff-Pilot

JP

50.02

-0.10

Beasley

BBGI

15.38

-0.23

Journal Comm.

JRN

16.96

+0.06

Citadel CDL
12.10 -0.07

Radio One, Cl. A

ROIA

13.43

-0.05

Clear Channel

CCU

29.97

+0.40

Radio One, Cl. D

ROIAK

13.40

-0.11

Cox Radio

CXR

16.47

+0.11

Regent

RGCI

6.06

+0.01

Cumulus

CMLS

13.04

-0.02

Saga Commun.

SGA

13.85

+0.05

Disney

DIS

27.29

+0.21

Salem Comm.

SALM

18.76

+0.31

Emmis

EMMS

18.65

+0.28

Sirius Sat. Radio

SIRI

5.84

-0.05

Entercom

ETM

33.87

+0.02

Spanish Bcg.

SBSA

9.12

-0.07

Entravision

EVC

7.56

+0.19

Univision

UVN

26.89

-0.06

Fisher

FSCI

50.50

-0.34

Viacom, Cl. A

VIA

34.10

+0.05

Gaylord

GET

42.21

-0.02

Viacom, Cl. B

VIAb

33.90

+0.03

Hearst-Argyle

HTV

24.96

+0.24

Westwood One

WON

20.49

+0.19

Interep

IREP

0.45

+0.02

XM Sat. Radio

XMSR

32.97

-0.51

International Bcg.

IBCS

0.01

unch

-

-

-

-

-



Bounceback

Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments to [email protected]

Listeners weren't the only ones left in the lurch when WCBS-FM New York suddenly switched to "Jack"
(6/6/05 RBR #110).

Anyone who has ever been through a midnight format switch knows only too well what a nightmare those first few days are, especially for the sales department. In my 30+ years in radio I have had to listen to angry listeners yell and sometimes cry because "we killed their friend." The sales department had to deal with enraged clients who yesterday were sold a station that was the perfect choice but today it's an entirely different station. We clearly lied! Let me count the ways that radio has been losing and continues to lose credibility...and revenue. | More... |

Stan Campbell
President
Travel Radio Network


Arbitrends

Arbitron
Market Results
| Austin |
| Baton Rouge |
| Jacksonville |
| Louisville |
| New Orleans |
| San Antonio |
| Tulsa |


Stations for Sale

TVBR - TV News

Stevens expects bipartisan DTV bill
Sen. Ted Stevens (R-AK) expects that the Senate Commerce Committee will be able to put together a bill to push forward the transition to digital television that will earn support from members of both parties. If he is able to do that, it will be in contrast to what has happened so far in the House. Stevens told the Federal Communications Bar Association that the bill will be similar to the version circulating in the House, and although it's not firm yet, he thought the Senate would probably go along with a 2009 hard deadline for the end of analog transmission. The biggest sticking point in the House has been the issue of those left behind on that date with only a blank analog screen. Stevens said his committee will be looking at options to address this problem, and put forth the notion that the sooner we stop the sale of analog-only consumer receivers, the better. Stevens later noted the complexity of issues being handled by both his committee and the FCC, and had pointed words about what he sees as an unnecessary hurdle. Seeing FCC Chairman Kevin Martin in the audience, he noted the need for cooperation between the two, only to be reminded the no more than two commissioners can meet with senators in private at one time. Stevens said he called that "stupidity." | Here's Stevens' comments on DTV and Sunshine |






RBR Radar 2005
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Infinity to spin fewer stations
Viacom Co-President/COO Les Moonves confirmed what's already been pretty well known in the radio industry - - that Infinity has cut back on plans to sell most of its radio stations outside the top 20 markets but currently having some conversations about getting rid of some of the smaller radio stations right now. "The 'Jack' format is something that we've used in LA and a few other markets. In LA, it went from 15th to third in total listeners in about a six-month period of time, so obviously this is a format that works exceedingly well. It's sort of like your own iPod. It does not have DJs. It has 1,200 of your top songs and the format has worked extraordinarily well. We've also, as I said, put promotion dollars in eight of our stations - - six of them have seen double digit growth. So, I'm optimistic that if we look at radio realistically, as a smaller growth business, it's still a great business that's producing a ton of cash and as we look toward the potential split, cash is a very good thing I will take it any day of the week," Moonves said.
RBR observation: Yes, we noted that Moonves was careful to say "if" the split happens several times during his presentation. The bottom line is that Sumner Redstone has absolute voting control of Viacom - - and will continue to have absolute voting control of both post-split companies. If he thinks the split is a good idea, it will happen. If not, it won't. No one else's opinion counts.
06/07/05 RBR #111

Stocks on a roll - - a downhill roll
If you're an active investor in broadcast stocks, 2005 has not been a happy time. Radio stocks are an out of favor sector. Unless you somehow managed to divine which four radio stocks, out of the 29 in our daily list, would gain so far this year, you've lost money. 06/07/05 RBR #111

Kathy Crawford
spells out LPM impact
We're living in 1902 in the scheme of things. We're playing catch-up here. We should have been here long ago. The people Meter has been out there for years and we've never gotten it done and we've been screaming about it for years. Well now we're going to get it done in the top 10 markets, but we're going about this is like slow motion. And now we've got the stations who have had their heads in the sand over so many things. ... For the analysis see 06/07/05 RBR #111

Jack in the city
Infinity shocked New Yorkers by blowing up long-established Oldies outlet WCBS-FM to launch a "Jack" format with a playlist of more than 1,200 songs. ew York Post called the format change a "bloodbath."
RBR observation: WCBS-FM billed 34.1 million last year, so Infinity is blowing up a big revenue center to go in a new direction. Mel Phillips, who was once at WCBS-FM questions whether a format with 1,200 songs can really counter the threats from iPods and satellite radio, which have 10,000-plus. And he says it will be "extremely hard" for the new Jack station to identify and qualify the type of music it's playing. "You just can't broad-brush the music as everything from the 50s to the 90s. My question is what kind of music from the 50s to the 90s ? Publisher note: Make all the excuses you want but in New York City it is so big oldies will work and can remain viable and grow with a progressive program director (PD) that has the passion for the content and presentation and now no competition. 710-AM WOR, Buckley Broadcasting. should be the new home of current and future legends with live entertainment that takes on the meaning of live and community involvement. Plus a built in 3.1 and 31 million bucks. Call Joe McCoy and Mel Phillips.
06/06/05 RBR #110

WCBS-FM is now Jack,
we hear from Joe
Joe McCoyFormer WCBS-FM - Surprising? No. When the Sales Department continually complains to the GM that they are having a problem selling it because of low 25-54 ratings you expect a change is going to come. GM's and Upper Management do not come from Programming. They have no attachment to the audience or the format, just the bottom line. I guess the question is why change a station that makes millions of dollars when you can change one that has been treading water for 3 years? Namely WNEW-FM. 06/06/05 RBR #110


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