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Volume 24, Issue 15, Jim Carnegie, Editor & Publisher
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Tuesday Morning January 23rd, 2007
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Radio News ®
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CC Radio shopper's guide: Still plenty left
 Clear Channel Radio has thus far announced sales of its stations in 17 markets from the original list of markets to be divested, which totaled 448 stations in smaller markets deemed non-strategic for the company. But that still leaves 73 markets up for grabs, although we understand that some are in advanced stages of negotiations, so deals should be announced soon. RBR has taken the official sale announcements and updated the list of markets to be sold that CC Radio announced last November.
| Here is the updated shopping list |
RBR observation: Not included in this list are the stations to be divested in larger markets where grandfathered combinations that exceed current FCC local ownership limits cannot be transferred intact as the company is taken private. Our sources say the company is not even talking with potential buyers about those stations yet. We do hear that the online due diligence site for qualified bidders seeking the smaller market stations has opened, so potential buyers, including those who attended the recent session for minority and female broadcasters, can now get down to the nitty gritty of bidding.
Air America gets a buyer?
Air America Radio may have found a buyer to save it from liquidation after it declared bankruptcy last October, reported WSJ. Investors led by the French family of Westchester County, NY (which owns WRNN-TV Westchester) is close to signing a deal to purchase the assets of Piquant LLC, AAR's parent, the story said. If the acquisition does go through, it could lead to at least one programming tweak. Richard French, son of WRNN owner Dick French, will likely get his own show. Richard French, formerly a NY Democratic Party official, already has a nightly show on WRNN, "Richard French Live," where he has hosted guests including Sen. Hillary Clinton.
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Tribune assessing options, keeping all open
After spending the weekend looking at the bids submitted for all or part of Tribune Company, the special committee of independent directors had little to say officially, except that they are keeping their options open. "The committee is actively engaged in the review process," said William A. Osborn, Tribune's lead independent director and chairman of the special committee. "Assisted by our outside legal and financial advisors, we are carefully considering all alternatives for creating additional shareholder value. These alternatives include potential transactions involving third parties as well as actions the company may take alone," Osborn said in the brief public statement on the bid assessment. After looking at the options, the special committee will make a recommendation to the full board, and the Tribune board has indicated it expects to announce a decision before this quarter is over.
RBR observation: After all of the early talk focused on the big newspapers, such as the Chicago Tribune and Los Angeles Times, it seems now that the focus has turned to the broadcasting side - although only to TV, with still no one seeming to pay much attention to the lone radio property, WGN-AM Chicago. No less than the Wall Street Journal ran this headline: "Fate of Tribune May Rest With Television Business." According to the article, the bid by Tribune's largest shareholder, the Chandler family, which would spin off the TV group to other shareholders while they and some new investors take everything else, values the TV group at around 4.2 billion. Some insiders think that is too high, but we have heard that the TV-only bid from The Carlyle Group is not far from that valuation. Our take is that the television group has a lot more upside potential than the newspapers, particularly as the CW network becomes better established.
 More MORA on the way
US Rep. Maurice Hinchey (D-NY) and Sen. Bernie Sanders (I-VT) are planning to bring back to life the Media Ownership Reform Act (MORA) this year. Last year's attempt never had a chance to get past Republican House leadership, but Hinchey faces better prospects following the Democratic mid-term takeover, and Sanders' move from the House to the Senate opened the avenue to introduction of a companion measure (although there are no doubt other senators who would have been happy to work with Hinchey). Among Hinchey's goals with MORA are a rollback of station ownership caps both nationally and locally, heightened public interest requirements, more independently-produced programming and the return of the Fairness Doctrine. Discussing Rush Limbaugh, Hinchey, pictured, told website rawstory.com, "If Rush shoots his mouth off, he must give equal access to our side. The American public will begin to get both sides or all sides of an issue. That is basic - fundamental to a democracy."
RBR observation: The devil would be in far more than the details on a legislative package like this. It would really be in the court challenges. Broadcasters forced to sell of valuable property in a government-induced fire sale would be looking for financial redress, and both the practical and the First Amendment implications of reinstating the Fairness Doctrine are mind-boggling. Just for starters, take a complex issue like Iraq. It would be no problem at all to find five thoughtful and informed observers with five completely different opinions on how to proceed there. How many of them do you have to give time to after you air your own editorial. If MORA fails to rationally deal with the practical aspects of its goals, it figures to die a swift death at the hands of the first judge who finds it on the docket.
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The outlook is lukewarm
That is the view of CL King analyst Jim Boyle about radio in 2007. "We are initiating our industry 2007 (estimated) revenue forecast at a 1% decline. The Street consensus is for a 1% improvement. The sluggish trend is inescapable: 2006 (estimated) is likely to be a 0.5% uptick, compared to 2005 (actual) at flat, 2004 (actual) at a 3% improvement, and 2003 (actual) at a 1% increase. Indeed, much has occurred in radio, media and advertising over the past few years. But 2007 is expected to be a 'clean' year with little to set it apart. Hence, radio's operational fundamentals should be able to rise or fall on their own merits or demerits. We anticipate 2007 in radio to be the Year of Non-Traditional Revenue (NTR). But what could be exciting is if Radio can garner non-advertising NTR. Could consumer-fee driven NTR be successfully chased by radio groups? Why not monetize your primary listeners (P-1s in radio jargon)? iTunes does. E-Bay does. YouTube wants to. We believe Radio can build a dual-revenue stream. It doesn't have to be a dream. We wonder if radio can adapt in 2007-2008 and burst out of the sluggish, sideways revenue trend," Boyle said in a research note. More immediately, he is looking for December revenues to come in flat, despite the easy comp from a year earlier - another sluggish month with no political spending to take up the slack.
 Supremes to re-examine BCRA
BCRA is, of course, the McCain-Feingold Bipartisan Campaign Reform Act. One of its planks restricting issue ads that are deemed separate and apart from a coincidental election cycle is under renewed attack. SCOTUS upheld the plank in 2003, but now SCOTUS has a new lineup. Sen. Russ Feingold (D-WI) is at the center of the particular dispute. The case was brought before the court by Wisconsin Right to Life wanted to run ads encouraging the Senator to support their stand on the abortion issue. WRTL made no recommendation to either vote for or against Feingold, and said it simply wanted to continue to promote its viewpoint. BCRA proponents argued that there was no pressing legislation on the table at the time and that WRTL was a long-standing opponent of Feingold, so the true purpose of the ad was questionable. Further, WRTL could run it if they wanted by adhering to finance restrictions. WRTL won a 2-1 split decision at the DC Circuit, and now there'll be a rerun at the nine-member Supreme Court. In 2003, Sandra Day O'Connor cast a decisive vote to uphold BCRA 5-4. Last year, with Sandra Day O'Connor on her way out, a likely 4-4 tie prompted to Supremes to boot the case back to a lower court.
RBR observation: The presence of Samuel Alito in O'Connor's chair makes it a good bet that the 5-4 vote of 2003 will go the other way, upholding the DC Circuit's ruling and freeing up more cash for spending in the month before a primary and two months prior to a general election. Backers of campaign finance reform aren't going to like it if that happens, but grassroots issues groups are not responsible for the bulk of election season political spending. The real money will be coming from candidates and PACs. But will this open a new loophole? Well, let's see what the Court decides before we ask our crystal ball that particular question.
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| Special Report |
Traffic systems evolving to meet industry needs, Prt II
In our yearly traffic systems update, we ask just about everyone in the business to discuss their latest product upgrades, along with addressing a lineup of important issues agencies and broadcasters are concerned about. We also spoke with Larry Keene, President of TDGA/Traffic Directors Guild of America for his insights. One issue that seems to have been resolved in the industry, and as evidenced by their responses, was how well their systems integrate across large station groups. All responses were along the lines of they're designed to run multiple stations efficiently across large station groups, ensuring large station groups can function and grow in their space. Another resolved issue, especially for radio, was how handling the new 10's, 15's, 20's and 30's compared to the more standard 60's. Most can now handle any spot length as well as multi-impression spots like bookends. For television, the responses we got back mentioned capability to handle non-primary spots such as snipes, logos, bugs, crawls, etc. Demands from the networks on promotional spots are also no longer an issue. Spots are coded and scheduled in advance using station-defined parameters and priorities. This provides control over the placement of network and promotional ads-more where they're needed; less where they're not. And the last resolved issue was whether traffic systems can handle same-day orders. Keene says a big problem in radio (and it can apply to TV), is if a salesperson sells something the same day or after the next day's log is done, you can go in and tell the digital automation system to insert these additional spots and it will, but that sometimes doesn't reflect back on the log that the master control is using. The general response was salespeople can now enter orders from any online computer and be on the air as fast as production or management approval allows-verification is now automatic. That leaves us with a few other hot industry issues. (Continued from yesterday).
The participants who responded:
Bob Lamb, Pilat Media CTO
Dave Scott, RadioTraffic.com
Jeff London, Sr. Director of Business Operations, Marketron International
Arthur Drevnig, Director of Sales & Marketing, BroadView Software
Neil Klar, SQAD
Crist Myers, Director, Sales & Marketing, Myers Information Systems (MIS)
Jay Batista, VP Sales and Marketing, VCI
Ro Catalfo, LAN International
Pete D'Acosta, CEO, Wicks Broadcast Solutions
Ed Adams, VP/GM, North America Media and Broadband Sales, Harris Corp.
| Read More... |
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| Media Business Report TM |
 CC Outdoor, Nevada
Amber Alert go live
Clear Channel Outdoor and the Nevada Amber Alert Committee announced the successful conclusion of Amber Alert testing on seven digital billboards serving the Las Vegas area. The completion of the test officially gives the Nevada Amber Alert Committee access to the digital billboards. The seven billboards are located along key areas within the Las Vegas Area. "We could not be more excited about our ability to utilize our digital technology to provide this invaluable community service, which will be available to Las Vegas not only when a child is missing but also during a wide array of other community emergencies," said Paul Meyer, Global President of CC Outdoor. "We expect to establish similar emergency messaging protocols in other cities where Clear Channel Outdoor has deployed digital networks." As part of its agreement with Nevada Amber Alert Committee, the Las Vegas division of Clear Channel Outdoor now has the ability to download missing child information, including a photograph. By activating a system that is set up only for the purpose of communicating Amber Alert messages, the information will override the commercial schedule that is currently playing on each digital unit and quickly broadcast the Amber Alert information to thousands of people instantaneously.
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| Media Markets & Money TM |
Close encounter in Boston
Although minority groups were demonstrably not WILD about the sale of a Radio One FM station to Entercom, their attempts to scotch the deal at the FCC failed, and now, Star Media Group broker Peter Handy tells us the deal is closed. The station has already flipped its calls to WKAF-FM and gone into simulcast with Entercom's signal-challenged WAAF-FM. The pricetag was 30M.
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| Washington Media Business Report TM |
Because one sub apparently is not enough
Two House subcommittees plan on making broadcasting an issue of interest in the 110th Congress. We have already named the members of the traditionally-critical one, the Subcommittee on Telecommunications and the Internet, which operates under the umbrella of the Committee on Energy and Commerce. Representative and announced repeat presidential candidate Dennis Kucinich (D-OH) has also announced his attention to grill up a little broadcaster this year via his Subcommittee on Domestic Policy, under the umbrella of Henry Waxman's (D-CA) Committee on Oversight and Government Reform. Here, then, for your advance warning and lobbying fun, are the members of the subcommittee and larger general committee.
RBR observation: And as if this isn't enough, the Rep who seems to have the greatest interest in all things broadcasting, Maurice Hinchey (D-NY), isn't on either committee, adding a third source on Congressional heat.
| Subcommittee, Committee membership here |
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| Entertainment Media Business Report TM |
Bonneville keeps WGMS; flips to "George 104"
Looks like the Bonneville deal to sell its Classical 104.1/103.9 frequencies in DC to Dan Snyder's Red Zebra Broadcasting fell through, as the station has flipped formats yesterday to 70's and 80s as "George 104" (WXGG-FM). Snyder's 94.3 and 92.7 FM continue as Triple X ESPN Radio. The station, with its "playing whatever we want" mantra is aimed directly at ABC Radio/Citadel's WRQX-FM in DC. Meanwhile, local NPR affiliate WETA-FM has returned to its Classical roots to absorb the disenfranchised WGMS listeners. George 104 is sending them over with a message from Bonneville International. In the fray almost a dozen WGMS employees were let go yesterday, including its entire on-air staff.
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| HD Radio 2007 |
 HD Alliance names next
17 markets for multicasts
The HD Digital Radio Alliance announced the next 17 markets to choose HD2 programming formats. Set to be live by 1/31, these 17 bring the total number of markets choosing HD2 programming to 85 and mark the fourth wave in the 12-month-old rollout. All of the 85 markets are in the top 100. New formats being selected in this round include Jazz & Blues, Standards and Slow Jams and Dance. Many of these formats are entirely new and will be heard for the first time in this rollout. Individual radio companies will announce which stations in these markets have selected which formats.
| The next 17 markets to roll out HD2 multicast programming |
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| Music Media Business Report TM |
Indie labels form joint license agency
The world's Indie music industry has grouped together to launch an agency to secure licensing deals with new media sites such as MySpace and YouTube. Indie record labels comprise some 30% of the music sold worldwide, up against Vivendi's Universal Music, Sony BMG, EMI Group and Warner Music. The group, "Merlin," was launched at the annual MidemNet music industry conference. Merlin has already agreed a deal with digital music company Snocap which will allow its members' music to be sold from sites such as MySpace.
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| Transactions |
N/A WZLM-FM Goodwater AL/WKGA-FM Dadeville AL; WTID-FM Repton AL; WHPH-FM Jemison AL; WEZZ-FM Thomaston AL from Great South RFDC LLC (Paul Reynolds, Greg Mixon) to Great South Wireless LLC (Paul Reynolds, Joan Reynolds, Lee Reynolds, Lyle Reynolds). 100 dollars cash plus assumption of unspecified liabilities. Duopoly between WZLM-FM and WKGA-FM only. Also includes pending acquisition of WKLF-AM Clanton AL. [File date 12/26/06.]
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| Stock Talk |
Tech worries on Wall Street
Stock prices were lower Monday, with investors apparently worried about whether some high tech companies might disappoint in the current wave of quarterly reports and forecasts. The Dow Industrials were down 88 points, or 0.7%, to 12,477.
Radio stocks sank with the market. The Radio Index was off 0.583, or 0.4%, to 157.718. Salem fell the most, off 3.9%. That is, the most of traditional radio companies. The satellite stocks fell more, with Sirius down 9.3% and XM off 6.3%.
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| Radio Stocks |
Here's how stocks fared on Monday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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45.66
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-0.74
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Journal Comm.
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JRN
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13.14
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+0.05
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Beasley
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BBGI
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9.12
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-0.08
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Lincoln Natl.
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LNC
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65.98
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-0.37
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| CBS CI. B |
CBS |
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31.34
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-0.17
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Radio One, Cl. A
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ROIA
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7.44
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+0.13
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| CBS CI. A |
CBSa |
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31.35
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-0.17
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Radio One, Cl. D
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ROIAK
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7.47
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+0.17
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| Citadel |
CDL |
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10.23 |
+0.04 |
Regent
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RGCI
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3.11
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unch
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Clear Channel
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CCU
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36.79
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+0.29
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Saga Commun.
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SGA
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10.03
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+0.29
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Cox Radio
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CXR
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15.56
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+0.04
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Salem Comm.
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SALM
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11.00
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-0.45
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Cumulus
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CMLS
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10.33
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-0.02
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Sirius Sat. Radio
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SIRI
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3.85
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-0.11
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Disney
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DIS
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35.15
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-0.35
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Spanish Bcg.
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SBSA
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4.07
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-0.04
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Emmis
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EMMS
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8.56
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-0.09
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SWMX
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SMWX
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1.75
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-0.18
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| Entercom |
ETM
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28.05
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-0.06
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Univision
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UVN
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35.84
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+0.01
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Entravision
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EVC
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7.80
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-0.15
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Westwood One
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WON
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7.07
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-0.09
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Fisher
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FSCI
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43.00
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+0.14
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XM Sat. Radio
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XMSR
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14.73
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-0.99
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Hearst-Argyle
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HTV
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26.26
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+0.08
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-
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Bounceback
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 We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]
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Below the Fold
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Media Business Report
Nevada Amber Alert goes live
It is successful testing on 7 digital billboards in Vegas...
RBR Special Report
Traffic Systems
How is EDI integrated into this system?...
HD Radio 2007
Next 17 markets for multicasts
Set to be live by 1/31...
Music Media Business Report
Indie labels
Form joint license agency...
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Stations for Sale
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Central CA Coast FM: $1.5M
Pacific Northwest FM: $750K
Terms Available
MCH Enterprises: 805.543.3466
www.mchentinc.com
Market your Stations For Sale
in our daily epapers.
Contact June Barnes
[email protected]
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Radio Media Moves
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Hohman to SCBA
exec board
Univision Radio VP/General Manager, Michelle Hohman, has been named to the SCBA Executive Committee, according to Pat Duffy, VP/Market Manager, News, CBS Radio and Chairman of the SCBA. Hohman has accepted the position of Treasurer, and will begin her duties on 1/31. She replaces David Haymore, who will be stepping down as VP/GM of SBS Los Angeles.
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TVBR - TV News
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Sinclair inks
deal with TW
And Mediacom wants one too. The agreement with Time Warner Cable keeps 35 Sinclair broadcast television in 22 markets available to TW subscribers. Mediacom immediately surmised that the deal reflects "the current market for retransmission consent," and asked for similar terms or binding arbitration. Sinclair's David Smith noted that the three year agreement puts it in sync with its biggest cable partner. "Sinclair is very pleased to have reached this agreement with Time Warner, which carries our stations to more subscribers than any other cable company," he said. "We are excited that this agreement not only ensures retransmission of our signals by Time Warner for the next three years, but also provides for the carriage of our digital signals for the first time to most of Time Warner's subscribers. This agreement, which represents a mutually acceptable economic agreement between the parties, is further indication of the value of our television stations to cable companies and provides a strong illustration of the successful operation of the free market for negotiation of retransmission consent agreements." Mediacom was quick to comment. Rocco Commisso said he wants Sinclair to give his company the same deal. "Failure to do so would be the strongest indication yet that Sinclair is intent on using its raw market power and leverage to discriminate against Mediacom and other smaller cable companies serving small communities across America." Commisso asked that the Senate Commerce Committee take up the matter in its already-scheduled 2/1/07 FCC oversight session. Smith and Commisso are expected to face off at the Iowa legislature today.
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RBR Radar 2006
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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XM lawsuit to Proceed
A federal judge in New York has refused to throw out a lawsuit by major record labels claiming copyright infringement by XM Satellite Radio, specifically its new receivers tied to mp3 recorders.
RBR observation: Think this doesn't matter to AM and FM stations? Think again. The record labels have long sought to collect performance royalties from broadcasters and have been repeatedly rebuffed by Congress. In this case, the record labels are trying to do an end-run around Congress to get the courts to rewrite the AHRA because the labels don't like the terms they agreed to in 1992. If they succeed in their attempt to collect additional payments from XM (Sirius has already agreed to pay), their lawyers will be ready to go after broadcasters for HD Radio receivers with digital recording devices included. It is only slightly reassuring that Judge Batts differentiated between "free radio" and "private radio broadcasts" in her ruling. Her basic belief that a radio/mp3 device is not the same as a radio/cassette device is just plain wrong. The technology has improved, but the legal right of consumers to make recordings for their own use is still protected by law.
01/22/07 RBR #14
Special Report: Traffic systems evolving to meet industry needs
RBR's annual report on the latest product upgrades, along with addressing a lineup of important issues agencies and broadcasters are concerned about. We discuss and investigate the who's who in Traffic. This annual Report is for to make your decisions one step easier.
01/22/07 RBR #14
Shareholders bucking CCU buyout
Is the offer of 37.60 per share to take Clear Channel Communications private too low? Big shareholders, including giant Fidelity Investments, want Thomas H. Lee Partners and Bain Capital Partners to pony up more cash. According to the WSJ, several of Clear Channel's 10 largest institutional investors have been talking to the company about their dissatisfaction with the buyout terms. One impetus was apparently a report put out last week by Bear Stearns analyst Victor Miller which reasserted his view that the buyout price should be higher, based in part on the recent stock price rise for Clear Channel Outdoor, which is 90% owned by Clear Channel Communications.
RBR observation: Back before the buyout deal was struck, Victor Miller was insisting that the company was worth over 40 bucks a share, so that it not really new - but the big investors are apparently paying attention now. Also, some of them probably heard Jeff Smulyan note in his conference call that his highest offer to take Emmis private, which was turned down by the board, put a higher multiple on the company than the radio portion of the Clear Channel deal. We recall, though, that there was an open, public auction of Clear Channel and this was the better of the two bids. If the shareholders of Clear Channel reject this deal, what then?
01/19/07 RBR #13
Michaels heading TV company
The rumors that were circulating for several weeks are true. Former Clear Channel Radio CEO Randy Michaels is back heading a large broadcasting company. named CEO of Local TV LLC, a company recently launched by the Oak Hill Capital private equity group with its pending purchase of the New York Times TV group for 575 million (1/5/07 TVBR #3). Joining Michaels at the new venture is another familiar radio name from their days together at Jacor, Bobby Lawrence. He will be President and COO.
RBR observation: Talk about bringing in some heavy hitters to reinvigorate some less than aggressive media properties! What does Randy know about television? Well, Jacor did own WKRC-TV (Ch. 12, CBS) Cincinnati. And what the heck, TV is only radio with a screen, Right? But the big factor is management and the Michaels/Lawrence team worked very well in the past and lightening will strike again. Lawrence has been looking at TV for years and brings solid focus with a smile add to it Michaels creative programming skills and this will work. RBR will not be surprised to see a new meaning of cross platforming/marketing in this new venture.
01/18/07 RBR #12
Fox has a slip of the...well,
it wasn't the lip
During the coverage of an NFL play-off game between the Philadelphia Eagles and the New Orleans Saints, a camera lens came to rest on a fan with a less-than-family-friendly message, and the PTC is up in arms. A crowd shot lingered for about five seconds on a female football fan wearing a t-shirt that said "F*** DA EAGLES."
01/18/07 RBR #12
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Editorial & Sales Reps
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