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Welcome to RBR's Daily Epaper
Volume 23, Issue 182, Jim Carnegie, Editor & Publisher
Tuesday Morning September 19th, 2006

Radio News ®

Emmis handing out cash
Rather than another Dutch auction, Emmis Communications has elected to make a cash payout of four bucks per share to shareholders as a special dividend. Emmis says the special dividend combined with last year's Dutch auction tender will have returned almost 550 million to shareholders. "The board decided that this special dividend - the first-ever for Emmis - would reward all of its common shareholders while at the same time establish an appropriate capital structure for Emmis to achieve its strategies. This action demonstrates the board's confidence in Emmis' financial discipline, while allowing all shareholders to benefit from overachieving the expected sale price for our television stations," said Emmis CEO Jeff Smulyan. Emmis has 37.2 million shares outstanding, so the special dividend will total 149 million. Nearly 20 million will go to Smulyan, who is the biggest shareholder. Emmis said it expects to make the special dividend payment in November. At the same time, Emmis said it would make a tender to purchase, at par, all of its 375 million outstanding of 6 7/8% Senior Subordinated Notes. That tender is required by an asset sale provision of the indenture for a portion of the notes.

RBR observation: This special dividend move did not please Wall Street, which had been hoping for another Dutch auction stock buyback round. Why not do that? One reason might be the current stock price. Having already rejected a 15.25 per share buyout offer from Smulyan to take the company private, it could have been embarrassing for the board of directors to turn around and do a big stock buyback at an even lower price.

Wall Street disappointed by Emmis move
Investors and analysts had been hoping another big stock buyback, likely a repeat of last year's Dutch auction, so they were not happy to see Emmis go the special dividend route instead. The stock price went down, not up, immediately after the announcement, then began to recover. In a note to shareholders, Bear Stears analyst Victor Miller asked what Smulyan was signaling with the move. "In a Dutch tender, Mr. Smulyan was unlikely to take any current economics for himself. Under this plan, he would actually take out 20M (he owns ~5m shares). The risk profile (company leverage) for Mr. Smulyan under a Dutch tender was higher, therefore likely to be more impactful to shareholders," Miller said. At Lehman Brothers, Anthony DiClemente was worried about the increased leverage. "Pro forma the special dividend we calculate Emmis's leverage ratio to be greater than 8.5x (incorporating preferred shares and using EBITDA net of compensation expense), or roughly two turns higher than prior to the dividend," he told clients. "Emmis has endured two consecutive quarters of steep declines in domestic radio cash flow, and we estimate domestic radio EBITDA to continue to decline in the double-digit range for the remainder of the fiscal year, and thus we are cautious on Emmis's incremental debt level in light of recent instability in revenue and cash flow," DiClemente added.


Televisa gives up quest for Univision
Saying it was responding to "speculation in the press," Televisa said in a filing with the Mexican Stock Exchange that it will not be making a new bid for Univision. Shareholders are due to vote September 27th on the bid from Haim Saban's group to buy Univision for a total of 13.7 billion, including debt assumption. Although Televisa CEO Emilio Azcarraga Jean has been anxious for years to acquire control of Univision, he came up short in the original bidding. But as recently as last week the New York Times reported that he was still trying to put together a bid to top Saban (9/13/06 RBR #178). He has now shut the door and says that topper bid will not be coming.

RBR observation: Don't imagine that you have seen the last of Emilio Azcarraga Jean. The Mexican media mogul is still anxious to expand his empire northward - he just has to figure out how to do it. We foresee many court battles ahead as Televisa sues over any possible violation of the contract that gives Univision exclusive US TV rights to Televisa programming through 2017, as well as the current litigation over who has the right to deliver that programming in the US via the Internet. If all else fails, Azcarraga will be still a relatively young man in 2017 and able to launch a new Spanish-language media entrant in the US.

Bush's perverse star turn in this year's crop of ads
In the past, President George W. Bush was frequently a featured character in the political ad wars, and again, he is all over the airwaves in what figures to be a bumper crop of political ads in the 2006 mid-term campaign which is already well under way. The only problem is that this time he's starring in ads produced by and for Democrats. The more negative the approval rating numbers are, the more popular he is with Dems. Even when Bush is not cast directly in an ad, he is directly in the background as a Republican candidate's level of support for Bush as measured by voting record stats is exposed. According to the New York Times, Republicans are much more likely to work Sen. John McCain (R-AZ) into their own material. And when they're looking for something negative, House Minority Leader Nancy Pelosi (D-CA) is a popular pick.


Powell unaware of localism report
Many watchdogs thought they saw the fingerprints of former FCC Chairman Michael Powell in the case of the not-so-dead FCC report on the relationship between local news programming and the proximity of station ownership. Powell told RBR/TVBR that he knows nothing of the report, and the fact that it's available everywhere is clear proof that it wasn't destroyed. "I never saw or even heard about this study until this week and I most certainly did not direct that it be destroyed - which given its present wide distribution it clearly was not," he told Publisher Jim Carnegie. "In fact, it would have contravened our practice and policy to destroy a report of this type. Researchers were permitted wide latitude to do research when I was Chairman and even where the FCC chose not to use a project officially, we permitted researchers to continue work under their own names with the project as a 'working paper.' The study also was completed long after the media ownership proceeding had concluded and the 3rd Circuit had entered its stay. Thus, the study could not have possibly influenced the outcome of that controversial proceeding as some are suggesting. If it was intended for the localism proceeding, that proceeding remains open and Chairman Martin has incorporated it into that review."

RBR observation: Powell, former Media Bureau Chief Ken Ferree and current Chairman Kevin Martin are pleading both innocence and ignorance. We're not sure who we'll need to get to the bottom of this one, Sherlock Holmes or Inspector Clouseau. Two things are clear, however. First, Martin exhibited a great deal of wisdom in shuffling this hot potato right into the public domain before any of his fingerprints could find their way onto the whole mess. Second, the bottom line is that it will make it just that much more difficult to edge the current redo of media ownership rules toward the deregulatory side.

Schore and Agovino launch Triton
Media veterans Neal Schore and Mike Agovino have launched a new company, Triton Media Group LLC, which will offer strategic marketing services to the media industry. The say Triton will specialize in integration linking on-air and online media, "enabling the sale of a complete marketing package while producing enhanced revenues for broadcasters." Schore, President and CEO, was most recently managing partner and CEO of Midway Marketing Group, which worked to connect media ventures with the private equity community. Agovino, COO, was formerly President of Katz Radio, President of Clear Channel Radio Sales and Co-President/COO of Interep. He was mostly recently a partner at MusicToGo. In fact, Triton has now closed an equity investment in MusicToGo, a software development company that builds applications for the radio industry. "Triton is not just about online but rather what online can do to drive on- air revenue," said Agovino.


Reminder:
RBR Publisher Jim Carnegie, Executive Editor Jack Messmer, Marketing/Sales Director June Barnes and Vice President Cathy Carnegie will be attending NAB Radio Show. If you need to find them they all will be located at the Hilton Anatole


Ad Business Report TM

CBS's "Jack" stations
hype the new TV season
with web play

The CBS Marketing Group and CBS Radio are presenting a one-week online Jack-FM radio show to promote CBS Television's fall lineup. The exclusive webcast, "CBS Got Jack'd," can be accessed the week of 9/18 at www.cbsgotjackd.com. CBS primetime stars Jon Cryer, George Eads, Franky G, Alyson Hannigan, Jennifer Love Hewitt, Lauren Holly, Phil Keoghan, Ray Liotta, Camryn Manheim, Kathryn Morris, Jeff Probst, Gary Sinise, James Woods and more, share their favorite songs of all time and give listeners the inside track on this season's new and returning series. Series promoted include: Shark, Smith, Jericho and The Class, as well as returning series CSI, CSI: NY, Cold Case, NCIS, The Unit, Two and a Half Men, Ghost Whisperer, How I Met Your Mother, Survivor, The Amazing Race and daytime game show, The Price is Right. The website will also include unique Jack-FM animation that will appear throughout the two-hour special. Jack-FM stations nationwide will promote CBS Got Jack'd with soundbites from the online show and provide giveaways to listeners from hit CBS series. Listeners can log online at any time during premiere week to hear CBS stars like James Woods riff about the Rolling Stones; Jeri Ryan introduce one of her favorite songs of all time, "I Want You to Want Me" by Cheap Trick; Alyson Hannigan's secret confession that she was a huge Michael Jackson fan back in the 80's; Bob Barker, who shares personal stories about Frank Sinatra and Sammy Davis Jr.; and Jon Cryer and Angus T. Jones, who offer their eclectic playlists, which include heavy metal and alternative bands. Celebrity soundbites will also be played on CBS Radio's 12 Jack FM stations with a link to the show featured on the stations' websites.

Progressive Direct selects Arnold Worldwide
The Progressive Direct Group of Insurance Companies announced it has concluded its agency review and selected Arnold Worldwide. "We're extremely pleased to announce that Arnold Worldwide will be our new primary agency," said Alex Ho, brand development director, Progressive Direct. "All the agency finalists were exceptional; Arnold has the right combination of strategic thinking, creativity and talent that we were looking for. We feel confident that, with their help, we will continue to find compelling ways to help consumers understand what sets Progressive apart and makes us the better choice for their insurance needs." Roth Associates, New York, managed the agency review process. Doner had been the primary AOR for Progressive Direct since 1999.


NAB Day Time Planner
The following will be attending the NAB. Call or email to make your
appointment in advance.
BROKERS
Todd Fowler/David Reeder/Gene Ferry/Bruce Pollock, American Media Services, Hilton Anatole, 843-972-2200, [email protected], [email protected], [email protected], [email protected]

Jack Higgins/Dan Graves/
Joel Day/Denis LeClair
, CobbCorp, LLC., Hilton Anatole, office 202-478-3737, [email protected]

Andrew P. McClure, The Exline Company, Hilton Anatole, Suite 353 office 415-479-3484, cell 415-497-3855, [email protected]

Frank Boyle, Frank Boyle & Co., Sheraton Suites Market Center, 203-969-2020, [email protected]

Cliff Gardiner, Clifton Gardiner & Co., Hilton Anatole, 303-758-6900, [email protected]

Gordon Rice, Gordon Rice Associates,
843-884-3590, Hilton Anatole, [email protected]

Ed Henson, Henson Media, Inc., Louisville, KY, 502-589-0060, Hilton Anatole, [email protected]

John L. Pierce,
John Pierce & Company LLC,
859-647-0101, cell 859-512-3015, Hilton Anatole, [email protected]

Jamie Rasnick,
John Pierce & Company LLC,
859-647-0101, cell 513-252-1186, Hilton Anatole, [email protected]

Dick Kozacko/George Kimble,
Kozacko Media Services, office 607-733-7138, cell 607-738-1219, Hilton Anatole,
[email protected]

Larry Patrick/Greg Guy/Susan Patrick/Summer Foust,
Patrick Communications, Hilton Anatole
Suite #1034, 410-740-0250, [email protected]

Glenn Serafin, Serafin Bros., Inc.,
office 813-885-6060,
cell 813-494-6875, [email protected]

Terry A. Greenwood,
TAG Media Consulting,
Hilton Anatole, office 410-931-3362, [email protected]

LAWYERS
Gregg P. Skall,
Womble Carlyle Sandridge & Rice, PLLC 202-857-4441, Hilton Anatole, [email protected]

TRAFFIC SOFTWARE
Eric Mathewson, Founder and CEO; Wide Orbit; 415-675-6751; Booth 617 and Hilton Anatole Presidential Suite;
[email protected]

REG.-NAT. SALES/STATION REPRESENTATION
Stuart J. Sharpe/Kevin S. Adelstein/Gail F. Lawing/Beth L. Lesser, Regional Reps Corp., office 216-781-0035, Stuart 216-272-8442, Kevin 216-702-2569, Gail 404-307-3194, Beth 214-621-5353, Hilton Anatole, [email protected], [email protected], [email protected], [email protected]


Media Business Report TM
Mediaedge:cia and Bravo create "MEC Bravo"
Mediaedge:cia and The Bravo Group, a pioneer agency of Hispanic marketing, today launch its dedicated Hispanic media communications division: MEC Bravo. Bravo's current media planning and buying capabilities will combine with Mediaedge:cia to provide a new offer which will include access to consumer insight and ROI, communications planning, media planning and buying, interaction (digital, direct, search), retail consultancy, sponsorship consultancy and activation and branded content and entertainment marketing services. Both Mediaedge:cia and Bravo already have a history of working together across clients such as Cingular Wireless, Payless ShoeSource and Chevron. Staff from Bravo's media department will relocate to MEC's New York (North America HQ) and Miami (Latin America HQ) offices from 10/1. Gonzalo del Fa, formerly Managing Director of MEC Argentina, will relocate to New York to head up MEC Bravo, reporting to Michael Jones, MEC's Chief Executive Officer, Latin America. Jorge O Espinoza, formerly Managing Partner of the Latin America Global Solutions unit in Miami, will become Managing Partner MEC Bravo, Miami.

NAB to distribute PSAs for
"Friends don't let friends drive drunk"

NAB is distributing a CD of 89 radio PSAs that encourage people to intervene in order to prevent a friend from driving drunk with the landmark tagline, "Friends Don't Let Friends Drive Drunk." A collaboration of NAB, RADD: The Entertainment Industry's Voice for Road Safety, the Ad Council and the U.S. Department of Transportation (DOT), the campaign is designed to reach the critical audience responsible for over half of all alcohol-related fatalities, 21- to 34-year-olds. The new PSAs feature Aerosmith, Black Eyed Peas, Faith Hill, NASCAR's Carl Edwards and many more. The CD will debut at The NAB Radio Show in Dallas this week, and then be distributed to stations nationwide.


Media Markets & Money TM
Four R ranges into Texas
Frank De Francesco's radio group, with its ranch-style Four R Broadcasting moniker, is up and operating on the border of Texas, just west of the Panhandle in New Mexico. Now it has a deal which will take it all the way below the Panhandle into San Angelo. It's getting a ready-made FM duopoly which includes KCDC-FM and KMDX-FM from Regency Broadcasting Inc. According to Media Services Group broker Bill Whitley, the price tag is 1.5M. Four R's other properties are in the Clovis/Pourtales portion of New Mexico.

Saga goes super in Charlottesville
Ed Christian's Saga Communications, operating as the Charlottesville Radio Group, is getting a third FM in the central Virginia college town where it also has a pair of AMs. The station, WCNR-FM, has just been put on the air by Force Five Communications. It'll go into an immediate LMA which will end on the closing of the acquisition transaction. It plans to offer a wildly eclectic playlist ranging "from Gnarls Barkley to U2, Moby to Bob Marley, Green Day to Howie Day, B.B. King to Nirvana." VP/General Manager Dennis Mockler said, "I think you would be hard pressed to find a radio station doing this anywhere in the country. We have constructed a radio station specifically for the Charlottesville market. Hey, 'different is good!'" In keeping with the stations forward-looking stance, it is signing on with related HD and Internet operations also up and ready to go. Terms of the deal were not immediately released.


Washington Media Business Report TM
Nominations headed for CommComm action
The re-nomination to the Chair of the FCC for Kevin Martin and the removal of "acting" from John Kneuer as head of the NTIA will be marked up by the Senate Commerce Committee today. Although at his hearing, Martin took heat from both ends of the ideological divide, sustaining tough questioning from John Sununu (R-NH) from the right and Byron Dorgan (D-ND) from the left, Dorgan seemed to indicate that he'd support Martin's second full term as Commissioner and the continuation of his chairmanship, which has been under way for about a year-and-a-half. Then Thursday afternoon the full committee will meet to discuss the nominations of Warren Bell, Chris Boskin and David Pryor to serve on the board of the Corporation of Public Broadcasting.


Internet Media Business Report TM
When new media needs to make a splash, it looks to old media
Yahoo is feeling the pressure, says MSNBC.com. In fact, MSNBC.com is one of the sources, along with TW/AOL, Google and newcomers like MySpace.com. It feels the need to defend its "hipness," and it feels the need to tout upgrades and new features. Unfortunately, the Internet isn't the best place to tout an Internet service, because a user has to decide to go to the site in the first place. In order to drive traffic, Yahoo will be resorting to a advertising blitz on those quaint, old-school advertising vehicles known as radio and television.

RBR observation: Those of you looking to make a splash for your goods or services would do well to follow Yahoo's excellent example.


Music Media Business Report
WMG, YouTube announce revenue,
video distribution deal

YouTube and Warner Music Group announced an agreement to distribute on YouTube the library of music videos from WMG's world-renowned roster of artists as well as behind-the-scenes footage, artist interviews, original programming and other special content. In a first-of-its-kind arrangement, YouTube users will be able to incorporate music from WMG's recorded music catalog into the videos they create and upload onto YouTube. WMG thus becomes the first music company to harness YouTube's leading video entertainment service to commercially distribute its music video catalog. WMG will have the opportunity to authorize the use of its content by the YouTube community by taking advantage of YouTube's content identification and royalty reporting system, set for release by the end of the year. YouTube and WMG will share revenue from advertising on both WMG music videos and user uploaded videos that incorporate audio and audiovisual works from WMG's catalog. WMG's music video library and special artist content will be made available simultaneously with the launch of YouTube's content identification and royalty reporting system.


Transactions
1.8M WZNZ-AM & WJGR-AM Jacksonville FL from Caron Broadcasting Inc., a subsidiary of Salem Communications Corporation (Stuart W. Epperson, Edward G. Atsinger III) to Chesapeake-Portsmouth Broadcasting Corporation (Nancy A. Epperson). 90K earnest money, balance in cash at closing. Existing duopoly. [File date 8/30/06.]


Stock Talk
Radio beats the market
There was really no explanation for it, but radio stocks were generally higher Monday as the broader market finished essentially flat. The Dow industrials fell six points to 11,555, while the S&P 500 and Nasdaq Composite were up slightly.

The Radio Index gained 0.508, or 0.4%, to 140.435. Radio One led the way, with its Class A up 2.6% and Class D ahead 1.8%. Citadel rose 2.4%.


Radio Stocks

Here's how stocks fared on Monday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

37.90

-0.33

Hearst-Argyle

HTV

23.37

-0.44

Beasley

BBGI

7.31

+0.09

Journal Comm.

JRN

11.33

-0.21

CBS CI. B CBS

28.67

+0.09

Lincoln Natl.

LNC

61.16

-0.09

CBS CI. A CBSa

28.67

+0.08

Radio One, Cl. A

ROIA

6.36

+0.16

Citadel CDL
9.38 +0.22

Radio One, Cl. D

ROIAK

6.39

+0.11

Clear Channel

CCU

29.33

-0.08

Regent

RGCI

3.96

-0.02

Cox Radio

CXR

15.31

-0.06

Saga Commun.

SGA

7.88

-0.07

Cumulus

CMLS

9.88

-0.04

Salem Comm.

SALM

10.63

-0.19

Disney

DIS

30.06

-0.25

Sirius Sat. Radio

SIRI

4.11

+0.04

Emmis

EMMS

12.00

+0.23

Spanish Bcg.

SBSA

4.20

unch

Entercom

ETM

25.05

+0.20

Univision

UVN

34.40

-0.48

Entravision

EVC

7.45

-0.04

Westwood One

WON

7.30

+0.06

Fisher

FSCI

43.84

+0.08

XM Sat. Radio

XMSR

13.88

+0.21

Gaylord

GET

44.82

-0.31

-

-

-

-

-


Bounceback

Send Us Your OpinionsWe want to
hear from you.

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




Below the Fold
Ad Business Report
CBS's "Jack" stations
Hype the new TV season with web play. Moonves using Radio to win...

Media Business Report
Mediaedge:cia and Bravo
Create "MEC Bravo" a pioneer agency of Hispanic marketing...

Media Markets & Money
Four R ranges into Texas
Is up and operating on the border of Texas...



Arbitrends

Arbitron
Market Results
| Chicago |
| Hamptons |
| Los Angeles |
| Middlesex |
| Nassau |
| New York |

NBA Minute


Stations for Sale

Alaska 5 Station Cluster
All from same building
Great Group at 8X trailing BCF
Cliff at Clifton Gardiner & Co
(303)758-6900 [email protected]




Radio Media Moves

WW1 brings
Gary Krantz on
board for digital

Westwood One announced that effective 9/25, former Air America President Gary Krantz will assume the position of Chief Digital Media Officer there. Krantz will oversee all aspects of Westwood One's digital portfolio including newly launched websites for The Osgood File (theosgoodfile.com) Randy Jackson's Hit List (rjhitlistonline.com), Loveline (lovelineshow.com) and Notre Dame Football (ndfootballradio.com).

Logan runs
to Vegas

Charlie Logan has been named Program Director of Beasley's KKLZ-FM Las Vegas. Logan is a 20-year veteran of rock radio and for the last six years served as the Senior Director of Rock Programming for XM Satellite Radio.

Hollywood
in SC

Tone Hollywood is moving from overnights at WJMZ-FM Greenville, SC to Cox Radio cluster-mate WHZT-FM "Hot 98-1" as night jock, 6-11 pm.

Tobin flies to WFUV
Former National Audubon Society Membership Marketing Director Cara Tobin has joined WFUV-FM New York as Membership Director. WFUV is a non-commercial, listener-supported station licensed to Fordham University.




More News Headlines

Univision.com named most visited Spanish-language site
Univision Online says according to a study conducted by Simmons Research, Univision.com is the most visited Spanish-language website among Hispanic Internet users-for the 6th year in a row. The study found that Spanish-dominant and bilingual Hispanics online visit Univision.com 2 times more often than Yahoo! en Español and AOL Latino, 4 times more often than MSN Latino and 20 times more often than Terra.com. "This year's study proves once again that Univision.com is the #1 Spanish-language website in the U.S.," said Javier Saralegui, President, Univision Online. Univision.com, delivers 11 million unique browsers per month. The study also found online Hispanics are more likely than non-Hispanics to find Internet advertising effective. Two-thirds of online Hispanics say they are more likely to click on ads on Spanish-language websites than on English-language websites. More than 60% of online Hispanics say that they find ads on Spanish-language websites more informative and educational than ads on English-language websites. Nine out of 10 online Hispanics value Spanish-language websites as an educational and cultural resource for the Hispanic community. Three out of four feel an emotional connection to Spanish-language websites, and 89% say they visit these websites to stay informed on current trends in Hispanic entertainment.

Patricia Kennedy Lawford dead at 82
Although best known for her Hollywood and political activities, Patricia Kennedy Lawford was an assistant in the NBC Television production department in New York and then went to the West Coast to work on Kate Smith's radio show and a couple of other programs in the late 1940s and early '50s. She then married actor Peter Lawford after they were introduced to each other by her brother, John Kennedy, who later became President of the United States. Patricia Kennedy Lawford returned to live in New York after divorcing Lawford in 1965. She died Sunday from complications associated with pneumonia at age 82.


August RBR/TVBR
Digital Magazine

In August's RBR/TVBR Solutions Magazine:
* Hispanic media managers on ratings and audience trending.
* The explosion of Hispanic formats and networks.
* Denuo CEO, Publicis Media CIO Rashid Tobaccowala.
* Beth Comstock, President/Digital Media and Market Development, NBC Universal.
* One on One with David Kennedy.
* Magna Global CEO Bill Cella's days at WXYZ-TV.
* Jim Yager is out to do it all again.


Read RBR/TVBR in 2 simple steps:
1.Create a simple account with Zinio and download the Zinio Reader.
2. You can then download the
August Issue of RBR/TVBR


RBR Radar 2006
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

"Sell" call for Cox Radio
Goldman Sachs analyst Mark Wienkes has lowered his "Neutral" rating on Cox Radio to "Sell." Wienkes says the stock appears to have been trading up on expectations of being taken private by Cox Enterprises, but he thinks that is unlikely to happen. Year-to-date (as of 9/14) Cox Radio shares are up 15% vs. a 25% decline for the radio sector. While the fundamentals for the company are stable, Wienkes says there is nothing about its performance to justify such a run up, so buyers must be banking on a takeout by its private parent.

RBR observation: In the current environment, every public radio CEO would like to go private. No one enjoys getting beaten up quarter after quarter by analysts and big money managers. But it takes money to go private and the deal has to make sense to the people supplying the money. We doubt that Cox Enterprises would pay off the public shareholders of Cox Radio at a huge premium in a soft market just to be rid of them.
09/18/06 RBR #181


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Talk Radio Network
Seeking professionals in three areas to join our TRN team. First: Executive Producer on topical subjects, Second: Board Operator with 2 years experience with Telos call-screening software and Third: Staff Engineer that can take initiative. This is a fast paced high pressure environment, must be able to think and act professionally in emergency situations. EOE. For complete details on all three positions
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