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Volume 21, Issue 206, Jim Carnegie, Editor & Publisher
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Thursday Morning October 21st, 2004
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Radio News®
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 Major League Baseball partners
with XM in 650 million deal
Major League Baseball and XM Satellite Radio announced an 11-year, 650 million agreement enabling XM to broadcast games of every MLB team nationwide beginning with the 2005 regular season. XM will also be the official satellite radio network of MLB and have rights to use the MLB silhouetted batter logo and the marks of the 30 MLB Clubs. XM also will develop specific programming content that showcases Major League Baseball, its teams, and its personalities. In addition to broadcasting live games, XM will create a Major League Baseball radio channel featuring original content and classic Major League Baseball game broadcasts. As Major League Baseball enjoys strong support from its Hispanic fan base, XM also will broadcast select games in Spanish.
RBR observation: It seems that every time we turn around, one of the satellite guys or the other is spending a half-billion or more on something. Sirius is spending hundreds and hundreds of millions of dollars on Howard Stern and the NFL; XM is spending hundreds and hundreds of millions on Opie & Anthony and Major League Baseball. All the while, both companies are losing hundreds of millions of dollars per year and they'll soon have to figure out how to raise hundreds of millions to pay for their second generation of satellites. What a business plan! And yet their stocks are darlings of Wall Street, while terrestrial radio stocks - - companies which actually have positive cash flow, and plenty of it - - see their stocks in the crapper. Don't ya love it? And by the way, how smart is it of Major League Baseball to spit on its radio partners of many, many decades to team up with a new rival that, even under the best case scenario, will still have only a miniscule fraction of broadcast radio's audience for many years to come?
 Lowry steps down for good
Although he's been back to board meetings and such for a few weeks now after recovering from emergency surgery, Clear Channel founder Lowry Mays has officially relinquished the company's CEO title permanently. President Mark Mays, who had been acting CEO since May 7th, is now President and CEO of the company. Lowry Mays will continue to be Chairman of the Board. "Mark is the ideal executive to lead Clear Channel into an exciting future," Lowry Mays said in a company announcement. "He has been instrumental in the company's development and growth, and the board and I have full confidence in Mark's leadership and vision." Lowry Mays underwent emergency surgery April 30th to relieve pressure from a blood clot on his brain (5/4/04 RBR Daily Epaper #87). Mark Mays was named interim CEO a few days later.
Veterans group files Sinclair complaint with FCC
The Veterans Institute for Security and Democracy (VISD) has filed an initial complaint with the FCC, charging Sinclair Broadcast Group with airing a program that is "...intended to dishonor the military career of Senator Kerry, and influence the outcome of the election." The action is a preliminary step in an attempt to secure equal time for Kerry should VISD believe it is called for. | More... |
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A rose is a rose is a....not THAT rose
Sinclair Communications has been getting quite a bit of unwanted attention lately. It has the misfortune of owning a name quite similar to a company over which a great deal of ink, both virtual and otherwise, has been spilled. But it's not the same company. If anything, Sinclair Communications has a firmer claim to the use of "Sinclair" than Sinclair Broadcast Group, which we're sure you've heard tell of in recent days (in fact, we have another story on them on these same virtual pages). Sinclair Communications is privately owned and operated by the Sinclair family. Sinclair Broadcast Group is primarily operated by members of the Smith family. Sinclair Communications has interest in radio stations in their HQ town of Norfolk VA, as well as Austin TX and Santa Rosa CA. As luck would have it, SBG has a TV O&O in Norfolk. According to the Virginian-Pilot, Sinclair Communications is essentially apolitical, although, like many radio groups, it carries a conservative Talker like Limbaugh and Hannity here and there. Nonetheless, its phones have been ringing off the hook. For those inclined to contact SBG, they aren't in Norfolk. They're located in Hunt Valley MD, just outside of Baltimore.
 Disney inks deal to sell Disney Stores
Michael Eisner is getting rid of another headache. The Walt Disney Company has signed a definitive agreement to sell its 313 site Disney Store chain to The Children's Place, completing negotiations that began back in June (6/4/04 RBR Daily Epaper #109). It's now been more than a year and a half since Disney decided to get out of the retailing business, indicating just how difficult it was to find a buyer willing to take over the troubled chain. Disney consumer Products Chairman Andy Mooney notes that the performance of the stores has improved of late, which he says should serve as a platform for The Children's Place to build on. "We believe that by utilizing our merchandising and sourcing expertise and leveraging our infrastructure we can further increase the level of profitability and build on the chain's positive momentum," said The Children's Place CEO Ezra Dabah. No one is yet saying how much the sales price is, but it's at least 50 million dollars since a Hart-Scott-Rodino antitrust filing is required. The Children's Place says it will invest up to 100 million into remodeling and operations at the Disney Stores.
Hicks speeds up retirement
Tom Hicks is retiring three months earlier than planned, telling the Dallas Morning News that he'll step down as Chairman of Hicks, Muse, Tate & Furst on January 1st, saying "I want to start the new year with a fresh focus." After building the buyout firm into a mega-billions giant, Hicks said in March that he wanted to step down and focus on the sports teams that he owns (3/9/04 RBR Daily Epaper #47). In late April he resigned from the board of directors of Clear Channel Communications, in which Hicks, Muse owns a large equity stake (4/28/04 RBR Daily Epaper #83). Hicks, Muse is also a large shareholder of LIN Television, although that stake is non-voting and the firm is not represented on LIN's board.
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Adbiz©
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Campaign ad watch
The Los Angeles Times has been tracking advertising expenditures of the two presidential campaigns and their proxies, via an arrangement with TNSMI/Campaign Media Analysis Group, and says that as a group they are well on their way to topping the half billion dollar mark, easily setting a new standard. They have narrowed the battle down to 14 states as the campaigns go into final approach to Election Day. The hot spots are Colorado, Florida, Iowa, Maine, Michigan, Minnesota, Nevada, New Hampshire, New Mexico, Ohio, Oregon, Pennsylvania, West Virginia and Wisconsin.
MediaBay retains M&C Saatchi NY
MediaBay, a spoken-word audio entertainment provider, announced that M&C Saatchi NY has been retained to reposition and relaunch Radio Spirits, a leader in original radio programming. MediaBay's Radio Spirits is the owner of more than 50,000 hours of famous Original Radio shows including such titles and performances as the The Shadow, Gunsmoke, The Lone Ranger, The Adventures of Superman, Suspense, Humphrey Bogart, Cary Grant, Jack Benny, Shirley Temple, Bette Davis, Lucille Ball, Bob Hope, Martin and Lewis, Fibber McGee and Molly, Orson Wells, and many others. Radio Spirits has complete ownership and control of a nationally syndicated show, "When Radio Was", as well as providing 100% of the content for Sirius and XM's Radio Classics stations. In addition, it's a service providing monthly subscriptions and digital downloads to a dedicated base of subscribers, as well as a hard product selling in national chains across the country including Wal Mart, Target and Dollar Stores. M&C Saatchi will focus on relaunching Radio Spirits to both consumers and advertisers providing the opportunity for more consumers to listen and providing an opportunity for advertisers to partner with Radio Spirits to reach a valuable demo.
 7UP Plus taps Regis Philbin, Kelly Ripa,
others for new effort
7 UP Plus, a new combination of 7 UP, real fruit juice, calcium and vitamin C with a mixed berry flavor - is launching two commercials, showcasing Regis Philbin and Kelly Ripa from Live with Regis and Kelly, and Kristin Davis and Cynthia Nixon from Sex and the City. The two spots, developed by Young & Rubicam, feature a tagline that reflects the beverage's distinctive qualities: "When you add it all up, the only way to go is UP." Philbin and Ripa are featured in a whimsical spot called "Mothers." Ripa, is seated on a NYC playground bench next to a fellow mother, while their "kids" play. The other mother asks, "How is that?", and Ripa confides, "Great! All my kids love it -especially my oldest." Philbin is then revealed, gleefully riding a child-sized rocker while dressed in a suit and tie. Kristin Davis and Cynthia Nixon star in a similar tongue-in-cheek ad, called "Pampering." Davis and Nixon, are luxuriously lounging in their bathrobes at an upscale New York City spa while being served 7 UP Plus by a very attractive male waiter. Davis then spots another handsome attendee approaching and says innocently to Nixon, "Looks like our lunch has arrived." After noticing the server, Nixon replies mischievously, "and he brought grapes," as the two share a laugh. The new ads will run on national network and cable, targeting primetime. Aimed primarily at women ages 25-49, the campaign also includes radio and print. 7 UP Plus first caught viewers' attention 10/4 with the premiere of two 15-second, product-focused television spots, titled "Drink Positive" and "Blushing."
BrownCo launches new campaign
BrownCo, the online brokerage offering of J.P. Morgan Invest, announced a new 15 million dollar campaign aimed at active traders, the company's sole target market. The integrated campaign consists of television, print and online ads, with a focus on BrownCo's niche as the online brokerage created and priced for active self-directed investors. BrownCo has experienced an 18% increase in new accounts opened YTD in 2004 from YTD 2003. Three TV ads, developed by McCann Erickson, will air on CNBC and Bloomberg. The price-based campaign focuses on BrownCo's low margin rates, 5 dollar online equity trades and competitive commission schedules. The ads mock the promotional gimmicks and high fees offered by other firms. The hero in each commercial represents BrownCo's target client base of experienced, self-directed clients, who manage their own financial assets and want an online trading experience geared towards their needs. The print ads, also developed by McCann Erickson, will share similar messaging to the TV ads and will run in WSJ, Investors Business Daily, Barron's and the NY Times. Online ads, developed by itraffic, the interactive marketing and advertising subsidiary of AGENCY.COM, will highlight the campaign's messages and will run appear on major financial Web sites including CBSMarketWatch, SmartMoney and TheStreet.
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| Media Markets & MoneyTM |
Andrew buys tower building unit
With its in-house tower-building activities significantly cut back, American Tower Corporation has agreed to sell most of the assets of its construction unit, ATC Tower Services, to Andrew Corporation for 10 million dollars. Andrew says it will assume a "significant portion" of ATC's 24 North American construction offices and 340 employees. Andrew is a manufacturer of equipment for broadcast and other wireless communications businesses, including antennas.
Sioux me, Sioux me, what can you do me
We now have a price for Backyard Broadcasting's acquisition of an intact five-station superduopoly in the Sioux Falls SD market (9/23/04 RBR Daily Epaper #186). Barry Drake's group is paying 28.5M for the cluster, which includes KELO AM & FM, KWSN-AM, KTWB-FM and KRRO-FM. According to broker Kalil & Co., the deal takes Backyard to 27 stations.
Close encounter in Atlanta
Radio One has had the keys to WAMJ-FM in Atlanta for some time, as part owner and full-time operator of the station. Now it's the sole owner, after an expenditure in the neighborhood of 35M dollars. "This acquisition solidifies our position in the Atlantic market," said Radio One's Alfred Liggins, who was part of both the seller and the buyer. "Our strong cluster of four FM stations has achieved tremendous ratings growth in the past two years and our revenue growth in this very important market for the first nine months of 2004 is more than 1000 basis points above the industry's growth rate in Atlanta."
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| Washington Beat |
 More EEO audits on the way
The FCC has made a random selection of broadcast licenses which will be subjected to an EEO audit. MVPD audits for 2004 have already been completed. If you're wondering if you're one of the stations on the list, but haven't yet received your letter of notification, you can check www.fcc.gov/mb/policy/eeo and see if your station is listed. The FCC randomly selects approximately 5% of all broadcast licensees and MVPD operators for EEO audits annually. Another 5% will be audited in 2005.
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| Transactions |
WLGN AM & FM Logan OH from Roger L. Hinerman to Edward A. Baker.
KESY-FM CP Cuba MO from Reichel Broadcasting Corp. to Twenty-One Sound Communications Inc.
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| Stock Talk |
A mixed day for stocks
Rising oil prices and a bad earnings report from JP Morgan pressured Wall Street on Wednesday, but stock prices still managed to close mixed. The Dow Industrials fell 11 points, or 0.1%, to 9,887, but the Nasdaq Composite and S&P 500 were up slightly.
Radio stocks rebounded a bit. The Radio Index rose 0.709, or 0.3%, to 208.270. cumulus was up 2.4% and Journal 2.2%.
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| Radio Stocks |
Here's how stocks fared on Wednesday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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36.35
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-0.47
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Jeff-Pilot
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JP
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47.03
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+0.47
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Beasley
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BBGI
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15.00
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+0.04
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Journal Comm.
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JRN
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16.30
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-0.04
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| Citadel |
CDL |
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13.80 |
+0.12 |
Radio One, Cl. A
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ROIA
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14.15
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+0.02
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Clear Channel
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CCU
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30.27
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-0.28
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Radio One, Cl. D
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ROIAK
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14.13
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+0.08
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Cox Radio
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CXR
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13.95
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+0.01
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Regent
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RGCI
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5.57
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+0.12
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Cumulus
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CMLS
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14.09
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+0.33
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Saga Commun.
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SGA
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16.95
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-0.03
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Disney
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DIS
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24.74
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-0.15
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Salem Comm.
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SALM
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24.80
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+0.17
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Emmis
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EMMS
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18.05
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+0.13
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Sirius Sat. Radio
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SIRI
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3.78
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-0.01
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| Entercom |
ETM
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30.83
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-0.42
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Spanish Bcg.
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SBSA
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9.92
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+0.04
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Entravision
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EVC
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7.23
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+0.09
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Univision
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UVN
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30.05
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-0.26
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Fisher
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FSCI
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47.70
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+0.20
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Viacom, Cl. A
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VIA
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34.42
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-0.41
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Gaylord
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GET
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31.30
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+0.10
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Viacom, Cl. B
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VIAb
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33.89
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-0.53
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Hearst-Argyle
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HTV
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24.98
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-0.07
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Westwood One
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WON
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20.15
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-0.04
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Interep
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IREP
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0.80
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-0.01
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XM Sat. Radio
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XMSR
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29.16
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+0.11
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International Bcg.
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IBCS
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0.01
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unch
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-
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-
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- |
-
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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 to [email protected]
A reader agrees with our point about measuring email complaints/ comments (10/19/04 RBR Daily Epaper #204).
While Brent Bozell has a point about the number of complaints, when an email blitz takes place, it seems that those that get on board don't seem to be speaking from their own heart, but just adding their name to a pre-written text to make it look like it was their concern. I believe that it is important for those that are concerned to go ahead and email and voice their concerns, but don't just add your name to a form. If you want things changed, speak your piece and rewrite the text, cite your own example and I believe the FCC will count it as legit, rather than just lump it in with all the others that had the exact same text. Thanks RBR for posting this and for your fine publication.
Paul Cameron
General Manager WEMI/WEMY/WGNV
Christian Family Radio
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Upped & Tapped
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From White House
to Univision
The former press secretary to First Lady Laura Bush, Noelia Rodriguez, has joined Univision Communications as Vice President of Corporate Communications. She will report directly to CEO Jerry Perenchio.
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September Digital Solutions Magazine
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Complimentary Report
Quarterly Deals:
4.1 Billion spent on broadcast properties since the thaw
RBR/TVBR Observation:
Where is the action? We got it.
Less is More
CCU's already meaning less with syndicators and nets.
Read RBR in 2 simple steps:
1.Create a simple account with Zinio and download the free Zinio Reader.
2. You can then download the free September Issue of RBR
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RBR Radar 2004
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Click on these issues for Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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Wachovia Securities Jim Boyle cuts Radio estimatesm again
Seeing nothing to improve radio ad sales in the near future cut his Q4 estimates for radio companies. Ad rate-cutting hasn't gone away, but it hasn't deteriorated either. His Q4 radio revenue growth estimates are not pretty. RBR observation: Boyle's chart comparison inside tells the story on how deep the knife has cut his Q4 revenue estimates for 10 of the 11 radio companies that he follows (all except Emmis) is worth a look see. 10/20/04 RBR #205
Shareholders ready to
go after Sinclair
A law firm representing institutional shareholders which own a piece of Sinclair Broadcast Group is preparing to sue the company for mismanagement and possible insider trading. The plans to air "Stolen Honor: Wounds That Never Heal" precipitate the action, and the law firm's investigation into it led to the discovery of the possible insider trading activity. RBR observation: The lawyers need to take a look at the proxy for Sinclair's 2004 annual shareholders meeting. All four Smith brothers still hold huge stakes of Sinclair stock and options, millions of shares each, so Robert and Duncan didn't even come close to cashing out. In all, the four control over 96% of the company's super voting Class B stock and nearly 85% of total voting power. 10/20/04 RBR #205
Arbitron cuts revenue guidance
Q3 came in pretty well for Arbitron, but the company has reduced its guidance for the remaining quarter of this year. CEO Steve Morris warned that while Arbitron is signing renewals for its ratings contracts, the continuing tough times in the radio are impacting revenues for Scarborough Research (which it owns 50/50 with Nielsen) and software sales. While Infinity switching its qualitative research business to The Media Audit was the big hit, Morris said Scarborough had lost some other radio business as well. 10/20/04 RBR #205
Arbitron chief says tide
is turning for PPM
The radio industry may have balked at moving to the Portable People Meter for ratings, but Arbitron President and CEO Steve Morris told analysts in his quarterly conference call that he sees indications of a shift in favor of the new ratings technology. Morris said it's not just PPM, but that radio groups are focusing more on what's needed to restore growth to the industry and build ad revenues. RBR observation: The key is ROI. We're hearing that everywhere. Advertisers want to be able to see a return on their investment - - and they are insisting on something faster and more accurate than paper diaries. Broadcasters want an ROI too and they're the ones who will be footing the bill for PPM. Morris repeated what we reported from San Diego, that Arbitron will give the radio industry an idea of what PPM is going to cost by the end of this year but warned that without an agreement on a joint venture with Nielsen, the cost estimate will still be only a range, which could vary by some 20 percentage points.
10/20/04 RBR #205
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General Sales Manager
Needed in Los Angeles with 5 years radio sales management experience. EEO. Reply to: [email protected]
Local Sales Manager
Cumulus Broadcasting of Shreveport seeking a LSM. The person hired for this very important position will have the ability to train, motivate, write and supervise proposals, close sales with A/E's and hit or exceed monthly and quarterly local sales budgets.
See Radio Careers for more info on this once in a lifetime shot.
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©2004 Radio Business Report/Television Business Report, Inc. All rights reserved.
Radio Business Report -- 2050 Old Bridge Road, Suite B-01, Lake Ridge, VA 22192 -- Phone: 703-492-8191
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Market Results