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Welcome to RBR's Daily Epaper
Volume 23, Issue 213, Jim Carnegie, Editor & Publisher
Wednesday Morning November 1st, 2006

Radio News ®

Paper-free diaries
set to debut

Beginning with the Winter 2007 survey, running January 11th to April 4th, Arbitron is going to give diary keepers the option of reporting their radio listening online, rather than on paper. The company expects at least one out of 20, initially, to chose the online option. "We want to give Internet-savvy respondents the option to use an up-to-date survey tool that better fits their lifestyle and habits. The Arbitron eDiary has the potential to increase survey participation from younger adults, a population that currently tends to be under-represented among paper and pencil diary keepers," said Ed Cohen, Vice President, Domestic Research, Arbitron. In tests conducted by Arbitron, the largest demographic group of eDiary keepers was between the age of 25 and 34 while the largest demographic group of paper diary keepers is between the age of 45 and 54. Also, eDiary keepers are more likely to work full-time. Arbitron said its tests also show that there is no significant difference in the number of quarter hours of listening or the number of stations entered into the eDiary versus the paper diary.

RBR observation: No surprise, of course, since Arbitron had been testing the eDiary concept and reporting on its findings to clients. We have not heard any controversy about this, unlike the vehement opposition that some radio groups have to the Portable People Meter. If online diary keeping makes it easier to get people in young demos to participate in the radio ratings process, everyone will like that.

Political may break 2B mark
In a conference call yesterday, Brian Wieser, MAGNA Global's Director of Industry Analysis and Anthony DiClemente, Lehman Bros. Radio & TV Broadcasting Analyst presented the latest numbers in political advertising this year - and they are big numbers! Wieser explained they started forecasting this year's political ad dollars about a year ago by looking at the sources and uses. "We tried to look at the sources of political fundraising and then the uses in terms of how they're being dispensed. In this way, we managed to reasonably accurately predict where the market was going...but we may have understated it." Indeed, Wieser made a point of noting the estimates were up from 1.6 billion broadcast spend on the slide show, to exceed 2 billion: "Evan Tracey of TNS/CMR's CMAG yesterday suggested that TV political spend (including national, cable and broadcast) will exceed two billion now. We have already passed 1.6 billion for the top 100 DMAs + cable + national, at a run rate of 200 million per week...How much money does this displace? Does it push the traditional advertisers out of the market for a short period of time? If it truly is taking inventory that wasn't being bought or it raises prices, then clearly this is a net positive. But it is difficult to asses just on that headline number alone." The big numbers are being attributed to systemic improvements in fundraising processes; better database management; online activities; investment in direct mail programs; a focus on grassroots mobilization; an earlier start to the entire process; an increased number of gubernatorial races (36 elections in 2006 vs. 11 in 2004); an increased presence of advocacy groups; and an increased presence of wealthy individuals (a wild card). Furthermore, current data from FEC.com and Opensecrets.com says we're still on track for 10% growth vs. 2004. National committees were pacing up 20% earlier in the year over 2004, but down 6% as of mid-year. House Candidates have sustained 20% growth and PACs are up 20%. 527s (i.e. The Swift Boat Veterans) are likely spending 300 million this year. Wieser also mentioned virtually all of the growth in political fundraising has been directed to media. "Broadcasting captures the bulk of the dollars...The bulk of the money comes after Labor Day and more than half actually shows up in October...Other media than broadcast are really secondary or tertiary. Online is a great DR medium as evidenced by Howard Dean, but it is more of a fundraising than publicity tool. Local cable is growing, but really because of viewing share rather than because it's better for targeting. In papers we see some benefiting to some degree from publishers' efforts to retain these political budgets. Radio doesn't actually capture much in the way of political at all. They really aren't seeing the benefits lie TV broadcasters are at all."


Air America hopeful of buyer;
gets financing for rest of year

Air America Radio (AAR) is reportedly talking to several parties about a possible sale and is hopeful of reaching a deal before Thanksgiving, Tracy Klestadt, a lawyer for the net told a bankruptcy hearing Tuesday. Klestadt told the US Bankruptcy Court for the Southern District of New York that AAR was very hopeful of reaching a deal by 11/22. The court then approved an agreement for financing through the end of the year. AAR is continuing to operate with cash from an investor group led by RealNetworks CEO Robert Glaser, who owns 36.7% of the company, and two other former board members. Also under the court agreement, AAR needs to have a deal in place with a buyer and have a motion filed by 11/22 which seeks approval of the sale to guarantee that financing continues.

Hey, let's all go private
If Tribune and Clear Channel are both sold to private equity firms, will it start a parade of broadcasters going private? Don't count on it, says one analyst who has been running the numbers. One problem, says Mark Wienkes of Goldman Sachs, is that private equity funds aren't sure they would be able to cash out at a profit down the road. "We have spoken to numerous private equity firms expressing cursory interest in some of the mid-sized operators in the radio sector. In general, the conclusion is that absent a stable revenue outlook, the variability around the terminal multiple is too great," he said in a note to clients. Although Wienkes was talking about radio companies, the same appears to be true for TV. Pure play TV stocks have been just as beaten up as radio stocks. Some promising IPOs from a few years back have ended up in penny stock territory, including SBS on the radio side and Nexstar and Young on the TV side. According to Wienkes, the private equity attraction for Clear Channel Communications is as much or more Clear Channel Outdoor, its 90% owned subsidiary in the billboard business, as about radio, its biggest unit. With Tribune, of course, the biggest operation is in the newspaper business, a sector that scares many on Wall Street even more than broadcasting. Thus, the reports of tepid interest in bidding for all of Tribune Company as a package. But while Wienkes says it is not likely that we will see a rash of public companies going private soon in the radio sector, he doesn't rule it out down the road. What would it take to make him more positive about the fundamentals of the radio business? "Our thesis remains that the lack of pricing power across radio has driven subpar fundamentals and multiple contraction. We believe improved pricing power, owing to secular improvements, is necessary to drive faster and sustainable industry revenue growth, leading to multiple expansion," Wienkes said.


Entercom in the clear for Rochester
The Department of Justice has cleared the way for Entercom to acquire stations in Rochester NY. Four FMs there are coming as part of its four-market, 15-station deal with CBS. We can only say that we hope DOJ didn't spend too awful much of our tax dollars figuring this one out. Entercom already has an AM and three FMs in Rochester, and its plans to properly spin off properties were clearly telegraphed, to the extent that the Rochester portion of the deal was segregated from the other part covering stations in Austin, Memphis and Cincinnati when it was filed at the FCC. We even know that the Rochester portion of the 262M agreement is 42M because of this. To recap, WRMM-FM, WCMF-FM, WPXY-FM & WZNE-FM are coming from CBS, and Entercom already owns WBEE-FM, WFKL-FM, WBZA-FM & WROC-AM. According to DOJ, two of the CBS stations, WRMM-FM & WZNE-FM, will join Entercom's own WFKL-FM on the auction block in search of a third party buyer. If Entercom had been allowed to keep all seven stations, it would have controlled over 57% of the market's radio advertising market; after the spins, it should come in below 40%.

Fraud squad: Scammers hiding
behind lease, language

Not too long ago, the Federal Trade Commission started a crackdown on scams and frauds perpetrated in various advertising media aimed at minorities, particularly those that speak a foreign language. It appears there is much for the FTC to look into. The Wall Street Journal has detailed numerous examples of over-the-air fraud, and most of it is hitting the airwaves via leased time on brokered multilingual stations. Brokered Ethnic has become a popular format for small AM stations in areas where a particular ethnic group has congregated. The groups are often too small to command a 24/7 format aimed their way, but become a loyal audience when such a format gains a spot on one of the Brokered Ethnic stations. They are also a tempting target for scammers who prey on the insecurities and/or lack of knowledge of their audience, getting it past station management that rarely looks into their background and more often than not cannot even understand what is being said over their airspace. WSJ mentioned Multicultural Radio, one of the primary groups which utilize Brokered Ethnic, and other groups mentioned included the two biggest Hispanic groups, Univision and Entravision.

RBR observation: According to WSJ, the FCC had little to say on this matter. We would note, however, that when it comes to indecency or any other station violation, the licensee is ultimately responsible. In other words, if you lease time to John Doe, and John Doe goes off on a obscene rant, you, as licensee, are the one the FCC is going to fine. While a licensee cannot be expected to police the practices of those with whom it does business, it does not seem a good policy to offer the excuse that you were unaware what the scammer was doing on your station. The FTC is already on this case. It is best for time brokers to straighten this out now rather than later.


Ad Business Report TM

Radio ads heat up political candidates, topics
Facing midterm elections on November 7 and with control of the US Senate and House up for grabs, political candidates and their "fan clubs" as well as key state issue-based organizations are running thousands of radio spots in major markets this week, according to the latest weekly analysis from Media Monitors. Radio commercials are especially heavy and competitive in the swing states of Tennessee, Missouri, Virginia, Florida and Maryland. Here are the results of some of the hottest political campaigns in terms of their use of radio to reach voters. Numbers used in parenthesis refer to that candidate's or issue's rank on or below this week's Media Monitors "Spot Ten Politics '06" chart which ranks the most-aired political commercials on radio this week.
| Read More... |

Chrysler unveils effort
for 2007 Chrysler Sebring

"Wind Tunnel," a 30-second television spot that debuts today on network and cable TV, signals the launch of a comprehensive multimedia campaign for the 2007 Chrysler Sebring. It airs on "The Nine" (ABC), "20 Good Years" and "Biggest Loser" (both on NBC) and late-night talk show programs on NBC and CBS. After Nov. 1, the TV spot will run on such prime-time programs on ABC as "Desperate Housewives," "Lost," "Grey's Anatomy," and "Boston Legal;" on such NBC programs as "Law & Order: SVU," "Medium," and "My Name is Earl;" and CW programs, including "The Game," "Everybody Hates Chris," and "Girlfriends." Additional programming includes NFL and college football, golf and the NBA. Cable TV networks also will play a key role, with Chrysler Sebring spots running on Food Network, HGTV, Fine Living, DIY, USA, BET, National Geographic, Animal Planet and more. In addition to four print ads, plus "Wind Tunnel" and a second TV spot due later in November, the campaign includes:
| Read More... |


Media Markets & Money TM
Georgia Eagle is partly a Staton station
WNNG-AM Warner Robins GA is changing hands. The station, serving the Macon GA market, is going from Gordon Van Mol's Chase Broadcasting Inc. to Georgia Eagle Broadcasting Inc., headed by Joe Sam Robinson Jr. and Cecil Pope Staton Jr. Staton's interest makes this a duopoly deal thanks to his interest in a pair of Macon FMs, WRPG-FM & WQXZ-FM. And there's WCEH-AM Hawkinsville GA, which is not considered to be part of the Macon market but has overlap with other members of this cluster. The cash deal is broken out as follows: Georgia Eagle will pay 50K for the building, 40K for the land, 110K for equipment and 450K for goodwill.

Close encounter in Topeka
Broker John Pierce called in to let us know he's put another deal to bed. This time, it's Educational Media Foundation's noncom Religious-to-noncom Religious acquisitions of the CP for KYFA-FM from Lowell Davey's Bible Broadcasting Network. Pierce pegs the price at 325K. The CP for the station, which will operate in the Topeka area from its city of license of Manhattan KS, is for Class C2 on 88.7 mHz with 25 kw @ 381'.


Washington Media Business Report TM
MUDPAC: National committees come out slinging
In 2004, the four national congressional campaign committees actually spent some money promoting their own candidates. On the Democratic side, that's mostly what they did, in fact. The Democratic Senatorial Campaign Committee (DSCC) spent 19M on individual races, and 18M of it consisted of positive messages. The National Republican Senatorial Committee (NRSC) behaved in quite the opposite manner in 2004. Out of 19.8M spent, a scant 2.9M was positive. This time around, there are two notable differences. First, the DSCC has more than double the expenditures of the NRSC, and second, it has joined NRSC in emphasizing the negative, putting only 5.9M of a total 37M spending spree into the positive side. The NRSC has gone almost exclusively negative, however, spending a scant 300K out of 14.2M on positive messages. The same pattern exists on the House side. The Democratic Congressional Campaign Committee was largely positive in 2004, putting 27.8M out of 32.6M onto the plus side. This year, it's put only 4.6M out of 47.1M into positive advertising. The National Republican Congressional Committee has gone from negative in 2004, spending 12.4M out of 43.3M on positive messages, to extremely negative in 2006, spending only 6.5M out of 70.8M on positive messages. Of the other two groups, the Democratic National Committee has made no independent expenditures this year. The Republican National Committee has, though, pumping out 9.3M worth. And it is pure. Pure negative. All figures are from the Federal Election Commission.

FCC's Consumer Advisory
panel to meet

Last spring, the Consumer Advisory Committee of the FCC was questioning whether or not there was any point to its existence. That notwithstanding, it'll be back in session Friday, 11/3/06 for a full day during which it will consider "...recommendations concerning Media Ownership and Universal Broadband service." FCC staff will participate, and reports from various committee work groups will be on the table. Last May, 14 members of the committee protested to FCC Chairman Kevin Martin that they had submitted recommendations on the DTV transition the previous November and had not received a response of any kind. Later, in July, it issued a report on the media ownership remand, calling for public hearings and for making any proposed rule changes public prior to voting on them.


Entertainment Media Business Report TM
ABC rolling out stars
for CMA telecast

When you think of Country Music, you of course think of Eve Longoria and Cameron Mathison. No? The stars from "Desperate Housewives" and "All My Children," respectively, are among those from ABC series who have been tapped to be presenters on "The 40th Annual CMA Awards," airing Monday, November 6th, 8-11 pm ET. If you haven't already guessed, the broadcast will be on ABC. A couple of the ABC/Disney presenters have closer ties to Country Music. Disney Channel fans know and love Country recording star and actor Billy Ray Cyrus and his daughter, Miley, as stars of the show, "Hannah Montana." Billy Ray won a CMA Award for Single of the Year in 1992 for his smash hit, "Achy Breaky Heart." Performers already announced for the CMA Awards include hosts Brooks & Dunn with Sheryl Crow and Vince Gill, Dierks Bentley, Kenny Chesney, Sara Evans, Faith Hill, Alan Jackson, Miranda Lambert, Little Big Town, Martina McBride, Brad Paisley, Rascal Flatts, George Strait, Sugarland, Josh Turner, Carrie Underwood, and John Rich of Big & Rich performing with Gretchen Wilson. Actor, songwriting legend and member of the Country Music Hall of Fame Kris Kristofferson will introduce the 2006 Hall of Fame inductees. The 40th Annual CMA Awards airs live from the Gaylord Entertainment Center in Nashville. It is a production of the Country Music Association. Walter C. Miller is the executive producer and Robert Deaton is the consulting producer.


Internet Media Business Report TM
Internet access for cars goes mobile
USA Today reports PCs are about to start showing up in vehicles, allowing streaming audio, e-mail, traffic info, etc.. Automotive PCs will connect through regular cellular phone signals. Each auto PC will have its own IP address. "The manufacturers expect the in-car systems to evolve to using to Wi-Max - high-powered Wi-Fi that blankets broadband access across cities - over the next few years...Drivers won't be allowed to view their e-mail and other distracting functions unless the car is stopped. But that problem is being solved as voice-command systems become more widespread," the story said. From USA Today, putting PCs on wheels right now include: Ford Motor. F-Series pickups can now be equipped with FordLink, which went on sale last month, as a 2,999 option. The PC is aimed at contractors who want to order building materials or send e-mail from the cab. A rugged PC fits into a cradle in front of the dash. The PC, which runs Microsoft's XP software, can play Internet radio and MP3 music files. KVH Industries. The TracNet 100 system displays web pages on a vehicle's navigation and video screens and creates a wireless connection in the car. The cost is about 2,000 for the hardware and 79 monthly for the connection. Microsoft and Azentek. The software giant, working with hardware maker Azentek, will offer consumers a choice of two small PCs next year. One is a small portable that can be carried around and temporarily popped into the dash where the stereo is located. The other, a more powerful model, is installed in the dash. Prices for both will be upward of 2,000.

RBR observation: Pretty pricey for now, but as more get installed and WiMax becomes ubiquitous, local radio and satellite radio should be concerned. However, for the thousands that may, for instance, listen to Indie 103.1 or KROQ-FM in LA in other markets across the nation, those listens will get logged and potentially make these stations a good deal of internet/out-of-market ad dollars for national spots heard. Will that listening also be logged by PPM? Hmmmm......a question for the future.


Music Media Business Report
Bandier exiting EMI Music Publishing
EMI Group announced that Martin Bandier has resigned as Chairman and Joint CEO of EMI Music Publishing. Roger Faxon, who has been President and the other Joint CEO, is now the sole CEO, completing a succession plan that began last January. "Over the last 17 years, Marty Bandier has led the development of EMI Music Publishing into a world-leading force. Roger Faxon and his highly talented management team will drive this outstanding business to new heights in the years ahead," said EMI Group Chairman Eric Nicoli. EMI said Bandier will remain with the company until his current contract expires next April, but it did not spell out what role he will play.


Transactions
1M KXOL-AM Salt Lake City (Brigham City UT) from Simmons-SLC LS LLC, a subsidiary of Simmons Media Group LLC (G. Craig Hanson et al) to Inca Communications Inc. (Nicolas Vicente). Two 25K down payments, balance in cash at closing. Seller agrees not to use Hispanic music format on its remaining SLC stations for at least 12 months. LMA 9/16/06 @ 5K/month applicable to purchase price. [File date 10/18/06.]

300K WOAY-AM Beckley WV (Oak Hill WV) from Commissioned Communications Inc. (Eugene C. Ellison) to Mountaineer Media Inc.[ (Thomas H. Moffit Jr.). Cash. 50K allocated to purchase of studio. [File date 10/18/06.]


Stock Talk
Lack of confidence shakes Wall Street
The Conference Board reported a drop in its Consumer Confidence Index and Wall Street traders lost confidence in stocks. The Dow Industrials slipped six points to 12,081, although the S&P 500 and Nasdaq Composite were up slightly.

Radio stocks were almost all lower, following the recent run-up on Clear Channel's strong Q3 results. The Radio Index was down 1.234, or 0.8%, to 152.702. Entercom fell 2.6%. Emmis and Entravision each declined 2%.


Radio Stocks

Here's how stocks fared on Tuesday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

42.00

-0.11

Hearst-Argyle

HTV

25.20

-0.23

Beasley

BBGI

6.96

-0.09

Journal Comm.

JRN

11.70

-0.17

CBS CI. B CBS

28.94

-0.06

Lincoln Natl.

LNC

63.31

-0.77

CBS CI. A CBSa

28.97

unch

Radio One, Cl. A

ROIA

6.89

-0.05

Citadel CDL
10.24 -0.04

Radio One, Cl. D

ROIAK

6.79

-0.11

Clear Channel

CCU

34.85

+0.38

Regent

RGCI

3.69

+0.03

Cox Radio

CXR

16.84

-0.12

Saga Commun.

SGA

8.40

+0.10

Cumulus

CMLS

10.72

-0.13

Salem Comm.

SALM

13.29

-0.03

Disney

DIS

31.46

-0.40

Sirius Sat. Radio

SIRI

3.83

+0.04

Emmis

EMMS

12.34

-0.26

Spanish Bcg.

SBSA

4.70

-0.03

Entercom

ETM

27.67

-0.75

Univision

UVN

35.06

-0.07

Entravision

EVC

7.34

-0.15

Westwood One

WON

7.91

-0.10

Fisher

FSCI

42.04

-0.62

XM Sat. Radio

XMSR

11.66

+0.26

Gaylord

GET

46.54

-0.12

-

-

-

-

-


Bounceback

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Below the Fold
Ad Business Report
Radio ads heat up political candidates, topics
It is not just candidates, but also issue-based organizations who are running thousands of radio spots in major markets ahead of next week's election.

Media, Markets & Money
Macon a move in Georgia
WNNG-AM Warner Robins (Macon) GA moves to Chase Broadcasting for an FM triple-play.

Washington Media Business Report

MUDPAC: National committees come out slinging
Who's into negative campaign ads this year? Everyone, it seems.

Entertainment Business Report
ABC rolling out stars
for CMA telecast
Stars from "Desperate Housewives" and "All My Children" are among the presenters for the 40th CMA Awards.

Radio Media Moves

Numme goes Live
KITS-FM "Live 105" San Francisco announced that Dave Numme will join the station as Program Director soon, although the exact date has yet to be determined. Numme has been PD for sister CBS stations KUFO-FM & KVMX-FM Portland, OR. He is also CBS Radio format Vice President for Active/Alternative Rock stations.

New directors for Fisher
President & CEO Colleen Brown is now also a member of the board of directors at Fisher Communications. Also joining the board is Brian McAndrews, President and CEO of aQuantive Inc., a digital marketing company. His resume also includes the ABC Television Network.

O'Brien repping Bayliss
The board of directors of The John Bayliss Broadcast Foundation announced an agreement with Barry O'Brien & Co. to represent the foundation for all advertising and sponsorship sales. Company president, Barry O'Brien, has been an active board member of the Bayliss Foundation for eight years and is probably best known for his 20 years as VP of Sales at R&R.


TVBR - TV News

Brokaw returns for cross-platform NBC election coverage
NBC News is spreading 2006 election night coverage across all of its platforms - broadcast TV, cable, Internet, cell phones and radio - with veteran anchor Tom Brokaw returning to join his successor, Brian Williams, and "Meet the Press" moderator Tim Russert at NBC News headquarters in New York. The "Weekend Today" co-anchors will also have major roles, with Campbell Brown reporting on voter trends and Lester Holt looking ahead at the 2008 presidential race. A large team of NBC News correspondents will fan out across the country to report on key races, along with reports from the White House and Capitol Hill. With Williams and NBC leading the evening news ratings battle, NBC Universal is hoping to dominate election news coverage, not just on NBC, but also Telemundo, MSNBC, MSNBC.com, CNBC, NBC Mobile and NBC News Radio. Here are the multi-platform plans for election coverage.
| NBC News 2006 election night coverage on all platforms |




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

Clear Channel guys
Windfall or not?
Wall Street Journal portrayed the coming buyout of Clear Channel Communications as a "windfall" for the Mays family, with Lowry in line to receive more than a billion bucks for his stake and sons Mark and Randall about 100 million combined. Not to mention golden parachutes.

RBR observation: A billion bucks is big money any way you look at it, but the Mays family stake in Clear Channel was worth twice that a few years back, so we doubt that they would consider the payout any windfall.
10/31/06 RBR #212

"Gluttons At The Gate"
A must read for Clear Channel
and Tribune staffers
Employees of Clear Channel Communications and Tribune Company who are waiting to find out which private equity firm (or consortium of private equity firms) will be their new owner might want to pick up this week's issue of BusinessWeek with the cover story "Gluttons At The Gate." As the title indicates, it is a critical piece on the private equity field.

RBR observation: Like most things, private equity funds are neither all good nor all bad. When they buy an out-of-favor public company, they are able to provide financial flexibility for restructuring. Sometimes, of course, that restructuring is painful to some employees, who either lose their jobs or see their division sold to yet another buyer. It is pretty clear that a lot of Tribune assets are going to change hands, no matter who ends up with the company. That divestiture process had already begun before the company was put on the block. Likewise, Clear Channel had already been selling some non-core stations. The end-game is the big question for both of these buyouts-to-be. Will investor interest in the newspaper and radio sectors improve in the next few years so the private equity buyers can take profits via the IPO route? That is a tough call. But we certainly don't see the potential for buyout firms taking either of these companies private and then selling stock again in a matter of months. These look like long-haul investments.
10/31/06 RBR #212

Tribune bidding called "lukewarm"
That analysis comes from the Los Angeles Times, which has a keen interest in the potential sale of its parent company. If private equity bids submitted Friday offered little or no premium over the current stock price, the board at Tribune Company is likely to explore breaking the company into pieces for sale.

RBR observation: The board of directors at Tribune has set no timetable for completing the effort to maximize shareholder value. However, if the bids for the whole thing were unimpressive, we should soon start hearing rumors of a wider range of potential bidders begin invited to submit offers for various pieces of the Tribune Company. CEO Dennis FitzSimons may yet be able to realize his dream of doing a management buyout of the choice properties in the biggest markets after selling off everything else.
10/31/06 RBR #212

Clear Channel, Hey
You Can't Be a Little Bit Pregnant
A couple of Wall Street analysts have been holding onto the position that after exploring "strategic alternatives" with the folks from Goldman Sachs, the board of directors at Clear Channel will decide to stay public and go with a restructuring plan, rather than sell the company. Perhaps they are confused because of what happened with Emmis, but this is not the way the world works. Once you have hung out the For Sale sign, the auction is underway.
10/30/06 RBR #211

Clear Channel What is it Worth?
But, sale will create lots of station inventory
The answer is whatever the highest bidder is willing to pay. Wall Street analysts are debating the ultimate price, with estimates running mostly in the mid to high 30s, although at least two see a possibility of 40-plus. Clear Channel has 496 million shares outstanding. At 35 bucks that works out to 17.4 billion. At 40 it goes to 19.8 billion. Add in 7.9 billion of debt and the total deal value works out to a range of 25.3-27.7 billion - a hefty price tag that means only very big players will be able to participate in this game. Wallstreet is all over this issue. Regardless of who buys Clear Channel Communications, lots of radio stations will be going on the market for divestiture. We are not just talking about the smaller market clusters that the company has been slowly selling off to use up 1.5 billion in tax loss carryforwards. Some quite desirable larger market stations will also have to be divested once a sale or management buyout is agreed to. That's because Clear Channel has lots of markets with large clusters that were OK under the FCC ownership rules based on contour overlaps established in 1996, but not since a federal appeals court approved the new Arbitron/BIA market definitions adopted in 2003.
10/27/06 RBR #210

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