McGavren Guild to be reborn
We broke the story yesterday afternoon (MBR 12/1/08), with confirmation from McGavren Guild President Lisa Sirotka-Sonnenklar and Barry Fischer, McGavren Guild RVP and GM for the Spanish Broadcasting System client group: In the ashes of the Interep bankruptcy, its McGavren Guild division has gotten funding — and likely approval by now from the judge — to open their doors as an independent rep firm. This means they can go after all of 600-700 stations, including SBS, that Interep left in its wake that have not yet decided where to sign for a rep.

RBR observation: The news probably couldn't have come any sooner, as many Interep clients are considering signing with Katz out of necessity. Now that Interep's Focus 360 and McGavren Guild are back in the game, it should help foster a healthy sense of competition back in the marketplace. When there's a monopoly, deal-making tends to become less and less flexible and agencies/clients tend to walk. Nonetheless, the goal for any rep company these days has to be creative selling ideas packaged in multimedia [read: Internet] offerings.

LFM and Beasley sign with Katz
Katz Media Group is believed to be in the midst of drawing up contracts to rep a number of former Interep clients, after signing the two biggest, CBS Radio and Entercom, last week. Katz officially announced yesterday that it will represent the 44 stations of Beasley Broadcast Group and the 15 stations of Lincoln Financial Media. Look for more signings to come quickly. After all, Interep is no longer selling national spot radio for anyone.

Sirius XM hitchhikers delayed
As part of its merger agreement, satellite audio service Sirius XM is supposed to provide 4% of its channel capacity to “qualified entities.” The third party access program is scheduled to kick in on 11/28/08 – oh, wait – that day has already passed. But the blame cannot be laid upon Sirius XM. According to the FCC, “…several commenters raised concerns about the mechanics of the channel lease administration and allocation, and the Commission committed to determine the implementation details for use of these leased channels at a later date.” The Commission is still trying to figure it out. As such, XM Sirius is now off the hook for its third party carriage agreement until 2/27/09.

Ford opposes HD Radio mandates
Ford has come out opposed to Rep. Ed Markey’s proposed Radio Receiver Act that could require HD Radio reception capability for satellite radio receivers. The automaker sent a letter to the FCC outlining its opposition. Said Ford: "[The proposal] has several ancillary consequences that would be extremely burdensome to consumers, the auto industry and OEM manufacturers, and it should be rejected by the commission…[It] will likely increase the price of audio entertainment options in vehicles..."

RBR observation: No shocker here. Ford, along with all of the American automakers, are struggling to stay alive. The last thing they need to do is pass onto the consumer additional costs associated with the in-dash car stereo. In case you hadn't noticed, 90% of all HD Radios available from the automakers are in foreign vehicles.

Surviving (and Maybe Thriving) in a Downturn

Viewpoint
Radio’s discontent
Slump? What slump? That’s what Rush Limbaugh is wondering. Oh, he sees the slump all right. In fact, he read the recent New York Times article which attempted to explain why radio’s audience is growing (do you believe that one?) and its revenues are shrinking (we’re SURE you believe THAT one). But Rush says he’s not having any problem keeping his operation prosperous. The three-word answer is simple: content, content, content.

Katz Media, Marketron expand Electronic Order Delivery
Katz Media Group (KMG) and Marketron Broadcast Solutions announced a significant expansion in delivering electronic orders for radio ad schedules from national agencies. In January, KMG and Marketron will enable the processing of electronic sales orders for KMG’s nationally represented business for distribution to all participating Marketron Traffic, Visual Traffic, and DeltaFlex radio clients. Station managers will then be able to accept or reject orders, confirm them electronically and move them directly into the radio station’s business system, leading to a more efficient operation while eliminating the manual re-entry and discrepancies associated with current processes.

Baton Rouge, Mortgage/Finance spots examined
Media Monitors took a look at radio spots last week for Mortgage and Finance companies, along with Baton Rouge, LA. According to Arbitron, Baton Rouge, LA is the 78th largest radio market with a population of 570,300. AT&T was the #1 advertiser on the radio last week with 438 spots.

Jarad’s Morey spins to partners
WBON-FM, in the eastern Long Island market Hampton-Riverhead NY, is going from Ronald Morey’s Jarad Broadcasting Company to JVC Broadcasting Corporation. The buyers have a stake in another east Long Island station, along with Morey. The price for WBON-FM will be $1.75M cash. The duopoly partner station is WDRE-FM Calverton-Roanoke NY, which Morey holds along with JVC principals John W. Caracciolo and Victor Canales. Morey has yet another station in the vicinity, WLIR-FM Hampton Bays NY.

$25K KXJO-FM CP St. Maries ID College Creek Media LLC (Christopher F. Devine) to Spokane Public Radio Inc. (Richard Kunkel et al). $5K earnest money, balance in cash at closing. CP is for Class C3 on 92.1 MHz with 25 kkw @ 328’. [FCC file date 11/3/08]

File under agree to decree
The FCC had some problems with the public files kept by Utica College, licensee of noncommercial WPNR-FM in Utica NY. His generally results in a $10K fine, but this time Utica College is not admitting any guilt. Both parties agree that pursuing the issue to its bitter end would be costly and time-consuming. So UC has agreed to submit to terms of a compliance plan under a consent decree, and will also make a voluntary donation to the US Treasury of $10K.

RBR observation: Consent decrees tend to be used when the issues are highly complex, involve potentially large amounts of punitive cash payments, or involve contentious and gray-shaded areas of the rules and regulations. Public file violations, on the other hand, are depressingly routine. So the fact that a decree is being used for such a normal piece of FCC business is what makes this case unique.

Matthews moving from pundit to target?
The politicians who have found themselves in the verbal crosshairs of MSNBC’s Chris Matthews may someday soon find him on their side of the verbal shooting gallery. Widespread rumors have Matthews looking toward the US Senate in 2010. His MSNBC contract expires in June 2009. However, the current resident, Arlen Specter (R-PA) has indicated that despite bouts with cancer and the fact that he is already past retirement age at 78, he fully intends to run and win in 2010.

RBR observation:Specter is an incredibly resilient politician, not to mention human. Still, many can’t help noticing that he is one of only four remaining Republican senators in the entire northeast part of the country. His seat is a virtual lock to be a prime target in 2010, keeping Pennsylvania on the list of battlegrounds with national cash flowing to broadcasters.

Redstone exits the videogame business
Seeking to raise funds to shore up National Amusements Inc., via which he controls both CBS Corp. and Viacom, Sumner Redstone has sold his controlling stake in Midway Games to investor Mark Thomas for a fraction of what he paid for it. But will that be enough for Redstone to avoid selling any more of his CBS or Viacom holdings?

RBR observation: Just what was Sumner Redstone thinking when he bought up share after share of Midway Games? We began reporting on his purchases back in 2004 as he approached the 50% point and then kept buying and buying until he owned 87% of the company. For years it seemed that Redstone accounted for almost all of the trading volume in the stock as he bought blocks of a few hundred or a few thousand at a time. But the stock price cratered as Midway failed to produce new mega-hits – and Sumner Redstone was no longer buying to keep the stock price propped up.

Dr. Seuss Enterprises channels the Grinch
As part of ceremonies ushering the holiday season, the City of Louisville KY was planning a special place for children called LouWhoVille, which was based on the Dr. Seuss classic “How the Grinch Stole Christmas.” But attorneys for Dr. Seuss Enterprises (DSE) got wind of it and shut the city’s plans down. "It appears these lawyers' hearts are two sizes too small," said Louisville mayor Jerry Abramson.

RBR observation: By all means, in these troubled times, it makes sense to attack a non-profit event aimed at entertaining children, just when your cartoon figures to air on television stations all over the nation and can use some free promotion, and not only drive the event off the schedule but besmirch yourself with the very worst traits of your own character. Perhaps Dr. Seuss Enterprises needs a visit from the same squadron of ghosts who rehabilitated Ebenezer Scrooge’s image.

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Ideas Working Now
Surviving (and Maybe Thriving)
In a Downturn, suggestions
to help you survive

Viewpoint
Radio’s discontent
Slump? What slump? That’s
what Rush Limbaugh is wondering

Ad Business Report
Katz Media, Marketron
Expand Electronic Order Delivery

Media Markets & Money
Jarad’s Morey spins to partners
WBON-FM to JVC Broadcasting
Corporation. Buyers have a
stake in another

Media Business Report
Redstone exits
The videogame business
Just what was Sumner thinking

Lynch to Buckley
Buckley Radio has named Bill Lynch Station Manager and Director of Sales of KSEQ-FM & KIOO-FM Visalia/Fresno, CA. Lynch previously worked as Director of Sponsorship and Non-Traditional Revenue at Susquehanna Broadcasting in San Francisco.

Radiolicious-MySimBook taps T.J. Lambert
Radiolicious, the new native iPhone application available through the iTunes App Store, announced the appointment of radio industry veteran T.J. Lambert as Executive Vice President and Chief Operating Officer. Lambert, most recently ABC Radio Networks’ SVP Affiliate Relations, will direct the software development, customer service, sales and marketing teams for Radiolicious and lead the company’s efforts in securing radio stations, networks and content providers looking to expand their digital distribution.

Another piece of Interep sold
Unless a topper bid is made by December 9th, the interactive rep business will be sold to Mission Media Group, a company headed by Interep Interactive’s CEO, Adam Guild.

RBR observation: What sealed Interep’s fate? It probably should have avoided Wall Street. But once Katz began offering revenue guarantees to lure away Interep clients, it became virtually impossible for Interep management to stop the downward spiral. Interep was not match against Katz (Clear Channel) money guarantees and the greed of the group CEO’s that took the cash in return for long term contracts.
12/01/08 RBR #233

Interep founder looks back on its legacy
The idea of consolidating the radio rep business by having multiple national reps operating under a single corporate umbrella dates back to 1980, when Ralph Guild created Interep. More at RBR.com
12/01/08 RBR #233

When the Going Gets Tough, Toughen Up Your Collections Efforts
No advertiser wants to cut back on advertising, especially when there are fewer customers walking through the door. These tougher times may give media companies a reason to rethink their credit policies to make sure that avails don’t go unsold.
12/01/08 RBR #233

Hispanic agencies complain about PPM
“The PPM sample is wrong” maintains (AHAA) in a letter sent to Arbitron which also charges that the ratings company has been “indifferent” to AHAA’s attempts to communicate its concerns about the impact of the (PPM) on Spanish-language radio. AHAA complains that PPM sample sizes are too small and don’t adequately represent the Hispanic population.
12/01/08 RBR #233

CBS and Entercom sign with Katz after bid approved
the offer by Clear Channel-owned Katz Media Group to have Interep's radio representation contracts cancelled in return for payment of $3.64 million.

RBR observation: We hear that there were other offers – and that at least one bidder who wanted all of Interep offered more than Katz. But the proposal carried some risk, rather than all cash on the barrelhead – and Chapter 7 is all about getting cash for creditors right now in liquidation.
11/26/08 RBR #232

Will the new national spot strategy work in 2009?
Big radio groups' strategy for generating business in 2009 will likely have a significant effect on their bottom line. We broke this story first (RBR 11/3/08 #215): Big radio groups have been submitting national spot business with network radio pricing to network radio buyers.

RBR observation: The national spot strategy of pitching network radio business can have a tremendous blowback effect on the radio groups. More at RBR.com
11/26/08 RBR #232