Welcome to RBR's Daily Epaper
Volume 24, Issue 240, Jim Carnegie, Editor & Publisher
Tuesday Morning December 11th, 2007

Radio News ®

Legal beagle handicaps Savage suit
Michael Savage is going after the Council on American-Islamic Relations (CAIR) for going after him. CAIR is not at all happy with the opinions espoused by Savage on his Talk Radio Network program, and has been using exerpts in a campaign to encourage an advertiser boycott. Savage has turned around and sued CAIR for copyright infringement. George Washington University Professor Jonathan Turley has looked at the case and offered his opinion on his blog. Savage is attacking CAIR's motives, saying it was done not for political reasons but rather to use him to raise funds. "In part of his complaint, Savage seems to be laying the groundwork for a false light claim," said Turley. "He claims that CAIR 'repackaged' the material to falsely suggest a hatred for Islam -- though it is pretty hard to imagine a context where these statements would not reveal such a hatred." Turley thinks Savage may instead be using the "privileged" nature of court filings to make charges against CAIR without risking exposure to defamation charges directed back at him. "The purpose does not appear to be true legal action," Turley said. "If it were, this is a remarkably low-grade effort for a federal filing."

RBR observation: The substantial elements of this altercation seem to have high on heat but low on matter; Savage's suit is found to be light on substance by a legal expert, while CAIR's plea to advertisers appears to have been more successful in listing companies with "non-controversial" program dictates that kept them away from the program regardless, rather than persuading existing Savage clients to exit the show. The bottom line is that Savage is free to do what he does, and CAIR is free to protest it. CAIR is just as free to try to persuade advertisers to stay away from the show as Savage is to try to sign them to a long-term contract.

Arbitron changing Condensed Market tool
You may recall the recent exchange in RBR between Northern Broadcast, Traverse City, MI General Manager Charlie Ferguson (11/14/07 RBR #223) and Arbitron VP Thom Mocarsky (11/15/07 RBR #224) over two books per year Condensed Market ratings issues. Now, at least one of the issues has been resolved. Ferguson's complaints have resulted in Arbitron agreeing to modify its SmartPlus software for ad buyers so that they can no-longer pull two-book averages in Condensed Markets, which they aren't supposed to be doing anyway. "We intend to remove that capability," Mocarsky confirmed to RBR. Ferguson is happy about the change, if not how long it is taking to get it done. Arbitron has told him that the fix will take effect in March of 2008. "Considering that Arbitron's SmartPlus summary data program has been performing non-MRC accredited calculations for Condensed Markets since late 2005, how much money do you think your Condensed Market stations have lost due to buyers using inaccurate ratings information? For over a year and a half, Arbitron has tried to sweep this under the rug as a 'training issue with the agencies using SmartPlus.' That's simply not true - it was a mistake that has cost our company a small fortune - and we're supposed to celebrate because they're going to fix it at the end of the first quarter of 2008," Ferguson said in an email to RBR. And he added this kicker for folks in larger markets: "I'm thrilled - and can't help but wonder if they'll use the same timetable for the big markets to fix PPM."


XM off the hook
XM Satellite Radio reported in an SEC filing something the SEC itself already knew - that the SEC staff had wrapped up an investigation of XM reporting practices and decided against any enforcement action against the company. The investigation had involved XM's reporting of subscriber data and stock options. According to the filing: "XM Satellite Radio has been notified by the Staff of the Division of Enforcement of the Securities and Exchange Commission that the Division has completed its investigation, initiated in August 2006, relating to various matters including our historic practices regarding subscriber data and stock options. The SEC has advised that it does not intend to recommend any enforcement action." Despite being off the hook with the SEC, XM still faces purported class action lawsuits for the same issues. The lawsuits claimed that XM failed to give timely warning to investors about higher subscriber acquisition costs.

Down year for Senate spending?
Wachovia Capital Markets' Marci Ryvicker and associates are looking for at best a rerun of the amount of spending on Senate races as we saw in 2006, which WCM pegs at 302M (for television). WCM says it could even be lower than that, noting that Republicans may not mount as spirited a defense as it did that year in which the Democratic Party squeaked out enough wins to gain control of the body. How much lower? WCM suggests as much as 20%-30%. Two states have both seats up for grabs -- Wyoming's Michael Enzi (R-WY) is up for re-election and the other seat opened upon the death of Craig Thomas (R-WY). In Mississippi, Thad Cochran (R-MS) has indicated he'll run for another term, while Trent Lott (R-MS) is retiring early after winning re-election in 2006.

Five other open seats are available, all due to exiting Republicans. They are in Colorado (Wayne Allard), Idaho (Larry Craig), Nebraska (Chuck Hagel), New Mexico (Pete Domenici) and Virginia (John Warner). Democrats are expected to be competitive in Virginia, Colorado and New Mexico, and perhaps Nebraska. Idaho is still generally considered safe Republican territory despite Craig's well-publicized problems. Republican candidates thought to be particularly vulnerable include Susan Collins (R-ME), Norm Coleman (R-MN), John Sununu (R-NH), and Gordon Smith (R-OR). Conversely, two Democrats are being targeted by Republicans, Mary Landrieu (D-LA) and Tim Johnson (D-SD). Wachovia lists nine states anticipated to be staging areas for hot races. Among those we mentioned are Colorado, Louisiana, Maine, New Hampshire, New Mexico, Oregon, South Dakota and Virginia. It does not list Minnesota or Nebraska. The others it thinks may attract cash are Georgia, Saxby Chambliss (R-GA) defending; Kentucky, Minority Leader Mitch McConnell (R-KY) defending; and Texas, John Cornyn (R-TX) defending.

RBR observation: Depending on how things are going, we'd suggest that there is every possibility that spending on Senate races will exceed 2006, even though the presidential race will drain some of the cash as it did not last time around. Smelling blood, Democrats cheerfully went into debt to maximize their chances at the last minute, a tactic either party may adopt if it smells opportunity or needs to put up a stiff defense.


Runoff election for two RAC seats
Ballots have been sent out to decide two elections to the Arbitron Radio Advisory Council (RAC) where no one got enough votes to be elected in the initial round of balloting. Competing for the seat representing Hispanic stations is Jeffery Liberman, President, Entravision (KXPK-FM/KJMN-FM/KMXA-AM) Denver, CO and Tony Perlongo, GM, Univision Communications (KSOL-FM/KBRG-FM/KVVZ-FM) San Francisco, CA. The runoff election for the Condensed Markets seat pits Dale Miller, President, Virginia West Radio Corporation (WVAQ-FM) Morgantown, WV against Mike Haile, General Manager, The News-Gazette Inc. (WDWS-AM) Champaign, IL. Ballots from eligible voters are due back this Friday, December 14th.

Here are the results of the other RAC elections.
These members will begin their terms on January 1, 2008:
* Two-Time standard: Tom Skinner, VP &GM, Redwood Empire Stereocasters (KZST-FM) Santa Rosa, CA.
* Continuous markets 50+: Thomas Mandel, President & GM, Rubber City Radio Group (WAKR-AM) Akron, OH.
* Youth Format: Dan Austin, VP & GM, Pamal Broadcasting (WKLI-FM/WROW-AM) Albany, NY.

The Arbitron Radio Advisory Council was founded in 1978 to provide a forum between Arbitron and its radio subscribers. The RAC consists of one representative from each of Arbitron's five largest radio group customers, 11 elected local market and designated format representatives; three research persons; one at-large member; one programmer; and the immediate past chairman.

Gordon Mason dead at 80
Former Southern California Broadcasters Association (SCBA) President Gordon Mason has died at age 80. After retirement, Mason, pictured on the right with Gary Owens, had continued to write articles for the SCBA newsletter "Call Letters" and his last column, anticipating his own passing, is posted on the SCBA website, www.scba.com, sort of an autobiographical obituary. Mason recalled his career, beginning with CBS in LA, covering a number of call letters, a stint in trade publishing and eventually 10 years as President of SCBA. Along the way he also taught at UCLA and was involved in a number of charities. "So, dear friends, that's my story. No funeral services or celebrations, please. Thanks for your patience in reading this. And to so very many of you - thanks for such a wonderful time! (And, it wouldn't have been half so wonderful without twenty-seven years with Bette.)" Mason said in conclusion. Also posted on the website are numerous tributes from people touched by Mason during his long involvement in radio in the Los Angeles market. "He was a mentor and dear friend to me and he will be missed in more ways than I can imagine right now," said current SCBA President Mary Beth Garber.


Wall Street Business Report TM
Fidelity cuts Clear Channel stake
Once the largest institutional shareholder of Clear Channel Communications, FMR Corp., parent of the Fidelity Mutual Funds group, has been selling off most of its shares. Once the owner of 9.8% of Clear Channel, FMR reported to the SEC yesterday that it has cut that to 13.4 million shares, or 2.7%. That puts FMR below the 5% threshold for having to report further Clear Channel stock sales. FMR had been one of the leaders of the resistance to the initial going private offer for Clear Channel, helping push the bid up to the eventual 39.20 per share. The stock has been trading well below that, but with the closing dragging on into 2008, the mutual fund giant has apparently decided to take a lot of cash off the table now and move on.

Social networking IPO this week
How much is Wall Street really willing to bet on the social networking craze? We'll find out this week as Classmates Media Corporation prices its IPO, expected to raise 120-144 million bucks. The company operates the Classmates.com website for folks to stay in touch with old school chums. It was a true pioneer of the field, dating back to 1995, before anyone started calling them "social networking" sites. But even with 50 million registered accounts, it is nowhere near the size of MySpace or Facebook. Pro forma 2006 revenues were 152.1 million and the company was just eight million short of that with another quarter to go this year. The IPO led by Goldman Sachs, Deutsche Bank and JPMorgan seeks to place 12 million shares in an expected range of 10-12 bucks each.


Ad Business Report TM

Arbitron releases
RADAR 95 pre-data

Arbitron released preliminary findings from RADAR 95 Radio Network Audience Report. On Monday, Arbitron will release the complete results. The sample size has been increased to more than 200,000 respondents.

Radio reaches 233 million listeners over the course of the week according to the RADAR 95 December 2007 estimates--up from estimates one year ago from RADAR 91. The 7,200+ RADAR Network Affiliated stations reach 82% of all people age 12+. RADAR Network affiliates reach 84% of adults 18-34 and 84% of adults 25-54. They also reach 84% of Adults 18-49.

95% of Adults age 18-49 with a college degree and an annual household income of 50,000+ tune into radio over the course of a week. RADAR Network affiliates (which account for over 50% of all radio stations) reach 86% of this coveted demo. They also reach 85% of adults 25-54 in households with a college degree and an annual household income of 75,000+.

While the trend in radio shows fewer young listeners, network radio reaches the ad elusive and media multi-taskers, Teens 12-17. While overall, RADAR networks reach 82% of all radio listeners ages 12+, these same networks reach 84% of listeners ages 12-17.

94% of Black Non-Hispanic persons and 95% of Hispanic persons, age 12+ tune into radio over the course of a week. Radio reaches 95% of Black Non-Hispanics and 96% of Hispanics age 25-54 over the course of a week.

Radio reaches 94% of college grads age 18+. 96% of adults 18-49 with a college degree and an annual income of 75,000+ tune into radio over the course of a week.


Media Business Report TM
Report: Telecom spending drives Q3 outdoor ad spend
In a Bear Sterns report issued today on outdoor ad spend, the company noted that the Outdoor Advertising Association of America (OAAA) recently said industry revenues increased by 6.1% in Q3. Q3 revenue growth was driven by categories such as communications (+35%), public transportation, hotels & resorts (+13%), and the insurance & real estate category (+6%). Communications spending grew by nearly 40 million in Q3. Real estate remained one of the more healthy categories in Q3, posting the 3rd largest growth rate among the top 10 categories. However, real estate spending has slowed from 15% in Q1, to 13% in Q2, to 6% in Q3. Said the report: "Some of the private outdoor companies we speak to have cited real estate or slowing ad spending from home builders as reasons for a softer second half than first half of the year."

Five of the top 10 ad categories posted increases in Q3, which is lower than Q2, when 7 of the top 10 categories showed increases. In addition to the categories listed above, the largest category, local services and amusements grew by 1%, while auto, auto access & equipment increased by 2%. Ad spending from the media and advertising category was flat. Down categories included automotive dealers & services (-5%), financials (-5%) and retail (-3%). On a combined basis, the two separate auto categories posted a 2% decline. Bear Stearns' is maintaining a 7% growth outlook for 2007. "Outdoor advertising is benefiting from advertiser perceptions that other traditional mediums face increased competition, fragmented audiences, and new technologies. Though ad spending from weak categories (financials) and strong categories (real estate) bear watching given recent trends in the housing and financial markets, we expect outdoor to continue to take share from traditional media. Converting static displays to digital displays should accelerate the pace of outdoor's share gains."

ABC SuperSign beefs up
in Times Square

The ABC SuperSign, the giant electronic icon in Times Square known for its signature wavy LED ribbons and eye-catching curved ticker, has heightened its digital and multimedia capabilities to offer advertisers and producers the most technologically advanced displays in operation. With resolution of its LED ribbons boosted 25 times and the addition of many other new features, the SuperSign has significantly expanded options and flexibility in content display, interactivity, synchronized multimedia timing and remote high definition feeds. SuperSign advances in interactivity give advertisers more ability to engage customers and passersby in custom-developed marketing campaigns, special promotional activities and live events through digital photo uploads, text messaging, e-mail, and other applications. Greater real-time control allows "on the fly" switching among graphics, video, text and other media. Many more effects are also available to enhance marketing messages. Live video feeds from remote locations can now be more flexibly received and displayed in high definition across any of the sign's display surfaces.


Media Markets & Money TM
Salem spins one in Houston
Businessradio Network will be switching from a rental to a fully-owned property in the Houston TX market, while Salem thins its cluster down to an old-fashioned AM-FM combo. Salem's KTEK-AM is the station on the acquisition track -- Businessradio will pay 7.75M for the KTEK, licensed to Alvin TX. The sale will leave Salem with an AM-FM combo in the market. Meanwhile, Businessradio's new position as owner will bring an end to its LMA with Multicultural's KXYZ-AM. In its FCC filing, the buyer noted that the beginning of an LMA with Salem and the end of the one with Multicultural be timed so that it will be operating only one station in the market at any given moment.


Washington Business Report TM
DTV transition leaves LPTV
with a chip on its shoulder

The Community Broadcasters Association is stunned that some of the digital-to-analog converter boxes approved for distribution are not equipped to pass through analog signals, a fact which could be seriously detrimental to the operations of large numbers of LPTVs, Class As, translators and even some full-power stations which will continue broadcasting analog signals after 2/17/09. The purpose of the boxes is to pass through stations off-air to households retaining their analog receivers, but CBA VP-Technology Greg Herman, pictured, told RBR that boxes failing to include an NTSC chip will only pass through broadcast digital signals, blocking analog broadcasts. The only recourse available to affected consumers will be to unplug their converter box and reattach their rabbit ears to pick up an analog television broadcast. Herman noted the example of the lone local digital station in Bend OR. Bend citizens will be able to pick it up off the air, but will lose access to numerous Portland OR stations available off-air in Bend only via analog translators. CBA President Ron Bruno said, "Converter boxes that block our analog LPTV signals will confuse viewers and significantly decrease LPTV viewership." The group has lodged an official complaint with the FCC, and threatens to seek redress for lost viewers and revenue. Herman concluded, "It will be substantially less expensive to correct this problem now instead of recalling 70M boxes and paying our industries' lost revenues later."

RBR observation: Herman says adding an analog pass-through to the boxes would be a relatively inexpensive fix. It seems to us it's either that, or the government steps in an builds digital plants for all the affected analog stations, or buys all affected citizens a digital receiver. We doubt there will be much debate as to which course makes the most sense at this late date in the transition.


Ratings & Research
Imus clicks with People Meters
The return of Don Imus to the New York airwaves showed up big time in the market's PPM test sample. Arbitron reports that WABC-AM's AQH estimated 6+ listenership for the December 3rd debut show were up an average of 87% over the previous programming on the station. For the 6:00 am launch, the number of meters reporting exposure to WABC jumped 251%. By the final quarter hour nearly four hours later the audience estimate was still up 33%. Arbitron cautions that this is raw data and has not been weighted or qualified for in-tab. Besides, the market is still in pre-currency testing/
| Take a look at the numbers |


Transactions
345K WBVA-AM & WVAB-AM Norfolk-Virginia Beach-Newport News VA (Bayside, Virginia Beach VA) from R. Clinton Stackhouse Jr., Interim Trustee to Birach Broadcasting Corporation (Sima Birach). 13,750 deposit, balance in cash at closing. Bankruptcy proceeding. Existing duopoly. [File date 11/21/07.]


Stock Talk
Betting on the Fed
The Federal Reserve's policy making committee meets today and Wall Street traders are convinced another rate cut will be announced. So, they bid stocks up yesterday. The Dow Industrials rose 101 points, or 0.7%, to 13,727.

Radio stocks joined the parade. The Radio Index rose 1.815, or 1.8% to 101.222, putting it back above the 100 mark where it began nearly a decade ago. Regent gained 6.6%, SBS 6.3% and Citadel 6.1% as the top performers.


Radio Stocks

Here's how stocks fared on Monday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

41.89

-0.11

Google

GOOG

718.42

+3.55

Beasley

BBGI

6.65

unch

Hearst-Argyle

HTV

21.78

+0.48

CBS CI. B CBS

27.09

-0.06

Journal Comm.

JRN

8.96

+0.06

CBS CI. A CBSa

27.01

-0.13

Lincoln Natl.

LNC

61.77

+0.86

Citadel CDL
2.10 +0.12

Radio One, Cl. A

ROIA

2.37

+0.10

Clear Channel

CCU

35.31

-0.52

Radio One, Cl. D

ROIAK

2.38

+0.07

Cox Radio

CXR

12.12

+0.48

Regent

RGCI

1.62

+0.10

Cumulus

CMLS

8.09

+0.17

Saga Commun.

SGA

6.70

-0.05

Debut Bcg.

DBTB

0.95

unch

Salem Comm.

SALM

6.94

+0.16

Disney

DIS

32.35

-0.44

Sirius Sat. Radio

SIRI

3.58

-0.03

Emmis

EMMS

4.51

+0.19

Spanish Bcg.

SBSA

1.86

+0.11

Entercom

ETM

15.65

+0.21

SWMX

SMWX

0.01

unch

Entravision

EVC

7.55

-0.04

Westwood One

WON

2.19

+0.04

Fisher

FSCI

38.46

-0.04

XM Sat. Radio

XMSR

14.92

-0.35


Bounceback

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Below the Fold
Ad Business Report
RADAR 95 pre-data
Arbitron released preliminary findings & sample size increased...

Media Business Report
Telecom spending
Report: Telecom spending drives Q3 outdoor ad spend...

Media Markets & Money
Salem spins 1 in Houston
Businessradio Network will be switching from a rental to...

Ratings & Research
Imus clicks
With People Meters as RBR has the Numbers...




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Radio Media Moves

McVay get VP stripes
Jim McVay, VP/Sales for McVay Media Programming Consultants, has been promoted to Executive VP/Sales. The promotion, which is effective January 1, 2008, signifies the expansion of McVay's duties to include radio sales, syndication, music, special projects and non-traditional business. McVay Media is a full-service broadcast consultancy that specializes in programming for radio stations.




More News Headlines

Bubba reups with Sirius and back in TPA
Bubba the Love Sponge has renewed his contract with Sirius Satellite Radio to continue hosting his uncensored afternoon talk show on channel Howard 101. The Bubba the Love Sponge Show features several co-hosts and is regularly visited by stars from the worlds of sports, comedy, and music. It airs M-F live from 3:00 pm to 7:00 pm ET on Howard 101 from Bubba's studio in Tampa. Also, Bubba is back in Tampa with Cox Radio at 102.5 the Bone. His shift starts in ’08 or a few weeks. Bubba has been off the Tampa airwaves for close to four years after he was hit with a 750,000k FCC fine when he was with Clear Channel.

Ad-dled by politics
NBC Television Network first turned down, then accepted an ad from conservative watchdog Freedom Watch which was intended to thank troops stationed overseas for their service during the holiday season. Not long before, Fox News Channel rejected an ad from liberal Center for Constitutional Rights that was accepted on two rival cable networks. The objection to the Freedom Watch ad was not controversial content, but rather a reference to the group's website, which NBC deemed overtly political and triggering the network's ban on such material. NBC said in a statement that from now on ads will be judged by content only. The CCR ad rejected by FNC featured actor Danny Glover and charged that the Bush administration is chipping away at constitutional rights of Americans. Fox said the ad's charges could not be substantiated, and said in a statement that documentation was required to show that the Constitution was actually being "destroyed." CCR objected to FNC's "literal interpretation of the ad." It was accepted for broadcast on CNN and MSNBC.

RBR observation: It is our firm belief that matters of opinion do matter to the American public. Media outlets cannot help but be gatekeepers, but that does not mean they need to put on a complete hockey goalie uniform and decide what is and is not worthy of being passed along to the public. As long as an ad isn't based on obviously false information and is not indecent, it should run.

Google renews push for white space access
Internet search guide Google says it has devices which can operate in the margins between television stations without interfering with licensed spectrum users, and says it's demonstrated two technologies for the benefit of US regulators. Broadcasters remain unconvinced that it's time to open the spectrum up to all comers. Earlier tests have either come up short or have been withdrawn in advance. Broadcasters contend that it will take very little interference to disrupt a broadcast digital signal, and the disruption will be more than mere static, but will make the broadcast signal completely unwatchable. And if the devices causing interference are unlicensed, there will be no possibility of tracking them down to bring such interference to an end.

RBR observation: We will say once again that it is utterly irresponsible to consider such a potentially-disruptive regulatory spectrum land rush on the eve of the digital television transition, the most ambitious and risky such endeavor ever attempted. If all involved parties want to experiment with white spaces and potential unlicensed devices over the next two or three years, fine. All serious regulatory consideration should be tabled until digital television is up and running with no viewers left behind.




RBR Radar 2007
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Lots of initiatives to improve PPM
In Arbitron's monthly calls with reporters and clients for a PPM update, the company said lots of things are being done and considered to improve PPM sample performance. Hush-Hush on Houston MRC accreditation - There was, of course, no confirmation that the Media Rating Council MRC has moved to withdraw PPM accreditation in Houston and that Arbitron is appealing through the MRC's secret proceedings MRC, A few words, and only a few, The Media Rating Council (MRC) is famed for its extreme secrecy, but RBR did receive a response from MRC Executive Director George Ivie to our questions about PPM. Not that he had much to say. A: "I have no comment on this matter."

RBR observation: Mark your calendars. The next monthly PPM conference calls are set for January 3rd. Will Arbitron still be able to say then that PPM is accredited by MRC in Houston? If it can't resolve the issue in Houston and somehow move on to get accreditation in Philadelphia and then New York, how is delaying the rest of the roll-out a few months going to help? As for the MRC, The End. Now sit and watch the movie credits roll down the screen at the end of the movie, which of course nobody ever sits in anticipation for that long list to roll. (The Arbitron Agency Advisory Council for compete details in RBR)
12/10/07 RBR #239

RBR First Report
What's going on in Houston?
Houston is the only PPM market to thus far win Media Rating Council (MRC) accreditation, but there are now reports circulating that that lone seal of approval could be withdrawn. Arbitron isn't commenting and the MRC is as super-secretive as ever. Arbitron's Portable People Meter being up for "reaccreditation" in Houston because the company wants to switch to the same recruiting methodology used in Philadelphia and New York - and which Arbitron intends to use elsewhere. We hear that it is worse than that - that Arbitron failed a routine re-audit of PPM in Houston. The Houston PPM data reportedly failed to maintain minimum MRC standards even using the more expensive recruiting methodology dating back to Arbitron's efforts to enlist Nielsen in a joint venture to use PPM for both radio and television. Arbitron is said to be appea! ling that loss of accreditation and can continue to put the MRC double-check logo on its Houston PPM reports pending the outcome of that appeal. Like all proceedings of the MRC, the appeal process is totally secret - so secret that Arbitron won't confirm or deny that there is an appeal going on, or that there is anything to be appealed.

RBR observation: At its meeting this week, the Arbitron Radio Advisory Council supported Arbitron continuing to roll out PPM to more markets without waiting for MRC accreditation (12/6/07 RBR #237), but we hear that the vote was not unanimous. Some radio groups are absolutely outraged that Arbitron is not able to meet the accreditation standards, but is continuing to move ahead with PPM. But we also understand that the PPM contracts which the groups have signed with Arbitron don't mention MRC accreditations, so there is no easy out if MRC doesn't give its seal of approval.
12/07/07 RBR #238


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