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Rich Russo tells it like it is.
(4/5/05 TVBR #67)

People don't like to go through the whole process of making choices. They want to do it once (or at least very infrequently) and be done with it. Jack programmers should keep in mind that listeners tune in an average of 3 radio stations per week (gross cume divided by population). They make those choices from maybe 100 radio stations available to them. Then the listener depends on the station to make the song selections from that point forward. If the program director is not doing his/her work and just letting every type of music be played, the listener will eventually discern that and go to another station. I suspect the same thing will eventually occur with people who own iPods. They will eventually get bored of the shuffle and select certain songs to be played. But eventually they will grow bored of those songs, find that it's tedious to select a new group of songs, and either:

1. Turn to regular radio where the program director is doing his/her job, or
2. Select some sort of mix offered by iPod that's periodically updated.

Problem with the latter option is that no one knows when the iPod listener will want to "flip" channels - and he/she will have to go through the whole "choices" process again. Plus, I believe people listen to music stations for more than the music. It's the personalities, current events, advertised sales and services and local information that glues a listener to a station. I don't think iPod can do that.

Mike Levine
Director Affiliate Relations
Matrix Media Inc Radio Networks
Chicago, IL

Koman to Stewart
Martha Stewart Living Omnimedia has named Liz Koman Vice President of Advertising Sales, putting her in charge of the sales effort for the company's new TV programs launching this year. Koman was Sr. VP and General Sales Manager at American Movie Classics and WE: Women's Entertainment.

Beasley sees high multiples for Susquehanna stations
The radio properties that Susquehanna Media has put on the auction block are attractive, to be sure. But it doesn't look like George Beasley will be in the final round of bidding for them. Asked about the move by Susquehanna's founding family to cash out, Beasley said it now appears that there will be a lot more merger and acquisition activity in radio in 2005 than in recent years. But he indicated that the projected multiples for Susquehanna's big market stations (presumably San Francisco, Dallas-Ft. Worth, Houston and Atlanta) will be sky high - - making it unlikely that publicly traded companies like Beasley Broadcast Group will be able to justify paying the price. Rather than public buyers, he sees companies with private equity backing emerging as the winning bidders. As for the medium market properties (Cincinnati, Kansas City and Indianapolis), Beasley said even there he's expecting the stations to bring cash flow multiples of 15-18 times. Here's George Beasley's response to a question about Susquehanna from Wachovia Securities analyst Jim Boyle.

RBR observation: Beasley has not a single market in common with Susquehanna, so he wouldn't have an opportunity to fill out an existing cluster. Some other public groups do have holes to fill in those big markets - - notably Infinity, which is likely to be an aggressive bidder in Atlanta and Houston, even in the face of huge multiples. We also wouldn't rule out a public company still emerging as the winning bidder for the whole package, since a stock-swap deal with a public company can reduce the tax consequences for the Susquehanna folks. We've previously noted that both Cox Radio and Entercom would have relatively few spin-offs to worry about from such a deal.

'05 Clock is Ticking -
Heading for Closure

June Magazine
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EDI - Electronic Delivered Invoicing
Special Analysis:
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Media, Markets & Money:
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Publishers Perspective
Network TV's Big Problem:
No Passion
Ever wonder why the network programming gurus dump programming as well as your affiliate compensation? No passion or respect for programming content, or a commitment to find that right time slot. NBC is most likely will pull the plug on a great TV program entitled 'American Dreams' which is one of the few programstoday that is meant for a cross platform for CHR and Oldies radio. NBC you missed the boat. Now, ABC you have an opportunity staring you in the face if you have the passion and commitment to re-build your TV network and local radio can be your White Knight.
Two quick reasons to have AD:
If you were a teenager in the early '60s, you looked forward to watching American Bandstand. If you are too young to remember the '60s, but are curious about the styles and the conflicts, the "transistor radios" that everyone carried around, the round-screen black and white TVs, all those are very authentic in this TV series. It's a time machine. It's a great show. ABC Pick it Up - - Build from it - - because it is all American.
05/02/05 TVBR #86

Wall Street welcomes
Clear Channel breakup
After the initial excitement over the moves we reported in a special bulletin, the stock eased back and ended the day down slightly. The only big damper on the excitement was a warning by Moody's Investors Service that it may downgrade Clear Channel's band ratings because of the restructuring. Since the rating is now the lowest level investment grade, any downgrade would move Clear Channel's 7.5 billion in debt to junk bond status. TVBR observation: What went wrong? In the first place, Clear Channel overpaid for SFX Entertainment. It wasn't worth 4.4 billion in 2000, as quite a few people outside San Antonio said when the blockbuster transaction was announced. Oh well, not the first time that Bob Sillerman got the better of someone at the negotiating table. Here's what Moody's had to say. 05/02/05 TVBR #86

CCU's Less is More taking its toll
The final result was even worse. Radio revenues came in 7% below Q1 of 2004 at 773.6 million. LIM that focuses on convincing advertisers to use :30s and :15s instead of the traditional 60-second spots is also taking hold. Asked for specific categories, the use of :30s is widespread, named automotive and telecommunications in particular. Noted that Verizon recently began running its first-ever :30s. Big box retailer Home Depot is also using :30s. TVBR observation: While CC Radio is still facing a negative number for Q2 anyway you look at it, the gap is narrowing a bit from Q1. What analysts wanted to know was where is the end of the tunnel? 05/02/05 TVBR #86

Auto biz disappointing,
but LIN is fighting back
CEO Gary Chapman is optimistic about some of the initiatives his company has underway to boost revenues this year including deployment of its WAPA-America Hispanic cable network and growing Internet sales. The searchable classified ads are, of course, on the Internet, but are promoted on LIN's TV stations. The contracts with dealers are for a full year and the venture has already generated a million bucks in revenues, which is ahead of plan. TVBR observation: Times may be tough for car dealers, but they're still spending a ton on newspaper classifieds. Bravo to Chapman and company for figuring out a way to tap into that revenue stream. No doubt LIN will soon expand this to other markets and there will others making similar moves. Go to www.woodtvcars.com to see what all the fuss is about. 04/29/05 TVBR #85

Mel the salesman raises
the bar at Sirius
Projecting that Sirius will add 1.6 million subscribers this year, total to 2.7 million. Zen Master expects not just to make Sirius profitable, but to make it a very profitable. Research by Sirius, the biggest impediment is not the monthly subscription cost, but the cost of receivers. So, Sirius is launching a new 50-buck rebate program. RBR observation: Mel is a great salesman and it's always fun to hear him make his pitch, even if we remain skeptical of the long-term viability of the satellite pay radio business. It was interesting to note that Sirius has found that its ad-supported talk and sports programming (plus Howard Stern on the horizon) is increasingly driving its subscriber growth. No wonder they brought in a new CEO who knows how to drive ad sales! Sirius is also reporting a lower churn rate than XM a monthly rate of 1.3% for Q1, which it claims is its lowest churn rate ever. 04/29/05 RBR #85

Radio Marches forward 3%
Radio comps for March 2005 can be written in black ink, according to the latest figures from the RAB. A 3% gain in total business matched the gain in local a 5% uptick on the national side was insufficient to push the total figure any higher, an non-spot revenue was flat.
RBR observation: These numbers, while not eyecatching, are certainly in line with what we've been seeing since we got out from under the red-ink splatter of the dot-com bubble burst. What this means, while LIM doesn't seem to be causing a major revenue surge, neither does it seem to be punching a gaping hole into early 2005 results. 04/29/05 TVBR #85

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