RBR's Daily Morning Epaper

Are you reading this from a forwarded email?
New readers can receive our RBR Morning Epaper FREE for the next 60 Business days! SIGN UP HERE

Volume 22, Issue 102, Jim Carnegie, Editor & Publisher

Tuesday Morning May 24th, 2005

Radio News®

Cumulus Media, Inc. does as it says
Set a 30-day deadline on May 4th, (05/04/05 RBR #88), to make a change when

he told analysts that there are three options - - either Interep's Cumulus Radio Sales will adopt that types of new business initiatives and accountability that Cumulus has adopted for its local sales, or Cumulus will take its national business elsewhere. After business hours last night the pr came flying first was "Interep announces discontinuation of national radio representation of Cumulus Radio." In their release CEO Ralph Guild pointed out that "...Cumulus represented approximately 4% of Interep's total commission revenue in 2004." RBR estimates that to be around 3 million. Next, Cumulus announcing the move of their 310 stations in 61 mid-size markets over to Clear Channel owed Katz Media. Most likely the 310 will be spread over the Katz firms of Eastman and Christal but no official assignments were handed out in the Cumulus release. RBR received no official pr from Katz Media. No one of this is surprising. No one was available for comment at the late hour.

RBR observation: Said it before but worth repeating. It's not that they were anxious to jump to Katz as Citadel did rather he was complaining that the national rep business isn't structured for growth. True, in reality they are not but one would have to examine future growth. Cumulus also felt both rep companies are too focused on continuing business from existing national advertisers, rather than working to expand the mix of advertisers and build new business. Again we have to say True to some extent. Now the reality of losing the second largest in number radio group is a blow to the Interep ego but in dollars, approximately give or take 3 million, is not a large hunk of business in green backs and the capital expenditure in developing those dollars for 310 stations in mid to small markets is costly. It is called cost effectiveness as it takes the same dollar to pay the same person to sell etc a cluster in market 20 as it does in market 150. Time is money and the key for a small firm is to concentrate on quality of their clients giving more time to allocate the people expense over from market 150 into new business development. Seems both sides win on this deal - Interep will be able to redeploy people resources and focus more time on the major clients they have. Cumulus wins as Katz Media has the financial resources to spread the goodwill value of their sales effectiveness that Cumulus stations need as Clear Channel owns a bunch of small market stations. Meanwhile, Guild will have explaining to do this morning as he has to keep his current clients content while he fends off a bidder in Oaktree and seeks to recapitalize with Allen & Co.

House panel ready to tee up DTV bill
The House Committee on Energy and Commerce is drafting an initial version of a bill which would impose a hard deadline on the DTV transition. Rep. Fred Upton's (R-MI) Subcommittee on Telecommunications and the Internet is meeting Thursday 5/26/05 for "a legislative hearing on a staff discussion draft of the DTV Transition Act of 2005." According to numerous reports, the bill would set a hard deadline at the end of 2008 and accelerate the timetable for required digital-capable set manufacturing. Democrats are said to have split from Republicans over the issue of subsidies for digital-to-analog converters for households reliant solely on over-the-air broadcast and without digital sets - - although the Dems and many Republicans are thought to favor such a provision, it is not expected to be in the bill as presented this week. It is also expected that multicast must-carry will not be a part of the bill.

Adelstein commits to Conclave session
Democratic FCC Commissioner Jonathan Adelstein will be on hand when the Conclave confab takes place this summer in Minneapolis. He will be interviewed and take questions Friday, 7/22/05 at the Marriott City Centre. Adelstein is expected to tackle issues such as indecency, ownership consolidation, technology and payola. The Conclave event runs from 7/21-24-05.

RBR observation: Have you noticed how its always the Democratic commissioners you read about making an appearance at this event or the other? For the time being, they can force a tie vote on issues put before the Commissioners - - and perhaps in view of that fact, little of any consequence is being put to a vote. Once the Republicans refill the fifth seat overall and third claimed by their party, the will be able to get back to the past of forwarding the Republican agenda. All Adelstein and his colleague Michael Copps can do is make as much noise as possible. We have to say, their track record indicates that they can and will pump up the volume level, so don't expect Chairman Kevin Martin to be able to sneak anything past the watchdog community any time soon. He may get things done, but they are not likely to get done quietly.

Where's the beef? SCOTUS
The Department of Agriculture can continue running its "Beef, It's What's for Dinner" ads - - and it can continue to force beef producers to foot the bill, even those beef producers who object to the campaign, according to the US Supreme Court. In the case of the beef ads, a one dollar-per-head fee is charged for all cattle sales to fund the Agriculture Department Ads. Protesting groups sued, saying that the ads tended to favor large producers at the expense of small independent producers. Explaining the opinion of the 6-3 majority, Justice Antonin Scalia said the ads were a form of government speech and were immune from First Amendment challenge. Dissenting Justice David Souter said, according to the Associates Press, that for the government "...to compel specific groups to fund speech with targeted taxes, it must make itself politically accountable for indicating that the content is a government message." The decision overturns a lower court ruling, and is likely to effect other such campaigns such as the popular "Got Milk" print campaign.

Another devil's eye view of VNRs
Again, since the devil's in the details, we want to look at some of the issues attached to the attempt by John Kerry (D-MA) and Frank Lautenberg (D-NJ) to require perpetual sourcing for government-issued VNRs. For starters, you have to accept the premise that there is nothing wrong with the practice of issuing press releases. If 7,429 reporters are all calling your office with the same question, the only possible way to deal with the influx is to answer the constantly-repeated question, write down your answer, and fire off 7,249 faxes, or emails, or: drum roll please: VNRs. At the recent Senate Commerce Committee hearing on the topic, Chairman Ted Stevens (R-AK) queued up a complete VNR package - - one of the controversial ones. In point of fact, it was the Department of Health and Human Services release pushing the prescription drug plan. There was a lot more to it than the "Karen Ryan reporting" segment. Let's look at a chunk. A major part of the release were statements for the press, just like one might make in print, issued by appropriate government officials. There officials were clearly identified, and their remarks were provided in such a way that a local news department could weave them into a story on the topic. The officials were clearly identified - - the bottom line is that arguably there is no need for further sourcing.

RBR observation: And you could argue that there is a need. What wasn't provided with the VNR package was an opposing point of view - - the Republican administration which produced it didn't go out looking for Democrats to include. However, there is nothing stopping a responsible news department from doing just that, and - - if the opposition is on the ball - - they may well have a competing VNR out there anyway. RTNDA and PR pros at the session argued that sourcing such material could be disruptive to a responsible story's look, and could have the perverse result causing pertinent material from being excluding and limiting coverage of such events.

Some BBC talent cross picket lines
in UK strike
BBC employees are on strike, protesting the massive job cutting plans that will eliminate 3,780 positions. More than 13,000 BBC staff are taking part in the biggest strike to hit the corporation. The walkout began at midnight 5/23, at which time some of the radio and TV networks went into largely prerecorded mode. The 24-hour stoppage is disrupting virtually all television and radio news. A total of 52% in the radio and music division stayed away, while about 60% of employees at BBC Broadcast and Resources, both of which are to be sold off this summer, went on strike. Radio 1, 2, and 3 and the World Service are still operating normally. Radio 4, however, went to taped shows for the "Today" show, "PM," and "The World Tonight." Another strike, to last 48 hours, is scheduled for next week.

Adbiz©

Product placement in Neil Simon Broadway play
As part of a product placement campaign in Broadway's Sweet Charity, playwright Neil Simon approved a script change to promote Jose Cuervo's Gran Centenario tequila. Sweet Charity stars Christina Applegate. Simon approved a script change to incorporate the brand into the dialog. The brand logo will also appear in set and ads will be placed in the playbill. NY-based Bridge to Hollywood/Broadway put the deal together-it previously brokered product placement deals for appearances in Thoroughly Modern Millie and Raisin in the Sun.

Israeli firm unveils new ad delivery system
for in-video game placement
An Israeli company is first to market with a new system that allows for the introduction of rich media advertising into online video games-a prospective 750 million market by 2006 according to Jupiter Research. Double Fusion, based in Jerusalem, has unveiled an ad-serving system that will allow marketers to incorporate rich media formats of 2-D, 3-D, music, animation and video seamlessly into the video game environment. Double Fusion's initial roll-out of its ad-serving technology will be in two games initially distributed in the U.K: London Taxi Rush Hour (Data Design Interactive) and Taxi3: eXtreme Rush (Team6-Games). Both games feature the first ever ad-buy of rich media in a video game. The ads feature a product by Procter & Gamble and are incorporated into the storylines of both games. The ads take advantage of Double Fusion's ability to integrate dayparting, localization and customized creative campaigns. Meanwhile, companies like Puma and Motorola are turning to video games and "advergames," games solely created for product placement, to reach that audience.

Hilton Hotels puts account in review
Hilton Hotels has issued RFPs on creative and media-buying services in a fresh review of its 45 million-dollar annual account. Foote, Cone & Belding has handled the account for seven years and will reportedly defend.

Media Markets & MoneyTM

EMF finds a calling in Collins
WKNZ-FM Collins MS is being sold to the Educational Media Foundation for 700K. The Laurel-Hattiesburg station has already entered into somewhat of an LMA with EMF, in the form of a network affiliation agreement. The station agreed to begin running EMF's non-commercial K-Love Contemporary Christian network beginning 4/1/05. The sellers, Radio Broadcasters LLC, will get 700K - - 200K at closing and the rest pursuant to a promissory note.

Washington Beat

MSRC meeting set
The Media Security and Reliability Council is going to gather at the FCC's Southwest Washington digs 6/2/05 from 10AM-11:30AM to go over efforts designed to guarantee uninterrupted media operations in the event of another 9/11-type catastrophe. In particular, the efforts of the Toolkit Development Working Group and the Local Coordination Working Group will be reviewed. The session is open to the public. Hearst-Argyle honcho David J. Barrett is heading up the effort, which is coordinating the efforts of radio, TV, cable and satellite companies, along with relevant associations, manufacturers and public safety organizations.

Programming

X launches "The Big Show Saturday Night"
X Radio Networks announced it will debut a new weekend Country program, "The Big Show Saturday Night" over the 7/4 weekend. The program, hosted by KZLA-FM LA afternoon driver Whitney Allen, is designed specifically for Saturday nights and feature five hours of hit songs, high-energy production and imaging, humor, artist interviews, and listener interactivity. The live satellite feed of the show will be available 7p-midnight in all time zones.

Transactions

750K WSAG-FM Saginaw-Bay City-Midland (Pinconning MI) from Blue Moose Broadcasting LLC (Victor A. Michael Jr.) to MacDonald Broadcasting Company (Kenneth H. MacDonald Jr.). 250K escrow, balance in cash at closing. LMA until closing. [File date 4/22/05.]

105K WSWV AM & FM Pennington Gap VA from IBS Communications LLC (Hossein Faiz) to B C Broadcasting Company Inc. (Billy Louis Carter). 10K deposit, balance in cash at closing. LMA 2/28/05. [File date 4/21/05.]

Stock Talk

Oily to bed, oily to rise
People with media stocks may be grumbling when they stop at the local gas station on their way home, but at least the higher prices being raked in by those companies helped cause most stocks to rise in Monday trading. That means media stockholders will in many cases have a little extra net worth to apply to those rising gas bills...

Radio Stocks

**Here's how stocks fared on Monday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		40.90	-0.20	Jeff-Pilot	JP		49.78	+0.44
Beasley	BBGI		16.98	-0.17	Journal Comm.	JRN		16.89	+0.34
Citadel	CDL		12.00	unch	Radio One, Cl. A	ROIA		12.61	+0.05
Clear Channel	CCU		30.60	-0.04	Radio One, Cl. D	ROIAK		12.56	-0.01
Cox Radio	CXR		16.51	+0.28	Regent	RGCI		6.02	+0.09
Cumulus	CMLS		12.57	+0.23	Saga Commun.	SGA		13.69	-0.43
Disney	DIS		27.54	-0.29	Salem Comm.	SALM		18.22	+0.64
Emmis	EMMS		17.99	+0.14	Sirius Sat. Radio	SIRI		5.67	+0.02
Entercom	ETM		33.00	+0.10	Spanish Bcg.	SBSA		8.32	-0.01
Entravision	EVC		7.51	+0.01	Univision	UVN		26.49	-0.20
Fisher	FSCI		50.93	+0.68	Viacom, Cl. A	VIA		35.51	+0.42
Gaylord	GET		42.53	+0.20	Viacom, Cl. B	VIAb		35.41	+0.41
Hearst-Argyle	HTV		24.91	-0.04	Westwood One	WON		19.98	-0.09
Interep	IREP		0.48	unch	XM Sat. Radio	XMSR		31.77	+0.20
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

Bounceback

Send Us Your Opinions We want to
hear from you.
This is your column, so send your comments to [email protected]

I am so glad that Saga is standing on "principle" by dumping Hannity (5/19/05 RBR #99). Obviously the "principle" Ed Christian is talking about is money. Too bad the principle wasn't "honest and unbiased speech." My point is that it is interesting today when most points of "principle" simply revolve around business deals. And this is not a shot at Saga, or their management. I don't even know them. It's a general observation on all media. I am in business too, and a hard core capitalist, but I am waiting for the day when some broadcaster says they won't run a popular show (read: Hannity, O'Reilly, etc.) because it's promoting too much of a one-sided agenda. Unfortunately, today, most broadcasters are so afraid of the current government (read: FCC, Congress, Bush) that they cringe at anything that may even come close to rocking the most conservative members of the Christian right. And besides who cares about promoting a political agenda if we're all making money. You are witnessing the early stages of the creation of a Theocracy. And I am far from an alarmist. I have often voted Republican in the past, although will never again in the future.

Jon E. Currie
Currie Communications, Inc.

Arbitrends

Upped & Tapped

Cox Radio appoints Keiser LSM at WSB
Cox Radio announced David Keiser as the new LSM for News/Talk 750 WSB-AM Atlanta. Keiser comes to WSB-AM from Emmis St. Louis heritage rocker KSHE-FM where he was GSM. During Keiser's tenure, he led the station to record billing and power ratio levels.

CC Radio/Dallas
names new RVP
CC Radio today announced that J.D. Freeman has been named Regional Vice President of CC Radio's Dallas Region. Effective immediately, Freeman will be based in Dallas and will assume responsibilities for this top-five market reporting to Susan Karis, SVP/Southwest Region.

ABC News Radio
ups Fitzgerald
ABC News Radio announced the promotion of Jeff Fitzgerald to Director, Operations. Fitzgerald began his tenure at ABC News Radio in 1995 in a technical support position for the O.J. Simpson murder trial, and has held multiple production and editorial positions over the years. He served as the technical supervisor of long-form anchored coverage for such events as Princess Diana's death, the impeachment of President Bill Clinton, the September 11 terror attacks, and the war with Iraq.

More News Headlines

KMJ-AM adds HD Radio

98 Rock's Bob Lopez
loses battle with lung cancer

WRCJ-FM Detroit to be
run by WTVJ-TV

Rosenberg pulled from Imus show

JRN adds Gunnar Nelson
to Lifetime Radio

RBR Radar 2005

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

Is deconsolidation
just part of a cycle?
That's the theory put forth by Thomas Weisel Partners analyst Gordon Hodge in a research note on the current wave of media companies spinning off units or selling assets. After a boom-bust consolidation period in the late 1980s, the Telecom Act of 1996 propagated another consolidation wave, which rolled through the Internet bubble and then crashed into the breakers of recession, antitrust concerns and 9/11. We are living in the aftermath of that wave. RBR observation: Reminds us of a Yogi Berra quote on his hitting, "Slump? I ain't in no slump ... I just ain't hitting." Well same with many companies they just ain't hitting because as Berra would say - "90% of the game is half mental." Think about it because Hodge and Berra are both correct either a slump of the sum of their parts. Key for all media companies is your business plan and execution of the plan. If you didn't see it coming after 9/11 and the '02 recession which is still alive then you best get your house in order now or you will find it very difficult to compete in 2006. 05/21/05 RBR #101

Time Warner may spin AOL
Has discussed with management of AOL the possibility of selling shares of the unit in an initial public offering and decided not to go ahead with such a plan "at this point," said Parsons. The likelihood of a spinoff probably depends on whether AOL CEO Jonathan Miller succeeds in his strategy of attracting more Internet users and advertisers to his service to compensate for the decline in dial-up subscribers. AOL's 112 billion purchase of Time Warner in January 2001 led to a record 98.7 billion loss in 2002 and caused the shares to tumble. RBR observation: A good idea. AOL still hasn't realized its main client base is dial-up. When Juno and Netzero came along with basically the same core service at less than half the price, AOL should have immediately matched those 9.95 a month fees to keep its customers from leaving. It didn't. Instead, it bought Netscape and made a Netscape service for 9.95-too little too late. What it should have done is offered the AOL service for 9.95 a month and touted its extra benefits/services. But AOL ad sales are showing some real promise lately, so we will see what happens.
05/21/05 RBR #101

GSM Opportunity with Emmis
Legendary KSHE-95 St Louis needs a strong GSM with minimum 5 years battle experience and NTR skills a plus. Generous benefits and compensation await. Are you ready for this challenge!

General Manager
On the NJ Shore with at least five years suburban market and cluster exp. Strong sales but programming and engineering knowledge a plus. Excellent benefits including 401(k).

See Radio Careers

Other Links

State Associations
Contact Us

Publisher question:
Reading RBR from a friend?
Receive your own morning copy at www.rbr.com

Help Desk

Having problems with our epapers?
Please send Questions/Concerns to:
[email protected]

If you wish to remove your name completely from our database use this link __UNSUB__

If you wish to unsubscribe
to RBR only, use this link