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Redstone downplays radio sale notion
Viacom Chairman and CEO Sumner Redstone has poured cold water on rumors that the company might sell off its Infinity radio unit to former President Mel Karmazin or anyone else. �I would say our chances of selling Infinity are minimal. The margins are high, the cash flow�s great,� Redstone said yesterday in an interview on CNBC. RBR observation: We never put any stock in those silly rumors. Sumner sold the original Viacom radio stations years ago when they were a much smaller piece of the company. But with cash flow of over $1 billion per year, the radio group acquired in the CBS merger and built up since is a major source of cash flow to today�s Viacom. Les Moonves, who is now overseeing radio and outdoor as well as TV recently said he�d like to have more radio stations. He loves how cross-promotion helps launch new CBS shows and gives the TV network a leg up over arch-rival NBC, which has no radio stations at all.

Premiere Radio Networks has decided to move its Dallas marketing and promotions offices to its Sherman Oaks, CA HQ at the end of August. Premiere SVP/Marketing Marty Raab and his Dallas staff are not joining the move. Marty, who�s on vacation, is forming his own company, Premiere tells RBR. This isn�t the first of Premiere�s restructuring. Remember, last November Premiere moved its ad sales under Rhonda Munk-Scheidel to NYC. Premiere also confirmed the Dallas offices would be staying open for the other affiliate and sales functions.

Public interest gets short shrift
The focus of the House subcommittee hearing on the DTV conversion amounted to a fact-finding mission, during which the various stake-holders were allowed to state where they think the transition is and where it should be going.
There was another sub-theme during the session, first mentioned by Rep. Edward Markey (D-MA). He wanted to tie public interest obligations to the transition - - he said in essence that if broadcasters are getting increased ability, it should come with increase responsibility. This sentiment was echoed by former FCC Commissioner Gloria Tristani, who was on the witness panel in her new capacity as Managing Director of the Office of Communication the for United Church of Christ Inc. She argued for a minimum of three hours weekly of pubic affairs programming, along with commitments to children's education programming Public interest proved to be of minimal interest to the legislators, at least on this day. After making her statement, Tristani did not receive a single question from any of the reps present.

FCC prepared to alter TV group approach?
The Deal.com says that a lot of folks expect that at least some of the Third Circuit Court's review of the FCC's 6/2/03 ownership rulemaking is not going to go the Commission's way, including the TV group national cap. And that could lead to a radical departure from the current method of measuring the size of multimarket broadcast television groups. The current approach measures potential audience - - the total number of households in markets in which the group owns a station. The cap was 25% before Telecom 1996, went to 35% with its passage, and was moved up to 45% by the FCC's rulemaking, to a hail of protest. The 45% cap was repudiated by both houses of Congress, set back at 35% in an appropriations rider, then set at 39% in a back room White House-conference committee deal. According to the Deal.com, the new system would be based on actual, measured viewership. Proponents of a real-audience measurement regime would include local caps based in part on viewership as well, with a hard and fast three-station max in the largest markets. RBR observation: Such an attempt would hinge on the results of the presidential election - - it is unlikely to get much traction under a Democratic FCC. Also, a 25% limit - - given four big broadcast networks and healthy competition from cable and satellite - - would presumably allow a group to own a station in every market in the US, an utter impossibility under current rules.

Measuring the Media Moguls

Westwood One: Norman Pattiz, Chairman

2003 stock performance: -8.43%
2003 CEO pay: -1.60%

As non-executive Chairman of Westwood One, founder Norman Pattiz no longer runs day-to-day operations. We�d love to tell you about the paycheck that new President & CEO Shane Coppola received last year, or Joel Hollander the year before, but we can�t. Believe it or not, Coppola is not a Westwood One employee. Rather, he is employed by Infinity Broadcasting, a subsidiary of Viacom, which runs Westwood One under a management agreement. Westwood One paid Infinity $2,793,000 last year, which will rise to $3,000,000 this year, from which it pays Coppola and CFO Jacques Tortoroli. Infinity is also to receive 10% of Westwood One�s operating cash flow above a certain target, but 2003 was not a good year and the company didn�t hit the target, so there was no additional payment. |MORE|

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Steve Grubbs on the upfront - - Part I
As the official start of the television upfront launched just days ago, we thought we'd provide a bit of observation with a few lines from our upcoming interview with PHD CEO Steve Grubbs that runs in our August print edition. [MORE]

What Mel�s departure could mean to the upfront
We asked MediaCom Co-CEO/Global Buying Officer Jon Mandel and another  media agency CEO (who commented off the record) about Mel Karmazin�s departure.  Does this affect the upfront at all? Says Mandel: �No, it doesn�t affect upfront at all because if you noticed, he had Les (Moonves) go to Wall Street to say, �We�re going to get double-digit.� RBR observation: Mel is one of the greatest M&A guys in the history of the media, but his approach to sales problems of �We�re going to kick a lot of sales people�s asses� may have demonstrated shortcomings in problem solving and people skills. But while there�s been lots of speculation that he�ll end up at Disney or Time Warner, we hear one suggestion that he could really help out Clear Channel, with Lowry Mays sidelined. Is that idea too far-fetched? [MORE]

Media, Markets & Money tm

Opus kicks off with Monroe FM quartet
Opus Broadcasting Monroe LLC, headed by Richard Linhart, is entering the ranks of radio ownership with an FM foursome in the Monroe LA market. It'll pay $6.25M for a quartet which includes KXRR-FM Monroe, KZRZ-FM West Monroe, KQLQ-FM Columbia and KMYY-FM Rayville. The seller is Monroe Radio Members LLC. $10K of the price will go to a non-compete to one of the members, namely Michael Schwartz.
Opus will be contending with regional groups and local owners in the market's ratings wars. Monroe is one of those rarest of rare markets - - it is a Clear Channel-/Cumulus-free market.

Credit raters yawn at Viacom changes
Mel Karmazin�s exit from Viacom may be big news to broadcasters, but corporate credit rating agencies don�t see the changes in the company�s executive suite having any impact on Viacom�s finances. Both S&P and Fitch have issued statements affirming their investment grade credit ratings for Viacom. �The resignation of Viacom's President, Mel Karmazin, does not affect the company's ratings. Despite the loss of his strong leadership ability, the company will benefit from a new co-President, co-Chief Operating Officer team of two highly respected executives, Tom Freston (previously Chairman and CEO of MTV Networks) and Leslie Moonves (previously Chairman and CEO of CBS). Viacom will need to ensure the continued momentum of the performance of the MTV and broadcasting units-both management intensive businesses-as these two executives transition into their new responsibilities,� said S&P. Fitch also said Karmazin�s departure should have no impact on the company�s credit worthiness and added that �the announcement actually provides some clarity for succession at Viacom,� with Freston and Moonves now competing to succeed Sumner Redstone as CEO within three years.

Washington Beat

Transactions

$17.3M: KMVT-TV Twin Falls ID from Catamount-Idaho License LLC (Ralph E. Becker) to Neuhoff Family LP (Roger A. & Louise Neuhoff). $875K escrow, balance in cash at closing. Includes non-compete. Station is CBS affiliate on Channel 11. DTV facility on Channel 16. [File date 4/26/04.]

$775K: WZRH-AM Charlotte NC (Dallas NC) from Zybek Media Group LLC (Beth Howerton) to Truth Broadcasting Corporation (Stuart W. Epperson Jr.). $38.K escrow, balance in cash at closing. LMA 6/1/04. [File date 4/27/04.]

$700K: KVRP AM & FM Abilene TX (Stamford, Haskell TX) from Rolling Plains Broadcasting Corporation (Ken Lane) to 1 Chronicles 14 LP (Gregg Weston). $150K escrow, balance in cash at closing. [File date 4/26/04.]

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