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2007: The Need for -- Ideas Working Now
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Volume 24, Issue 11, Jim Carnegie, Editor & Publisher

Wednesday Morning January 17th, 2007

Radio News ®

NAB weighs in on
ownership proceeding
"The Commission must have fair and rational rules so that local broadcasters can continue to provide the many vital, free services that all Americans have come to expect." Thus does the National Association of Broadcasters kick off its 100+ page tome on the media ownership remand. It says that the deregulatory tenor of the 1996 Telecommunications Act and the First Amendment are "...fully consistent with relaxation of the local ownership rules, which presently single out broadcasters from among the numerous competitors in today's media marketplace for substantial speech burdens." It says that the "breathtaking pace" of technology has "...rendered current broadcast ownership restrictions not just obsolete but affirmatively harmful to the public interest." Audience and revenue fragmentation have put many broadcasters, especially those in small markets, into the position of "facing grave economic difficulties." "Permitting more flexible ownership arrangements would enable struggling broadcasters to offer competitive advertising packages and to take advantage of cost-saving efficiencies and economies of scale to better position themselves in the modern marketplace, thereby supporting increasingly costly high-quality local news and public affairs programming and, ultimately, the public interest." It asks for further relaxation of local radio caps, more room for television duopolies "in markets of all sizes," and an end to broadcast-newspaper cross-ownership restrictions.

RBR observation: It is an extremely challenging time to be in the media business, as we well know from second- and, even more compellingly, first-hand experience. NAB has no choice but to fight tooth, nail and claw to keep broadcasters as unshackled as possible. And the NAB position may receive favorable reviews over as much as 60% of the office space on the FCC's 8th Floor. But for a preview of how this is likely to play on Capitol Hill, see the following article the new chairman of the House Subcommittee on Telecommunications and the Internet.

Markey: Media consolidation a "toxin to democracy"
And Democratic Commissioners Michael Copps and Jonathan Adelstein are the "dynamic duo." House Subcommittee on Telecommunications and the Internet Chairman Ed Markey (D-MA) took the coincidental occasions of the National Conference for Media Reform and Martin Luther King's birthday to note the lack of minority owners among the nation's broadcasters, among other things. Markey looks to be manning the barricades against any further media ownership deregulation. He noted that minorities make up 30% of the population, but hold only 3.26% of all broadcast licenses. He criticized the 2003 ownership dereg attempt, saying, "The FCC's plan did not create more entertainment and information sources for consumers. Nor did it enhance the ability of the broadcasting medium to meet the informational and civic needs of the communities it serves. Instead, it threatened to intensify control of information and opinion in entire cities and regions of the country." He said that "...overwhelming concentration of media power is a powerful toxin to democracy and the death knell for community control of its own media." He said this is not a one-sided issue: "Both Republicans and Democrats, liberals and conservatives, have a stake in media diversity." He thinks communications policy can be done right and pledged to "...fight to make national telecommunications policy reflect our highest aspirations as a society."

RBR observation: Just in case anyone didn't notice, these are not the words of someone who is going to sit idly by and applaud whatever comes out of the FCC in the coming two years. The Bush administration was not prompt when it came to filling the seat left vacant by Michael Powell (R) - it was over a year before Robert McDowell (R) took it - meaning that Chairman Kevin Martin was handcuffed with a deadlocked 8th Floor during the what would have been the last chance to push Republican goals through without serious challenge from Capitol Hill.

Today's the day; Will anyone bid?
It has been widely rumored on Wall Street, but never officially confirmed, that today is the due date for bids to buy Tribune Company. Lately, though, the question has not been how many bidders will step forward to offer 11-14 billion for the media company - that includes not only big market newspapers and TV stations (plus WGN-AM Chicago, its lone radio property), but also the Chicago Cubs - but rather whether anyone will bid at all. Newspaper values have been in a free-fall for some time and the Tribune TV group has its own problems in a sector that is also less than red-hot. According to the New York Times (which is not a Tribune property), billionaires Eli Broad and Ron Burkle were still deciding as recently as two days ago whether or not to submit a formal bid. That is bad news for Tribune, since it was a surprise preliminary bid from Broad and Burkle that put the auction process for the entire company back on track after the initial bids from two consortia of private equity funds came in below expectations.

Iraq policy dominates news hole
President Bush took to the airwaves last week to announce his plans going forward in Iraq, and the ensuing debate claimed by far the biggest chunk of the news hole, according to the second weekly survey from the Project for Excellence in Journalism. Combined media devoted 34% of its time/space to the story. Radio, TV and cable homed in on it with even greater intensity. Radio devoted the most attention to it, at 46%, followed by network TV (43%), cable TV (41%), newspaper (23%) and online (22%). No one issue so much as broke into double digits after that for the media as a whole. The other major stories overall were the new Congress (7%), the Somalia missile strike (5%), events in Iraq (4%) and homefront stories (2%). Out of the top ten overall stories, only one - the move of soccer star Beckham to the US - made the list, with 2% of the newshole.
| Top ten lists here |

Wall Street Media Business Report TM

Lynch pares Interep stake
Famed investor Peter Lynch has apparently tired of waiting for a turnaround by Interep. In an SEC filing, Lynch reported that he has cut his holdings to under 4% of the company's outstanding stock and will no longer file reports, since he is below the 5% threshold. Lynch had filed a report in 2004 that, as of the last day of 2003, he had acquired a stake of just under 9.4% in the radio rep firm (which has since expanded into Hispanic television as well). Lynch is best known for the time that he headed the Magellan Fund at Fidelity Investments, with an average 29.2% average annual return over his tenure. Lynch now consults Fidelity, but primarily invests his own money. Interep ended 2003 stock trading at 1.45. It has traded recently at 30 cents.

Ad Business Report TM

"Radio from the Agency View"
Bear Stearns analyst Victor Miller held a conference call on Friday with Rich Russo, Director, Radio Broadcast Services, JL Media and Kim Vasey, Senior Partner and Director of Radio, Mediaedge, CIA. This week, we'll run a bit of a series on some of the major topics discussed-from Google Audio to satellite radio PPM to HD Radio. Today: Satellite radio buys and HD Radio

How do you look at satellite radio and how do you determine the size of the audience that you're buying? Are your advertisers are they increasingly more interested?
| Read their responses |

Food Network signs Campbell's
Food Network has crafted a multi-platform integrated alliance with Campbell Soup Company in support of the season two launch of the network's primetime series, Ace of Cakes. Hosted by Chef Duff Goldman, the new season premieres 1/18. This partnership is an example of the network's new "full force" marketing strategy, joining forces with valued advertisers, such as Campbell's, a season two sponsor, to offer additional, appropriate exposure within the network's extensive off-air advertising campaigns. By leveraging key internal assets (i.e. the off-air ad campaign), utilizing new extensions beyond standard websites and on-air tactics (deko graphics, etc), the initiative meets the broad-based goals of both the advertiser and the network by engaging viewers in both the series and the brand. The multimillion dollar off-air campaign planned for Ace of Cakes Season 2 will integrate Campbell's product in off-air spots, print ads, online extensions, and radio promotions.

Media Business Report TM

Army, Ad Council use tissue boxes
to promote in-school campaign
The Ad Council and the U.S. Army have enlisted the help of AdPack USA and Zim2 to support their "Boost" public service advertising campaign designed to motivate students to stay in school and obtain a high school diploma. The partnership pairs out-of-home marketing company, AdPack USA and their branded tissue products with Zim2, a youth marketing company with an expertise in in-school campaigns. This partnership will provide a donation of thousands of tissue boxes and individual tissue packs to New York City's high schools with at risk students. The Boost campaign's (www.boostup.org) sponsored tissue boxes and packs, will feature the stories of individuals who have been helped by the campaign and will be distributed throughout classrooms and guidance offices. Zim2 has relationships with over 100,000 schools, libraries, camps, and youth service organizations across the country and addresses the increased demand for educational supplies for the youth community, teachers, administrators, schools and institutions due to constant budget cuts and inventory shortfalls.

Media Markets & Money TM

Close encounter in Albany
Regent Communications has its fifth FM and sixth radio station in the Albany-Schenectady-Troy market, now that its closed on its acquisition WNYQ-FM from Vox Radio Group. Dick Foreman of Richard A. Foreman and Associates brokered the deal which clocks in at about 4.9M. Regent's Bill Stakelin said this was another step in the corporate gameplan of building in middle and small markets.

Washington Media Business Report TM

Allard to take leave of the Senate
Saying he was going to make good on a pledge to limit his stay in Congress to two terms, Sen. Wayne Allard (R-CO) announced that he will not be seeking re-election in 2008. Allard has not been a key figure in broadcast issues in recent years, but his exit figures to ramp up an already challenging 2008 Republican senatorial election scenario. As usual, about a third of the 100 seats are on the ballot. Currently, there is a 49-49 tie between the Democrats and the Republicans in the chamber, but the Democrats move to the all-important 51 by virtue of two independents, Bernie Sanders (I-VT) and Joe Lieberman (I-CT) who caucus with them. By the luck of the draw, Republicans are defending 22 seats in 2008 to the Democrats' 11. The lack of an incumbent in Colorado will be a particular challenge. Once counted as a red state, it is well into purple territory and seemingly headed blue, particularly with the 2004 election of Ken Salazar (D-CO) to the Senate and the 2006 election of Bill Ritter as governor.

Entertainment Media Business Report TM

BusinessTalkRadio to keep
WLIR, WDRE on "cutting edge"
Good news for NYC and Long Island music fans. The NY Daily News reported BusinessTalkRadio.net will keep the Alternative/Classic Alternative format on WLIR (107.1 FM) and dance on WDRE (105.3 FM), two of the three Long Island stations the company is now buying. The third, WBON (98.5 FM), has already been switched to the business and lifestyle talk. The Daily News says BTR CEO Michael Metter "sounds most enthusiastic about WLIR and WDRE, which he sees as the flagships of a cutting-edge music radio network. He grew up on the Island with the old WDRE and WLIR at 92.7 FM and 'I always loved those stations. Every great new rock band in the world came up through WLIR. It was exciting. I want to bring that feeling back'." WLIR's transmitter will also be moving about 25 miles closer to the city from its current location in the Hamptons.

Imus signs for another five
WFAN-AM NY and WW1-syndicated morning man Don Imus has signed for another five years. The four hour daily radio show is heard on some 90 affiliates and is simulcast for three hours on MSNBC.

Internet Media Business Report TM

NetRatings says
VNU bid too low
The independent directors at NetRatings say an offer by VNU to buy out other shareholders for 16 bucks per share is too low. Actually, it turns out they told VNU that more than a month ago, but say there have been no substantive talks since. At the time it made the offer to buy out other shareholders for 225 million (10/10/06 RBR #197), VNU billed the bid as a substantial premium to the recent trading price for the stock. But as soon as the 16 bucks bid was announced, the stock price jumped past 17 bucks and has lately been around 18 - indicating that speculators are expecting VNU to come up with more cash. VNU has ruled out any auction of NetRatings, saying it is only interested in buying out other shareholders, not selling its own stake. The special committee of independent directors at NetRatings said it had done extensive diligence and analysis with its financial advisor, Lehman Brothers, and concluded that the 16 bucks offer "significantly undervalued NetRatings." An announcement by the special committee yesterday said that was communicated to VNU on December 12th and there have been no substantive talks since, nor has VNU revised its offer.

Transactions

380K KCAJ-FM Rouseau MN from Jax Broadcasting Inc. (Jack J. Swanson) to North Country Media Inc. (Joseph A. Bain). 19K earnest money, 284K cash at closing, 80K note. [File date 12/21/06.]

350K WVDA-FM Valdosta GA from AGT Communications Inc. (James Andrew Howard) to Educational Media Foundation (Richard Jenkins). 18.5K escrow, 182.5K cash at closing, three 50K notes. Buyer also loans seller 100K. Seller gets additional 50K if station is upgraded to 100 kw within seven years. [File date 12/21/06.]

Stock Talk

Three in a row for the Dow
Coming back from the three-day holiday weekend, the Dow Jones Industrial Average pushed to its third straight record close. Stock prices rose as Saudi Arabian officials said there was no need to reduce oil production in the face of falling prices. The Dow rose 27 points, or 0.2%, to 12,583.

Radio stocks joined in the celebration. The Radio Index rose 1.049, or 0.7%, to 158.689.

Radio One had the best day, with its Class D stock up 2.4% and Class A up 2.2%. Citadel rose 1.9% and Cumulus 1.8%.

Radio Stocks

**Here's how stocks fared on Tuesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		46.10	-0.31	Journal Comm.	JRN		12.90	+0.02
Beasley	BBGI		9.09	+0.09	Lincoln Natl.	LNC		66.06	+0.16
CBS CI. B	CBS		31.48	-0.14	Radio One, Cl. A	ROIA		7.14	+0.15
CBS CI. A	CBSa		31.47	-0.13	Radio One, Cl. D	ROIAK		7.17	+0.17
Citadel	CDL		10.21	+0.19	Regent	RGCI		3.14	+0.06
Clear Channel	CCU		36.23	+0.04	Saga Commun.	SGA		9.99	+0.05
Cox Radio	CXR		15.54	-0.02	Salem Comm.	SALM		11.66	+0.07
Cumulus	CMLS		10.64	+0.19	Sirius Sat. Radio	SIRI		4.15	+0.05
Disney	DIS		35.03	-0.18	Spanish Bcg.	SBSA		4.25	+0.07
Emmis	EMMS		8.65	unch	SWMX	SMWX		1.95	+0.10
Entercom	ETM		28.03	+0.19	Univision	UVN		35.79	-0.03
Entravision	EVC		8.06	+0.11	Westwood One	WON		7.16	-0.05
Fisher	FSCI		44.04	+0.37	XM Sat. Radio	XMSR		17.14	+0.02
Hearst-Argyle	HTV		26.27	+0.31	-	-	-	-	-

Bounceback

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Below the Fold

Ad Business Report
Radio from the Agency View
How do you look at satellite radio? And their replies are...

Media Markets & Money
Close encounter in Albany
Regent Communications has its fifth FM...

Entertainment Media
Business Report
BusinessTalkRadio
To keep WLIR, WDRE on "cutting edge"...

Internet Media Business Report
NetRatings says VNU bid too low
Turns out they told VNU that more than a month ago with no substantive talks since...

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Radio Media Moves

Bobo
on first
Jerry Bobo has joined First Broadcasting in the newly created position of Regional Manager. Bobo will report directly to First Broadcasting Chairman Ron Unkefer and his duties will include day to day responsibility for all station operations of KFXR-AM Dallas, WAAM-AM Ann Arbor and WVIM-FM Memphis. Bobo's 37 year radio career includes sales, group and station management, including long stints at KVIL-FM Dallas and most recently 13 years as VP & GM of KRLD-AM Dallas. He is currently Chairman of the Texas Association of Broadcasters.

Promotion in Philly
Matt Cowper has been promoted to National Sales Director of Greater Media's Philadelphia-based radio properties. In his new role, Cowper will supervise all aspects of Greater Media Philadelphia's National team and oversee Greater Media Philadelphia's rep firm, Katz Radio Group.

More News Headlines

10 fired after fatal stunt
Entercom has fired 10 employees following an on-air contest at KDND-FM Sacramento which apparently led to the death of one contestant (1/15/07 RBR #9). The Sacramento Bee reported that station management declined to identify those who were terminated, but the morning show for the station has been cancelled. Jennifer Lea Strange, age 28 and a mother of three, was found dead Friday a few hours after competing in an on air contest in which the winner drank the most water without going to the bathroom. The preliminary autopsy result was that she died from water intoxication.

Few radio winners in DuPont Columbia University Awards
Only two radio entities, both non-commercial, were among the 14 winners announced for the 2007 DuPont Columbia University Awards. National Public Radio won for its Iraq war coverage and the Cape and Island Stations of WGBH Boston, WCAI-FM and WNAN-FM, won for a series on hidden poverty in the summer playground of the wealthy. The awards will be presented at a ceremony on January 17 at Columbia University in New York.
| Here are the winners |

RBR Radar 2006

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

Ad time down slightly in December
BMO Capital Markets analyst Lee Westerfield is not surprised that the amount of commercial time on radio stations in top 10 markets declined in December after the increased political demand in November. The analyst is not convinced that radio is back to normal growth. In fact, he is predicting a decline in 2007.

RBR observation: So you are shaking your head and do not like what you read. Only people than can improve this gloom are the radio broadcasters. First key to success this year is not to be a follower by letting center companies dictate what direction or course of action radio will take. If anyone learned a valuable lesson on 'Less is More' and following an assumed leader well LIM is the prime example.
01/16/07 RBR #10

Executive Comment
Lund stands firm on LIM research
Regarding the "response" of Brainerd Communicators (a PR firm in Manhattan) in RBR (1/10/07 RBR #6) on behalf of Clear Channel in response to comments I made in your first issue this year; Lund Media Research and Lund Consultants stand by those comments. Enlarged spot loads and more 60s in many markets can be easily documented by listening to Clear Channel stations or reviewing documentation from Media Monitors or Media Base (both firms, coincidentally, are owned by Clear Channel).]

Publisher observation: Everyone give John Lund a big pat on the back for his research and standing firm. Where as Clear Channel executives from the Top down Can Not even speak for themselves they go thru a PR firm. In 24 years RBR has never witnessed such poor dialogue and communications from a radio company or any media company. To some inside Clear Channel, Naples is truly calling.
01/15/07 RBR #9

Minority buyers step up,
but funding is issue
Three-day conference for minority and women entrepreneurs to find out how they can best position themselves to buy the radio and TV assets that Clear Channel has up for sale. Approximately 60 separate potential buyers were in among the more than 120 attendees.
01/15/07 RBR #9

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