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Welcome to RBR's Daily Epaper
Volume 22, Issue 111, Jim Carnegie, Editor & Publisher
Tuesday Morning June 7th, 2005

Radio News®

Moonves: Infinity to spin fewer stations
Viacom Co-President/COO Les Moonves yesterday confirmed what's already been pretty well known in the radio industry - - that Infinity has cut back on plans to sell most of its radio stations outside the top 20 markets. "We're still looking to sell some of the smaller radio stations. Possibly we're not going to sell quite as many as we initially talked about in the first place, because we'll wait to see what happens with the split, where they all fit in. But we're currently having some conversations about getting rid of some of the smaller radio stations right now," Moonves told a Deutsche Bank Securities conference in New York. Earlier in his presentation, Moonves was upbeat about the future for Viacom's radio and outdoor businesses, which he admitted are currently low single digit growth businesses. "Hopefully they get to mid single digit growth in the near future. I think Joel [Hollander] is doing a terrific job. I think we're changing the formats at a number of stations. We're investing a little bit of money in promotion and programming. We've been running some experiments in terms of promotion. We've done a new format, as you've all heard about loudly here in New York, in the 'Jack' format. God, it seemed like we had shot somebody when we changed the WCBS format. The 'Jack' format is something that we've used in LA and a few other markets. In LA, it went from 15th to third in total listeners in about a six-month period of time, so obviously this is a format that works exceedingly well. It's sort of like your own iPod. It does not have DJs. It has 1,200 of your top songs and the format has worked extraordinarily well. We've also, as I said, put promotion dollars in eight of our stations - - six of them have seen double digit growth. So, I'm optimistic that if we look at radio realistically, as a smaller growth business, it's still a great business that's producing a ton of cash and as we look toward the potential split, cash is a very good thing - - I will take it any day of the week," Moonves said.

RBR observation: Yes, we noted that Moonves was careful to say "if" the split happens several times during his presentation. You've probably read, as we have, speculation that Viacom's management and directors are rethinking whether splitting the company is a good idea, since the two smaller entities could be more vulnerable to competitive attacks. The board is expected to vote on the idea later this month and, if they approve a split, shareholders will vote a few months later. The bottom line is that Sumner Redstone has absolute voting control of Viacom - - and will continue to have absolute voting control of both post-split companies. If he thinks the split is a good idea, it will happen. If not, it won't. No one else's opinion counts.

Stocks on a roll - - a downhill roll
If you're an active investor in broadcast stocks, 2005 has not been a happy time. Radio stocks are an out of favor sector. Unless you somehow managed to divine which four radio stocks, out of the 29 in our daily list, would gain so far this year, you've lost money. In all fairness, one of those four isn't much of a radio stock, since Gaylord is now primarily a hotel company and only owns one station, with Cumulus selling its inventory. And Arbitron doesn't own any radio stations, but rather it sells ratings data to most major radio station owners. So, the only real radio stocks which posted gains for the first five months of this year were Regent (a pure play radio company) and Fisher (TV, radio and a bit of real estate). Even the formerly high-flying satellite radio companies have had their wings clipped this year. The stock prices of both Sirius and XM are down double digits so far this year. The RBR Radio Index was down 12.29% through May and only 16 radio stocks did better than that. | Here's the full list |

Jack gets a Vice President
Who knows Jack? At Infinity Broadcasting, it's Kurt Johnson. He programmed the company's first "Jack" station in Dallas and has now been named Vice President of Jack Programming for the entire company, including the two latest launches in New York and Chicago (6/6/05 RBR #110). "As Program Director of our first Jack station, Kurt has been instrumental in the format's adoption at several Infinity stations across the country. He has successfully guided KJKK to a position of leadership in the market where it now ranks among the most listened stations in Dallas. Kurt's first-hand experience will be invaluable to Infinity as we continue to evolve our eight Jack stations," said Rob Barnett, President, Programming, Infinity Broadcasting. While adding the new duties, Johnson will continue to serve as Vice President, Programming, Infinity Dallas and Program Director of KJKK-FM and KOAI-FM Dallas. Meanwhile, the former Oldies stations that the new Jacks replaced in New York and Chicago are continuing to play Oldies online at and, respectively, but without any announcers. We asked yesterday what personalities, if any, would be staying on, but Infinity VP of Communications Karen Mateo said "We're still in discussions going forward." The big names now off the air included "Cousin Brucie" Morrow, Harry Harrison, former "Monkee" Micky Dolenz and Bill Brown in New York and Dick Biondi, Fred Winston, Greg Brown and Paul Perry in Chicago. Mateo also said there is as yet no timetable for bringing both Oldies stations back to life on-air via HD Radio multicasting.

Walsh retiring from Arbitron
After 41 years with Arbitron and its predecessor, Bill Walsh has announced plans to retire as the company's Executive VP and Chief Financial Officer. In a brief conference call with Wall Street analysts, Walsh pronounced Arbitron "in great shape" and said he would stay on until around the end of the year to help with the transition to his successor. CEO Steve Morris didn't disclose when Walsh, who's 59, informed him of his decision to retire, but Morris said an executive search firm has already been engaged and he expects to announce the selection of a new CFO within a couple of months.

Another vote cast for piecemeal approach
Financial Times, on its website, spent some virtual ink looking at the current situation in the ongoing broadcast regulation battle. Like many other recent speculative pieces, it expects that new FCC Chair Kevin Martin will go about the task item by item, rather than go for one big regulatory package as did his predecessor Michael Powell. quoted Legg Mason's Blair Levin, who predicts that the first item to be teed up will be broadcast/newspaper crossownership. The Third Circuit, in remanding that rulemaking back to the FCC, stated that it had no problem with the concept of common ownership of newspapers and broadcast interests in a single local market. Indeed, it recognized some of the studies presented into the body of evidence which stated that often such combinations produce the finest local news in those markets where they exist. However, it had no confidence in the numerical caps the FCC attached to the eased cross-ownership restrictions.

Salem ups its guidance
Salem Communications is raising expectations. The Religious radio specialist says Q2 revenues should be 51.1-51.6 million, up 200K from the range it give The Street last month. Salem says it continues to project that Q2 broadcast revenue growth will be in the mid to high single digits and same station growth in the mid single digits.


Kathy Crawford spells out LPM impact
As President/Local Broadcast at MindShare, Kathy Crawford, has long been pressing for more and better ratings data in both TV and radio. As we reported yesterday, she sees the 28-day delay for Local People Meters in Washington, DC and Philadelphia as pretty insignificant, but she does see LPM implementation as very significant. The broadcasters who complained about LPMs in a letter to Nielsen CEO Susan Whiting, leading to that temporary delay, will get no support from her. | Here's her take on the LPM dust-up |

Coca-Cola and ABC strike Academy Awards deal
Beginning in March 2006, seven commercials featuring Diet Coke and other Coca-Cola brands will air during the biggest entertainment program on television. The annual broadcast of the Academy Awards reaches an average audience of 42 million people, second only to the Super Bowl in total viewership. "Our brands, especially Diet Coke, have been synonymous with entertainment and style for decades, so our association with the Academy Awards telecast makes perfect sense," said Katie Bayne, SVP/Coca-Cola Brands. "Today, more than ever, people are passionate about the world of film. By refreshing moviegoers in theaters across the country, featuring celebrities in advertising, and participating in the Academy Awards telecast, we offer people multiple ways to enjoy the entertainment lifestyle." The sponsorship of the Oscars adds to other entertainment and sports properties that Coca-Cola will activate in 2006, including the Olympic Winter Games, the World Cup, American Idol, NCAA, NBA, NASCAR, and NHRA.

Online ad spend hits 2.8 billion in Q1
Internet ad spend continued its uphill climb in Q1, expanding for the ninth straight quarter, according to The Interactive Advertising Bureau and PricewaterhouseCoopers. The IAB noted the 2.8 billion Q1 estimate is the highest ever reported for a quarter, representing a 26% increase from last year's Q1. The report also believes the industry expanded 4.3% from the Q4 '04, which traditionally attracts the highest ad spending from holiday promotions. The IAB and PwC attributed the increased spending to a growing online audience that is appearing more attractive than the fragmented TV landscape and the growth of broadband.

Bank of America to sponsor
"HD GameNights"

The Boston Red Sox, Showcase Cinemas and NESN announced Bank of America-the Official Bank of Baseball and the Official Bank of the Boston Red Sox-has agreed to become the primary sponsor for their high-definition in-theatre broadcasts of Red Sox games, and simultaneously added four theatres and two Sox-Yankee games to the schedule of GameNight broadcasts. "HD GameNight presented by Bank of America" will debut today, as the Red Sox take on the defending National League Champion St. Louis Cardinals. The HD GameNight broadcasts now appear in nine cities and sixteen screens throughout New England.

NBC reduces CPM rates by 3%
As predicted, NBC has reportedly cut its upfront rates, in some cases as much as 3% less (most deals were at between flat and minus 2%). The move reverses a decade-old trend that saw the network pricing itself above the other broadcast networks and commanding premium rates. With ABC scoring CPM increases of 4% to 6% and agencies providing a lukewarm reception at NBC's upfront presentations, the Peacock had no choice after holding the line for some two weeks.

Radio & Television Business Report

Coming in the July issue:
Media Business Report:
"People Make the Difference" -- We've asked our readers to give recognition to the people that are making a difference in today's business environment.
GM Talkback:
Who in your company or stations deserves
a pat on the back and why?
Carat Americas CEO David Verklin: "Mastering a digital future" from advertising in a digital convergence world to improving metrics to the TV upfront and more.
Special Report:
Part II: "Going Private" - time to loose that chain around your neck. We show you how.
Media Markets & Money:
Mid Year Report -- "Going independent": Not many have taken this road, but in recent years Post-Newsweek's WJXT-TV Jacksonville, FL and Young Broadcasting's KRON-TV San Francisco have gone from being major network affiliates to being independent. RBR/TVBR looks at how they did it.

Reserve your Ad Marketing Space today. Advertising space is limited, contact:
June Barnes [email protected] -- or -- Jim Carnegie [email protected]

Media Markets & MoneyTM
Bustos sounds off in Puget Sound
Amador Bustos has found an FM to pair up with KDDS-AM in Seattle. Bustos Media Enterprises is paying 20 million to add KAYO-FM Elma, WA to its fast-growing group targeting Hispanic audiences. Kalil & Co., which brokered the deal, says the seller, Puget Sound Broadcasting is owned by Gregory Smith and Edward Hardy. "We are very proud to bring this beautiful Northwest City its first full-time Spanish language FM. We made such an impact in Seattle with our AM (KDDS 1210) which we recently put on the air that we decided to get a sister FM station. With this purchase, we will grow and protect our market share, and continue to execute on our business plan to build a strong national platform of Spanish-language stations in key US markets," said Bustos. An LMA begins tomorrow to replace the Country format with "La GranD," Bustos' flagship Regional Mexican format.

RBR observation: Seattle-Tacoma may be only 6.2% Hispanic, but, like in so many markets, that number is growing. KAYO (99.3 mHz) is a rimshotter from southwest of Seattle, but it is a Class C, so a big signal, and an application filed last week for a new transmitter site should dramatically improve its coverage of the major population centers.

Clear Channel spins another
With the official start of summer about two weeks away, radio giant Clear Channel seems to be in spring cleaning mode. The latest dust and sweep job on the station portfolio is WNSX-FM in Winter Harbor ME, on the outskirts of Bangor. It's being sold to Stony Creek Broadcasting, owned by Mark Osborne and Natalie Cox, for 800K cash. Although CCU lists the station as part of its Bangor cluster, the town of Winter Harbor is on the Atlantic coast, a significant distance from the market's land-locked title town. Clear Channel will still have an AM and five FMs in the market.

Close encounter in Fresno
Wilks Broadcasting has officially increased its sphere of operations more fittingly than most - - according to broker Michael Bergner, it has closed on its 25M acquisition of a trio of Mondosphere FMs in the Fresno market. Jeff Wilks now has the keys to KJFX-FM, KFRR-FM and KUUS-FM. The seller is headed by Clifford Burnstein.

Radio One buying back shares
Radio One is the latest broadcasting company to announce plans to use its free cash flow to buy back its own stock. The company's directors have authorized a buyback of up to 150 million bucks worth of Radio One's Class A and Class D stock over the next 18 months. ""We are pleased to announce the authorization of this stock repurchase program, which we believe reflects the financial strength of the Company, our belief that our current stock price does not adequately reflect the fundamental value inherent in our Company and the fact that the M&A environment is not particularly attractive at this time. We believe that this stock repurchase program is in our stockholders' best interests, and we intend to execute it in such a way that we will not overly burden our balance sheet or be unable to continue to maintain our leverage in our 'comfort zone' of 4-6x EBITDA," said CFO Scott Royster.

Washington Beat
What Tropicana cannotta saya
Drinking Tropicana orange juice may be a good thing, but it has simply not been demonstrated that it's as good as the company claimed in its 2002-2004 "Healthy Heart" campaign. The company made very specific claims about the juice's ability to lower blood pressure, improve cholesterol levels and improve blood quality. According to the Federal Trade Commission, the claims were unsubstantiated, and claims of clinical support for them were false. FTC's Lydia Barnes said, "Orange juice contains many nutrients important to a healthy diet, and advertising can be an important source of information about health benefits of foods. But it is essential that such advertising be truthful. In this case, Tropicana's claims went well beyond its scientific support." Tropicana got off relatively easy. Under terms of a consent agreement, it is "...prohibited from making similar health-related claims in the future unless they can be substantiated by reliable scientific evidence."

2M WSIG-FM Mount Jackson VA from Force 5 Communications LLC (Jeffrey D. Shapiro) to Vox Communications Group LP (Bruce G. Danziger, Burton K. Barlow). 100K escrow, balance in cash at closing. LMA until closing. [File date 5/2/05.]

450K KOZQ-AM/KFBD-FM Waynesville MO from Fidelity Broadcasting Inc. (John Colbert et al) to Viper Communications Inc. (Kenneth W. Kuenzie, Dennis J. Klautzer). Cash. Duopoly with KRMS AM & FM Osage Beach MO (with KFBD-FM only). [File date 5/2/05.]

26K KYLW-AM CP Billings MT (Lockwood MT) from Palmetto Radio Group Inc. (Edward F. Seeger) to Sun Mountain Inc. (Richard Solberg). Cash. Duopoly with KBSR-AM Laurel MT. LMA 5/1/05 @ 1 dollar/month. [File date 5/2/05.]

Stock Talk
Stocks end barely higher
There wasn't much in the way of economic news on Monday, but stocks moved up a tiny bit anyway. The Dow Industrials gained six points to close at 10,467.

Radio stocks were a bit stronger than the blue chips. The Radio Index rose 1.778, or 0.9%, to 205.971. Radio One rose after announcing a big stock buyback, with its Class A stock up 2.5% and Class D gaining 3.1%. Regent rose 2.5%.

Radio Stocks

Here's how stocks fared on Monday

Company Symbol Close Change Company Symbol Close Change













Journal Comm.




Citadel CDL
12.17 +0.22

Radio One, Cl. A




Clear Channel




Radio One, Cl. D




Cox Radio












Saga Commun.








Salem Comm.








Sirius Sat. Radio








Spanish Bcg.
















Viacom, Cl. A








Viacom, Cl. B








Westwood One








XM Sat. Radio




International Bcg.










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The recent announcements by Infinity to end oldies on their New York and Chicago stations (6/6/05 RBR #110) points out another tried-and-trusted format is on the way out, but does it really have to happen? Unquestionably, millions of people in two of the country's most populated markets are wondering that right now.
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Upped & Tapped

Annie Hoffman joins Chic Sports Radio
Emmy-nominated Annie Hoffman has joined "Chic Sports Radio," heard on the Sports Byline USA network on Friday nights at 9:00pm (ET), on the armed forces network and on the net at The list of celebs she's interviewed includes former President George Bush, Bob Hope, Denzel Washington, Jerry Seinfeld, David Letterman, Shaquille O'Neal, Kareem Abdul-Jabbar, John McEnroe, Jack Nicklaus, Joe Montana, Serena Williams, Oscar de la Hoya, Dan Marino, Evander Holyfield, George Steinbrenner, Tom Hanks and Paul Newman. But she's no name-dropper...

Stations for Sale

Santa Fe Market #237 FM
New market FM entrant ready to go! Santa Fe is a unique and rich market with a great opportunity for an aggressive, innovative operator!
Cliff at Clifton Gardiner & Co
[email protected]

More News Headlines

RBR Radar 2005
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Jack in the city
Infinity shocked New Yorkers by blowing up long-established Oldies outlet WCBS-FM to launch a "Jack" format with a playlist of more than 1,200 songs. ew York Post called the format change a "bloodbath."
RBR observation: WCBS-FM billed 34.1 million last year, so Infinity is blowing up a big revenue center to go in a new direction. Mel Phillips, who was once at WCBS-FM questions whether a format with 1,200 songs can really counter the threats from iPods and satellite radio, which have 10,000-plus. And he says it will be "extremely hard" for the new Jack station to identify and qualify the type of music it's playing. "You just can't broad-brush the music as everything from the 50s to the 90s. My question is what kind of music from the 50s to the 90s ? Publisher note: Make all the excuses you want but in New York City it is so big oldies will work and can remain viable and grow with a progressive program director (PD) that has the passion for the content and presentation and now no competition. 710-AM WOR, Buckley Broadcasting. should be the new home of current and future legends with live entertainment that takes on the meaning of live and community involvement. Plus a built in 3.1 and 31 million bucks. Call Joe McCoy and Mel Phillips.
06/06/05 RBR #110

WCBS-FM is now Jack,
we hear from Joe
Joe McCoyFormer WCBS-FM - Surprising? No. When the Sales Department continually complains to the GM that they are having a problem selling it because of low 25-54 ratings you expect a change is going to come. GM's and Upper Management do not come from Programming. They have no attachment to the audience or the format, just the bottom line. I guess the question is why change a station that makes millions of dollars when you can change one that has been treading water for 3 years? Namely WNEW-FM. 06/06/05 RBR #110

Groups held the line in May
Harris Nesbitt analyst Lee Westerfield says the results of his monthly Radio Airtime Monitor for May startled him - - groups slashed commercial air time by nearly 10%, yet revenues still improved by an estimated 2-3%. And he says it's not just Clear Channel that's cutting back. "At 12.6 minutes per hour, Infinity was down 4.1%, but continues to run the most commercial time across its entire group of stations in the Top 10 markets. RBR observation: While last week's spot load analysis from Wachovia that got noses out of joint at Infinity compared month-to-month spot loads since January, Harris Nesbitt's Westerfield is comparing each month of 2005 against the same month of 2004. Thus, his numbers do show that Infinity has been reducing inventory for some time, although it still carries heavier spot loads than many of its competitors.
06/06/05 RBR #110

Infinity says it's already
reduced inventory
Aren't taking kindly to a Wachovia Securities report that the Viacom radio arm has failed to cut inventory on its stations. Rather than promising to cut spot loads on a third of its stations, the company says it's already made the inventory cuts. Infinity CEO Joel Hollander said in December that the radio group had reduced spot loads at 56 stations but without any fanfare like the Less is More announcement by Clear Channel. In fact, he told RBR months earlier that Infinity was cutting spot loads, saying "We don't need to put out a press release for something we've been doing for the last year." 06/03/05 RBR #109

Buyers chime in on LPM letter
Broadcasters may be complaining about Local People Meters, but we're also hearing from major ad buyers who think the TV executives are off base. Jon Mandel, Chairman/MediaCom US and Chief Global Buying Officer MediaCom Worldwide -"The thing is, the LPM is so far superior to what they have now that it's better off. The problem is they (TV) haven't figured out how to adjust their business to it." - Pat McNew, PHD's EVP, LMN Director of Operations "PHD believes the people meter is a superior method for measuring television audiences and we support its use in local markets. We believe accreditation is important, and we expect that Nielsen will continue to work through any issues to meet MRC standards." Ray Warren, Managing Director, OMD, tells RBR/TVBR Nielsen is to blame for some of the problems and disagreements we're seeing with the LPM rollout, but we can't turn back now." 06/03/05 RBR #109

Seeking Challenge
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Mergers & Acquisitions
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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!

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