Radio News ®

Hardball DoD bill: Decency hitches a ride
You could say that Sen. Sam Brownback (R-KS) was successful in his bid to attach an amendment to up the ante on indecent broadcasts to a defense authorization bill - - he got 99 votes. That's everybody in the Senate with the exception of John Breaux (D-LA). If it survives conference with the House intact, the maximum single-shot fine will go to $275K. A ceiling of $3M is set for a continuing violation. "The Senate Commerce Committee has found that the current fines do not deter indecent broadcast because they are merely the cost of doing business for large media companies," it says in the findings portion of the amendment. "Therefore, in order to prevent the continued rise of indecency violations, the FCC's authority for indecency fines should be increased and further media consolidation should be prevented." | More... |

6/2/03 FCC ruling undone?
The Brownback measure did not go unamended, and it was a major victory for Sen. Ernest Hollings (D-SC), who was able to forward his long-sought measure attacking gratuitous broadcast violence, and an even bigger victory for Sen. Byron Dorgan. The Dorgan amendment states that the FCC 6/2/03 ownership ruling "...shall be invalid and without legal effect." Sen. Olympia Snowe (R-ME) is listed as co-sponsor of Dorgan's amendment to the amendment undoing the FCC's 6/2/03 ruling. RBR observation: This passed by unanimous consent. Everyone in the Senate is at least tacitly agreeing that media consolidation is bad. The bill blames consolidation for increased indecency broadcasts. It is also an extreme departure from the Dorgan amendment as presented in Committee. In essence, it is the Dorgan-Lott Resolution of Disapproval offered up under a new brand name. So, anything can happen. All we can say is - fasten your seat belt.
| More... | RBR Observation |

NAB reacts to Senate action
The response of the National Association of Broadcasters to the Senate actions on broadcast indecency, violence and ownership was swift and negative. President/CEO Eddie Fritts said, "NAB does not support the amendment passed today by the Senate. We continue to believe that voluntary industry initiatives that have been taken by a number of broadcasters thus far are far preferable to government regulation when dealing with programming issues. We also believe that most Americans would acknowledge that broadcast programming is considerably less explicit in terms of violence and sexual content than that which is routinely found on cable and satellite channels."

Clear Channel pulls out of pacing reports
Clear Channel, the largest radio station group in history, has elected to withdraw from the weekly industry sales pacing reports produced by accounting firm Miller, Kaplan, Arase & Co., calling it an anachronistic practice. Clear Channel says it will, however, continue to report actual monthly sales. President of CC Radio John Hogan said, ""As an industry, we must discontinue practices created for a different time and, instead, focus on consistent, reliable metrics that reflect the true value of our business. Weekly pacings are no longer a meaningful or accurate measure of the performance and long-term value of radio advertising." "Miller Kaplan's weekly data does not help us run our business," he continued, "creates volatility in the financial markets by inviting exaggerated interpretations of normal sales cycles, and puts the radio industry at a competitive disadvantage to other media sectors who focus on advertisers and investors on longer-term value." Another CC complaint was the fact that only 32 of its 250 radio markets were included in the MKA&C universe. The company also says that the move is consistent with competing media. Television and newspapers report monthly data, and cable companies limit their reporting to a quarterly basis.
Editor's note: A call was made to Miller Kaplan's George Nadel Rivin but he was out of the office until Monday and George is aware of the pull out. The tone in which we were told was one unhappy camper. Some where it reminds us of the once exclusive and many moons deceased RBR-Miller Kaplan pacing report. We heard every reason or excuse from a need to know basis, not giving Wall Street short trades any edge or that business coming in at last minute to get an even report. Bottom line - nobody wants anyone to know anything more than they need to know or want you to know. So, just read RBR & TVBR because it tells you the reasons every morning.

Coen remains bullish on ad growth
Six months into 2004, Universal-McCann ad guru Bob Coen is even more bullish on advertising growth for this year than he was back in December. Updating his forecast yesterday in New York, Coen raised his projections for total ad spending this year and even hung tough with his radio growth numbers in the face of recent downward revisions by Wall Street analysts. "The recession is over, the recovery is continuing," Coen said. Reflecting on the just-completed upfront, he said it provided evidence that advertisers are coming back and TV is raising prices. And as political spending and the Olympics really kick in, he expects to see growth patterns similar to 2002, with the strongest growth in the final two quarters of the year. Although there has been some hesitancy by local merchants to make heavy advertising commitments yet, Coen expects to see competition pick up as the economic recovery continues. When local retailers see their competitors advertising, they will respond and that will improve the outlook for local TV and radio. Because of that, Coen remains confident that local radio growth will hit his target of 6% growth this year, despite a slow start. He's increased his forecast for local TV, which he now expects to grow by 8% this year, rather than his original forecast number of 7%. Here's his updated forecast by medium. | Chart |

FCC collars a mountaineering buccaneer
Mark A. Clay was caught operating an unlicensed FM station on 98.1 mHz from a site in Huntington WV, part of the Huntington-Ashland KY Arbitron market. The action is a departure for the FCC, in that the infraction is must closer to the Commission's Washington digs, and the terrain much rougher, than is the case for the Commission's more fertile airwaves in terms of pirates harvested. those airwaves, of course, are located in the great state of Florida. Despite being a repeat offender - - "...Clay has continued to operate on the subject frequency without a license, notwithstanding previous inspections...," wrote Commission Enforcement Bureau Chief David Solomon, Clay was nevertheless hit with a standard, one-time $10K fine. Even that plank was deemed too high for the red-handed buc to pay - - Clay produced tax returns for 2000, 2001 and 2002 and was able to get his total fine reduced to $1K.

Adbiz ©

GE whiz: You can bank on
expanded consumer services
General Electric, parent company of NBC Television Network, may well be looking to use its media assets to the advantage of its consumer finance division. In a move of global scope, it is pulling all such operations together under an umbrella to be known as GE Money. It'll offer mortgages, personal loans, and credit cards. It's already started overseas and is expected to launch in the US next year. RBR observation: These guys aren't exactly the first ones into the pool. They're going to have to part with plenty of green if they expect to see even more green flow back into their coffers. Sales gang, forewarned is forearmed!

Joe Uva: Shepherding $19 billion
in annual ad spend Part III
Joe Uva is President & CEO of Omnicom's OMD Worldwide, overseeing operations in 80 offices in 50+ countries. He's in charge of a whopping $19.3 billion global ad dollars spent yearly-$8.3 billion here in the US. Clients include McDonald's, Visa, PepsiCo, Office Depot, Nissan, Hershey, Johnson & Johnson, Epson, ABC-TV, State Farm, and TAP Pharmaceuticals' Prevacid. Here, Joe gives RBR more of his take on the media biz-the pros, cons, problems and solutions. | More... |

Media, Markets & Money tm

Washington Beat

GM Talkback

What have been your strategies for increasing revenue, reducing expenses, and attracting and maintaining quality personnel?
Melody Spann-Cooper, Midway Broadcasting's WVON-AM Chicago
Despite being in a down economy, WVON maintained its market share last year and '03 revenues almost mirrored '02, showing only a slight increase. Considering that we were able to maintain market share, I saw no need to lay off personnel or adjust spending, but made the decision to ride out the storm hoping that 04 forecasting would offer an improvement. Within the first month, we have increased revenues by 25% over January '03, which proves that I made the right decision. As general manager, I choose not to run my operation like the stock market, making instantaneous decisions because of a volatile market. If you have a good solid operation, good employees and faith in your product, rash decisions based on what everyone else in the market is doing relative to employee layoffs and budget cuts are not your answer. However I do encourage management to take a look at infrastructure in terms of employees. Because of layoffs across the board, especially as a result of media consolidation there is a lot of available talent at bargain prices. Now is the time to rid your operation of unmotivated and mediocre staff.

Programming

Lollapalooza gets the axe
The famed Alternative Rock concert series kicked off and revived by Perry Farrell is off life support due to lack of support - - ticket sales just aren't there despite what organizers thought was a solid talent lineup composed of groups popular in the 80s. It was scheduled to hit the road in about three weeks. RBR observation: Not good news if your station's pllaylist relies on a hefty chunk of 80s gold.

Branding

Ken Rye, Advertising Account Executive,
The Home Depot, Part III
Ken is currently transitioning into becoming a marketing manager. In terms of his day-to-day responsibilities, he manages the advertising budgets, strategy and execution for key departments within the company: paint, decor, plumbing, professional contracting and installation services. From point to point, that includes everything from research to strategic planning, competitive analysis, integrated campaign planning, under-integrated campaign planning (everything from mass-advertising to direct marketing, multicultural marketing and Interactive marketing where applicable). Here, Ken talks a bit about the daily grind and media usage. | More... |

Transactions

$78.45M KRTS-FM Houston (Seabrook TX) from KRTS Inc. (M.S. Stude) to Radio One Licenses LLLC, a subsidiary of Radio One Inc. (Catherine L. Hughes, Alfred C. Liggins et al). $3,622,500 escrow, balance in cash at closing. Superduopoly with KBXX-FM, KMJQ-FM. [File date 5/28/04.]

$28M WNDS-TV Boston (Derry NH) from CTV of Derry Inc. (Gerald Q. Nash) to Shootingstar Broadcasting of New England LLC (Robert Emmert, Diane Sutter, Brian McNeil). $3.1M escrow, balance in cash at closing. Station is independent on Channel 50. [File date 5/28/04.]

Stock Talk

Radio Stocks