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Welcome to RBR's Daily Epaper
Volume 22, Issue 130, Jim Carnegie, Editor & Publisher
Tuesday Morning July 5th, 2005

Radio News®

Radio stocks still soft at mid year
Broadcasting stocks improved ever so slightly in the past month, but the market is still pretty dismal. Through the first six months of 2005, only three radio stocks have posted gains-Gaylord (which is hardly a radio company, since the hotel chain owns a single AM that's JSA'd to Cumulus), Regent (performing well with its small market focus) and Arbitron (which isn't actually a radio company, but makes its money from radio companies). Even those Wall Street darlings of satellite radio, XM and Sirius, were down double digits for the first half of 2005. We don't expect to see any dramatic improvement until the economy really kicks into gear and advertising demand improves a lot.

RBR observation: The field of dreams concept has finally ended and now for the balance of this year it will be interesting to see which CEO begins to pay attention to front line management. The first issue noticed is there are not too many CEO's with front line battle or management and programming experience. That is why we see so many quick knee jerk reactions to blowing up formats, flushing local brand identities along with their producing dollars in ad revenue. Best example that will be at the top of this format demolition of 2005 is the imploding of Oldies - WCBS-FM, NYC for who knows Jack. And what is next on the format horizon - we speculate with tongue in cheek - new format will be Jill. | Read'em and weep Chart |

Where, oh where is the indecency?
Sherlock Holmes famously noted in a murder case that his relatively low-wattage friend Dr. Watson had failed to take into account the curious matter of the barking dog. But there was no report of a dog barking, noted Watson. That's what was curious, explained Holmes of the dog, which had a hair-trigger bark. It showed that the murderer was clearly a friend of the dog. What to make, then, of the silence of the FCC in 2005 when it comes to indecency fines? At least one watchdog, the Center for Public Integrity, says that the quiet, and the zero-dollar fine level, is a result of the massive amount of fines and settlement agreements which hit the books in 2004. The chilling effect on program content many predicted would seem to be all present and accounted for. CPI puts it in stark relief. From 1990-2003, the FCC proposed 69 indecency fines for a total just under 2.9M. It also entered into a pair of consent agreements for 1.82M, for a total 14-year indecency penalty of just a hair under 4.72M. In 2004 alone, it proposed 12 fines for about 3.66M, and entered into three consent decrees for 5.55M, for a total of 9.21M. In one year, it came close to doubling the indecency results of the prior 14 years.

RBR observation: And all this without any action on the Upton/Brownback bills to drastically increase indecency fines. Where are those bills, anyway? We haven't heard a peep about them for months now, despite the fact that whenever they've actually been on the table they've seemed a mortal lock to take the fastest possible track to the desk of George W. Bush. Could it be that they will simply wither and rot on the legislative vine again, as they did in 2004? Stay tuned...

Time decision doesn't sit with Times
The New York Times expressed its disappointment with the decision of Time magazine to supply reporter Matt Cooper's documents to a federal prosecutor in the case of the Valerie Plame outing. A New York Times reporter, Judith Miller, is also in jeopardy. An article in NYT quoted Publisher Arthur Sulzberger Jr., who said, "We are deeply disappointed by Time Inc.'s decision to deliver the subpoenaed records. We faced similar pressures in 1978 when both our reporter Myron Farber and the Times Company were held in contempt of court for refusing to provide the names of confidential sources. Mr. Farber served 40 days in jail and we were forced to pay significant fines." NYT says it paid 286K in connection with the case, which involved a New Jersey murder trial. New Jersey subsequently tightened its shield laws to better protect the press, and in 1982, both Farber and NYT were pardoned by then-Gov. Brendan T. Byrne, with 101K being returned to the paper.

RBR observation: Many are hoping that the current situation will results in similar legislative action at the federal level. At least 34 state AGs support such a move, and bipartisan efforts to enact a federal shield law are under way in both houses of Congress.

House puts down pay-for-say
The Transportation, Treasury, HUD Appropriations Bill for FY 2006 includes an amendment prohibiting the use of "writers and broadcasters as well as public relations firms to favorably report on Administration policies and pass it off as authentic objective news," according to Rep. Maurice Hinchey (D-NY), who spearheaded the legislation. The amendment was attached to the appropriations item without objection. "The passage of this amendment is a critical victory for the American people who, as a result of these secret government contracts with writers, broadcasters and public relations specialists, have been unable to determine whether they are receiving real objective news or government-sponsored propaganda," said Hinchey. Hinchey went on to say that the Bush administration has spent 200M with PR firm Rendon Group - - 100K monthly beginning sometime after 9/11/01 - - to spread anti-Saddam Hussein propaganda worldwide, and effort he said managed to cause confusion in the US regarding Hussein's involvement in the events of that day. "American taxpayers should not be footing the bill for the Bush or any other administration to manipulate the media in order to advance its agenda," said Hinchey.

SoFla pirate nabbed
North Miami Beach, FL police arrested an operator of an illegal pirate radio station in Miami-Dade County, Florida on June 23rd, seizing and impounding the station's equipment under Florida Statute 877.27. The illegal station transmitted on 91.7 MHz, causing interference to in-market co-channel WMKL-FM (Call Communications Group). According to the police report, the pirate station operated a KA-1000 FM transmitter feeding a high-gain, 4-bay FM antenna attached to a tower on top of a two-story commercial office building. The pirate station operated unattended using Windows Media Player running on a PC with a DSL connection. The transmitter was turned on every evening using a timing switch, which would turn off each morning. The transmission completely eliminated WMKL's signal (City of License is Key Largo, FL) throughout northern Miami-Dade County. After receiving complaints from listeners, WMKL staff located the pirate station in less than 30 minutes using a pocket radio. A complaint was filed with the FCC. Station staff then contacted detectives with the North Miami Beach Police Department who immediately responded by investigating the antenna and building. Detectives obtained a search warrant from the Assistant State Attorney's office which was then signed by a judge. Detectives waited at the pirate station location around the approximate time the illegal station would begin transmission. The detectives presented the search warrant and then entered the office and discovered the broadcasting equipment operating, unattended. The detectives then lowered the volume on the audio mixer and verified that audio disappeared from the vehicle radios. The detectives then began surveillance on the illegal station to see if somebody would come by to fix the audio. Approximately, 90 minutes later, an individual arrived to unlock the office and was arrested and later transported to the Miami-Dade County Jail. All of the illegal station's equipment was seized and impounded by police. WMKL's northern Miami-Dade county signal reception immediately reappeared, in clear stereo.

Quote us on SCOTUS, Part 4
We continue with more commentary from interested parties regarding the Supreme Court's Monday triple play involving Brand X, Grokster and confidential source shielding. Today: Ben Scott of Free Press and Tom Giovanetti of IPI on Brand X, plus Sen. Stevens/Innouye and Warner Music Group's Edgar Bronfman, Jr. on Grokster.
| Here are more SCOTUS comments |


The Gay Ad Council launches
W. Everett Hauck, III a longtime lesbian, gay, bisexual, and transgender advocate announced today the formation of a non-profit organization called, EQualitySource. The organization will be the home of the Gay Ad Council, assisting organizations with communication programs and PSAs to educate Americans on the value of equality towards ending discrimination. "I applaud Brian Graden (President of MTV Networks, Inc. / LOGO) on providing programming that many LGBT people want to see," says Everett. "We know the Gay Ad Council will be a valuable resource to help those advertisers who wish to evolve their brand messages to speak to this market. LGBT media has been around for many years, but now we are getting the additional exposure we deserve through QTV, HERE!TV and even internet video streaming channels, like OutOfTheCloset.TV. I'm happy that Viacom has invested into Logo and our community." For more info:

Classified Ventures
acquires HomeGain
Classified Ventures, a strategic joint venture owned by Belo, Gannett, Knight Ridder, The McClatchy Company, Tribune and The Washington Post Company, has acquired HomeGain. HomeGain is an online lead and real estate marketing resource that provides consumers with direct access to real estate pros, while giving agents and brokers the products and tools to conduct and manage their online marketing. Richard Sommer will continue to serve as CEO of HomeGain and will also become president and GM of Classified Ventures' real estate vertical, overseeing the operations of HomeGain and Homescape, a current Classified Ventures property. HomeGain will operate as a wholly-owned subsidiary of Classified Ventures and will retain its headquarters in Emeryville, CA.

Media Business Report
Whiting defends LPM - Part I
As Nielsen Media Research continues to roll out Local People Meters to the top 10 TV markets, President & CEO Susan Whiting recently spoke with RBR/TVBR about the ongoing controversy over the devices.

We asked, do you agree that LPM has a problem with too many households faulting out and what are you doing about it?

"Well I'd like to step back and say that when you look at People Meter service, faulting is one component of a very long list of quality measures. The first thing you're looking at is the overall sample and its design, and does it represent the community which each of these samples do better than the sample they're replacing. Do you have a high cooperation rate? And they do and they're higher. Do they measure more channels and broader activity? They do. Do they provide data 365 days a year? Yes. Do we have other issues to study and research like fault rates? Yes, we've always had fault rates because basically what that means is a TV set either isn't plugged in or operating in the panel or a person isn't following all the rules and then when you have larger households you have more opportunity for that to happen. We don't like to see fault rates but there will be fault rates, there have been in any People Meter services. Diaries don't actually show a fault rate because you don't know. With a People Meter you actually know everyday what the status is and we've seen, and as a result of that, we've put a lot of plans put in place to improve them. But they actually also don't significantly affect the ratings. They are one measure of what you look at to improve the service, but ultimately what you want to know is are you including the right people and by including or not including them, are you affecting the ratings? And they're not affecting the ratings, we're weighting results. So it's become a very highly discussed topic that's only one small component of an overall service," said Whiting.

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Media Markets & MoneyTM
Three FMs for Three Eagles in three-headed market
Mankato, New Ulm and St. Peter are the burgs making up a small tri-cornered market southwest of Minneapolis. Rolland Johnson's Three Eagles Communications will soon have its third FM there, when it seals the deal on KQYK-FM, a CP licensed to Lake Crystal MN. It's getting the station from William C. Doleman for somewhere around 620K, depending on where the principal stands at closing, payable in the form of debt forgiveness - - Three Eagles loaned Doleman money to use in bidding for other stations at the recent FM Broadcast Auction. KQYK, which will be a standard Class A on 95.7 mHz, with 6 kw @ 328', will join the cluster already comprised of KRBI AM & FM St. Peter and KEEZ-FM Mankato.

Close encounters in Louisiana
The sale of a pair of FMs in the New Orleans area from Citadel to Wayne Dowdy has come to closing. According to broker Michael Bergner, Dowdy (who Bergner reminds us used to work near RBR's VA digs at a place called the United States Capitol Building, were he was a member of Congress) paid 4.5M for WOPR-FM Lacombe LA and WPRF-FM Reserve LA. Citadel is making room for some area acquisitions of its own. Meanwhile, further upstate, Greg Guy and Summer Foust of Patrick Communications tell us that Educational Media Foundation and their K-Love Contemp Christian net have the keys to WQCK-FM. Larry D. Stockstill's Touch Family Broadcasting gets 3.2M in that deal. For EMF, it's another dial foray to the right of the reserved band - - the station's located just a few channels over on the commercial side of the line at 92.7 mHz.

Washington Beat
Hutchison headed back to Washington
Kay Bailey Hutchison has decided not to switch cities - - she had been considering a new job based in Austin TX - - that's where the governor of Texas clocks in every morning - - but has decided instead to pursue a third full term at her Washington DC gig as a member of the US Senate. She is a member of the all-important Committee on Commerce, Science and Transportation (all-important if you're a broadcaster, that is). The former TV reporter carried the state with 65% of the vote in the 2000 election.

RBR observation: Hutchison is generally a friend of the business community, but has frequently joined committee colleagues John McCain (R-AZ) and Olympia Snowe (R-ME) in taking the Byron Dorgan (D-ND) side on issues relating to broadcast ownership. Not that that's been all that unusual--Trent Lott (R-MS) has wound up on that side of the fence quite a few times, even emerging as co-sponsor with Dorgan in a measure repudiating the FCC 6/2/03 ruling in its entirety.

"Truth Tour" headed to Iraq
A posse of conservative talkers is headed to Iraq this month on a mission to report "the truth" about the war: American troops are winning, despite headlines to the contrary. The "Truth Tour" has been organized by the conservative webcast radio group and Move America Forward, a non-profit conservative group. "The reason why we are doing it is we are sick and tired of seeing and hearing headlines by the mainstream media about our defeat in Iraq," Melanie Morgan, a talker for KSFO-AM San Francisco and co-chair of Move America Forward, told Fox News. Morgan said the media is "imposing a Vietnam template on this war." The delegation, which Morgan said is being funded by individual radio stations and the hosts themselves, will be leaving on Friday for about a week. They will be broadcasting from U.S Central Command headquarters in Baghdad's Green Zone and will be traveling with the troops daily. The group kicked off the trip with a "Thank You BBQ" for the troops at Centcom headquarters in Tampa before traveling to Kuwait to visit with soldiers. They will be flown from there to Iraq via military transport and will be sleeping in tents inside the secured Green Zone. According to retired Col. Buzz Patterson, host of "The Buzz Cut" on Rightalk, the delegation of seven to 10 conservatives will also include two writers from the website FrontPage Magazine. Others in the delegation include Mark Williams from KFBK-AM Sacramento, Michael Graham from WMAL-AM DC and Martha Zoller of WDUN-AM Atlanta. For more info, see

Why spend the money for HD Radio?
by Norman Philips

The concept for an in band on channel (IBOC) solution for U.S radio was thought of fifteen years ago. It's finally rolling out and being supported by many large groups as well as small stations. The NRSC formally adopted the iBiquity HD Radio format as the digital radio standard for the United States at its meeting in Las Vegas. HD Radio transmitters are now being installed as fast as the manufacturers can deliver them due to the demand. A year ago an HD transmitter could be delivered in two weeks, now it's at least two months. | More... |

TVBR - TV News
Burns introduces bill to regulate Nielsen
Sen. Conrad Burns (R-MT) isn't backing down on his effort to have the federal government regulate Nielsen's TV ratings. He (and, presumably, New Corporation's Washington lobbyists) has even lined up three fellow Republicans as co-sponsors of the "Fairness and Accuracy in Ratings" (FAIR) bill - - George Allen (VA), Olympia Snowe (ME) and Mel Martinez (FL). The bill would make Media Ratings Council accreditation mandatory for TV ratings companies. Currently, that means the bill would only apply to Nielsen Media Research. A hearing on the legislation is set for July 27th.

TVBR observation: It's no secret where we stand on this issue and if anyone has forgotten - the Gov. stay out as you will cause more harm to a medium that is already if deep trouble. | More... |

Monday Morning Makers & Shakers

Transactions: 5/23/05-5/27/05
The last week of May (with one last day pending) was no great shakes in general, with a bit more than 30M changing hands. Most of the activity could almost have been done on one application - - buyer Educational Media Foundation and seller Broadcasting for the Challenged used seven apps for seven FM CP transactions in seven markets totaling only 247K. Still, the TV deal streak was extended to four weeks.



Total Deals







| Complete Charts |
Radio Transactions of the Week
Savadove moves into Hagerstown
| More...
TV Transactions of the Week
Sinclair bails out of Tri-Cities
| More...

7M WEMT-TV Tri-Cities TN-VA (Greeneville TN) from WEMT Licensee LP, a subsidiary of Sinclair Broadcast Group (David Smith) to Aurora License Holdings Inc., a subsidiary of Trumper Communications (Jeffrey Trumper). 1.4M for license assets, 5.6M for intellectual property, which is being acquired by BlueStone Television Inc. (5/17/05 TVBR #97). BlueStone will enter into JSA/SSA with WEMT. WEMT is Fox affiliate on Channel 39. BlueStone owns WCYB-TV, an NBC affiliate on Channel 5. [File date 5/27/05.]

5.2M KLBB-AM & KLBP-AM Minneapolis-St. Paul (St. Paul, Brooklyn Park MN). 100% of 1400 Inc. from Minnesota Public Radio (William H. Kling et al) to Davidson Media Gruop (Peter Davidson). 300K escrow, balance in cash at closing. Existing duopoly. [File date 6/2/05.]

1 KWTY-FM Cartago CA from Michael L. Benson to Mark A. Miller. Cash. [File date 6/2/05.]

Stock Talk
Stocks barely higher
In typical pre-holiday fashion, traders didn't make any bold moves on Friday. Prices rebounded slightly from Thursday's drop on disappointment at the Federal Reserve indicating that it would continue to raise rates. The Dow Industrials rose 28 points for the day, or 0.3%, to spend the three-day weekend at 10,303.

Radio stocks did much the same. The Radio Index moved up 1.340, or 0.7%, to 204.129. Citadel rebounded 2.6% from Thursday's sell-off and Spanish Broadcasting System gained 2.1%.

Radio Stocks

Here's how stocks fared on Friday

Company Symbol Close Change Company Symbol Close Change













Journal Comm.




Citadel CDL
11.75 +0.30

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.










Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments to [email protected]

The Commission just turned down a request by Beasley Broadcasting for the transfer of an Elizabethtown, NC AM-FM to Beasley (6/27/05 RBR #125). The rationale was that BIA had once placed the FM in the Fayetteville, NC market and, although BIA no longer classified it as being in the Fayetteville market, once a station has been so classified, it remains in that market for two years. Confused? You have every right to be confused. The Elizabethtown FM is in the Fayetteville market like Spartanburg belongs in Atlanta. Many of us in broadcasting know that BIA, in the past if not today, could be hired to produce a report favorable to whatever cause we embraced at the moment. As they say, statistics can be "maneuvered" and BIA is the best in the business at it. I've hired them myself in the past. For the FCC to rely, solely on BIA's market definition is a recipe for disaster. I am not disparaging BIA, simply pointing out the obvious.

Tom Joyner
Joyner Radio, Inc.


Market Results
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| Las Vegas |
| Salt Lake City |

Upped & Tapped

WDET-FM Detroit
gets new GM
The long-running search to fill Caryn Mathes' job as GM of WDET-FM Detroit Public Radio (101.9) has ended with the selection of Michigan Public Media Deputy Director Michael Coleman. He starts 8/8. Mathes currently heads WAMU-FM DC

CC Radio's Mega 94.9 taps consultant in
Funk-E-Frank Walsh, who was the first to put an Hurban type format on the air over two years ago while at Univision Miami's WRTO, and worked at Power 96 for ten years, as programmer, will be working with another Miami legend, Rob Roberts, and Clear Channel Latin head, Alfredo Alonso, as an in house Consultant for their Miami Hurban station, Mega 94.9. Frank will be in the building on Tuesday, 7/5.

Judy Dixon named LSM KUFX and KCNL
Regional VP Kim Bryant announced the appointment of Judy Dixon to the position of LSM of KUFX and KCNL, in the CC Radio Group San Jose market. Judy brings 22 years of experience in the San Jose Market to KUFX and KCNL. Most recently, she served as the LSM for 94.5 KBAY-FM and KEZR-FM.

Stations for Sale

Rocky Mountain
Rated Market

New market FM on the air and ready to go! One of the Rocky Mountain Region's most upscale markets priced to sell! 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.

New rules NPRM about to be teed up
FCC Commissioner Kathleen Abernathy told reporters that the Third Circuit order remanding the far-reaching 6/2/03 media ownership rulemaking will be dealt with at the Commission's next regularly-scheduled Open Meeting, due to be held 7/14/05 at 9:30AM. It will be a simple, non-controversial laying-on-the-table of the issues brought up by the Third Circuit. RBR observation: This looks like a continuation of Chairman Kevin Martin's apparent strategy - - move ahead where possible, but keep any of the divisive issues off the table while the vote is two-two. But in reality, there really is no choice but to put the issues out there for stakeholders and other interested parties, now that the Supreme Court has made the Third Circuit remand official. Still, we wonder when the White House is going to notice the antsy Republican commissioner in one chair and the absent one in the other.
07/01/05 RBR #129

A look behind Bob Coen's numbers
Before concluding that US advertising spending in 2005 would be significantly lower than he'd earlier predicted, Universal McCann guru Bob Coen analyzed what's been going on so far this year. What he found was that national advertisers were spending somewhat less than he had expected - - and ad demand at the local level was particularly soft. RBR observation: Data worth a print out see. 07/01/05 RBR #129

Back down on ad spending forecast
Universal McCann Sr. VP and Director of Forecasting Bob Coen is no longer as bullish about 2005 ad spending as he was back in December. Instead of 6.4% overall growth, he now expects US ad spending to grow 5.7% this year. Why so slow? Coen points to tough comps as one reason. Another is Sarbanes-Oxley law may be a factor, making national marketers more cautious about how they do business. Coen reduced his 2005 growth estimates for radio and television, but boosted his estimate for cable. RBR observation: Local Local Local is your focus. It's reasonable for Coen to back down some on local and quite a bit on national business expectations. The national cable networks really have their act together this year - - thus, Coen is now predicting 12% growth rather than 7%. If he's right, which appears likely, this will be the first year that the cable nets (all of them combined) have more ad billings than the Big 4 broadcast networks. View the chart and print it out and post it. This is your road map.
06/30/05 RBR #128

Cable upfront dollars
likely to come in down
A different version from Bob Coen as CIBC World Markets is officially cutting its 2005 and 2006 U.S. ad spend forecasts for TV ahead of what it believes will be a flat-to-down upfront for both broadcast (already completed) and cable network spend (not completed but tracking flat to down Yr/Yr)-owed mainly to 5% less inventory sold but also 2% lower CPMs than CIBC had been expecting. While CIBC still expects the dollars to show up in the scatter markets this Fall and for national TV advertising to grow next season.
RBR observation: Focus and train your staffs for - Local Local Local. 06/30/05 RBR #128

Cable industry to reach
47 billion by '09
The survey finds cable has made a vigorous recovery since the ad market meltdown in 2001 and continues to attract attention from investors. The industry posted an estimated 9.0 billion in cash flow in 2004, with a margin of 34.1%. In a market dominated by major media companies, new nets continue to have a difficult time getting off the ground. Limited bandwidth has also changed the competitive parameters for incumbent networks. Source of the data by Kagan.
06/30/05 RBR #128

KXOL heading for a new tower
It looks like the landlord-tenant dispute between Emmis and Spanish Broadcasting System is about to be rendered moot by SBS' KXOL-FM Los Angeles finding a new landlord. In its latest filing in the lawsuit brought by Emmis to evict KXOL from its tower for launching a format that competes with Emmis' KPWR-FM, SBS says it has nearly completed construction at a different tower site, Verdugo Hills, owned by Infinity. According to SBS, the new site should be ready to go by this Friday (7/1) and, once the FCC gives its OK. RBR observation: Loss of a client is loss of money. You pick the winner. 06/30/05 RBR #128

How about an Emmis-ABC swap?
Broadcasting is still a tough business says CEO Jeff Smulyan but was proud to report that radio and TV groups both outperformed their markets and peers in the company's fiscal Q1, which ended May 31st. "We're not as bearish on some signs in the radio business as I've seen from the analysts out there. Our June has been very good." If you expected to find out a lot about how the effort to sell Television is going Smulyan played it close to the vest. Emmis could end up swapping its TV group for some of Disney's ABC Radio stations. Smulyan noted speculation about what an ideal match-up that would be and praised John Hare and the management team at ABC Radio, but also insisted that he doesn't yet know if incoming Disney CEO Bob Iger has decided to get out of radio. RBR observation: Smulyan couldn't do a deal for all of ABC Radio because Emmis would end up way over-leveraged. ABC Radio is worth 2-3 times the value of the Emmis TV group. But a workable and intriguing scenario would be to swap Emmis TV for some of ABC's larger market FM's, particularly those which would add to Emmis' clusters in New York, LA and Chicago. For RBR in depth observation see 06/29/05 RBR #127

Apple releases iTunes update
Rolled out an update to its iTunes music software to handle podcasting. The software, designed for both Windows-based PCs and Apple's Macs. MBR observation: Remember, so far no licensing deals have yet been struck with radio stations to podcast their music shows. Negotiations continue with ASCAP, BMI and SESAC. When that gets done someday, it should be interesting the effect it may have on the industry. Note: Be sure to see our Podcasting story in Radio and Television Business Report's August print edition, not reading us see 06/29/05 RBR #127

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