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Volume 22, Issue 136, Jim Carnegie, Editor & Publisher

Wednesday Morning July 13th, 2005

Radio News®

WSJ adds rocket fuel
to Disney radio rumors
Perhaps you read this in the RBR/TVBR story "Peace reigns once more over the Magic Kingdom." "And maybe they'll finally get around to changing the status of the talked-about sale of the radio station group to something other than rumor." (7/11/05 RBR #134) Now Wall Street Journal has put out a possible sell-off deal structure for ABC radio interests, and fingered possible buyers. WSJ describes the structure as a "reverse Morris Trust." It would involve putting debt into the 71 O&O/4,500 affiliate strong radio group to extract cash, followed by a merger with another radio company in which Disney investors would retain 50% of more of the new company's total equity. To make that part of the structure work, the merger partner would have to be roughly the same size as ABC Radio. According to WSJ, the short list of companies in that range include Cox, Citadel, Entercom and Emmis. The value of the whole radio package is pegged at about 3B, with 1.75B-1.5B attributed to the stations and 1.5B-1.25B attributed to the network. The group is churning out an estimated 700M in annual revenue, and is thought to be outperforming the industry as a whole. For that reason, it still remains unclear if the group is really for sale or not.

Duel on the Hill: Hard date
Both the National Association of Broadcasters and the National Cable & Telecommunications Association appear to have settled into the near-certainty of a 12/31/08 hard date for the end of over-the-air analog television broadcasts. The two organizations used the forum provided by the Senate Commerce Committee to engage in a pitched battle over must-carry issues. NCTA's Kyle McSlarrow kept it in neutral as far as the hard date goes, saying, "...while the cable industry has taken no formal positoin on a 'hard date' for the broadcasters' return of the analog spectrum, we understand and aplaud your Committee's leadership in grappling with the important policies inherent in the return of spectrum, particularly for public safety purposes." Fritts didn't exactly endorse a hard date, but indicated readiness to comply, saying, "broadcasters accept that Contress will implement a 2009 hard date for the end of analog broadcasts."

RBR observation: If there was any shred of doubt left that Congress fully intends to put a deadline on the DTV conversion, it has almost certainly been dissolved by the terrorist attack on London. In the unlikely event that there was a pocket of even token resistance to 12/31/08 in either party, in either house, the fresh reminder of the needs of first responders has certainly put it to rest.

Duel on the Hill: Must carry
Kyle McSlarrow of the NCTA acknowledges that cable operators are legally bound to carry broadcast television stations in their service area. And that's where is should end, he told members of the Senate Commerce Committee. "But dual must carry - - and multicast must carry, another one of the broadcasters' proposals - - will do nothing to forward the digital transition and harms consumers, cable operators and cable programmers alike. The broadcasters' attempt to appropriate additional channel capacity on cable systems through dual and multicast must carry will harm consumers by slowing the deployment of broadband and a host of other digital services." | More... |

CPB update
Sparsely populated Alaska has had a particular fondness for and dependence on public broadcasting for years, and it's top emmissary to Washington, Senate Commerce Committee Chairman Ted Stevens (R-AK), has long been a fervent supporter, so much so that he was given the first ever Public Radio Leadership Award by NPR. It should come as no surprise, then, that Steven's committee is inclined to provide full funding to the nation's noncommercial broadcasting service. The House put funding at 400M, after attempting to trim it by 100M, but did not restore funding for children's programming and the DTV conversion. As an item at FoxNews.com put it, "...no one in Congress particularly wants to be known as the elected official who killed off Big Bird and Elmo." Meanwhile, a Washington Post story notes the the two ombudsmen - - ostensibly put in place by CPB chair Kenneth Tomlinson to ferret out liberal bias - - have instead been giving out glowing reviews of public broadcasting news stories. Finally, Byron Dorgan (D-ND) has gotten assurances from CPB Inspector General Kenneth Konz that there will be an investigation into the process used in hiring Patricia Harrison as CPB president.

"Complaints that the selection process was inadequate are significant and come from people in a position to know the facts," Dorgan said. "I think such an investigation is not only appropriate but very much needed. We rely on the Corporation for Public Broadcasting to be a fair and unbiased steward for public broadcasting. The selection of its President should be beyond reproach. I look forward to this review, and to receiving the full facts, promised by Inspector General Konz."

AOL, AEG, XM join
for live content venture
The executive producer of global anti-poverty campaign Live 8 will head a new business for live entertainment programming created by AOL, XM and event presenter AEG. Kevin Wall, executive producer of the Live 8 aid concert for African countries that included performances from cities around the globe, is a co-founder and chief executive of the new venture, called Network Live. The venture will focus on developing content from live concerts and comedy performances for distribution through AOL and XM. "As Live 8 proved, this is a new era for live entertainment on the Web," said AOL Chairman and CEO Jon Miller. "This venture taps into the immediacy of the Internet for live shows and live shows on demand." Network Live's business will be based on licensing fees paid by its distribution partners as well as offering advertising and sponsorships to marketers, Wall said during a conference call with reporters. AOL.com, which streamed video of the Live 8 concerts, said that more than 5 million people worldwide logged onto the Internet to watch, making it the biggest streaming event ever.

Imus sued for slander
A doctor who once took care of sick children at Don Imus' New Mexico ranch has sued the I-man for slander, claiming he made false derogatory comments about him on his show. Dr. Howard Pearson, a pediatric cancer specialist, claims that on four days last year on-air, Imus said Pearson "was one of the worst doctors in the world and did not care if children suffered." | More... |

Conference Calls Q2 2005

Media General up overall, TV profits down
Multimedia newspaper/television group Media General was able to book a Q2 2005 profit which more than doubled its margin from the year prior. However, half of the total came from a one-time-only event. The TV side of the business, representing about a third of the total, was down 2% in the face of tough comps to last year's heavy political ad schedules. The big one-timer was the sale of a 20% stake in the Denver Post, which accounted for 19.4M of total earnings of 38.4M. Taking that out, the company pulled in 19M in profit on 234M in total revenue, for increases of 3% profit and 4% revenue over Q2 2004. On the broadcasting side, revenues were up modestly at 2%, but earnings declined slightly to 22.9M, largely due to the standard drop in political advertising, although increased expenses also played a role. Nonetheless, the political category is being fueled by issue ads on Social Security and educational reforms. The company said it realized an 11.1% gain in local time sales, driven by pulling in new customers. Strong categories include furniture, financial, entertainment, fast food and home hardware/improvement. The company is expecting the broadcast situation to continue along much the same lines, with strong local business, weak national and a loss of 1%-1.5% in broadcast time sales overall for the third quarter.

Adbiz©

McDonald's, Coca-Cola, Heineken,
others begin Summer wireless efforts
Ad spend on mobile phone campaigns is getting serious for some major marketers. McDonald's, Masterfoods, Timex, Coca-Cola, Heineken and Johnson & Johnson are readying promotions covering everything from mobile games to ring-tone giveaways and text-in trivia contests and sweepstakes, reports AdAge. Highlights:

* McDonald's is launching a Hispanic-targeted music promotion called LoMcXimo, with an on-packaging text-messaging code and supporting TV ads. * Johnson & Johnson will target patients awaiting eye exams in the doctor's office with a point-of-sale poster asking patients to text in the code "MYEYE." About 15 minutes later, it will send a reminder to the patient's phone to ask for the J&J lens brand. * Timex plans a fall text-messaging effort touting the "new face of Timex" with a text-messaging vote on watch faces. * Masterfoods is running a contest with a promo code on 60 million Starburst packages in which about half the responses have come via text messaging. * Kraft Foods is reportedly planning a text-messaging promo involving numerous products. Its Oscar Mayer brand is giving away free ringtones of its ad jingle. * Coca-Cola is working mobile games with developer Jamdat. * Heineken is using the short code "green" to allow consumers to text in updates and win giveaways in connection with its sponsorship of the AmsterJam concert scheduled for 8/20 at in NYC.

Hispanic population, ad spend rise in unison
According to preliminary figures released by Nielsen Monitor-Plus, advertising spending for the year's first quarter rose 2.4% over the same period last year. The gains were reported across major media, led by Spanish-language TV, which was up 19%, followed by cable, which saw a 12.4% gain. At the same time, new statistics emerged last week that show a continuous increase of ad expenditure on Spanish-language television. The news comes on the heels of a new U.S. Census report that states that the U.S. Hispanic population, which now stands at 41.3 million, is growing three times faster than the general population. | More... |

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Media Markets & MoneyTM

Davidson still on the prowl
The toner has barely dried on the announcement of the most recent Davidson Media Group acquisition - - we reported the deal for WNTS-AM ni Indianapolis just yesterday - - and already there's another one in the hopper. Broker Jamie Rasnick of John Pierce & Company tells us Peter Davidson has found a station in the Des Moines market which will take his group to 31 stations in 18 markets. KXLQ-AM Indianola IA is coming from Warren Broadcasting for 425K.

Another public company gets ready to saddle up
McGraw-Hill Companies, which ABC-affiliated television stations among its holdings, is getting ready to trot out its top execs to go over Q2 2005 results. The traditional conference call will be held 7/26/05 at 8:30AM eastern. It will be available on the web or over a traditional phone line. Those wishing to participate are asked to RSVP by 7/25/05.

Washington Beat

Auction No. 62 gets set to enter runway
The preliminaries to the 11/1/05 auction of FM CPs is only two weeks away, and the deadline to register for the initial event - - the Pre-Auction Seminar - - is even sooner. Applications for the seminar are due by Monday, 7/25/05, and the event itself is scheduled for the following Wednesday, 7/27/05. The 27th also marks the opening of the filing window - - it'll remain open until 8/12/05. The final landmarks are the upfront payment deadline of 9/30/05 and the mock auction, held 10/28/05. After that, it's show time.

Programming

CC Radio pacts with Black Entertainment Magazine
Clear Channel Radio and Black Enterprise Magazine announced a strategic partnership to expand radio programming for the African American community. Beginning 8/15, Black Enterprise's "Keys to a Better Life" will launch on 29 Clear Channel stations. The twice-daily report will be introduced by stars from music, television, film and sports, including Alicia Keys, Cedric the Entertainer and Keith Sweat, and will provide news and information on finance, health, and home buying.

ABC News Radio launching "Super Nanny" today
ABC News Radio will present a 20-part series on parenting hosted by ABC-TV's parenting expert Jo Frost, better known as the "Super Nanny." "Super Tips from the Super Nanny" will be available to affiliates today. Each of the 20 episodes offers advice to parents on topics ranging from getting your child to bed, to effectively disciplining your child using the Super Nanny's infamous "naughty corner." All 20 'sodes will be available to affiliates every day. Affiliates will be able to package the 30-second long episodes with reports from local sponsors to create additional sales opportunities.

Engineering

New tower standard takes effect 1/1/06
Did you know existing standards for broadcast and communications towers have been updated with their biggest revisions, some say, since their inception in 1949? The new standards have been in the works for six years. The standards committee, made up of members from TIA and EIA, is labeled "TR-14.7." The final version has was approved 10/20/04 at a meeting held in Denver and went back though for public response/comments 12/16/04. Public comments/balloting were completed 7/1. No major changes were made to the standard based on comments. So the TIA/EIA 222-G Standard will be published/printed this summer and officially take effect 1/1/06. | More... |

Transactions

2.25M KBNH-FM Boise ID (Homedale ID) from Leopoldo Ramos d/b/a R&S Media to Bustos Media of Idaho License LLC, a subsidiary of Bustos Media Enterprises LLC (Amador Bustos). 112.5K escrow, balance in cash at closing. Duopoly with KDBI-FM. LMA 5/17/05. [File date 6/8/05.]

N/A WKBE-FM, WENU-AM, WENU-FM, WFFG-FM, WMML-AM & WZMR-FM Glens Falls NY (Warrensburg, South Glens Falls, Hudson Falls, Corinth, Glens Falls, Altamont NY) from 6 Johnson Road Licenses Inc., a subsidiary of Pamal Broadcasting Ltd. (James J. Morrell) to Glens Falls Trust (Mark O. Hubbard, Trustee). Establishing trust to enable acquisition of WNYQ-FM Malta NY from Vox New York LLC in Albany-Schenectady-Troy market. Existing superduopoly. Trustee can only attempt to sell stations on Pamal's instuctions. [File date 6/8/05.]

Stock Talk

A mixed bag
The Dow only lost five points and change. Radio stocks were pretty much mixed, with little fluctuation. Saga was down 0.42 and Clear Channel up 0.40 at the extremes.

Radio Stocks

**Here's how stocks fared on Tuesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		43.11	+0.36	Jeff-Pilot	JP		50.78	+0.23
Beasley	BBGI		14.49	-0.12	Journal Comm.	JRN		16.76	+0.01
Citadel	CDL		11.68	-0.07	Radio One, Cl. A	ROIA		12.92	+0.12
Clear Channel	CCU		32.00	+0.40	Radio One, Cl. D	ROIAK		12.96	+0.10
Cox Radio	CXR		16.08	+0.12	Regent	RGCI		6.08	-0.09
Cumulus	CMLS		12.19	+0.36	Saga Commun.	SGA		14.48	-0.42
Disney	DIS		25.41	+0.23	Salem Comm.	SALM		20.62	-0.06
Emmis	EMMS		18.02	+0.04	Sirius Sat. Radio	SIRI		6.98	-0.13
Entercom	ETM		33.17	-0.28	Spanish Bcg.	SBSA		9.97	-0.15
Entravision	EVC		8.27	-0.11	Univision	UVN		27.90	-0.04
Fisher	FSCI		46.40	-0.35	Viacom, Cl. A	VIA		33.19	+0.35
Gaylord	GET		47.06	+0.33	Viacom, Cl. B	VIAb		33.05	+0.39
Hearst-Argyle	HTV		24.62	-0.02	Westwood One	WON		20.04	-0.18
Interep	IREP		0.43	unch	XM Sat. Radio	XMSR		36.04	-0.04
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

Bounceback

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More News Headlines

2005 NAB Marconi Radio Awards
finalists named
Finalists for the NAB Marconi Radio Awards competition have been selected. Established in 1989, and named after inventor and Nobel Prize winner Guglielmo Marconi, the NAB Marconi Radio Awards are given to radio stations and outstanding on-air personalities to recognize excellence in radio. An independent task force selected finalists in 22 categories. Ballots will be sent to members of the NAB Marconi Radio Awards Selection Academy later this month. The winners in each category will be announced 9/22 at the NAB Marconi Radio Awards Dinner & Show at The NAB Radio Show. | The finalists are: |

Sirius now offered
on Land Rovers
Sirius announced that Land Rover is now offering it as a factory-installed option the 2006 Range Rovers and Range Rover Sport. Both vehicles are available with factory-installed head units that display artist, song title and category when playing Sirius. The Range Rover also features a touch-screen interface to enhance the driver's radio control.

June Digital Magazine
Now Available

National Sales:
EDI - Electronic Data Interchange, sometimes synonymous with Electronic Invoicing
Kathy Crawford, MindShare President, Local Broadcast, speaks her mind on EDI, specifically stating what solutions she needs from the software and keying entries to get stations faster payment in an exclusive column. States straight up, "Lest you should all think that our work is done in the world of EDI. Think again!" EDI- the focus of the future of national spot dollar. Who is and who isn't involved. From the rep firms to the software companies, we get answers. The Clock is ticking on EDI. Closure in '05?

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RBR Radar 2005

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

Goldman Sachs sees radio
increase in 2005
A simple analysis of radio revenues, which monetizes three industry trends in coming to its 2% result. Trend #1 is less-is-more: GS says that the net impact of the Clear Channel/Infinity initiative will be a loss of 1.5% of revenue due to simple inventory reduction. Trend #2 is continuation of a steady decline in time-spent-listening (TSL). GS says 1.5% of revenue will be lost based on "acceleration of approximate 1% TSL erosion. Coming in to save the day if Trend #3 a 5% price tag increase, a number they say comes from a proprietary survey and our broader Goldman Sachs media team advertising forecast. More to come 07/12/05 RBR #135

iPod overrated and other mullin'
Emmis Communications uberhoncho Jeff Smulyan took to the company's website to discuss the general state of affairs with his company. The TV group, featuring both attractive signals and markets, is attracting significant interest and higher-than-expected numbers. Part of the reason, he believes, is good old supply and demand. Outlook on radio - Wall Street is skeptical of all media right now, but we're seeing data on satellite and iPod consumption that show us that some of the threats against terrestrial radio are overblown. RBR observation: We do agree with Jeff that much is overstated but we have to point just one finger at the Street as it is their job to move the market on new gadgets. iPod has its place in the consumer media mix as the consumer is always in control. Remember this fact then remember more so like radio, TV must stay focused on local content and presentation as gadgets will not replace local and the loyalty factor. We see this in local TV news every day as a number of local anchors have such a long running loyalty factory that in some cases the station just can't retire them so they use duct tape to keep'em straight in their chairs. Local wins every time. 07/12/05 RBR #135

The Local Radio
win auto disclaimers
RBR was First to report on the Missouri House Bill #487, the first state allowing broadcasters to use a #800 number or Internet site to provide the required disclosure information for automotive advertising. Missouri Broadcasters Association President/CEO Don Hicks, explains how other state broadcasters/associations could get this legislation from a grass-roots perspective. RBR observation: First this is a local victory not a national one since leaders at the association level of NAB, RAB, 4A's, TVB etc. have not been able to move anything inside the DC beltway and they probably won't just because there is too much on the plate of anyone to get anything completed. Plus, in all honesty this is a much better victory for local broadcasters and especially radio. Now the key will be to have other grass root state movements spin from Missouri and now take the mega bucks from your local newspaper. Just look at any Sunday auto section of any newspapers and count the opportunities.
07/11/05 RBR #134

Peace reigns once more
over the Magic Kingdom
The swords were put back in their scabbards at Walt Disney Co. Roy E. Disney and Stanley P. Gold "have agreed to put aside the differences that have characterized their relationship over the past several years." Winner will be Robert Iger. RBR observation: Now that the boys in the family have agreed to play nice with one another, the company can focus 100% of its energy on getting back on solid footing. The New York Times noted that Iger was already in the process of trying to mend a rift between Disney and Pixar Animation that was caused by testy relations between Eisner and Pixar's Steve Jobs. And maybe they'll finally get around to changing the status of the talked-about sale of the radio station group to something other than rumor. Iger now calls the shots and it is his media game to win or lose. But what ever it is just start doing something. 07/11/05 RBR #134

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