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Volume 24, Issue 138, Jim Carnegie, Editor & Publisher
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Tuesday Morning July 17th, 2007
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Radio News ®
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 Reps concerned about
private equity deals
A pair of powerful US Reps are concerned about private equity companies, saying the term "suggests a financial management style focused on cutting costs, increasing revenues and the ultimate resale of the enterprise," which may conflict with the public interest obligations of FCC licensees. On the other hand, they note, such enterprises are somewhat insulated from Wall Street pressure to boost stock prices, which could be a plus. They want to know how the ins and outs of such companies when cutting deals on the FCC's turf. The two reps are Energy & Commerce Committee heavy-hitters John Dingell (D-MI) and Ed Markey (D-MA). They've asked FCC Chairman a series of questions on this topic, in large part due to the pending plan to take Clear Channel Communications off the stock charts. They want to know if the FCC has any compiled stats on such ownership groups, their impact on localism, their impact on consumer protection, and their impact on media ownership rules, particularly when it comes to attribution. They wonder if private equity participation in FCC areas should result in tweaking "debt-plus-equity" attribution rules. They are curious as to whether the FCC has trouble with financial and managerial transparency when dealing with such companies, what issues he thinks the FCC should be concerned about and what plans the FCC has regarding a study of this matter. They stated their concerns, saying, "These historical styles may not be consistent with many of the core public interest and localism values that Congress has assigned to local media outlets and may implicitly undermine the Commission's media ownership rules.
Q2 fundraising results are in
The new results are in on the Federal Election Commission presidential fundraising map, and it shows a trajectory clearly favoring the Democratic candidates. At the end of March, the combined Democratic total was 32.2M ahead of the Republican pack; the edge has now swelled to 56.2M. There are a lot of stories in the individual numbers. For instance, former Senator Mike Gravel (D-AK) has doubled his income since the beginning of the year. The fact that leaves him where he was, 19th out of 19 with 200K total, puts him in the category of a statistical anomaly. However, others were able to double their income (or better), and in these cases we're talking some real money. Barack Obama (D-IL) went from 25.7 to 58.6M, nearly catching up with leader Hillary Clinton. On the second tier, Bill Richardson (D-NM) went from 6.2M to 13.2M and on the lower tier Dennis Kucinich (D-OH) went from 0.4M to 1.1M. On the Republican side, Mitt Romney (R-MA) and Rudy Giuliani just missed doubling their take, and numerous lower tier candidates did manage to double up and then some. The big winner was Ron Paul (R-TX), who ran his total by a factor of five, from 0.6M to 3M. Jim Gilmore (R-VA), who is on the bottom of the Republican chart with 0.4M, just withdrew from the race. Several Republican possibles remain unannounced, most notably Fred Thompson (R-TN), whose announcement is generally considered to be a matter of time only.
| Results for individual candidates |
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A legal eagle's eye view of EAS
The FCC has come out with a new report and order, plus a further notice of proposed rulemaking, on the Emergency Alert System. Here with us today is attorney Peter Gutmann of Womble Carlyle Sandridge & Rice PLLC to break it all down for us. As usual, the opinions expressed here are just that - opinions - and should not be used for barber shop arguments, wagering or actual litigation. Peter?
| WCS&R EAS report |
 Bancroft on a mission
to derail Murdoch
The Wall Street Journal says Christopher Bancroft, who is a director of Dow Jones & Co., is trying to find financial backing to buy up super-voting shares from his sale-minded relatives and block any sale of the WSJ parent company to Rupert Murdoch's News Corporation. But, much as WSJ staffers may cheer such a move, the story admits that Bancroft isn't likely to succeed. Christopher Bancroft's wing of the family owns about a third of the super-voting shares that have 10 times the voting power of the common shares traded on the NYSE. So, he would need to raise quite a bit of capital to buy out enough of his cousins who want to cash out - and it appears he only has a few days left to put it together. So, he has been courting hedge funds, private equity funds and other potential investors. The WSJ says people close to the board of directors don't give him much chance of securing the backing he needs.
RBR observation: Hedge funds and private equity funds are out for profits, so we can only imagine their reaction to Bancroft's pitch. So, you want to buy shares from your cousins at 60 bucks a share to block the sale and make the trading price fall back to around 36 bucks, where it was before the bid by Murdoch became public. And then you want to keep operating Dow Jones the same way it has been for the past few decades. Now, could you explain again where the upside for us is in this plan?
Marconi finalists named
NAB announced the finalists for the NAB Marconi Radio Awards honoring radio stations and on-air personalities for excellence in broadcasting. The winners will be announced on September 27 at the NAB Marconi Radio Awards Dinner & Show during The NAB Radio Show at the Charlotte Convention Center. Glenn Beck of Premiere Radio Networks will be the host and he won't have to worry about having to have an acceptance speech as well. He is not a nominee this year.
| See who is |
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Ad Business Report TM
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 CC Radio unveils EAR awards
Clear Channel Radio announced an industry-wide call-for-entries for its Excellence in Advertising on Radio (EAR) Awards, which was created to recognize outstanding radio creative throughout the country. CC Radio encourages radio advertisers, agencies, broadcast entities, and creative houses across the country to submit entries by the 8/10 contest deadline for prizes valued at over 1 million. The competition will award radio creative in six categories with the grand prize going to "Best of Show." The prizes for each:
Best Copywriting -a private, chartered jet to any U.S. destination
Best Use of Humor -a pair of new Mini Coopers
Best Use of Music -a new BMW 3 Series Convertible Hard Top with HD Radio
Best PSA/Pro Bono -$25,000 donated to charity of choice
Best Radio Station Produced Commercial -20,000 Paris shopping spree
Best Use of Radio to Drive Consumers to the Web -50,000 credit for online purchases
Best of Show - The agency will receive 1,000,000 in advertising on CC Radio
The winners will be announced at the EAR Awards luncheon at Jazz at Lincoln Center 11/2. There is no charge to enter, and creative submissions can be uploaded at earawards.com.
RBR observation: Not a bad idea. Often the complaint from advertisers is the lack of good radio creative available. Agencies seem to put most of their creative energies into concepting television campaigns. It's the TV campaigns that are touted to win them new business. Sure, there are already the Radio Mercury Awards, but it can't hurt to have even more awards programs to stimulate good radio creative. The move by CC Radio may move the needle a bit.
 David McDavid Automotive Group to offer HD Radios
On the heels of the announcement regarding a similar initiative in Detroit (7/16/07 RBR #137), The David McDavid Automotive Group has joined forces with the HD Digital Radio Alliance to now offer HD Digital Radios at all of its dealerships in Texas. The auto group is currently the only dealership group there to make HD Radio technology available. David McDavid, a division of dealership giant Asbury Automotive Group--with seven dealerships in Dallas and Houston--will offer Visteon's JUMP HD Digital Radio to customers buying new or used cars. And for all new Hondas purchased in July, McDavid Group is giving away a complimentary HD JUMP receiver and will be announcing similar promotions next week in their other Texas stores. The Alliance and David McDavid are a new model for partnership between local radio stations and their automotive car dealership customers. Ideally radio stations and car dealerships, who are likely already marketing partners, will use this kind of promotion to drive car and HD Radio sales and awareness, and give consumers a chance to discover HD Radio in their newly purchased car. In support, the HD Digital Radio Alliance will be running commercials in Dallas and Houston for thirteen straight weeks, giving this campaign excellent reach and frequency. The campaign started 7/2.
| Check out the new ads here |
RBR observation: This is what more radio markets should be doing-partnering with the local dealers with HD Radio promo efforts. However, getting the automakers to put OEM receivers in new cars is really what should be happening-at least more quickly. Going the long way around is fine, but points out the biggest weakness in HD Radio adoption.
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| Media Business Report TM |
IPG launches mobile marketing agency
Interpublic has formed Ansible, a dedicated mobile marketing agency, in a joint venture with Velti, a leading mobile technology provider. Ansible will be a stand-alone unit that will partner with agencies throughout the holding company and be a part of Interpublic's recently created Futures Marketing Group. Ansible will be led by Vladimir Edelman as CEO. A mobile marketing veteran, Mr. Edelman joins the company from Soapbox Mobile, where he was CEO. Larry Harris, formerly EVP/director of integrated marketing for Draftfcb, will join Ansible as president. Harris most recently led the Interpublic/Facebook.com collaborative team. Prior to Draftfcb, Harris founded and ran FCBi Digital, where he led online strategies and creative development for a broad array of clients, including AT&T, HP, Merck, MetLife, JPMorganChase and Qwest. Based in NYC, Ansible will be a provider of mobile marketing solutions to Interpublic agencies and clients. The company will operate in North America, Europe and Asia and will utilize Velti's proprietary services and mobile marketing technology in all markets.
Verizon up, despite Vodaphone denial
Is Verizon, which is busy rolling out its FiOS competitor to cable and cutting content deals for it and wireless phones with lots of media companies, a takeover target? Verizon's stock jumped 11% in pre-market trading yesterday after a Financial Times blog reported that Vodaphone was preparing a 160 billion bucks takeover bid - and it still closed up about 2% after UK-based Vodaphone denied that any such thing is in the works. Vodaphone already holds a large stake in Verizon Wireless, so it was not such a stretch for investors to believe that it might want to make a play for its partner in that venture.
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| Media Markets & Money TM |
Prescott Valley pair adds a Chino
Sanford and Terry Cohen have struck a deal which will take their Prescott Valley AZ combo up to duopoly status. They're dropping over 1M to bring KPPV-FM Chino Valley AZ into the fold, 1.2M to be exact. They're using licensee name Prescott Valley Broadcasting Company Inc., not that much of a change from the name of seller James L. Primm's company, Prescott Radio Partners. But the station will double up with KQNA-AM & KPPV-FM, licensed to Prescott Valley and part of the Flagstaff-Prescott Valley Arbitron market. The Cohens have also applied for a new FM in Parker AZ, but that is on the state line near California, many miles away from the Flagstaff area.
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| Washington Media Business Report TM |
 FEC admonishes political campaign
Steven Porter, who ran for Congress in 2004, was attempting to unseat Phil English (R-PA) in Pennsylvania's 3rd District. And it turns out he cheated. His campaign was using radio, and one ad ran a total of 127 times. And although the candidate voiced a message at the end of the ad identifying himself and endorsing the message, it was missing one piece of information. The campaign neglected to mention that the ad was paid for by a committee called Porter for Congress. You may be relieved to learn that this low electoral blow did not provide an edge for the Porter campaign, which lost to English by a convincing 60.1%-39.9% margin. It did bring him before the FEC however, where the powers that be decided a simple admonishment was punishment enough for the wayward candidate and his committee.
RBR observation: The rules are the rules, but we believe the important part of such a disclaimer is that of the actual candidate. But the financial disclosure can be important, too. For example, if the ad had been paid for by the Student Body of Potomac View Elementary School, we'd want to know about it because our daughter was elected treasurer of that student body (with an eye on a higher office next school year) and to the best of our knowledge her primary duty was keeping an track of the student popcorn fund. Since in this case the ad's funding was routinely handled by the campaign's own committee, there is little need for concern as long as its own financial dealings have been accurately reported. We feel an admonishment was an appropriate FEC response, and we are pleased that once again no apparent attempt was made to hold the radio stations themselves liable for policing the airwaves when it comes to political advertising.
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| HD Radio 2007 |
DC HD Radio tidbits
Clear Channel is now simulcasting its WTNT-AM on the HD-3 signal of sister Country WMZQ-FM (WMZQ-HD2- is Classic Country). We also reported CC also began airing Progressive Talk WWRC-AM on its AC WASH-FM HD-3 last month (WASH HD-2 is Easy Listening). Meanwhile, Bonneville has temporarily turned off its WTOP-FM HD-2, which was airing its iChannelMusic.com unsigned artists network. Why? Likely to fix signal problems. The network is delivered locally via satellite and the local delivery has been cutting off lately for 30-second stretches, while the signal remained strong. CC Radio's WBIG-FM HD signals were off air yesterday as well. The Radio One-Bonneville LMA for WPRS-FM DC has had no HD signal for days now.
RBR observation: Not a bad idea for DC AMs to simulcast on HD-3. CC picked two stations that have pretty poor coverage, especially in the Northern VA suburbs outside of the Beltway. The good news is they kept music formats on their HD-2 streams. Using HD multicasts for AM sister station relays defeats the purpose of HD Radio-to offer more music variety. The usual complaint on HD Radio is how will consumers take a liking to it if it's so unpredictable? One would think broadcasters could keep HD and HD multicasts on the air in a consistent fashion. Maybe in some markets...
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| Internet Media Business Report TM |
Fox Sports Radio added to MSpot Radio lineup
mSpot has added the FOX Sports Radio Network to mSpot Radio's growing lineup of more than 100 channels. FOX Sports Radio will deliver live and on-demand sports action directly to mobile phones - from the latest stats and box scores to passionate sports talk and commentary from well-known industry veterans.
 Bravo launches
TVBigShot online game
Bravo's www.TelevisionWithoutPity.com has introduced www.TVBigshot.com, an online season-long game that allows users to play 'network executive' by creating their own fantasy network lineups and awarding the individual with the most points a 100,000 grand prize. TVBigshot - born out of Bravo Digital's successful Fall Season DeathWatch, which also returns this year - will launch this September in conjunction with the new fall television season. The game will allow players to create, name and program their own fantasy television networks using both new fall shows and returning series from the five broadcast networks (NBC, ABC, CBS, FOX and CW). Anyone can play and it's free. Starting with a budget of 300 million virtual dollars, each player must purchase shows for their daily primetime lineup. The user-created networks will earn points based on the success of their chosen rosters and will compete against each other for the top spot. At the end of the 2007-08 season, the player whose network has accumulated the most points - based on actual ratings for the programs, ratings growth, and "buzz" measured by press coverage and awards garnered - will win the 100,000 grand prize. TVBigshot will offer special monthly showdowns throughout the television season for secondary prizes, allowing new players to join in the competition at any time. TelevisionWithoutPity.com became Bravo's other broadband properties include www.BravoTV.com and the TRIO suite of channels: www.BrilliantButCancelled.com, www.OUTzoneTV.com and www.getTRIO.com.
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| Transactions |
1.8M KGND-AM/KITO-FM Vinita OK from Mid America Ag Network Inc. (Larry Steckline) to KXOJ Inc., a subsidiary of Stephens Family LP (Michael P. Stephens, David P. Stephens, Joy Stephens). 90K escrow, 310K cash at closing, 1.4M note. Seller also receives advertising, one minute per hour on each station, seven days per week during each hour between 6AM-10PM for maximum of five years, or less if he spins off other local business interests. Overlap with KFTR-FM Chelsea OK and KEMX-FM Locust Grove OK. [File date 6/18/07.]
162K KHMB-FM Crossett AR. 51% of R&M Broadcasting from Jack Reynolds (51% to 0%) to Dennis Maxwell (49% to 100%). Cash. [File date 6/11/07.]
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| Stock Talk |
Blue chips rise alone
More M&A activity, including an IHOP buyout of Applebees and a debunked rumor about Verizon, pushed the Dow Industrials to another record close, very close to the 14K mark. The Dow rose 44 points, or 0.3%, to 13,951. But the broader market did not participate in the rally, with the S&P 500 and Nasdaq Composite both down slightly.
Radio stocks were also left behind. The Radio Index declined 1.610, or 1.1%, to 152.291. Volatile Salem had the worst day, down 5.8%. Journal Communications was down 2.6%.
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| Radio Stocks |
Here's how stocks fared on Monday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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53.48
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-0.52
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Google
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GOOG
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552.99
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+0.83
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Beasley
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BBGI
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8.36
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-0.16
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Hearst-Argyle
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HTV
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23.50
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-0.32
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| CBS CI. B |
CBS |
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34.87
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+0.32
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Journal Comm.
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JRN
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13.16
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-0.35
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| CBS CI. A |
CBSa |
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34.88
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+0.32
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Lincoln Natl.
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LNC
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69.47
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-0.30
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| Citadel |
CDL |
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6.21 |
+0.01 |
Radio One, Cl. A
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ROIA
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7.09
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-0.09
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Clear Channel
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CCU
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37.81
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-0.02
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Radio One, Cl. D
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ROIAK
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7.09
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-0.07
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Cox Radio
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CXR
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13.91
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-0.20
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Regent
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RGCI
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3.33
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-0.07
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Cumulus
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CMLS
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8.93
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-0.12
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Saga Commun.
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SGA
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9.01
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+0.11
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Debut Bcg.
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DBTB
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1.80
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unch
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Salem Comm.
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SALM
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10.24
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-0.63
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Disney
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DIS
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34.47
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+0.10
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Sirius Sat. Radio
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SIRI
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3.18
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+0.06
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Emmis
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EMMS
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8.83
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unch
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Spanish Bcg.
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SBSA
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4.14
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-0.03
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Entercom
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ETM
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24.00
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-0.36
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SWMX
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SMWX
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0.20
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+0.01
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Entravision
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EVC
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10.95
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-0.13
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Westwood One
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WON
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5.92
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+0.02
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Fisher
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FSCI
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50.80
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-0.49
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XM Sat. Radio
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XMSR
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12.67
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+0.38
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Bounceback
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 We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]
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Below the Fold
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Ad Business Report
CC Radio unveils EAR awards
An industry-wide call-for-entries for its Excellence in Advertising on Radio...
David McDavid Automotive Group
To offer HD Radios at all of its dealerships in Texas...
Media Markets & Money
Prescott Valley pair adds a Chino
Sanford & Terry Cohen strike a deal...
HD Radio 2007
DC HD Radio tidbits
Clear Channel is now simulcasting its WTNT-AM on the HD-3 Bonneville has temporarily turned off its WTOP-FM HD-2...
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Stations for Sale
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Hispanic Stations-Connecticut
Two full-time established AM stations serving the Hartford & Bridgeport Markets.
Contact Dick Kozacko,
Kozacko Media Services
607-733-7138,
[email protected]
MCH Enterprises, Inc.
CA Coast FM: $1.5M
NV Boomtown: $895K
www.mchentinc.com
805.680.2265 (cell)
 Market your Stations For Sale
in our daily epapers.
Contact
June Barnes
[email protected]
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Radio Media Moves
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 Jason joins Harris
Harris Corporation announced that radio industry vet Al Jason has joined its radio sales team as district sales manager for the Northwestern U.S. region. In his new position, Jason is responsible for an eight-state territory that includes Washington, Oregon, Idaho, North Dakota, South Dakota, Montana, Minnesota and Alaska. He previously served as western regional sales manager of radio products for Dielectric Communications, western regional sales manager for ERI, and domestic sales manager for Jampro Antennas.
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More News Headlines
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Broadcast Foundation
scholarships to 14
The board of directors of The John Bayliss Broadcast Foundation announced that 14 college and graduate-level students have been awarded Bayliss Radio Scholarships of 5K each for the 2007-2008 academic year. Since 1985, the foundation has awarded scholarships to over 320 students.
| The latest recipients |
Krall leaving Avid
Avid Technology announced that President & CEO David Krall will exit at the end of this month, with board member and former chairman Nancy Hawthorne taking over as interim CEO of the digital media tech company while the board looks for a permanent successor. Krall joined Digidesign, a division of Avid, in 1995 and became COO of that division in 1998. The following year, Krall was named President of Avid, and in April 2000 he was promoted to CEO.
Leslie Marshall
launches new
syndicated show
Leslie Marshall announced the launch of her all new nationally syndicated radio show. Re-debuting yesterday, the show airs live 7-10pm eastern time in various markets across the country.
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SmartMedia Magazine
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Coming in September
FALL NAB ISSUE
SPECIAL DISTRIBUTION:
NAB RADIO SHOW
Radio Roundtable:
Radio execs find solutions.
Media Markets and Money:
What's attractive to equity capital these days?
Ad Biz:
Gennele Niblack, Katz Political President
Sales:
Dial Global's Eileen Decker on radio ad sales
Political Advertising:
Gregg Skall: "The FCC rules on political ads-Network exception issue"; Greg Pinello, GMMB.
Engineering & Technology:
Conditional Access for HD Radio
New Media:
Money-making opportunities for on-demand web video
For advertising
information, contact:
June Barnes
[email protected] 803-731-5951;
Jim Carnegie
[email protected] 813-909-2916 or
Carl Marcucci
[email protected] 703-492-8191.
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RBR Radar 2007
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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Warshaw in; Goodman out
Jeff Warshaw will replace Dean Goodman as CEO of the new company backed by American Security Capital Partners (ASCP) to buy 187 stations from Clear Channel for 452.1 million dollars - the single largest package of the Clear Channel Radio divestitures in medium and smaller markets. Relations between Goodman - former President of Ion Media Networks and its predecessor, Paxson Communications - and his equity backer had been deteriorating for a couple of months as ASCP delayed approving the management team that Goodman had chosen and resisted buying TV stations as well.
RBR observation: Don't shed too many tears for Dean Goodman. He got five million bucks when he left Ion and millions more when Citadel Capital took Ion private and bought out all of the public shareholders, including Dean. Now he gets a few million more from ASCP to walk away. With his own cash and that of the investors he had brought to the table (including Eddie Fritts, Larry Patrick and Carl Hirsch), Dean will be able to build a substantial radio and TV company without having to answer to a private equity partner. More in RBR.
07/16/07 RBR #137
One on One: deCastro details
The Content Factory plans
A day after the announcement that Dan Patrick teamed with longtime broadcasting industry entrepreneur Jimmy de Castro's "The Content Factory" (7/13/07 RBR #136), de Castro gave RBR an idea of where he's taking Patrick's content and what might be in store for the future as far as talent and offerings. Read the details in this special page RBR report.
07/16/07 RBR #137
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