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Volume 22, Issue 140, Jim Carnegie, Editor & Publisher

Tuesday Morning July 19th, 2005

Radio News®

Scorekeeper downgrades ad expansion
Advertising prognosticator and scorekeeper ZenithOptimedia has revised downward its most recent prediction for worldwide advertising sales growth. It had been looking for a global increase of 5.4% as of last April, but now expects the year to end only 4.7% to the good. The culprit? US network television. ZenithOptimedia also knocked down its prognosis for 2006, taking it from a 6.5% increase down to 6.1%. The charts take into account most forms of advertising, including television, radio, newspaper, magazine, cinema, outdoor and Internet. | View the charts |

Kagan predicts 46.8M
satellite radio subs by 2014
As both XM and Sirius continue to add new subscribers, the latest forecast from Kagan Research is that satellite radio subscriptions will hit 46.8 million by 2014, generating 7.6 billion in revenues. That's still just a fraction of what terrestrial radio does, but impressive nonetheless if it proves to be true. Kagan bases its latest estimates on recent programming deals announced by the two satellite services, and especially their deals for factory installs by auto makers - - not the least of which is the Hyundai deal to install XM receivers in 100% of its vehicles. Kagan is projecting that XM will turn cash flow positive in Q3 of 2007 and Sirius sometime in 2008.

RBR observation: Hey, wait a minute - - hasn't XM been promising shareholders it would be cash flow positive in Q3 2005? That will be its first quarter with more than four million subscribers for the entire three month period - - the supposed magic number. At least Kagan has figured out that that's not going to happen. And we give Kagan analyst Michael Buckley credit for acknowledging that, "As wireless technology expands and access to free music Web sites and on-demand services increases, satellite radio will lose potential customers to alternative sources in the battle for consumers' attention." But where does he get the idea that "low churn" is helping the satellite radio companies? Look behind the quarterly churn numbers, which are already in the high teens (remember when both companies promised 15% churn when they reached maturity - - which is still years away?) and you'll see that car buyers are canceling service at twice that rate once the upfront term built into their auto purchase sticker price expires.

Connolly named SVP/Sales for ABCRN
Jim Robinson, President of ABC Radio Networks, announced that Mike Connolly has been named Senior Vice President, Sales for ABC Radio Networks, replacing Jennifer Purtan. Connolly was previously VP/Sales for ESPN Radio Network. In this new role, Connolly will be responsible for developing and overseeing ABC Radio Networks' advertising sales strategies to maximize revenues across all properties including ABC News Radio, ESPN Radio, syndicated talk and entertainment programming, as well as the networks' Urban and Hispanic initiatives and 24-hour formats. Based in NYC, Connolly will oversee sales activities in all eight regional ABC Radio offices and report directly to Jim Robinson. The buyers are apparently happy about the move: "He's a great guy. He'll do a great job and he's got the background for it. I think we're all pleased...I think everybody is pleased," Natalie Swed Stone, US Director, National Radio Investment, OMD, tells RBR.

Sharpton "Cuttin' Up" with TV One
Rev. Al Sharpton is getting his own TV show. He's signed with TV One to host a talk and interview series. According to the cable net, the show "will take place in those havens of African American culture where no topic is off limits - - barbershops." Sharpton and his guests will discuss "what's really on the minds of African Americans," from politics and current events to sports and social issues. And while he's the moderator, the former Democratic presidential candidate won't hesitate to get in his two cents worth on every topic. "While we expect to have a good time and a lot of laughs along the way, we're also going to be talking to real people about what's most important to them, and there's no better place for candid conversations than barbershops," said Sharpton. "Cuttin' Up with Al Sharpton" is slated to premiere in November 2006 and will be produced for TV One by The House, Inc. Executive producer is Diane Houslin and TV One executive in charge of production is Sitarah Pendleton, vice president of production and development.

RBR observation: This has the potential to be some really fun television! And we hope that TV One's part owner, Radio One, will take advantage of the obvious opportunities for promotional tie-ins with many of its radio stations. If this show is done well, it should attract not only TV One's target audience of 25-54 African Americans, but news and political junkies of all ethnic backgrounds. There's only one Rev. Al and he should be something to see in the venue.

Congressional caucus holds DTV session
Maurice Hinchey's (D-NY) Future of American Media (FAM) Caucus will meet today in the Capitol from 2:00PM-3:30PM to discuss aspects of the DTV transition. In a release, the Caucus wrote, "With DTV legislation beginning to gather momentum in the House and Senate, the FAM Caucus believes it is vital that members and staff have a good understanding of the technical challenges posed by the transition and the tremendous opportunities to serve the public interest that will be created, as well as ramifications of both for industry stakeholders, policy-makers and consumers." Several speakers are scheduled. New America Foundation's Jim Snider will provide an overview; Ben Scott of Free Press with discuss the relationship between the transition and public broadband Internet; Capitol Broadcasting CEO Jim Goodmon wil discuss public interest obligations; Jeannine Kenney from the Consumers Union will look at consumer compensation and set-asides during the spectrum auction; and NAB's John Orlando will discuss the DTV deadline and converter boxes.

Adbiz©

TiVo launches interactive ad technology
TiVo has launched its next generation interactive advertising technology solution with campaigns from GM and The WB. | The new features include: |

Muslims launch TV effort against terrorism
The Council on American-Islamic Relations (CAIR) has launched a campaign to denounce acts of terrorism after bombers believed to be British Muslims killed at least 54 people in attacks on London. "Any effort by terrorists to hide their criminal activities under the mask of religious piety is being categorically and unequivocally rejected by mainstream Muslims," said Parvez Ahmed, chairman of CAIR. He said the TVad, which will air nationwide starting today, is an attempt to detach Islam from the "heinous" acts of a few Muslims. "Backlash is a concern ... but it's not our main motive," said CAIR spokeswoman Rabiah Ahmed. "Our main motivation lies with making sure our position is clear where Islam stands on terrorism." The 30-second public service spot, called "Not in the Name of Islam," features two American Muslim women and religious leader Imam Johari Abdul-Malik. "We often hear claims Muslims don't condemn terrorism and that Islam condones violence," they say. "As Muslims, we want to state clearly that those who commit acts of terror in the name of Islam are betraying the teachings of the Koran and the Prophet Mohammed. We reject anyone - of any faith -- who commits such brutal acts and will not allow our faith to be hijacked by criminals. Islam is not about hatred and violence. It's about peace and justice."

Mediaedge:cia, Mindshare,
Poster Publicity create "Kinetic"
Mediaedge:cia (MEC) and MindShare have joined with leading Out-of-Home company Poster Publicity to form Kinetic, the largest OOH company in North America. The new company will be headed by Chairman John Miller, formerly of MEC. Steve Ridley, formerly president at Poster Publicity, was named CEO. Kinetic, based in New York and with an additional office in Miami, launches with 26 employees. The North American company expects to have 50 employees, plus a West Coast office, by year's end. The roll out of the Kinetic network will be undertaken in stages ultimately leading to the employment of more than 300 professionals across offices in over 35 countries. This first stage will see the launch of Kinetic in the US, UK, Switzerland, Singapore, Hong Kong, Thailand, the Philippines and Malaysia. Other major markets will be in place before the end of 2005. "By combining the tools and analytics for out-of-home media with our roster of leading clients, we've created the region's premier OOH agency" said Miller. "Synonymous with movement and energy Kinetic will benefit world brands in their quest to co-ordinate regional campaigns and increase the value they get from the OOH medium. Our global footprint enables us to mirror the geographic reach of the major outdoor vendors such as Clear Channel, JC Decaux and Viacom." Ridley adds, "Kinetic offers our clients flexibility and the confidence that we can deliver domestic and regional campaigns over and above our competitors. Kinetic does this with personality and professionalism always bringing with it a fresh approach. Kinetic is without doubt a strong and independent choice."

Media Business Report

News Corp. to buy
Intermix Media
News Corp. announced it signed a definitive agreement to acquire Intermix Media for 580 million in cash, or the equivalent of 12 dollars per common share. In a separate transaction, Intermix announced today that it exercised its option to acquire the 47% of MySpace.com that it does not already own. MySpace.com is the leading lifestyle portal for networking online. Both MySpace.com and Intermix's more than 30 sites will become part of News Corporation's newly formed Fox Interactive Media unit. The acquisition of Intermix, combined with the recently announced formation of Fox Interactive Media, underscores News Corporation's commitment to expand its internet presence by offering a deeper, richer online experience for its millions of users. With the addition of MySpace and Intermix's network of sites, News Corp's US web traffic will nearly double to more than 45 million unique monthly users, putting the company in the top echelon of most trafficked content sites on the Internet today. The Intermix network of sites is the largest multi-category online entertainment network with more than 27 million unique monthly users. Intermix's group of entertainment, humor, gaming and social networking sites has become the leading network for shareable digital entertainment such as pictures, music and video. In a related transaction, News Corp announced that it entered into a voting agreement with VantagePoint, the largest stockholder of Intermix. The agreement provides that VantagePoint will vote its shares, representing approximately 22.4 % of the outstanding shares of Intermix, in favor of the transaction. Intermix CEO Richard Rosenblatt and MySpace CEO, Chris DeWolfe will continue in their roles following the completion of the acquisition. Rosenblatt and DeWolfe will join Fox Interactive Media, led by Ross Levinsohn.

Radio & Television Business Report

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Media Markets & MoneyTM

NextMedia catches Viacom cast-offs
A buyer has been found for the pair of San Jose FMs which Viacom/Infinity needed to spin in order to keep its radio/TV San Francisco cluster orderly. NextMedia will spend 80M to enter the market with KBAY-FM and KEZR-FM. San Jose is one of those markets which Arbitron measures twice - - once in its own right and again as an embedded portion of San Francisco. In SF, Viacom properties include KPIX-TV (Ch. 5, CBS), KBHK-TV (Ch. 44, UPN), KEAR-FM (coming in a deal with Family Stations), KCBS-AM, KFRC-FM, KYCY-AM, KITS-FM & KLLC-FM. In order to make that cluster possible, the two San Jose FMs have to go. And a deal to get them off the books technically has already been filed - - Viacom filed last month to send them to MVP broker Elliot Evers. Evers told RBR that the FCC hasn't gotten around to approving that transaction, but once it does, he will LMA the stations to NextMedia. All aspects of the deal are expected to close by December.

Washington Beat

No escape for Noe phone no-no
KNOE-TV, the Noe Corp. CBS affiliate in the Monroe LA-El Dorado AR DMA, was hit with a 10K FCC fine for playing the voice of a citizen over the air without notification. The case was atypical in that there was no traditional conversation. Rather, the station recorded an individual's outgoing phone answering message, and also aired the citizen answering the phone, then hanging up. Noe argued that a phone message is not the same as a conversation, that the same standard applied to the simple "Hello" it broadcast, and that the citizen, who was a public figure with possible involvement in a corruption scandal, had waived his rights by offering an "invitation that members of the public contact him to discuss the situation." The FCC held that "...it is reasonable and desirable to retain for individuals the right to answer the telephone without having their voices or statements transmitted to the public by a broadcast station in the absence of their prior notice." The recorded message fits into that standard, according to the FCC. It also said that the citizen's offer to discuss the matter did not constitute a waiver of his phone rights. Noe was given a 2K discount for overall compliance.

Programming

Stern confirms (maybe):
David Lee Roth, Adam Carolla to replace
After a long prank featuring his "firing" and a David Lee Roth impersonator doing a fake replacement show, Howard Stern told listeners yesterday that "the rumor we hear is that we're out of here in September (7/7/05 RBR #132) with David Lee Roth replacing me in NYC...I got confirmation on that...It's not a rumor, it's a done deal." And on the Stern website, David Lee Roth's new co-host was hailed to be, pictured, "Irene from Scores." The King of all Media also said Loveline's Adam Carolla will replace him in LA, San Diego and two other markets.

RBR observation: The real deal? Or is Howard jerking our collective chain? Wouldn't be the first time that has happened. So far, there's no confirmation from Infinity that Roth, Carolla or anyone else has been hired to fill Stern's morning slot anywhere - - nor that any change will take place before Stern moves to Sirius next January. We remain skeptical.

TVBR - TV News

Cable competition bill back on track in Texas
While it had appeared earlier that legislation to make it easier for phone companies to compete with cable MSOs in video distribution was dead for this year in Texas, a special session of the state legislature has breathed new life into the effort. The Dallas Morning News reported that the Texas House voted 135-6 on Sunday to approve a bill which would let phone companies roll out Internet-based digital TV services without having to win franchises from each local government in the state. The bill had passed the state Senate last week, also by a lopsided 25-3 vote, but has to go back to the upper chamber for another vote because of minor changes by the House. The special session of the Texas legislature is due to wrap up tomorrow. The bill has been pushed heavily by lobbyists for SBC communications and Verizon Communications, while the cable MSOs and local government officials have been trying to stop it. Verizon CEO Ivan Seidenberg had appealed to broadcasters at last Spring's NAB convention (4/25/05 TVBR #81) for help in passing legislation at the state level to help phone companies create competitors for the cable MSOs - - and new sources of retransmission consent payments for TV stations.

Transactions

65K WAPZ-AM Montgomery AL (Wetumpka AL) from J&W Promotions Inc. (Johnny E. Roland) to Contemporary Media Inc. (Michael S. Rice). $5K escrow, 3,468.75 payment for money owed to FCC (see below), balance in cash at closing. LMA 5/11/05. Buyer will repair station in lieu of LMA fee. Deal is refiled from 7/19/04. It was denied by FCC because seller owed regulatory fees for 2002 and 2003. Rice is paying those fees, an amount which will count toward the purchase price. [File date 6/13/05.]

N/A KEZR-FM & KBAY-FM San Jose CA (San Jose, Gilroy CA) from Infinity Radio, a subsidiary of Viacom Inc. (Sumner Redstone et al) to San Jose Trust (Elliott B. Evers, Trustee). Stations placed in trust for resale to enable acquisition of KEAR-FM from Family Stations. [File date 6/13/05.]

Stock Talk

Citigroup depresses stock prices
A poor quarterly report from banking giant Citigroup put Wall Street traders in a pessimistic mood. The Dow Industrials fell 66 points, or 0.6%, to 10,575 and investors are now keeping a wary eye on upcoming reports from other major companies.

Radio stocks were also lower. The Radio Index fell 2.037, or 1%, to 200.774. Spanish Broadcasting System, which last week announced its first foray into TV ownership, plunged 5.5%. Regent fell 2.8%.

Radio Stocks

**Here's how stocks fared on Monday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		43.04	-0.38	Jeff-Pilot	JP		50.93	+0.36
Beasley	BBGI		14.33	-0.10	Journal Comm.	JRN		16.46	-0.21
Citadel	CDL		11.27	-0.07	Radio One, Cl. A	ROIA		12.56	-0.10
Clear Channel	CCU		31.88	-0.17	Radio One, Cl. D	ROIAK		12.53	-0.14
Cox Radio	CXR		15.63	-0.27	Regent	RGCI		5.61	-0.16
Cumulus	CMLS		12.14	+0.05	Saga Commun.	SGA		14.00	-0.01
Disney	DIS		26.05	-0.33	Salem Comm.	SALM		20.45	-0.05
Emmis	EMMS		18.05	-0.11	Sirius Sat. Radio	SIRI		6.84	+0.04
Entercom	ETM		31.71	-0.11	Spanish Bcg.	SBSA		8.41	-0.49
Entravision	EVC		8.30	-0.11	Univision	UVN		27.27	+0.18
Fisher	FSCI		44.50	-0.01	Viacom, Cl. A	VIA		32.58	-0.54
Gaylord	GET		47.51	-0.04	Viacom, Cl. B	VIAb		32.28	-0.59
Hearst-Argyle	HTV		24.43	+0.05	Westwood One	WON		19.87	+0.01
Interep	IREP		0.55	+0.02	XM Sat. Radio	XMSR		35.76	+0.14
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

Bounceback

Send Us Your Opinions We want to
hear from you.
This is your column, so send your comments to [email protected]

Sometimes our readers use this column for a dialogue with each other. Here is a response to a recent letter from Jerry Smith
(7/14/05 TVBR #137).

Dear Jerry,
I found your perspective on HD radio to be very interesting. As a very small market broadcaster, I have been wrestling with the cost / "benefit" ratio of IBOC HD technology. With a city of license of 8,000 and a total coverage area populated by about 45,000 people the cost seems excessive. Your perspective tells me that broadcasters are like most other business people... we have a hard time seeing ourselves as others see us. When you're inside the bottle it is almost impossible to read the label. I may be short sighted, but it seems to me that the best way for terrestrial broadcasters to survive satellite broadcasters, pod-casters, Internet streaming and all the other emerging technologies, is to pay attention to content. We need to provide high quality live local content that nationally distributed programming simply cannot duplicate. Quality content (talk/news/sports radio) saved AM radio from extinction in spite of FM's clearly superior sound. Quality content is the only thing that will save terrestrial broadcasters from new technology threats. Even that may not be enough, but anything less is like re-arranging the deck chairs on the Titanic. I appreciate your frank opinion.

Jay Austin
Owner / General Manager
KIOD (FM) / KSWN (FM)

Stations for Sale

Top 100 Market FM
NEast CapCity 6kw Class A @ 8.5x trailing BCF, good upside 1.95M
781-848-4201 or [email protected]

Arbitrends

Upped & Tapped

Westwood One
ups Chris Greene
Westwood One announced, effective immediately, Chris Greene assumed the position of SVP of Affiliates Sales & Operations for Network Radio. Greene will be based in New York, reporting directly to Peter Kosann, Co-COO and be responsible for the management of all network affiliate sales ops including staff, affiliate relations and audience growth. Previously, Greene was VP/NY Sales for Westwood.

More News Headlines

Pitcher booked for assault on cameraman
Texas Rangers pitcher Kenny Rogers turned himself in yesterday and was released on 1.5K bail after being booked on a misdemeanor charge that he assaulted KDFW-TV Dallas-Ft. Worth cameraman Larry Rodriguez before a June 29th game. Arlington, TX police also plan to file an additional assault charge for Rogers shoving Fox Sports Net Southwest cameraman David Mammeli just before he grabbed Rodriguez's camera and hit the photog with it in the head and hand as the pitching ace threw it to the ground - - an incident captured on video by yet another TV photographer - - which resulted in a hospital trip for Rodriguez. Rogers has already been fined 50K by Major League Baseball Commissioner Bud Selig and suspended for 20 games. And while the pitcher has issued a public apology, calling his actions "unacceptable behavior," WFAA-TV Dallas-Ft. Worth reports that Rogers had a verbal run-in with one of its photographers, Mike Zukerman, as he videotaped the pitcher's booking yesterday.

Emmis & Radio One
in charitable mood
Emmis Communications and Radio One announced a joint donation of $100,000 to the Center for Leadership Development in Indianapolis from the Emmis/Radio One Community Fund. Just last week at the Black Expo luncheon in the Hoosier capital, Emmis and Radio One also announced a $100,000 donation from the fund to the Rev. Charles Williams Prostate Cancer Unit.

July Digital Magazine
Now Available

Media Business Report:
"People Make the Difference" -- We've asked our readers to give recognition to the people that are making a difference in today's business environment.

GM Talkback:
Who in your company or stations deserves a pat on the back and why?

AdBiz:
Carat Americas CEO David Verklin: "Mastering a digital future" from advertising in a digital convergence world to improving metrics to the TV upfront and more.

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RBR Radar 2005

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

Eddie Fritts fires letter to
Congress on WCS-XM deal
Wrote members of Congress 7/14 claiming XM Satellite Radio's deal to buy WCS Wireless and its licenses is "part of a longstanding pattern of deception by the satellite radio industry." satellite companies have "proven once again they simply cannot be trusted." He asks the legislators to support the proposed H.R. 998 bill to solidify a prohibition against local content on satellite. RBR observation: We applaud Fritts and the NAB's efforts to initiate some way to make XM and Sirius follow the rule of their licenses, even though the entity that issued those licenses-The FCC-isn't. Please send your comments on this issue to [email protected] Your fellow broadcasters thank you.
07/18/05 RBR #139

Publisher Perspective
Foolish All are with Bill S.1372
Senators involved: Conrad Burns (R-MT) Mel Martinez (R-Fla.), Olympia Snowe (R-Me.) and George Allen (R-Va.). None of which have a clue what they are about to undertake and the potential problems all broadcasters and total media will face if this gains more speed. Why? What happens with bills? How much pork will be added to the belly. Our recommendation is these fabulous four should do a bus trip to Tampa, FL and take a tour of the Nielsen technology plant and talk with the 4,000 plus employees working on the issue at hand to find the pros and cons, especially Martinez. Hey Sen. Mel there are over 4,000 voters there you have done POed.
07/18/05 RBR #139

SBS to launch cable net too?
May be a bigger deal than anyone thought. This may be an entrée into a new national TV network for the broadcaster. What may help get it off the ground, so to speak is the SBS/Interep Hispanic Radio Network, which is already in the minds of broadcast buyers around the country. Not to mention the cross-promotional benefits already in place with the SBS radio stations across the country. The demand is definitely there for another national Hispanic TV net. Getting carriage is less and less a problem in the digital cable world. 07/18/05 RBR #139

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