Clear Channel grows in Delaware
There's only one Arbitron-rated market in the tiny state of Delaware, but Clear Channel is increasing its station count in Wilmington, DE from four to five. It's paying Delaware Broadcasting Company, headed by Sally Hawkins, just under four million dollars for WILM-AM in a deal brokered by Star Media Group. The acquisition gives Clear Channel a News/Talk station in the heart of the market to pair with WDOV-AM, which is actually located in Dover, DE, and WWTX-AM, its Sports/Talk station in Wilmington.

Happiness is a Lubbock, TX FM
for Entravision
Entravision is expanding to the FM band in Lubbock, TX, where it currently owns only KBZO-AM. It's paying American Media Services upgrade artist Ed Seeger and associates, doing business in this case as Littlefield Broadcasting, one and a half million dollars for KAIQ-FM. Entravision will also pay for the cost of building out a new Class C1 facility for the station on 95.5 mHz at Wolfforth, TX after changing its city of license from Littlefield, TX, where it had a C3 authorization.

Curtis adds again in the Research Triangle
Curtis Media Group may operate in only one state, but Don Curtis doesn't take a back seat to anyone when it comes to radio in the Raleigh-Durham, NC market. In his latest move, Curtis is paying Alchemy Communications 8.7 million dollars for WRBZ-AM. That will give Curtis an even dozen stations that show up in the Raleigh-Durham Arbitron book - - although, obviously, not all have contour overlaps.

Midway may merge with Viacom
Now that Sumner Redstone owns more than 80% of the stock of Midway Games (7/21/04 RBR Daily Epaper #141), it's hardly surprising that he's thinking of buying out the remaining shareholders. But it may be that Redstone himself wants to be bought out. According to a filing made last week at the SEC, Viacom has appointed a special committee of outside directors to evaluate possible acquisitions or partnerships in the video game industry. That's surprising, since over the time that Redstone has been amassing his stake in Midway, he has insisted that he was acting for himself, not Viacom, which he, of course, also controls.

RBR observation: Should Viacom pay Redstone 12 dollars each for his Midway shares? Even those that he bought for two bucks or less? After all, Redstone has been single-handedly driving the price of the stock up over the past year with his relentless buying. Would he now dare to stick Viacom shareholders with the bill for his overpaying? Quite a few Viacom investors would protest such a scenario - - and well they should.

Tips on how to buy a station, Part 2
In a recent speech to the Minority Media and Telecommunications Council, attorney Erwin Krasnow of Garvey Schubert Barer, and co-author of "Radio Deals: A Step by Step Guide," published by RBR, offered tips for people looking to buy a radio or TV station. Here's tip #2 on the negotiating process:

"Do your homework. Learn as much about the station, the competition, and the market as you can. You'll need to have the facts ready to support your negotiating position. A good negotiator is fully prepared to discuss every aspect of the deal and to respond to every question and comment. Consider getting a copy of the asset purchase agreement (APA) used by the seller in acquiring the target property (or if unavailable, other properties purchased by the seller). If it's a strong APA, it will be a great negotiating tool. - 'If a provision was needed by you to acquire a property, why is it not OK for me to use it?'"

As you'd expect, the bad news on the retail front was bad news for broadcast stocks. The Radio Index fell 2.923, or 1.3%, to 227.975. Regent had the worst day, falling 5.2%. SBS was down 4.9% and Salem was off 3.1%

08/24 - Listen to what Real Local Radio Should Be... Listen to this morning's AudioCast and
Hold On To Your Hair!

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"In Da Morning"

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This reader was sad to see Infinity return to Arbitron.

Arbitron...they control the radio ratings world
...they are disliked by most industry people
...they are said to be rude, arrogant and pushy
...they are accused of being over priced
...there are better more accurate systems

and yet Infinity did not have the backbone to go the distance against them, and the other big players hid in the closet while it played itself out. Makes one wonder if Arbitron has compromising pictures of all the industry players. What a shame that the 1,000-pound gorillas had to back down from the bully with the stick.

Tim Johnston
American Radio

Market Results
| Chicago |
| Los Angeles |
| Middlesex |
| Nassau |
| New York |
| Westchester |

Station owner faces sex charges

David Earl Hughes dies suddenly

Greater Media signs with
Media Monitors

Clear Channel auctions autographed guitars for Hurricane Charley fund

Laura Ingraham ratings soaring

NBC and Paxson
head back to court
The strained partnership between Paxson Communications and disgruntled shareholder NBC Universal is back for another round of battling in court. It looked like the conflict between the two companies was cooling down when NBC handled the upfront presentation for Pax this year in New York. But now NBC Universal has sued Paxson over the dividend payment that Paxson has to make on the 32% Paxson stake that NBC Universal owns in the form of preferred stock. Not that Paxson has actually ever paid a cash dividend mind you - - the 166 million in dividends due so far have merely accumulated to be paid at some future date. The 8% rate for the first five years of the preferred stock issue is due to be reset next month - - NBC Universal thinks it should be increased dramatically, say to 30%, while Paxson thinks 8% is just fine. "The terms at the heart of this dispute are clear and unambiguous and contradict the claim NBC has filed. We are disappointed that NBC chose to resort to litigation rather than accept the plain meaning of the Certificate of Designation," said Paxson CEO Bud Paxson.

RBR observation: NBC Universal is having to tread a thin line. Much as it would like to get back its 581 million dollar investment in Paxson - - the original 415 million that it paid, plus the 166 million in unpaid dividends - - there's no way that Paxson can pay more than a tiny portion of that today. So it's in NBC Universal's interest to keep Paxson healthy enough, indeed to improve it, so that someone else will be interested in buying it and cashing out NBC Universal. It's not a pleasant situation for either NBC Universal or Bud Paxson, but it looks like this unhappy marriage is going to drag on for a while yet.

RBR observation - - Why Arbitron stands unchallenged
Although plans by The Media Audit and Infinity Broadcasting to develop Radio Ratings USA are apparently still going ahead, despite Infinity signing a new contract with Arbitron last week, creation of a second radio ratings competitor in major markets is an idea that's unlikely to succeed in today's marketplace. Sure, plenty of radio stations would welcome having an alternative to Arbitron. But strangely, although they pay the bills, the client stations are not the key factor in the equation. The agencies are. They pay relatively little for their access to Arbitron data, but they control the ad dollars..
08/23/04 RBR #164

RBR Observation - - Infinity vs. Arbitron: The aftermath
Like the Wall Street analysts and most people in radio, we at RBR were not surprised that Infinity came back to subscribing to Arbitron's ratings after just a few weeks of operating ratings free. It had been tried before and the result was always the same. We're right back where we started as Arbitron is still the undisputed king of US radio ratings.
08/20/04 RBR #163

Analysts' conclusion:
Infinity blinked
You'd be hard-pressed to find anyone in radio or on Wall Street who believed that Infinity's refusal to renew its ratings contract with Arbitron in June was the final word on the matter. But many had expected a longer hold-out by Infinity.
RBR observation: If you bought Arbitron's stock back in June, figuring this is exactly what would happen, it looks like you made about 3.4% over less than two months. But if you were lucky enough to buy in at the recent low just last week, your profit was over 18% if you sold yesterday. Not a bad return either way. Analysts Kit Spring and Alissa Goldwasser tell it like it is.
08/19/04 RBR #162

RAEL releases first study:
How Radio Ads Affect Consumers
How radio and radio advertising works with listeners, how to maximize ROI and how radio ads can improved upon for effectiveness.
RBR observation: We're still not sure if the radio groups are kicking in enough dollars to fund all of this (RAB doesn't supply the funding details for RAEL), but the big showed up and that's a good sign. Bottom line: Any study can say people have a more personal feeling with radio spots, but too many spots and annoying spots from any medium will turn them away. Next step: Let's fix the programming and invest in the creative production of radio's content. 08/19/04 RBR #162

Infinity signs multi-year
deal with Arbitron
By bringing a good offer to the table, what it is we just are not sure yet, but whatever it is Infinity decided it was fair. RBR had stated the hard posturing from Infinity, may have been, but was, a bluff and wouldn't last a quarter. In fact, many in the industry said they knew this was all a "joke" from the start.
RBR observation: Infinity's biggest problem with Arbitron was and always will be price.
08/18/04 RBR #161