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Volume 22, Issue 169, Jim Carnegie, Editor & Publisher
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Monday Morning August 29th, 2005
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Radio News®
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 2005 the roll of the Dice; Tracking of a Soft Year
Less is More (LIM) and weak advertiser demand has kept a lid on radio revenue growth this year. And there's not much reason to think the rest of 2005 is going to be much better. Forecasts that seemed conservative six months ago are now looking overly optimistic. Universal McCann's Bob Coen started the year with a prediction that radio revenues would rise around 5% this year. He cut that aggressive view back to 3.5% last month for local radio, but held onto the 5% for network and national spot combined. Most Wall Street forecasters, though, are expecting much less - - and group owners have been careful not to over promise. Wachovia Securities analyst Marcia Ryvicker last week cut her 2005 growth estimate to 1.5% and provided her month-by-month projection. We've put that into a chart, along with the actual RAB monthly numbers for the first six months of the year. If anything, Ryvicker's numbers look optimistic for the second half of the year, given that we've already booked three flat months so far. Chart Source: January-June RAB actual results; July-December Wachovia Securities estimates
RBR observation: The bar is now set pretty low, but this is going to be one year when just about everyone can say that they outperformed the industry average - - and not be lying. That average is going to be held down by the giant of giants, Clear Channel, which is sticking to its Less is More plan and taking a big hit this year to set the stage for future growth. In their quarterly conference calls, group heads have been saying that each month out looks progressively better than the one before, so things are going in the right direction. It's just going to be a long, tough climb. The main key is focusing on being local with your content and sell local. RBR's advice - set your in-house tracking chart and then compare when we produce the overall national forecast. Break your in-house into local, national spot, network and other categories. This will become your road map for the balance of the year and get you pointed in the right direction for 2006.
 Will NAB move from
Eddie to "Gopher"?
Fred Grandy will always be known for his long-running role as "Gopher" on "The Love Boat," but he's done a lot more since his acting days. He was elected to four terms in the US House (as a Republican) from his native Iowa and then was CEO of Goodwill Industries for five years. He's well connected in Washington and lately has been morning co-host on WMAL-AM DC. The Wall Street Journal tipped Friday that Grandy is in the running to succeed Eddie Fritts as President and CEO of the NAB.
RBR observation: We hear that Grandy is indeed in the running, but not currently among the most likely candidates. RBR has been asked and has given only a few candidates to consider off the record to various executive committee members. Those names will go unmentioned as not to put their current positions in jeopardy. The qualifications check list RBR proposed: Youth or the demo of 48 that will lead for the next 15 years. Over all working knowledge of all communications issues with an emphasis on the inner dealings of Wall Street as money is a driving force and will be this way for years to come. An announcement is likely within weeks now.
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 Watchdog trying to take the air/wire
out from under Robertson
Saying the comments of 700 Club's Pat Robertson "...are not appropriate for children - - or anyone else, for that matter," media watchdog Media Matters for America is organizing a public campaign to have the show removed from the lineup of some of its biggest distributors. The campaign is directed at three basic cable offerings: ABC Family, FamilyNet and Trinity Broadcasting Network. "Numerous organizations and individuals, both religious and secular, have denounced [Robertson's] comments. Responsible shows and news outlets should think twice before providing him a platform from which to peddle his false and hateful claims."
RBR observation: In what is almost a refreshing change from protest business as usual, Media Matters refrained from composing a form letter for citizens to use. Instead, it offered tips about putting together an original, self-composed communication. "Be polite, and clearly state what you want," suggested the watchdog, "Make your subject line clear and concise. Limit your email to about 250 words or fewer. Include a Web link to any information you reference." To our way of thinking, 100 original letters have far more impact than 10K click-and-send copies of someone else's letter. We further note that Media Matters avoided what would be a futile attempt to get the FCC involved. Good move - - it does not appear there is a single thing the FCC could do.
SCOTUS air wars: Roberts winning 8-1
When it came to the Supreme Court issue, opponents of the Bush administration were spending 5 dollars for every three that supporters of the administration were spending on generic issue ads 200K to 120K, according to the Brennan Center for Justice (BCJ). They were generic ads by necessity, since at that time there was no nominee. Now that John Roberts' name is out there, the pendulum has swung drastically. Conservative groups have put 1.275M into advertising since the nomination was announced; compared to only 165K from liberal groups opposing Roberts. BCJ says almost all of the conservative campaigns have been mounted by Progress for America, both before and after the nomination was announced. A variety of liberal groups have run limited campaigns. The odds may even up some, though. "Since the nomination, television viewers in most states had been getting only one side of the debate," said Deborah Goldberg, Democracy Program Director at BCJ "But, just this week, a number of liberal groups formally announced their opposition to the nomination, so things may be about to change."
RBR observation: Senate confirmation hearings are set to begin next week, so if it doesn't heat up now, it isn't ever going to.
 Bill Frist White House run
already under ad attack
The mid-term elections are a year away, and the next contest for the presidency is two years after that. That contest has no major announced candidates, and certainly Senate Majority Leader Bill Frist (R-TN) has made no such announcement. But this is not stopping the Center for Reclaiming America (CRA) from kicking off an ad campaign in Iowa protesting his stand on stem cell research. The 50K ad buy is using both television and radio, and will possibly be expanded if the group is able to raise more cash, according to the Associated Press. CRA says the ads will be on TV in Des Moines and heard on radio statewide.
RBR observation: It's a staple of Washington pundit philosophy that the 2008 presidential campaign began the day after the 2004 election was decided. Still, we didn't think that meant it was already open season on candidates real and imagined by unaffiliated third party organizations. All potential candidates may as well realize they travel in an imaginary bull's-eye, and broadcasters may have to come to grips with a political category that is moving from occasional or seasonal activity to something approaching 24/7.
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Adbiz©
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 IPG working to keep BofA account
Four senior execs from agencies owned by Interpublic have visited Bank of America headquarters in Charlotte in recent days to try to retain the bank's advertising biz, according to The Wall Street Journal. To reinforce its pitch, Michael Roth, Interpublic's chairman and CEO, also stopped by the bank's HQ. The account, one of Interpublic's most prestigious, is valued at 60 million to 65 million in annual revenue. Since putting the account up for review, Bank of America has also heard pitches from Omnicom and WPP. The bank could make a decision as soon as next week, the story said. Bank of America consolidated its marketing and advertising duties with Interpublic in October 2002, with an account that was handled at the holding-company level, rather than by a specific Interpublic agency. Executives from Interpublic's direct-marketing agency Draft Worldwide and events-marketing firm Jack Morton Worldwide were among those to visit Charlotte.
WPP's profit up 45%, thanks to Grey Global
WPP Group reported its profit jumped 45% in the first half as the world's second-largest advertising firm benefited from its acquisition of Grey Global Group. The London-based company, which owns the Ogilvy & Mather, J. Walter Thompson and Young & Rubicam, also raised its outlook for the full year. Net income rose to 243.6 million in Q2. Revenue increased 22% to 4.47 billion. WPP's operating margin increased to 12.1% from 11.3%, helped by higher-than-expected revenue, which was boosted by the inclusion of Grey Global. Excluding the effect of the Grey by as well as currency fluctuations, WPP's revenue rose 6% during the period. Revenue growth was led by a 20% jump in revenue from North America, the firm's largest market, as well as strong revenue gains in the Asia-Pacific region. Revenue shot up 22% and 13% in China and India, respectively.
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| Media Markets & MoneyTM |
Tired of payola stories? How about Paoli?
Under the name Diamond Shores Broadcasting, Blair and Kelly Trask are adding to their modest southern Indiana radio group, and, in what is a highly unusual circumstance for active broadcasters, in so doing they'll be getting their very first O&Os. That's because it's operating three other stations under LMAs. The immediate deal involves WSEZ-AM/WUME-FM in Paoli, located in an Arbitron-free zone in the south-central portion of a market triangle formed by Louisville to the southeast, Bloomington IN to the north and Evansville to the southwest. William K. Reynolds and his Indiana Patoka Development Corp. will get 750K for the combo. The Trask's LMAs are for WZZB-AM/WQKC-FM in Seymour, to the northeast, and WAVG-AM in Jeffersonville, to the southeast. There is no overlap between stations in the three separate communities.
Correction:
In Friday's story on the closing of the deal for KNRC-AM in the Denver market, Jody McCoy should have been identified as a broker with the firm Media Services Group.
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| Washington Beat |
 Done deal undone by FCC
The permit for KOWH-TV, a CP earmarked for Channel 51 in Lincoln NE, and licensed to Lincoln Broadcasting LLC, was approved by the FCC for transfer from World Investments Inc. to CFM Communications LLC for 300K, a deal filed in March 2004 in which CFM actually stepped in as buyer for Pappas Telecasting Company. The FCC approval came 5/24/05, and was closed in a flash, on 6/3/05. However, the grant was not scheduled to be final until 6/23/05. The FCC is now telling World to re-establish control of the permit or risk the consequences of being the licensee of an abandoned facility. The FCC said that any licensees which close in advance of the final date "...do so solely at their own risk." World's plea that is will be inconvenienced by being forced back into control and having the deal undone is not relevant, according to the Commission, particularly when compared to the public inconvenience at having a questionable licensee in control of the station instead. That would be the case in this instance, as the reason for the rescission of the grant was to allow time for a character investigation of the proposed buyer. The FCC is taking a stern tack in the case - - it will not even honor a request from both parties to toll the construction deadline while the second regulatory look into the transaction runs its course.
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| Programming |
 Greater Media flipping WPEN
to Sports in Philly
Greater Media Philadelphia announced its New Sports Talk 950 on Oldies WPEN will launch October 3rd. The new interview-based, sports/talk-oriented format will provide listeners with sports variety, facts, info and talk. It will also feature Jim Rome and Jody McDonald, former host at WIP Philadelphia and WFAN NY. Station Manager Bob DeBlois stated "This is an exciting opportunity for WPEN. Philadelphia has more passion for sports than any other city in America. Although we made progress with Oldies, we feel a true sports talk station like Sports Talk 950 would be the perfect fit to satisfy the Philly sports fans incredible appetite for great sports." Surely to be an interesting battle with 16 year sports programming veteran of WIP (610-AM) and WPHY (920-AM).
RBR observation: It was a long programming rumor in Philly that a new ESPN affiliate was coming in and it was to WPEN but no go. Good move for 950am by the crew at Greater Media of Market Manager John Fullam and Bob DeBlois and it beats hearing Bobby Vinton. Philly home of every sport - NBA, NFL, MLB, NHL, with college and local and it now a licensed Philly station. Key is limit your content from the bird and build local Philly sports as you are with McDonald and when you use outside talent make sure they are experts in their field. You'll get the chatter in the city of brotherly love. Last the signal: the FCC has approved WPEN from 5 kw to 50 kw slated to kick in right around the time of the launch of the sports format and will be more powerful than that currently generated by WIP.
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| Monday Morning Makers & Shakers |
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Transactions: 7/18/05-7/22/05
It was a nine-digit week, the first since the middle of April, and you have to go all the way back to 2/7-11/05 to find a higher bottom line than that filed with the FCC at summer's midpoint. But just about all of the value came from only two deals, a double-FM spin-off in San Jose and a marginal TV deal in Nashville. Otherwise, it was verrrrrry quiet. But we have it on good authority that things in this little weekly department are going to heat up soon.
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Total
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Total Deals
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11
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AMs
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5
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FMs
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8
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TVs
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1
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| Value |
107.242M
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| Complete Charts |
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Radio Transactions of the Week
NextMedia finds the way to San Jose
| More... |
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TV Transactions of the Week
Sinclair hopes failure leads to triple play
| More... |
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| Transactions |
80M KEZR-FM & KBAY-FM San Jose CA (San Jose, Gilroy CA) from Infinity Radio Inc., a subsidiary of Viacom Corporation (Suner Redstone) to NM Licensing LLC, a subsidiary of NextMedia Group (Carl Hirsch, Steven Dinetz, Samuel Weller, Sean Stover, Jeffrey Dinetz, Matthew Leibowitz, Ranny Wong). 4M letter of credit in escrow, balance in cash at closing. Existing duopoly. LMA until closing. [File date 7/18/05.]
24.37M WNAB-TV Nashville TN from Nashville License Holdings LLC (Michael Lambert) to WNAB Licensee LLC, a subsidiary of Sinclair Communications Inc. (David D. Smith et al). 750K option fee, 18M payment for intellectual property, 5.62M for license assets. Triopoly with WZTZ-TV & WUXP-TV. SSA since 5/02. Buyer is seeking failing station waiver from the FCC. WNAB is a WB affiliate on Channel 58; WZTZ is a Fox affiliate on Channel 17; and WUXP is a UPN affiliate on Channel 30. [File date 7/22/05.]
0 WSGG-FM Norfolk CT from Revival Christian Ministries Inc. (Sam Girona) to Sam Girona Ministries Inc. (Sam Girona). Donation. Noncommercial station. [File date 7/19/05.]
0 KAEN-FM CP Melbourne AR from Abundant Life Broadcasting (Frances C. Price) to American Family Association (Donald E. Wildmon). Donation. Station is noncommercial. CP is for Class A on 90.3 mHz with 1 kw @ 735'. [File date 7/19/05.]
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| Stock Talk |
Stocks fall despite lower oil prices
Oil prices retreated on Friday, but stock traders weren't impressed. Instead, they focused on somewhat negative comments from Fed Chairman Alan Greenspan about the economy. The Dow Industrials fell 53 points, or 0.5%, to 10,397.
Radio stocks also fell. The Radio Index dropped 1.660, or 0.8%, to 203.574. Salem was the day's worst performer, down 3.1%. One of the few gainers was Fisher, up 3.7%.
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| Radio Stocks |
Here's how stocks fared on Friday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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41.69
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-0.26
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Jeff-Pilot
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JP
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49.48
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-0.35
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Beasley
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BBGI
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13.78
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-0.38
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Journal Comm.
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JRN
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15.80
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+0.02
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| Citadel |
CDL |
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13.47 |
-0.19 |
Radio One, Cl. A
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ROIA
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14.03
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+0.03
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Clear Channel
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CCU
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32.89
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-0.51
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Radio One, Cl. D
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ROIAK
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14.07
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+0.02
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Cox Radio
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CXR
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14.89
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-0.08
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Regent
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RGCI
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5.36
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-0.05
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Cumulus
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CMLS
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12.26
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+0.05
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Saga Commun.
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SGA
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13.75
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+0.11
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Disney
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DIS
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25.33
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+0.13
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Salem Comm.
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SALM
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18.09
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-0.57
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Emmis
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EMMS
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23.41
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-0.01
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Sirius Sat. Radio
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SIRI
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6.70
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+0.12
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| Entercom |
ETM
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32.55
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-0.30
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Spanish Bcg.
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SBSA
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7.67
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-0.04
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Entravision
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EVC
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7.72
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-0.04
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Univision
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UVN
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26.40
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-0.08
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Fisher
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FSCI
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47.44
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+1.69
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Viacom, Cl. A
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VIA
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33.84
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-0.23
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Gaylord
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GET
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44.09
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-0.60
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Viacom, Cl. B
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VIAb
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33.77
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-0.23
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Hearst-Argyle
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HTV
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25.86
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+0.17
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Westwood One
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WON
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20.10
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-0.17
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Interep
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IREP
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0.60
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+0.02
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XM Sat. Radio
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XMSR
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33.73
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-0.14
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International Bcg.
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IBCS
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0.01
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unch
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-
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-
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- |
-
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-
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Bounceback
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 We want to
hear from you.
This is your column, so send your comments to [email protected]
More on branding HD Radio
(5/25/05 RBR #167).
 RBR/TVBR has a great take on the Class of 2009, but I think the class of 09 may be a little too "old." Talk to an 11 year old kid, that's who knows what's going on. I know -I have one. It's amazing how fast they catch on to technology and find innovative ways to use it. Back in my day we had a boom box (with cassette) and we liked it!
Just a thought.
Kim Styles
Styles Media Group
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Radio Media Moves
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ABC News Radio
ups Blaustein
ABC News Radio announced David Blaustein has been promoted to Senior Entertainment Producer and Reporter, based in NYC. He was previously the producer of "What Else is News," a feed of various features available to ABC News Radio affiliates, where he broke many major entertainment stories.
Changes at Zeo
Scott Thomas announced that he's returned to Zeo Radio Networks as CEO after a 2-month leave of absence. Rico Garcia, who had been acting prez, is now President. DJ JReam has joined the company as Utility Mixer and Andrew Bagley has dropped "assistant" from his title to become Director of Public Relations. Gone are former VP Eddie Hollenbeck and Sales Associate Geoff Allen.
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Stations for Sale
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Suburban NYC AM
Good population coverage. Comes with studio/transmitter site. Fulltime station w. low night power, upgrade possible. 1.6M. 781-848-4201
[email protected]
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NAB Daytime Planner
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The following brokers will be attending the NAB. Call or email to make your appointment in advance.
American Media Services,
Todd Fowler, David Reeder,
843-972-2200, Marriott,
[email protected], [email protected]
Clifton Gardiner & Company,
Cliff Gardiner, 303-758-6900,
Ritz-Carlton Hotel,
[email protected]
Force Communications, Hal Gore, John Laurer, Stan Raymond,
770-329-2234, Hilton Garden Inn, [email protected]
Frank Boyle & Co., Frank Boyle,
203-969-2020, Marriott Courtyard, [email protected]
Gordon Rice Associates,
Gordon Rice, 843-884-3590,
Marriott Downtown, [email protected]
Henson Media, Inc. Ed Henson,
502-589-0060, Loews Hotel, [email protected]
John Pierce & Company LLC,
John Pierce, Cell 859-512-3015,
Jamie Rasnick, Cell 513-252-1186,
859-647-0101 Hilton Garden Inn,
Kozacko Media Services,
Dick Kozacko, Cell 607-738-1219,
George Kimble, 607-733-7138,
Marriott, [email protected]
MCH Enterprises, Inc.,
Brett Miller, Cell 805-680-2265,
805-237-0952, Marriott Courtyard,
[email protected]
Patrick Communications,
Larry Patrick, Greg Guy,
410-740-0250, Marriott, [email protected], [email protected]
Schutz & Company,
Bill Schutz, Cell 757-880-9251,
757-258-8740, Loews Hotel, [email protected]
Serafin Bros., Glenn Serafin,
cell 813-494-6875, 813-885-6060, Marriott Downtown, [email protected]
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RBR Radar 2005
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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RBR Publisher observation
HD and the Class of 2009
Take our observation words to heart and if there was a time and place to slow down and breath into a brown paper bag - this is it - we in radio are only going to get one shot at the HD future or what I call the college graduating class of 2009. Those college Freshmen/women were born in 1987 and to them what they see today is a mobile device driven society. No books but hand devices, laptops, etc is where it is today. Forget the '20s, '50s or in my era of the '60s by asking this class about that time, events because if you do you get their reply - "Well - whatever." The leaders of our radio business best sit down and not at an NAB convention or board meeting but in an atmosphere that is non-combative but - fear I say it - 'Think Tank' it out by getting up close with manufacturers of the potential sets and even the auto business. Talk with the designers of the Ipod etc. Nothing is too far out when asking questions for verbatim input because we in radio call that a focus group. RBR will work with our radio business with thought reports on HD so don't watch your post office box but watch your email box because that is how our reports will be sent - electronic like 'When ever.'
08/26/05 RBR #168
Analyst cuts Radio Forecast
That's becoming the all-purpose headline of 2005. In the latest move by a Wall Street analyst to ratchet down their outlook for radio at Wachovia Securities has dropped her July forecast to flat from her previous expectation that radio revenues would be up 2% as 2005 growth is now an anemic 1.5%. Wachovia's Marci Ryvicker see the industry is in a transition phase that is likely to last another 6-12 months as operators reduce inventory, implement iPod-like format changes, and upgrade to HD Radio believing that radio will resume mid-single-digit top line growth once it cycles through its many changes, likely in 2007. RBR observation: Ryvicker may be slightly below the Wall Street consensus at this point, but we won't be surprised to see other analysts lower their projections yet again, particularly if the RAB's monthly report for July, which should be out in a few days, shows another flat or near-flat month. With radio revenues up only 1% for the first half of the year, there's no way that 2005 is going to turn into a stellar growth year. Bottom line looking almost 2 years out for a rebirth - Hello - the radio medium doesn't have 2 years to get its act together. Crunch reality people. 08/26/05 RBR #168
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Market Manager
To lead in Montgomery, Alabama our new Hallelujah 104 and our station group to new levels of success. Our three Urban stations now dominate the market and need this keep person to be community involved and provide leadership to a hungry sales staff. See our qualifications and if you have them you are encourage to joint our team at Clear Channel in Montgomery. In confidence contact us. See Radio Careers
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©2005 Radio Business Report, Inc. All rights reserved.
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