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Volume 23, Issue 189, Jim Carnegie, Editor & Publisher
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Thursday Morning September 28th, 2006
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Radio News ®
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 Investors ask Emmis
to revive buyout bid
Calling Emmis Communications a "struggling public company," an investment advisor has asked the board of directors to revive buyout talks with CEO Jeff Smulyan, implying that the special committee should have accepted the 16.80 per share offer from Smulyan - up from his original 15.25. Arnhold and S. Bleichroeder Advisers, LLC claims to represent holders of 1.7% of Emmis shares. When Smulyan withdrew his bid in August, there was no public disclosure of how much more he had offered. But Emmis later filed details with the SEC indicating that Smulyan had boosted that to 16.80 before the talks broke down. "At this point, we can only conclude that responsibility for a deal not being reached with Mr. Smulyan lies squarely on the shoulders of the members of the Special Committee, who have apparently decided that a buy-out at or above 15.25 per share, and perhaps even as high as 16.80 per share, is inadequate," the letter made public yesterday said. The letter questioned whether turning down the 16.80 offer may be an "extreme over-reaction to perceived conflicts of interest" because of the directors' personal and business ties to Smulyan. Arnhold and S. Bleichroeder Advisers makes it clear it has no such worries. "If a deal is struck in the vicinity of 16.80, we would be quite surprised if the transaction did not receive overwhelming shareholder support," it said. The Emmis board did not immediately respond and Smulyan told RBR/TVBR he would have no comment because the letter was directed to the board, not to him.
| Read the letter |
Univision buyout approved
Only 60% approval by shareholders was required, but Univision says the final tally of "yes" votes was over 80% yesterday as shareholders agreed to sell their shares to Haim Saban and his backers for 36.25 per share in cash. Regulatory approvals are still needed and closing of the 13.7 billion deal is expected in the Spring of 2007. In addition to his own Saban Capital Group, Saban's group includes Madison Dearborn Partners, Providence Equity Partners, Texas Pacific Group, Thomas H. Lee Partners. At closing, they will pay Univision shareholders 12.3 billion in cash, most of it borrowed, and assume 1.4 billion in debt. At the NAB Radio Show last week in Dallas, Drew Marcus of Deutsche Bank revealed that the acquiring consortium of private equity funds will use debt leverage amounting to 11 times EBITDA (9/21/06 RBR #184).
RBR observation: That 80%+ tally tells us that Televisa and Venevision did not both vote their shares against the sale, since they hold in total more than 20%. It will be interesting to see whether Haim Saban tries to make peace with Televisa CEO Emilio Azcarraga Jean or simply works to build up in-house programming and programming from other sources so that Univision will be able to do without Televisa once their exclusive US programming contract expires in 2017. We also wait to see whether Saban embraces the radio business at Univision, having been exclusively a TV guy.
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Watchdog echoes call for FCC to stay out of content
Adam Thierer of the Progress and Freedom Foundation has weighed in with the FCC in the matter of the network broadcast of fleeting indecencies, and concludes that the tools available to parents to control the content coming into their home is sufficient, and therefore the FCC should stay out of the business of regulating content. "Consumers and parents have the ability to effectively filter and block undesirable programming within their homes today," he wrote. He also says the evidence is there that programmers and broadcasters are clearly making a strong effort to increase parental control. Sure, they could do more, he said, "...but it's important to realize that they are already doing quite a bit." On the free speech side, he argues, "...decisions about acceptable media content are extraordinarily personal; no two people or families will have the same set of values, especially in a nation as diverse as ours. Defining which 'community standard' is appropriate for purposes of regulating broadcast content, therefore, is increasingly difficult and raises serious First Amendment concerns...the most important 'community standard' is the household standard; the standard that each family sets for itself." He says that arguments that the tools are there but parents don't use them are invalid. "Parents have been empowered. It is now their responsibility to take advantage of the tools and controls at their disposal to determine what is acceptable within their homes for their families."
RBR observation: Amen.
 Tribune chief hits the road
to reassure troops
Just what is going to happen at Tribune Company now is anybody's guess. Now that CEO Dennis FitzSimons has come to terms with Tribune's largest shareholder, the Chandler family, on reorganizing partnerships and moving to consider all sorts of alternatives for asset sales and reorganization of the company (9/25/06 RBR #186), he is dealing with the concerns of employees about what is going to happen next. In a meeting with staffers at the Baltimore Sun, FitzSimons refused to make any specific promises. The Newspaper Guild, one of the unions representing workers at the newspaper, presented the CEO with a letter asking him to increase spending on the Baltimore paper "or sell the Sun to someone who will." But FitzSimons was quoted by the Sun as refusing to make any commitments regarding any single property. "We're looking at this on an entire company basis, and it just may not be possible to determine what's best for any one part of the company without first determining what's best for the whole company," FitzSimons told the Sun in an on-the-record interview before an off-the-record meeting with staffers. The Chicago Tribune, flagship of the company, has reported that the preferred plan for Tribune management would be to spin off most of the TV group in a tax-advantaged deal, sell several smaller newspapers and take the rest of the company private.
RBR observation: Tribune's lone radio property, WGN-AM Chicago, appears to be one of the assets that FitzSimons hopes to hold onto in what would be a private company after the spin-offs and sales are done. That's because the station is so closely tied to the Chicago Cubs, which he doesn't want to sell. Other assets expected to be held onto include Tribune's TV stations in New York, LA and Chicago and the biggest newspapers, particularly the Chicago Tribune and Los Angeles Times. That's despite the fact that several prominent moguls in LA have already stepped forward as would-be bidders to restore the Times to local ownership.
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 FCC approves LPFM transfer
The precedent has been set. The FCC has granted a waiver and approved the transfer of a construction permit for an un-built low-power FM station from the original applicant to an unrelated entity. The Hoyt Sherman Place Foundation (HSPF) was granted a CP for the 100-watt station on 99.1 mHz in Des Moines, IA. HSPF never put the station on the air. In fact, the CP expired, but HSPF sought a waiver for an extension in August 2005, saying it had all of the equipment needed, but needed more time to complete construction of its studios. That waiver was granted, giving HSPF until February 27, 2007 - three years from the date the original grant was made - to get the station on the air. In February 2006 HSPF submitted an application to transfer the CP to Employee & Family Resources Inc. (EFR), an unrelated non-profit corporation, requesting a waiver of the general ban on any transfer of LPFM stations. HSPF said it had determined that operating the station would be a drain on its financial resources. Florida Public Radio filed an informal objection, saying that HSPF and EFR had failed to present any unusual circumstances to justify a waiver. Peter Doyle, Chief of the Audio Division of the FCC Media Bureau, disagreed and granted the waiver, saying it would serve the public interest because no cash was exchanged and EFR was qualified to be an LPFM licensee.
RBR observation: The camel has stuck his nose under the tent. HSPF presented absolutely no justification for a waiver, which is only supposed to be granted in exceptional circumstances. It just decided it didn't want to build the LPFM after all - and went out and found someone else who did. If you read Doyle's grant letter, it spells out an extremely liberal interpretation of a waiver rule that the FCC said was to be applied only in extraordinary circumstances. This is exactly the opposite of what the Commission intended and this staff decision ought to be appealed to the full FCC for the reversal it deserves.
No anthrax in studio scare
Life is back to normal at KSCO-AM and KOMY-AM in Santa Cruz, CA after lab tests ruled out anthrax or any other biological weapon in white powder mailed to the station (9/27/06 RBR #188). More tests are being conducted to determine just what the powder was. According to the stations' website, lab tests by health authorities determined that the powder had no DNA. That ruled out a biological agent such as anthrax. The three employees who were exposed to the substance showed no reaction.
RBR observation: Better safe than sorry. An envelope of powder with no return address is certainly suspicious. The only way to find out if it is a hoax or the real thing is to do exactly what the people at KSCO/KOMY did - call for help from the experts. Being stripped down and decontaminated in a tent in the station parking lot is no fun, but better than risking death or injury.
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Ad Business Report TM
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Buyers on Arbitron's new reporting
We asked buyers to comment on the just-announced plans from Arbitron to include public and non-commercial radio stations in the Fall 2006 local electronic ratings reports-as well as work on adding satellite and HD-2 format listening in the mix too.
 Rich Russo, JL Media's SVP/Director of Broadcast Services, has mentioned this numerous times in the past: "Over the last year or so, I have on a few occasions via some print articles or at the Radio Symposium have stressed the need for the measurement system to measure all things audio that delivers a commercial-this is a huge and important step in the right direction. Once internet and streaming radio is included with this on a market by market basis under the same ratings umbrella, radio will have created a measurement system that is unparalleled in the traditional media world."
 Says Kim Vasey, Senior Partner/Director of Radio, mediaedge:cia: "I think it's an important first step in capturing all listening, no matter, station, format or listening device. As we move into the future, with HD Radio, satellite radio and internet radio it will become ESSENTIAL to demonstrate, to our clients, the radio industry's ability to capture listening and provide ratings data across all applications. It is a changing world and we must remain relevant in the consumer world by offering more choices and new platforms to tune into radio. To that end, we will need to report all listening. To have Arbitron report 'universally' is ideal."
 Said Natalie Swed Stone, US Director, National Radio Investment, OMD: "It is important that all program providers understand that good audience measurement is not an option-and not something they can withhold. We have always had the ability to derive audience figures for any radio vehicle and now with this announcement this will continue with new media options. Arbitron needs to continue to think along these lines as we move forward with PPM, etc."
New RAEL research released
The Radio Ad Effectiveness Lab (RAEL) released new research yesterday that examines the emotional attributes and consumer perceptions of advertising on four media-radio, the Internet, TV, and newspapers. The study was unveiled to a gathering of advertisers, marketers, reporters, advertising agency and financial community representatives, as well as radio industry executives during a special event held at Bloomberg in conjunction with Advertising Week in NYC.
| Read More... |
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| Media Business Report TM |
Rino Scanzoni on the commercial ratings summit
As part of an interview for our November RBR/TVBR Solutions Magazine, Mediaedge:cia Chief Investment Officer Rino Scanzoni spoke to RBR/TVBR this week about the 9/21 summit meeting he organized with NBC's Alan Wurtzel on commercial ratings. We asked,
"What can you tell us about the theme of the meeting? What were the issues?"
Said Scanzoni: "The theme was very, very simple and we made it very clear leading up to it, and even talking to the press that were obviously inquisitive about what the meeting was all about. The objective was very simple...
| Read More |
 TBS partners with ViTrue to launch "Funny or Not?"
Building upon its rebranding effort "Very Funny," TBS has signed with ViTrue, which pioneered a user-created ad platform, to create an online community, "Funny or Not?." It will enable viewers to create, produce and upload their own funny videos using ViTrue's platform and tools. Funny or Not? will be available to viewers at tbs.com and is TBS's first entrance into the user-generated content space. "As TBS continues to build its online presence, especially in terms of broadband entertainment, we are focusing on ways to engage our audience of comedy lovers in new and exciting ways," said Jennifer Dorian, SVP/branding and network strategy for TBS and TNT. "ViTrue provides us with an engaging technology platform that enables viewers to interact with our brand in a compelling way, while also being in line with TBS's views regarding the protection of copyrighted material online." TBS and its website is attracting a growing following, as evidenced by the recent response to veryfunnyads.com, which is receiving an overwhelming response from TBS viewers. Funny or Not? will launch in November and will be marketed by TBS via its website as well as, promotions, television spots on TBS and contests. Funny or Not? original video submissions may air on TBS between scheduled programming.
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| Media Markets & Money TM |
Doing a dunes deal
Thomas Troland and Ronald Polcari are getting beachfront property in the truest sense of the word. The Western neighbor of Truro MA, where WCDJ-FM is licensed, is Cape Cod Bay. To the East is the Atlantic Ocean. It's not far from the northern tip of the Cape. The duo's company, Dunes 102FM LLC, is getting the station from Truro Wireless Inc. for 550K. The station is said to be using a News/Talk format.
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| Washington Media Business Report TM |
FCC formalizes emergency branch
There's a new bureau in town, the FCC's Public Safety and Homeland Security Bureau. Formed in the wake of 9/11 and Hurricane Katrina, it will "...build on the Commission's longstanding commitment to meet the needs of public safety by promoting robust, reliable and resilient communications services in times of emergency." More importantly, it will build on the lessons learned during both of the aforementioned emergency events, which the FCC has put to diligent study. The Commission will be looking at first responder communications issues, but will also look at issues which affect broadcasters, like keeping the public informed, and returning and remaining on the air themselves. FCC Chairman Kevin Martin said, "The bureau will also serve as an informational clearinghouse for public safety and emergency response issues as they relate to Commission initiatives. It will work to ensure robust and reliable communications services by reaching out to stakeholders in order to encourage best practices, develop preparedness plans, and promote network reliability. And in times of emergency the bureau will lead the Commission's efforts to expedite relief and ensure that communications in effected areas are quickly restored."
RBR observation: During Hurricane Katrina, the FCC was one of the few bright spots in the government's overall lackluster response. Although its tools were limited, the FCC did what it could swiftly and effectively. That it has gone the extra mile to build on its already-solid record is to be commended.
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| Internet Media Business Report TM |
 MSN and Control Room
team for big performances
Control Room (formerly Network LIVE), a provider of live digital entertainment and MSN announced a multiyear, global live content distribution agreement. MSN will be the exclusive online worldwide destination via live and on-demand streaming for Control Room's slate of live music programming, and visitors to MSN Video will have ongoing access to live concerts from the most popular, top-selling musical artists as well as today's most talked-about breakthrough acts. Further, through this agreement, Microsoft may stream Control Room shows to other platforms, including Xbox Live, MSN Messenger, Microsoft Windows Media Player and Windows XP Media Center Edition. When the relationship officially begins 10/2, the nearly 465 million worldwide monthly visitors to MSN will get to see an exclusive performance from multiple-award-winning singer, songwriter and pianist John Legend, live from the Royal Albert Hall in London live at 4 p.m. EDT. In addition, another artist already scheduled to appear on MSN through the relationship with Control Room is John Mayer from Webster Hall in New York City.
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| Ratings & Research |
Scarborough and Solucient form strategic alliance
Scarborough Research and Solucient, a leading source of information products for the healthcare industry, have formed a strategic alliance to help marketers better understand today's healthcare consumers and how to reach them. Scarborough is embedding Solucient's HouseholdView proprietary life-stage segmentation system and HealthView Plus, Solucient's proprietary national research on consumer attitudes and behaviors around healthcare services, into Scarborough's databases on consumer shopping habits, media patterns, demographics and lifestyles. This will allow healthcare marketers to examine local consumer media utilization to create more efficient media plans targeting specific segments, based on healthcare needs. Marketers can also use segmentation information when planning other marketing programs, such as co-marketing initiatives. The HouseholdView segmentation system identifies 56 different types of healthcare households.
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| Transactions |
N/A WOKK-FM Meridian MS from New South Communications Inc. (Frank E. Holladay) to Mississippi Broadcasters LLC (Clay E. Holladay). Swap for WMMZ-FM Meridian MS. Superduopoly with WJXM-FM, WKZB-FM & WMLV-FM. [File date 9/5/06.]
N/A WMMZ-FM Meridian MS from Mississippi Broadcasters LLC (Clay E. Holladay) to New South Communications Inc. (Frank E. Holladay). Swap for WOKK-FM Meridian MS. Combo with WALT-AM. [File date 9/5/06.]
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| Stock Talk |
Almost a record...but not quite
An unexpected August rise in new home sales kept Wall Street traders in a buying mood, but that was tempered a bit by a rise in oil prices. In the end, the Dow Industrials rose again, but fell short of setting a record. The Dow was up 20 points, or 0.2%, to 11,689 - still the 2nd highest close ever.
Radio stocks were mixed. The Radio Index was actually down a tiny bit, falling 0.032, or 0.02%, to 140.736. Emmis rose 3.7% as a major shareholder called for the board to return to talks on a management buyout. Cumulus jumped 3.2%. Going the other way was Westwood One, down 2.2%.
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| Radio Stocks |
Here's how stocks fared on Wednesday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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37.41
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-0.03
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Hearst-Argyle
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HTV
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23.16
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-0.03
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Beasley
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BBGI
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7.00
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+0.06
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Journal Comm.
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JRN
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11.23
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+0.08
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| CBS CI. B |
CBS |
 |
28.45
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-0.31
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Lincoln Natl.
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LNC
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63.13
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+0.31
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| CBS CI. A |
CBSa |
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28.57
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-0.25
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Radio One, Cl. A
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ROIA
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6.24
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-0.07
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| Citadel |
CDL |
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9.45 |
-0.08 |
Radio One, Cl. D
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ROIAK
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6.28
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-0.03
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Clear Channel
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CCU
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29.05
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-0.28
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Regent
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RGCI
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3.88
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unch
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Cox Radio
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CXR
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15.25
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-0.03
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Saga Commun.
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SGA
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7.70
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-0.12
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Cumulus
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CMLS
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9.99
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+0.31
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Salem Comm.
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SALM
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11.30
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-0.19
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Disney
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DIS
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31.04
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-0.03
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Sirius Sat. Radio
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SIRI
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3.97
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+0.03
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Emmis
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EMMS
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12.55
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+0.45
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Spanish Bcg.
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SBSA
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4.31
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+0.05
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| Entercom |
ETM
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25.84
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+0.57
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Univision
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UVN
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34.40
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-0.04
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Entravision
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EVC
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7.48
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-0.02
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Westwood One
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WON
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7.11
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-0.16
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Fisher
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FSCI
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42.82
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+0.28
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XM Sat. Radio
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XMSR
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13.56
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-0.02
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Gaylord
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GET
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44.50
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-0.01
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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 and
a photo to [email protected]
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Below the Fold
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Ad Business Report
Arbitron's new reporting
We asked buyers to comment and we get an ear full...
New RAEL research released
Examines the emotional attributes & consumer perceptions of ads on 4 media...
Media Business Report
Commercial ratings summit
Insight from Rino Scanzoni, Mediaedge:cia...
Media Markets & Money
Doing a dunes deal
Beachfront property in the truest sense of the word...
Ratings & Research
Scarborough & Solucient
Form strategic alliance...
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Stations for Sale
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WANTED! FM CP's
(commercial or noncommercial)
John W. Saunders, Media Broker
713.789.4222
[email protected]
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Radio Media Moves
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Torres slugging
in Louisville
Cox Radio announced that Amy Torres has been named General Sales Manager of WSFR-FM Louisville, KY, effective October 11th. She joins Cox Radio from Federated Media, where she most recently served as General Sales Manager at WMEE-FM Fort Wayne, IN.
Six named to AP broadcast advisory board
The Associated Press broadcast division announced the selection of six new broadcasting senior executives to serve on its TV and Radio advisory board. The board gathered in Chicago this week for its semi-annual meeting. The new advisors include: Colleen Brown, president and CEO of Fisher Communications; Don Perry, president and CEO, Clear Channel Television; Deborah Collura, vice president of news, Post-Newsweek Stations; Ed Munson, vice president of television, LIN Television Corporation; Dan Lawrie, vice president and market manager for Cox Radio; and Susana Schuler, vice president of news, Raycom Media.
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Download Now
August '06 RBR/TVBR Solutions Magazine
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RBR Radar 2006
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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Univision buyout
The suspense ended earlier this month when Televisa said it would not be making a new bid for Univision so acceptance of the buyout bid from a consortium headed by Haim Saban is pretty much in the bag.
RBR observation: It will still take some time for this deal to get to closing. Saban and his equity fund backers will have to pay more than the 36.25 per share bid if the deal closes after April 26, 2007, so that is the target date to have this wrapped up. Then we will see whether Saban wants to sell any assets to reduce the debt load going forward. There has been lots of speculation about radio, since Saban has no radio background, but Univision Radio produces lots of cash flow for the company and is also important for promoting the TV/cable networks (Univision, TeleFutura and Galavision). The most likely unit to be sold is Univision Music Group, the poorly performing record labels. Of course, the problem with selling poorly performing assets is that no one will pay you a premium price for them.
09/27/06 RBR #188
Arthur Liu expands
radio empire into TV
E.W. Scripps has found a buyer for its five-station group of local home-shopper television stations. Brokered multicultural radio specialist Arthur Liu is getting the TV group for 170M. His appropriately named Multicultural Radio Broadcasting will now make room at the board room table for sister Multicultural Television Broadcasting. The deal will result in radio/TV combinations in two of the markets.
RBR observation: Multi-ethnic video programming has pretty much been the domain of cable TV up until now. We are not sure if that's the direction Liu is going, but we'd have to expect that's what he has in mind. And if anybody can figure out how to transfer the concept from radio to television, Liu would be the one we'd bet on.
09/27/06 RBR #188
Political spending on radio taking off
Bear Stearns investment clients, Evan Tracey, COO of the TNS Media Intelligence/Campaign Media Analysis Group, said one fallout from the McCain-Feingold campaign finance law is that campaigns are able to raise more hard money - with donors now being able to write checks for 2K rather than 1K. So while there may be less soft money elsewhere, the official campaigns have more cash to spend that ever before. TV inventory is tightening in some markets, plus just because of the amount of cash available, some campaigns are spending more on media apart from broadcast TV - primarily cable and radio. Republicans, in particular, said Tracey, are spending on radio to reach maximum saturation.
RBR observation: Hello Radio did you read this report that Republicans, in particular are spending on radio to reach maximum saturation. RBR has stated before and again, Look for Political be to a full Ad Category in 2007. Get your sales marketing team in place and start now to cultivate those dollars for 2008 when the Big cash will be spent.
09/26/06 RBR #187
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Marketing Director
WFAN is looking for an experienced Marketing Director. Responsibilities will include overseeing the promotions staff, development and execution of overall station marketing and promotions strategy and working with sales on creative approaches to sales materials. Experience in NY Metro area a plus. CBS owned station and is an EOE.
See Radio Careers
Local Sales Manager
KPLX 99.5 The WOLF, Texas Country in Dallas a Premier Country station in Top 5 market. Focus with Responsibilities: Achieving local sales goals, maintaining reputation and integrity of sales operation with clients while recruitment and retention of Account Managers with in-field coaching. Minimum 3 years large market Sales/Management, NTR, Interactive Media experience. Cumulus Radio Dallas is EOE.
See Radio Careers
Talk Radio Network
Seeking professionals in three areas to join our TRN team. First: Executive Producer on topical subjects, Second: Board Operator with 2 years experience with Telos call-screening software and Third: Staff Engineer that can take initiative. This is a fast paced high pressure environment, must be able to think and act professionally in emergency situations. EOE. For complete details on all three positions
See Radio Careers
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