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Welcome to RBR's Daily Epaper
Volume 23, Issue 206, Jim Carnegie, Editor & Publisher
Monday Morning October 23rd, 2006

Radio News ®

Campaign cash flowing in
and right back out

One report shows that the National Republican Congressional Committee has spend more than 35M since 9/1/06. Another showed national Democratic Committees lagging in funding but at the same time doing a good job of playing catch-up. 527s are dropping soft money into the action again. And the FEC notes that a heaping helping of the dish from the national committees has a negative odor to it. The consensus grand total of spending we've been seeing for this political cycle is 1.4B. National income results for September, per the Associated Press, were 5.6M in and 8.2M on hand for the Democratic National Committee; 13.6M raised and 23.1M on hand for the Democratic Senatorial Campaign Committee; 14.4M raised and 36M on hand for the Democratic Congressional Campaign Committee, for a total of 33.6M raised and 67.3M on hand. On the other side, it played out with the Republican National Committee bringing in 13M with 26M on hand; 5.15M raised and 12M on hand for the Republican Senatorial Campaign Committee; 12M raised and 39.2M on hand for the Republican Congressional Campaign Committee, for a total of 30.15M raised and 77.2M on hand. And do you like that mud? Per the FEC, in the Senate battle, the DSCC has spent 4.5M on positive ads, against 10.63M that attack opponents. That is more than 2-1 negative, but it pales against the RSCC's 168K positive against 8.8M negative. On the House side, the DCCC has spent 3.1M positive against 18M negative, again paling in comparison to the RCCC's 5M positive and 41.9M negative.

RBR observation: There are no signs that anything is going to slow down right up until 11/7/06. The Democrats have even borrowed money to spread around from coast to coast. While TV is expected to benefit from a lot of this spending, radio certainly gets a chunk, and as Journal Broadcast Group's Doug Kiel pointed out this week, political-choked TV inventory spot loads tend to slide a certain amount of business radio's way, particularly from national buyers. If you're in a hot spot, the next two weeks and change figure to be especially crazy.

Publisher note: Watch closely the political dollar as it will grow. Stop thinking political is only during elections because it is a business and a big business with massive war chests which raise cash consistently. Bottom line: Get your local stations geared to spend time with these campaign fund managers locally and in the nation's capital as it might be a wise idea to retain a former political aid in the capacity of Political Sales Manager.

Sirius now has repeater issues
Only days after XM confessed a good number of its terrestrial repeaters were over-powered or not located where the licenses stated, Sirius is now admitting to some similar illegally operated repeaters. Sirius filed with the FCC requesting Special Temporary Authority to fix problems for some 11 repeaters and, like XM, is requesting to continue operating them for 30 days as they stand before an STA is granted.

RBR observation: Like we've said re: XM, Whitney Radio President Bill O'Shaughnessy years ago pounded the drums on this issue for all the trade press-and NAB-to hear: The repeaters were being operated illegally all over the place in his territory of Westchester County, NY as well as plenty of other areas. It will be interesting to see what the FCC might decide to do on this. Many broadcasters and The NAB have wondered why there are so many repeaters for the satcasters and questioned possible ulterior motives for future local services and content.


Diageo gets with the spirit of not serving teens
In the wake of studies showing that one of the leading causes of underage drinking is access provided by family and friends, leading manufacturer Diageo has announced full support of the FTC/The Century Council "We Don't Serve Teens" campaign. The spotlight on family and friends suggests that those watchdogs blaming advertising for the problem are not necessarily barking up the right tree. Arbitron last month drew the curtains on a new online tool allowing radio stations, clients and advertisers to check out 21+ audience composition by daypart, making it easy to see who should be included in a beer or wine campaign, keyed to the alcohol industry's standard that no more than 30% of a given audience be underage. The thrust behind the "We Don't Serve Teens" program is to attempt to make a meaningful impact towards solving the problem. At the same time, it could possibly head off repeated attempts from various organizations to lower halve the audience composition benchmark down to 15%. Diageo's Ivan Menezes commented, "Our steadfast commitment to preventing underage drinking does not stop here. We will continue to fight this battle and we encourage parents to help us by becoming part of the solution."

RBR observation: There are many factors that lead to underage drinking. Family history is one, and is dramatically underscored by the finding that the family itself may not only provide the inclination to drink, but is even providing the actual drink itself. You can't blame everything on advertising, and doing so often causes would-be problem-solvers to completely ignore real causes.

Adelstein revises comments
on CBS settlement

FCC Commissioner Jonathan Adelstein crossed the line when he said CBS radio "finally admitting wrongdoing" when it settled its account with Eliot Spitzer in the New York payola probe, and actually crossed that line out of the statement in a revision. CBS did nothing of the kind, stating for the record that it became aware of a problem involving two employees in one market and took appropriate disciplinary action, all before Spitzer was ever involved. It agreed to the settlement to get the matter over with. CBS issued a statement to fully explain its decision, saying, "CBS Radio is pleased to end this two-year music investigation without litigation. The Company, however, wants to make clear that in entering into this settlement, CBS Radio does not admit to any liability or violation of law. Prior to the Attorney General's investigation, CBS Radio had become aware of conduct that was inconsistent with the Company's internal policies by two employees in one of its markets. CBS Radio took appropriate disciplinary action, with suspension without pay in one instance, and immediate termination in the other. We believe this outcome is better for our company and our shareholders than protracted litigation, and we appreciate the spirit of mutual cooperation that guided the resolution of this settlement."

RBR observation: The use of this form of consent decree is reminiscent of another a government/broadcaster entanglement that has resulted in the use of consent decrees, that being the indecency wars. In both cases, the prosecuting government entity makes a lot of noise trumpeting the obvious guilt of its corporate target when in fact; there is considerable doubt that the prosecution's case will withstand court challenge. The question for the broadcasting company is whether or not it wants to perform a public service for all other broadcasters by taking the matter to court, which is an expensive and time-consuming proposition. This may yet make it to court, although some have speculated that the CBS deal may increase the likelihood that others caught up in Spitzer's dragnet may take the same side door out. Stay tuned.


Give me liberty from Liberty
Rupert Murdoch, among his many other accomplishments, remains a bitter pill to swallow, or so does his News Corp., thanks to a narrow vote to that affect by stockholders late last week. A small majority of the company agreed to keep a poison pill in place, which gives Murdoch needed muscle in for an ongoing arm-wrestling match with Liberty Media's John Malone. According to Reuters, Murdoch holds about 30% of News Corp., while Malone has quietly accumulated almost 20%. The provision wasn't in imminent danger of expiring, but the vote will increase its lifespan to roughly two years from now, extending it from 11/07 t0 10/08. The two groups are looking at possible swaps, with the possibility that New Corp. would send satellite service DirecTV to Liberty in exchange for Malone's News Corp. stake.

Million-dollar finding against station for naming suspect
NBC KSNW-TV Wichita KS has been hit with a 1.1M penalty in connection to the famed BTK killer case. During the investigation and hunt for the murderer, according to the Associated Press, Roger Valdez was arrested by police as a suspect in the case on 12/1/04, and KSNW reported that fact. Valdez of course turned out not to be the killer, and asked a court for 2M from KSNW for defamation. The jury did not go that high, but did award 800K for "suffering, humiliation and shame" and 300K for "damage to his reputation." The station, now owned by SJL Broadcast Group, was owned by Emmis Communications at the time. It is argued that they did nothing more than report the news. They will appeal on First Amendment grounds.

RBR observation: Attorneys also noted that Valdez's suffering did not move him to consult either a medical, psychiatric, clergy or other form of counseling. Just legal counseling. But that shouldn't matter. If Valdez was named as a suspect in public by the police, that should be enough. It's like during the anthrax scare following 9/11, and AG John Ashcroft named an individual as a person of interest. That individual (and we will not dredge his name up again here) may have a case against Ashcroft for damaging his good name, but he should have no case against the journalists who reported it. Bottom line, KSNW cannot be held responsible for the fact that it when Valdez was undergoing a series of unfortunate events, it also happened to be extremely newsworthy. If KSNW-TV has reported the identity of the actual BTK killer and thus noted that it was not Valdez, they should not owe anything further for simply doing their job. We hope they win on appeal.


Executive Comment
RBR continues our series hearing from radio executives on the status of our radio medium today and for tomorrow. If you have a comment feel free to send them along with total word count 250 and your photo to [email protected]

What are three things that radio must do
to be competitive in this new media environment?


William O'Shaughnessy,
President & Editorial Director, Whitney Radio:
Once again I'm flattered and honored to be asked to offer some thoughts to the very essential question which you and Jim have proposed. To be competitive in the new media environment the following three things have to occur if our tribe is to have a fighting chance:

1. Free ourselves from the shackles of government intrusion into our creative processes. We are at the People's business ... and we must learn to trust only them to censure the sometimes raucous and inartful product of our endeavors.
2. Strengthen and encourage hometown, independent and community broadcasters and create a turf on which entrepreneurs can once more run.
3. Acknowledge that this is a profession rather than an industry.

I know some of this may seem a little "pie in the sky" and perhaps even a little vague. But this is what we must do to remain relevant.

Rick Buckley, owner & CEO, Buckley Broadcasting:
Radio must be the king of local media and this can't be just lip service. We have to own our communities and or markets. HD represents the biggest change to radio since the advent of FM and we must support this new technology which puts us on an equal basis with all digital media... We also have to start selling the positives of radio to the public at large and stop the negative press that's been the focus of not only the trades but the newspapers as well... We are not dead, yet !


Wall Street Media Business Report TM
More conference calls lined up
Three more broadcast companies have put themselves on the schedule for what is generally the Q3 2006 results report calendar. Middle-market radio operator Regent Communications will be meeting with analysts over the wires a 9:00 AM on Friday, 11/3/06. Religious radio leader Salem Communications has booked the services of a teleconference venue for Monday, 11/6/06 at noon. And eight-station television group ACME Communications (Wiley T. Coyote's favorite) will hit the phones Tuesday 11/14/06 at 11:30. All times are Eastern. As usual, RBR/TVBR will listen in so you don't have to.


Ad Business Report TM

Looking to grow your revenue?
by Kim Vasey,
Senior Partner/Director of Radio, mediaedge:cia
I love to learn new things and I am constantly looking for new seminars, lectures and books that will help me - help my clients. And, whenever I attend a seminar it is always with a two fold purpose. One: is to learn something new that will help me help sell in radio to my clients and two: is to learn something to share with the Account Executives around the country who work tirelessly every week selling radio solutions to local and national accounts. I believe that we, as an industry, must share information with each other so that we can continue to increase our success rate and demonstrate to clients the real power of radio. We must always be looking to learn new approaches for solving and executing marketing solutions that deliver real results. By creating and developing solutions that are specific to a client's needs we eliminate the "pushing a package" approach to selling and begin to build a solid foundation of confidence and trust. When we take the time to sell solutions rather than packages we have greater chance of having a client for life. A client who believes in us knows we have their best interest at heart and that we're not in it to just make a sale.
| Read More... |


Media Markets & Money TM
Small market advocate expands
Alex Kolobielski has gone the extra mile for small market broadcasters, sitting before the US Senate to plead the case for his group and others like it. Now he's going a few extra miles to find some cluster mates for WOWQ-FM Du Bois PA. His First Media Radio is getting WCPA-AM and WQYX-FM Clearfield PA to that end. The seller, Robert E. Day's Clearfield Broadcasters, will pick up 750K for the combo. Both Du Bois and Clearfield are on east-west running I-80, which looks roughly like the state of Pennsylvania's equator, and in market terms, they are in the middle of nowhere. Both are northeast of groundhog-famed Punxsutawney (itself unrated), slightly and more so, respectively, and the Clearfield stations operate within the eastern portion of WOWQ-FM's coverage map. First Media operates stations in small or unrated markets in Pennsylvania, Maryland, West Virginia, Virginia and North Carolina.


Washington Media Business Report TM
Ohio stations kill political ad
The battle for the Senate seat between two current members of the US Congress has been one of the hot battlegrounds. Mike DeWine (R-OH) is defending the seat against US Rep. Sherrod Brown (D-OH), and it's one of the several that are being watched closely at the national level as the Republican hold on the Senate hangs in the balance. Last week, poll results trending toward Brown led to reports that the national campaign cash-distributor Republican National Senatorial Committee had abandoned DeWine, but the cash was quickly countered by an influx of money from the Republican National Committee. It pumped over 700K into a negative ad which claimed that Brown was a tax dodger, having skipped out on a 1992 unemployment tax bill of the ironically patriotic sum of 1,776 dollars. Brown's campaign cried foul, and even the DeWine campaign felt the ads needed to be tweaked, but RNC refused to alter them. But the charge was false. Brown was apparently late with the tax, but paid it off shortly after having been served by the state with a lien on it. The state released the lien. But according to the RNC, they found a document listing the matter as active into the year 2005. But the Brown campaign had their claim that the tax was paid long ago affirmed by the state. According to sources, Ohio stations confronted with this preponderance of evidence have declined to run the ad.

RBR observation: Once again, broadcasters are forced to play referee in an ugly and negative mudslinging campaign, concerning a matter that took place over a decade ago, with absolutely nothing to do with the issues currently facing the country, and over what amounts to a pittance compared to the amount of money at stake in the big issues of the day. Politicians continually wonder why they shouldn't get free access to the public airwaves. Because so often politicians use the airwaves for at best misleading and at worst utterly false garbage is the main reason we are glad that the continuous assaults on broadcast inventory have thus far been turned back.


Internet Media Business Report TM
Google Q3 revenue soars 70%
Google last week reported its Q3 profits nearly doubled, with revenue up 70%. The company earned 733 million, or 2.36 a share, compared with 381 million, or 1.32 per share, in Q3 '05. Revenue rose to 2.69 billion, from 1.58 billion last year. Google CFO George Reyes said weaker traffic growth was offset by growth in online advertising. 60% of its ad revenue came from its own sites and 39% came from members of it AdSense network (websites and other online publishers that display Google ads). Google Co-founder Sergey Brin was excited about video and video search after the recent announcement the company plans to buy YouTube for 1.65 billion. He said video will be integrated more and more into Google searches. Web traffic to Google sites grew 22% in Q3 compared with last year, according to Nielsen/NetRatings, with an increase of average monthly unique users of 98.4 million from 80.3 million.

Publisher observation: Being excited on what one does best is the best way to stay positive. Google is a Search Engine and YouTube is a good buy before someone else Gobbled it up. Caution: Do not take all at face value with anything else Google is doing on our media side of ad sales. Remember there are firms in the field right this minute moving advertising inventory and placing real spot dollars at the Local Radio station level. Not remnant business. Perception is reality and when one thinks Google one can only think Search.


Monday Morning Makers & Shakers

Transactions: 9/4/06-9/8/06
Even though two deals topped the 40M mark (you'll see them below in transactions of the week), the 13 remaining transactions filed this week did not have enough value to push the total to 100M. One, involving seven FMs in seven markets, went for only 575K. That's what happens when the stations involved are noncommercial CPs.

9/4/06-9/8/06

Total

Total Deals

15

AMs

7

FMs

22

TVs

1
Value
92.422M
| Complete Charts |
Radio Transactions of the Week
CBS to Entercom IV
| More...
|
TV Transactions of the Week
Newspaper company rings Hanna's Bell
| More...
|


Transactions
113.7M WLVI-TV Boston (Cambridge MA) from WLVI Inc., a subsidiary of Tribune Broadcasting Company (Dennis J. FitzSimons) to WHDH-TV, a subsidiary of Sunbeam Television Corporation[ (Edmund Ansin). Cash. Duopoly with WHDH-TV. WLVI is a CW affiliate on Channel 56; WHDH is an NBC affiliate on Channel 7. [File date 9/29/06.]

275K WIXI-AM Birmingham AL (Jasper AL) from James T. Lee to Walker Broadcasting Inc. (James Pereira III). 50K escrow paid at closing, two notes valued at 175K and 50K. LMA until closing at 2K/month + expenses. [File date 10/2/06.]

75K KTHO-AM South Lake Tahoe CA from Kidd Communications (Chris W. Kidd) to Live Wire Media Partners LLC (Gary Krausse, Steven F. Coombs, Andrew Peressin). 7.5K deposit, balance in cash at closing. [File date 9/28/06.]


Stock Talk
Did Arbitron save the day?
Ratings giant Arbitron met with analysts Thursday, and on Friday enjoyed a 1.33 surge in its share price. That's enough to the top five losers on our radio chart (Salem, XM, Lincoln National and two from CBS). Throw in most of the others who either gained or lost a few pennies and it was a fairly even day. Throw out Arbitron, though, and it was another negative one.


Radio Stocks

Here's how stocks fared on Friday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

40.12

+1.33

Hearst-Argyle

HTV

23.54

unch

Beasley

BBGI

6.90

+0.05

Journal Comm.

JRN

11.70

-0.03

CBS CI. B CBS

27.93

-0.26

Lincoln Natl.

LNC

63.86

-0.21

CBS CI. A CBSa

27.89

-0.30

Radio One, Cl. A

ROIA

6.43

-0.02

Citadel CDL
9.68 +0.01

Radio One, Cl. D

ROIAK

6.47

-0.01

Clear Channel

CCU

31.35

-0.02

Regent

RGCI

3.73

+0.02

Cox Radio

CXR

15.75

-0.14

Saga Commun.

SGA

8.00

-0.10

Cumulus

CMLS

10.21

-0.02

Salem Comm.

SALM

13.42

-0.28

Disney

DIS

31.45

-0.14

Sirius Sat. Radio

SIRI

3.76

-0.04

Emmis

EMMS

11.55

-0.03

Spanish Bcg.

SBSA

4.80

-0.13

Entercom

ETM

25.63

-0.03

Univision

UVN

35.00

+0.08

Entravision

EVC

7.36

-0.04

Westwood One

WON

7.50

-0.02

Fisher

FSCI

42.94

-0.01

XM Sat. Radio

XMSR

11.09

-0.27

Gaylord

GET

47.60

-0.40

-

-

-

-

-


Bounceback

Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments and
a photo to [email protected]

Who better to figure out where we're going than someone who knows where we've been? Broadcast veteran and self-styled curmudgeon Frank Boyle is back with another observation.

Living with a senior moment, I foolishly tried to pull up some AM day/nite coverage maps from fcc.govinfo,com,etc. Of course, they politely told me -again - they only do FM maps. AM is too difficult to get appropriate software - due to Darth Vader interference and the like. Isn't it curious that the primary cause of forming the 1934 Commmunications Act was due to problems from overlapping AM station contours/ Now, 74 years later, our FCC commissioners have time and tax payer funding to have local public meetings to negate further relaxation of ownership rules -and criticize consolidation effects - but can't take time to generate basic AM day-night coverage maps? Nor have any FCC commissioners and well paid staff for a jillion years. Just FM's since 1972. How many engineers would you estimate work at the FCC? I'll bet it's 500 or more. What do they do? The FCC response to me was hire a consulting private engineering firm who - for a fee - would be pleased to generate AM maps of my choice. Almost like the Engineering Full Employment FCC Plan. Try it sometime - to see what your tax dollars don't get for you.

Frank Boyle
Your friendly curmudgeon


Below the Fold
Executive Comment
What are 3 things that Radio
Must Do To be competitive
William O'Shaughnessy, Whitney Radio: Free ourselves from the shackles of government intrusion...

Ad Business Report
Kim Vasey, mediaedge:cia
Looking to grow your revenue? Learn something new that will help me help sell in radio to my clients and...

Media Markets & Money
Small market advocate expands
Alex Kolobielski has gone the extra mile

Internet Media Business Report
Google Q3 revenue
Soared 70% with 39% coming from members of it AdSense network...



Stations for Sale

Southern Small Markets
FMs and AM-FM Combos
Florida, Louisiana,
Mississippi, South Carolina
Call Gordon Rice @ 843 884-3590
[email protected]


Radio Media Moves

Greater Media
taps Tozzi, again

Greater Media announced former WJJZ-FM PD Michael Tozzi has returned as PD and midday personality of Smooth Jazz 97.5 FM in Philadelphia. Tozzi served as PD of the station from February 2001 to August 2006.

Maryann Varsolona joins SWMX
As Broadcast Radio Specialist providing transaction and campaign support to SWMX's expanding roster of advertising clients. Varsolona over 20 years of agency experience in the broadcast radio industry including Ogilvy and Mather will be responsible for helping facilitate the transaction process for clients using the SWMX Radio(tm) platform, including interface support, campaign planning and analysis, budget optimization and strategic direction. SoftWave Media Exchange is a revolutionary Internet-based marketplace that lets advertisers quickly and easily create targeted, ROI-based advertising campaigns and enables broadcasters to maximize the value of their inventory on a moment-to-moment basis, resulting in increased efficiency and profitability for both parties.


More News Headlines

Not sure what this has to do with broadcasting, but...
Well, we all know lawyers, and broadcasters from time to time find themselves before the judge. Anyway, last week the story came out that convicted Enron head Ken Lay was let off the hook because his passing deprived him of a chance to appeal the guilty verdict. Commenting on the matter, a lawyer told the New York Post that, "...it is a successful tactic to have your client drop dead in an appeal although I'm not recommending it to my clients."

RBR observation: So if your lawyer makes such a recommendation, it may be time to go attorney shopping, but first make sure he didn't tamper with your will...




RBR Radar 2006
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Arbitron Q3 revenue
And future is on PPM
CEO Steve Morris: "Our marketplace is being forced to deal with rapid and wrenching change and all of us at Arbitron are working to the company out in front of that change so that we can help our customers succeed, and in so doing, succeed ourselves...On the PPM front, there has been steady progress.

RBR observation: PPM is key to Arbitron's future success. It seems the company is making steady progress toward its goal of having the top 10 markets PPM-ready in 2008. Now, if Arbitron wins its patent suit against Media Audit/Ipsos, the company will likely have the electronic ratings market cornered for radio. Nielsen doesn't seem all that interested at this point in joining that fray. RFP Committee or not, Clear Channel will basically have to jump on the PPM bandwagon if Arbitron wins the suit. At this point, does Clear Channel want to wait for the outcome before it signs for PPM? It could take a while. Agencies want PPM and more and more radio companies are signing on with them. Needless to say, MRC accreditation is also pretty important to PPM's success. The next MRC meeting on PPM is imminent. In fact, it was only recently postponed.
10/20/06 RBR #205

Executive Comment
What are three things that Radio
Must Do To be competitive in this new media environment?
Bruce Maduri, Genesis Communications: Consolidation gave the industry a great way to turn a profit by cutting costs and offering advertisers bulk in listener reach. But it also gave us a mindset to cut costs where we should not and that is in talented interesting entertainers on a local level.
10/20/06 RBR #205

FTC aims to stop teen drinking
Is teaming up with non-profit The Century Council in an effort to reduce teen drinking, particularly when it is assisted by adults, including parents. Among its elements will be TV PSAs and a website with materials which can be used by broadcasters. Of interest to broadcasters is its affirmation of the alcohol industry's guideline banning ads on media outlets with a 21-and younger audience of greater than 30%. This is significant in the face of attempts to force the audience composition standard down.

RBR observation: We applaud any government solution that avoids First Amendment territory. And we heartily recommend that broadcasters and alcohol advertisers do a good job self-policing on this matter. Once again, it involves the word "children," and protecting them is a campaign asset that is prized by Democrats and Republicans alike. Legislators are often perfectly willing to lose in court if it will help get them through the next Election Day.
10/19/06 RBR #204

Radio You Need To Know
Nielsen unveils and announced number of proactive movements
As part of the company's commitment to bringing electronic measurement to all local markets it will bring Local People to additional markets....Also issued update on Average Commercial Minute MIT...and the ratings giant will continue to 'Follow The Video' is launching GamePlay Metrics, a new rating service for video games. Total and complete details on all three issues in
10/19/06 TVBR #204

They still want to give you a loan
Wall Street continues to beat up on radio and TV stocks, but the broadcasting sector is not out of favor with lenders. Those we checked with say they still want to make loans to the broadcasting sector. "Generally we see conditions remaining very favorable for borrowers. Over the past couple of months there has been a slight rationalization in the market as all the continuous deal activity of this year has begun to absorb some of the excess liquidity that was in the market. But that being said, it's still a very favorable market for borrowers to be issuing net capital," Robert Malone, Vice President at GE Commercial Finance Global Media and Communications.
10/18/06 RBR #203

NBA Minute


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