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Volume 23, Issue 214, Jim Carnegie, Editor & Publisher

Thursday Morning November 2nd, 2006

Radio News ®

SoftWave sees future
beyond remnant business
Its fees on the sale of remnant inventory may be the highest it charges, but SoftWave Media Exchange (SWMX) CEO Josh Wexler told investors and analysts that is not where he sees the biggest business opportunity. Rather, SWMX expects to make a lot more in the long run serving as the conduit for flighted business. The company recently jumped into the political ad placement business, deliberately offering a low fee to attract business, and placed 1.2 million in political ad buys in Q3 across radio, cable and broadcast television. No, SWMX doesn't yet have its broadcast TV online exchange operating, that is coming sometime this quarter, but it was able to use its platform to do TV placement for various candidates and issue campaigns. Not surprisingly, in Q&A one investment manager wanted to know how well SWMX is going to be able to compete with Google-owned dMarc. While Google is a giant company, SWMX COO Bill Figenshu (pictured) insisted that his company has the better platform. First, he said, it has a better commission structure. "We pay more to the stations," he said. Also, there is no hardware required for a station to use SWMX. And Figenshu noted that Google is hiring local ad salespeople to compete with local radio stations, which has made some stations wary of doing business with dMarc.

RBR observation: Note that SWMX recently received a Strong Buy from Capstone Investments (10/25/06 RBR #208). The research team at CapStone Investments, headed by Director of Research Jackson Spears, says the business model for SWMX is attractive due to potential high recurring revenue, operating leverage, high cash flows and a high return on invested capital. If you have not viewed SWMX's system, it is worth getting acquainted as we approach a potentially rocky 2007.

SBS makes real estate investment
According to an SEC filing, Spanish Broadcasting System has cut a deal to buy a 62,000 square foot office building on 5.51 acres in Miami. SBS will pay 8.83 million, plus broker's fees for a total of 9.35 million, to acquire the property from 7007 Palmetto Investments, an unrelated third party. SBS says it plans to consolidate its Miami radio and TV operations in the new building. It will seek early releases from the leases for the two locations which currently house its TV studios and radio studios. It should not have too much trouble dealing with those landlords, since both buildings are owned by SBS CEO Raul Alarcon and his father.

Fee-rocious negotiations
in store for satcasters?
The royalty contract between musicians and satcasters is about to expire. The music industry says it is largely responsible for the success of XM Satellite Radio and Sirius Satellite Radio, and deserves a substantial raise. The satcasters (who may well be wondering what success the musician are pointing to as their quarterlies continue to be bathed in red ink) say they provide valuable promotional exposure for musicians and should pay less. Are the two sides close? Does a chicken have lips? According to Jonathan Jacoby at Bank of America Equity Research, the musician group SoundExchange, representing musicians and record companies, wants 10% or 1.10 per subscriber for 2007, rising to 23%/2.75 per sub after six years. The satcasters are putting less than 1% on the table, for the entire six year term. For 2007, the figures work out to roughly 203M v. 18M. The Washington Post notes that traditional broadcasters only have to worry about royalties for composers and publishers, handled through BMI, ASCAP and other organizations, and estimates that the two satellite companies are currently paying 2%-3% to each. The Copyright Royalty Board gets to make the final call on this matter, and Jacoby guesses it could be a year and a half away at this point, but says that a split the difference approach would seem to make sense.

RBR observation: More and more of the media v. media stories today seem to be about extracting a pound of flesh from the competition wherever possible. We hear about pay-to-play one day, then don't-play-unless-you-pay the next. We wonder if that is perhaps taking one's eye off the ball. The electronic entertainment business model has generally been to superserve a portion of the media audience with the goal of selling advertising or subscriptions. All we know is if you decide to play hardball and end up pricing yourself off of a media venue that would like to share your good stuff with the consuming public, the consuming public isn't going to know about your good stuff. Who wins? Nobody. Who loses? Everybody. Think about it.

Recovery predicted for satcasters
Morgan Stanley analyst Benjamin Swinburne says 2007 should be a year of recovery for XM and Sirius, although he has reduced 2006 subscription estimates for both. The analyst thinks almost a third of all new cars sold in '07 will have a satellite radio receiver. But in the near term, he sees Sirius falling short of its guidance that it will have 6.3 million subscribers by the end of 2006. He sees a shortfall of 200,000 subs. The analyst now expects XM to have 7.9 million subs by yearend, down 100,000 from his previous estimate. But Swinburne remains bullish on satellite radio long-term and sees good growth in 2007 and beyond as OEM penetration increases. He is predicting that Sirius will go FCF positive in 2007 and XM in 2008. Saying the bad news of late is already reflected in the stock prices of both companies, he reiterated his "overweight" recommendations to clients.

Online advertising
practices questioned
The metrics of online advertising have been called into question recently due to their susceptibility to manipulation via the practice of click fraud. Now a pair of watchdogs are asking the Federal Trade Commission to check out another aspect of the business: data mining. The groups are the Center for Digital Democracy (CDD) and the U.S. Public Interest Research Group (US PIRG). They say there is a serious privacy issue brewing, and the practice is growing while regulators largely seem to be napping on the sidelines. Jeff Chester, CDD executive director, said, "The FTC should long ago have sounded a very public alarm - and called for action - concerning the data collection practices stemming from such fields as Web analytics, online advertising networks, behavioral targeting, and rich 'virtual reality' media, all of which threaten the privacy of the U.S. public." The issue with on-line tracking and profiling, explained by U.S. PIRG Consumer Program Director Ed Mierzwinski, is this: "Its effect has been to put enormous amounts of consumer information into the hands of sellers, leaving buyer-consumers at risk of unfair pricing schemes and with fewer choices than the Internet is touted to provide." They say this is a problem even if the tracking companies do not know the name of the computer user, since they still "...literally know every move those users make online."

RBR observation: So play it safe, advertisers. You don't need to know the last detail of a person's private life to sell him a soda. Radio offers precise targeting to a mass audience at a reasonable price, free of any hint of fraud or charges of spying.

Happy Traffic Director's Day!
Had you forgotten? We pass along this reminder from the Traffic Directors Guild of America (TDGA) that today, November 2nd, is Traffic Director's Day. "It's the best day of the year to say, thank you to your Traffic staff, surprise them with something nice in the office, or take them out to lunch," the TDGA says.

Wall Street Media Business Report TM

Q3 Conference Calls
SWMX proud of debut quarter
In its first quarterly report as a public company, SoftWave Media Exchange (SWMX) reported that it handled 4.6 million in advertising transactions, up from a mere 100K a year ago, and added cable TV to its exchange platform along with its original radio operation. Included in Q3 business was 1.2 million in political advertising, which SWMX helped agencies place quickly on radio, cable and also broadcast TV. From those 4.6 million in transactions SWMX received 633K in commission revenues, compared to less than 50K a year earlier. That rapid ramp-up is expected to continue for some time, but CEO Josh Wexler declined to provide any forecast on when the company would reach break even for operations. The company posted an operating loss of 2.8 million in Q3, compared to a loss of 6K a year ago.

Ad Business Report TM

Feinberg on Rush/Michael J. Fox issue
Matt Feinberg, Zenith Media SVP Radio/
Dir. Interactive Broadcast Extensions,
National Broadcast, commented on our story this week about client/advertiser backlash we've been hearing about after Rush Limbaugh recently imitated and taunted Michael J. Fox on his efforts to advance stem cell research (10/31/06 RBR #212).

Said Feinberg: "Many people are asking about it, commenting on the tastelessness etc., of the whole thing (some people used some very colorful language). Rush has been on the agency hit list since I've been here (the do not advertise list). For a while we thought he was safe to get back in, but then he went on about the veterans who opposed the war in Iraq (ironic for a guy who dodged the Vietnam draft), and clients received tons of e-mail from angry war vets. That was it for Rush. The one comment I kept hearing was, 'Why isn't he in jail for the oxycontin thing from last year?' Oh the inequities of the US Justice system."

ABC memo details Air America advertiser blacklist
Speaking of do not advertise lists (see above), a 10/25 ABC Radio Networks memo to its affiliates obtained by Media Matters for America and Fairness in Accuracy in Reporting (originally from a listener to The Peter B. Collins Show), reveals 90 major sponsors have a standing order that their commercials never be placed on syndicated Air America programming that airs on ABC affiliates. According to the memo, the advertisers insist that "NONE of their commercials air during AIR AMERICA programming." Advertisers listed include Bank of America, Exxon Mobil, Federal Express, General Electric, McDonald's, Microsoft, Wal-Mart, the U.S. Navy, Wal-Mart, Fed-Ex, Visa, Allstate, Sony and Johnson & Johnson and The U.S. Postal Service. The memo was headlined "Air America Blackout" and addressed "Dear Traffic Director." It read: "Please be advised that Hewlett Packard has purchased schedules with ABC Radio Networks between October 30th and December 24th, 2006. Please make sure you blackout this advertiser on your station, as they do not wish it to air on any Air America affiliate."

RBR observation: While some groups like Reclaim The Media are calling this censorship based on advertisers' political preferences, advertisers and agencies routinely avoid controversial and politically-charged hosts and programming. There's absolutely nothing wrong with it and it is common practice. Once boycotted, twice shy. See our above story - some advertisers avoid righty Rush; others lefty Air America. Some advertisers want to be associated with controversial hosts, for others it's a very risky idea. The more controversial, the less mainstream advertisers you will find. Always has been, always will be. Checking with a few agency folks off the record, this practice was confirmed as business as usual. The bottom line is this is done every day. Advertisers also have preferred program lists, as well as lists of programs to stay away from. It could be for demographic, psychographic reasons or that a specific client requests it. It's the clients' money and they can do with it what they wish. Now remember, there's a fine line on some things - non-urban dictates for example - where the practice may step over the line. But this ABCRN example is sheer fear of being associated with politically-charged commentary. No client wants to put his or her product in harm's way.

Media Markets & Money TM

Cincinnati shake-up
The FM dial is undergoing some changes in Cincinnati, some of which are behind the scenes. For starters, Entercom has taken control of CBS Radio stations in The Queen City and in Austin and Memphis, with an LMA going to effect in Cincy and elsewhere pending closing. Cumulus, who moved into the market last year by buying Susquehanna stations, is swapping its 94.9 mHz facility, Country WYGY-FM, to Entercom for its Classic Hits WGRR-FM 103.5 mHz. For Entercom, it'll have a Country duopoly with WUBE-FM (it also acquired Alternative WAQZ-FM and Oldies WKRQ-FM from CBS). In the Cumulus lineup, WGRR-FM is expected to be a good fit with AC WRRM-FM. Cumulus is also taking its 96.5 mHz facility to the market's first FM Talk, or as it is called in the Cincinnati Business Courier, Supertalk FM 96.5, using calls WPRV-FM. Mancow Morning Madness is said to be the AM drive anchor of a lineup that will include Glenn Beck and Bill O'Reilly, among others.

Close encounter in the Rockies
Cherry Creek just got visibly bigger via the act of closing on its acquisition of 18 stations in four markets from Fisher Communications. According to brokerage firm Kalil & Co., the unit known as the Fisher Radio Regional Group went for 26.104M. The stations are located in Wenatchee WA, and three Montana markets, including Billings, Butte and Missoula.

RBR observation: According to documents filed with the FCC last July, the transaction also two AMs and four FMs in Great Falls MT, where Cherry Creek already was in possession of an AM and three FMs. The full deal at that point was valued at 33.4M. When waiver/spin-offs are required, it is not uncommon for parties of a group transaction to split the closings along the fault line between stations facing normal regulatory hurdles and those needing extra attention.

Washington Media Business Report TM

The lightning ate my lighting
The FCC cited an "Act of God" in granting CMCG Puerto Rico another month to finish building WMEI-TV Channel 60 in Arecibo PR. The permittees said that an unusually heavy period of storms wreaked havoc on the transmitter site. Lightning damaged tower lights, construction machinery including a sky lift and winch, the electrical source to the site and may have damaged the tower ground system. The FCC called the events "rare and exceptional circumstances" and noted the special challenges faced by broadcasters on the Caribbean island.

Entertainment Media Business Report TM

WFIL, WNTP launch PrimeLife Radio
Salem Communications' Philadelphia stations, WFIL AM560 and News Talk 990AM WNTP, debuted a new, weekly radio program specifically targeted at listeners "50 or better." PrimeLife Radio, developed by Programming/Marketing Manager Mark Daniels, offers a fast-paced blend of conversation and information for the city's largest--and growing--demographic segment. "Philadelphia is second only to Miami in the number of 65+ residents in a single American city," says Daniels. "That population in the commonwealth of Pennsylvania is set to double in the next 10 years alone. When you add the 50 to 64 year old 'junior seniors' seeking information for themselves and their parents, we feel we're simply preparing to better serve an audience that's already listening to our stations."

Journal Broadcast Group syndicating
"The Todd and Tyler Show"
"The Todd and Tyler Show" will begin its run in syndication Mondayon KZRQ-FM (Z106.7), Springfield, MO and one week later, on November 13, on KICT-FM (T-95), Wichita. The announcement was made by Tom Land, Director of Radio Programming for Journal: "The program has a tremendous fan base in Omaha and we have been looking for the right markets and station opportunities to expand "The Todd and Tyler Radio Empire" across the region. Our sister stations are perfect launching points and we will continue to match this highly successful program with great stations wherever possible." "The Todd and Tyler Radio Empire" is the longest-running Omaha morning show. The show deals with a wide range of topics...from news and current events to politics, sports, entertainment, men's health and relationships.

Internet Media Business Report TM

Ad spend on social networks to reach 2 billion by 2010
Just four months ago, marketers were sitting on the sidelines of social networks and watching the traffic surge. Now, advertising on social networks has become a top priority. In 2007, ad spending on US social networking sites is expected to spike to 865 million from 350 million in 2006, according to eMarketer's new report, Social Network Marketing: Ad Spending Update. By 2010, eMarketer estimates, spending will hit 2.15 billion. MySpace will continue to dominate social networks, accounting for 60% of total US online social network ad spending in 2007. eMarketer estimates MySpace will generate 525 million in 2007, up from 180 million in 2006. Competitors such as Facebook, Bebo and Piczo will make up the second-largest chunk of revenue, followed by social networks offered by portals and "niche" networks. International expansion remains a key area for audience growth and will shift into high gear in 2007. eMarketer estimates that worldwide social network ad spending will reach 1.1 billion in 2007, up from 445 million in 2006. By 2010, spending is expected to rise to 2.8 billion. While many marketers are rushing to experiment with social networks, in order for serious ad dollars to continue, adequate measures of return on investment need to be in place, says Debra Williamson, eMarketer senior analyst and author of the report. "The longer existing social networks take to develop adequate ROI metrics, the bigger the opening for a next generation of networks that are built from the ground up to accommodate advertising," Williamson says.

Ratings & Research

Two-thirds of adults in St. Louis, Detroit closely followed World Series
Following the St. Louis Cardinals win over the Detroit Tigers in the fall classic, Arbitron unveiled a survey detailing how adults in St. Louis and Detroit watched and listened to the World Series and how these fans respond to advertisers and team marketers. According to the survey, conducted by the Arbitron Custom service group, seven in ten adults age 18 and older in the St. Louis radio metro say they followed the Series "very closely" (78% of men and surprisingly, 62% of women). Among Detroit radio metro adults 18+, six in ten say they followed the Series "very closely" (69% of men and 53% of women).

Highlights of the study among people in St. Louis:
· Three in ten adults (30%) in St. Louis listened to all or part of the Series on the radio.
· Among those who listened to the Series on the radio, 46% agreed (score of 5 or higher on a scale of 1-7 where a 7 is "strongly agree" and 1 is "strongly disagree") that they feel more favorably towards an advertiser who sponsors the St. Louis Cardinals than an advertiser who does not.
· Nearly three in ten (29%) World Series radio listeners in St. Louis said they would be more likely to purchase a product or service from a company that sponsors the St. Louis Cardinals.
· More than eight in ten (83%) World Series radio listeners in St. Louis said they were less likely to change radio stations while listening to a World Series broadcast than when listening to something else.
· Radio listeners to the Series were not shy about showing their team loyalties with nearly three quarters (73 %) reporting they wore St. Louis Cardinals clothing in the past week to show support for their team (compared to 54% of the total St. Louis market).
· Of the people who watched the Series on television and also listened to the Series on radio for some of the coverage, nearly three in ten (27%) said they have turned down the television sound and listened to the game on the radio.

RBR Stats

Univision buys rest of Disa Records
Univision announced that it has purchased the remaining 50% of Disa Records and Edimonsa Publishing from the Chavez family of Monterrey, Mexico. Univision said Disa will continue to operate as a separate label under Univision Music Group, with Carlos Ruiz, who has worked for Univision Music Group-Mexico, as VP/GM of Disa Records. Unmentioned in the Univision release was that the Chaves family had sued Univision in July in an attempt to force the company to buy the remaining 50% (7/19/06 RBR #139). Univision purchased the first 50% of Disa in 2001.

Engineering Media Business Report TM

Visteon demos transportable HD Radio
Visteon launched its new transportable HD Radio receiver at the Specialty Equipment Markets Association (SEMA) Show in Las Vegas. This unit, HD Jump, delivers premium new HD2 multicast channels both in the car, as well as in the home. The receiver docks into a cradle in the vehicle. An optional home kit allows the receiver to also be used with a home stereo. The unit offers the full spectrum of HD Radio features, including program associated data, such as real-time song title, artist and album information, as well as multicasting.

WCMC-FM transmits from new tower

The New 99.9 Genuine Country WCMC-FM is now transmitting from a new tower in Youngsville, NC, following approval from the FCC. The 500 foot tower was designed and constructed by Electronics Research. Capitol Broadcasting Company, owner of WCMC-FM, is sharing the new tower site with the Franklin Country Sheriff's Office and the North Carolina Highway Patrol. Space has also been allocated for amateur radio use.

Transactions

750K WCPA-AM/WQYX-FM Clearfield PA from Clearfield Broadcasters Inc. (Robert E. Day) to First Media Radio LLC (Alex Kolobielski, William E. Prettyman Jr.). 50K escrow, balance in cash at closing. Includes non-compete. Duopoly with WOWQ-FM Du Bois PA. LMA until closing. [File date 10/19/06.]

150K WKBF-AM Quad Cities IA-IL (Rock Island IL) from Mercury Broadcasting Co. Inc. (Van H. Archer III) to Quad Cities Media LLC (Randall R. Melchert). 10K escrow, balance in cash at closing. Deal will terminate lease for studio space with Clear Channel. [File date 10/18/06.]

Stock Talk

Manufacturing slows down
A report from a private research group that showed October manufacturing growth to be the slowest in three years put a damper on stock trading. The Dow Industrials fell 51 points, or 0.4%, to 12,031.

Radio stocks fell sharply as the euphoria over Clear Channel 's Q3 report abated. The Radio Index fell 3.689, or 2.4%, to 149.013. Salem plunged 5.9% and Entravision dropped 4.6% as the worst performers.

Radio Stocks

**Here's how stocks fared on Wednesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		40.91	-1.09	Hearst-Argyle	HTV		25.29	+0.09
Beasley	BBGI		6.84	-0.12	Journal Comm.	JRN		11.40	-0.30
CBS CI. B	CBS		28.81	-0.13	Lincoln Natl.	LNC		62.55	-0.76
CBS CI. A	CBSa		28.92	-0.05	Radio One, Cl. A	ROIA		6.75	-0.14
Citadel	CDL		9.94	-0.30	Radio One, Cl. D	ROIAK		6.73	-0.06
Clear Channel	CCU		34.52	-0.33	Regent	RGCI		3.64	-0.05
Cox Radio	CXR		16.17	-0.67	Saga Commun.	SGA		8.39	-0.01
Cumulus	CMLS		10.39	-0.33	Salem Comm.	SALM		12.51	-0.78
Disney	DIS		31.73	+0.27	Sirius Sat. Radio	SIRI		3.72	-0.11
Emmis	EMMS		12.02	-0.32	Spanish Bcg.	SBSA		4.65	-0.05
Entercom	ETM		27.49	-0.18	Univision	UVN		35.05	-0.01
Entravision	EVC		7.00	-0.34	Westwood One	WON		7.89	-0.02
Fisher	FSCI		40.37	-1.67	XM Sat. Radio	XMSR		10.84	-0.82
Gaylord	GET		45.43	-1.11	-	-	-	-	-

Bounceback

Send Us Your Opinions We want to
hear from you.
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Below the Fold

Wall Street Media Business Report
SWMX proud of debut qtr
Handled 4.6 million in ad transactions...

Ad Business Report
Matt Feinberg, Zenith Media
On Rush/Michael J. Fox issue...

Entertainment Media
Business Report
WFIL, WNTP launch
PrimeLife Radio argeted at listeners 50 or better....

Engineering Media
Business Report
Visteon demos transportable
HD Radio launched its new receiver...

Radio Media Moves

Entercom
rearranges Austin
Melissa Forrest has been named Vice President and Market Manager of the four-station Entercom cluster in Austin, TX, moving in from running KMTT-FM & KKWF-FM for Entercom in Seattle. Also moving to Texas is Greg Spencer, formerly General Sales Manager for Entercom at KNRK-FM Portland, OR. He is now GSM of KKMJ-FM Austin. Entercom has begun an LMA of the Austin stations, pending closing of their acquisition from CBS Radio.

More markets
for Reichert
Salem Communications has promoted Michael Reichert again. He is now Vice President of Operations, adding oversight of the New York and Boston markets to his previous duties as Regional Manager for San Diego, San Francisco and Seattle.

Upped in Miami
Cox Radio announced the appointment of Derrick Baker to Program Director of 99 JAMZ WEDR-FM "99 Jamz" Miami-Ft. Lauderdale. He moves up from Assistant PD.

Milano to Triton
Triton Media Group, a strategic marketing services company to the media industry, announced the hiring of Dominick Milano as Executive Vice President. He most recently served as a sales consultant to Entercom Communications and MusicToGo, a Triton partner.

More News Headlines

Former B&C
publisher passes
Larry Taishoff, the former President/Publisher of Broadcasting & Cable magazine and son of the founder, Sol Taishoff, has died at age 73. He took over the company from his father, and remained on the executive staff after selling to Times Mirror.

AWRT names "25 Women Who RULE in Sales and Marketing"
American Women in Radio and Television (AWRT) announced the 3rd Annual "25 Women Who RULE in Sales and Marketing." Nominations were accepted from AWRT members and industry leaders and encompassed a broad array of women from all facets of electronic media including radio, TV, cable, and web-based media.

The list of honorees (alphabetically)
Millie Adan-Garza- Univision/TeleFutura
Cynthia Ashworth-Oxygen Media
Chancey Blackburn-Media Rare, Inc
Cathy Bradbury-Univision - KUVN 23
Dana Marie Carroll-Univision
Christa Dahlander-
Radio Advertising Bureau
Deb Durben-Interep
Cathy Egan-ABC Television Sales
Jill Fredericks-KVUE- TV
Sherree Haevischer-Pence-WFAA
Laura Hagan-
Univision National Radio Sales
Twila Hill-CBS Television Stations
Wendy Jones-Katz Radio Group
Sheila Kirby-Interep Innovations
Ann Leary-
Clear Channel Katz Advantage
Kay Olin-Interep
Peggy O'Neill-Continental TV Sales
Juleann Pasqualini-
Continental TV Sales
Bonnie Press-
Clear Channel Katz Advantage
Ellie Reese-Oxygen Media
Mary Strickland-KVUE Television
Christi Swanner-Asher Media
Christine Travaglini-Christal Radio
Molly Wythes-
Clear Channel Katz Advantage
Linda Yaccarino-
Turner Broadcasting System, Inc.

RBR Radar 2006

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

Hey, let's all go private
If Tribune and Clear Channel are both sold to private equity firms, will it start a parade of broadcasters going private? Don't count on it, says one analyst who has been running the numbers. One problem, says Mark Wienkes of Goldman Sachs, is that private equity funds aren't sure they would be able to cash out at a profit down the road.
11/01/06 RBR #213

Clear Channel guys
Windfall or not?
Wall Street Journal portrayed the coming buyout of Clear Channel Communications as a "windfall" for the Mays family, with Lowry in line to receive more than a billion bucks for his stake and sons Mark and Randall about 100 million combined. Not to mention golden parachutes.

RBR observation: A billion bucks is big money any way you look at it, but the Mays family stake in Clear Channel was worth twice that a few years back, so we doubt that they would consider the payout any windfall.
10/31/06 RBR #212

"Gluttons At The Gate"
A must read for Clear Channel
and Tribune staffers
Employees of Clear Channel Communications and Tribune Company who are waiting to find out which private equity firm (or consortium of private equity firms) will be their new owner might want to pick up this week's issue of BusinessWeek with the cover story "Gluttons At The Gate." As the title indicates, it is a critical piece on the private equity field.

RBR observation: Like most things, private equity funds are neither all good nor all bad. When they buy an out-of-favor public company, they are able to provide financial flexibility for restructuring. Sometimes, of course, that restructuring is painful to some employees, who either lose their jobs or see their division sold to yet another buyer. It is pretty clear that a lot of Tribune assets are going to change hands, no matter who ends up with the company. That divestiture process had already begun before the company was put on the block. Likewise, Clear Channel had already been selling some non-core stations. The end-game is the big question for both of these buyouts-to-be. Will investor interest in the newspaper and radio sectors improve in the next few years so the private equity buyers can take profits via the IPO route? That is a tough call. But we certainly don't see the potential for buyout firms taking either of these companies private and then selling stock again in a matter of months. These look like long-haul investments.
10/31/06 RBR #212

Tribune bidding called "lukewarm"
That analysis comes from the Los Angeles Times, which has a keen interest in the potential sale of its parent company. If private equity bids submitted Friday offered little or no premium over the current stock price, the board at Tribune Company is likely to explore breaking the company into pieces for sale.

RBR observation: The board of directors at Tribune has set no timetable for completing the effort to maximize shareholder value. However, if the bids for the whole thing were unimpressive, we should soon start hearing rumors of a wider range of potential bidders begin invited to submit offers for various pieces of the Tribune Company. CEO Dennis FitzSimons may yet be able to realize his dream of doing a management buyout of the choice properties in the biggest markets after selling off everything else.
10/31/06 RBR #212

Clear Channel, Hey
You Can't Be a Little Bit Pregnant
A couple of Wall Street analysts have been holding onto the position that after exploring "strategic alternatives" with the folks from Goldman Sachs, the board of directors at Clear Channel will decide to stay public and go with a restructuring plan, rather than sell the company. Perhaps they are confused because of what happened with Emmis, but this is not the way the world works. Once you have hung out the For Sale sign, the auction is underway.
10/30/06 RBR #211

Clear Channel What is it Worth?
But, sale will create lots of station inventory
The answer is whatever the highest bidder is willing to pay. Wall Street analysts are debating the ultimate price, with estimates running mostly in the mid to high 30s, although at least two see a possibility of 40-plus. Clear Channel has 496 million shares outstanding. At 35 bucks that works out to 17.4 billion. At 40 it goes to 19.8 billion. Add in 7.9 billion of debt and the total deal value works out to a range of 25.3-27.7 billion - a hefty price tag that means only very big players will be able to participate in this game. Wallstreet is all over this issue. Regardless of who buys Clear Channel Communications, lots of radio stations will be going on the market for divestiture. We are not just talking about the smaller market clusters that the company has been slowly selling off to use up 1.5 billion in tax loss carryforwards. Some quite desirable larger market stations will also have to be divested once a sale or management buyout is agreed to. That's because Clear Channel has lots of markets with large clusters that were OK under the FCC ownership rules based on contour overlaps established in 1996, but not since a federal appeals court approved the new Arbitron/BIA market definitions adopted in 2003.
10/27/06 RBR #210

NBA Minute

Manager/Sales Manager
For Palm Beaches newest signal AM 960. Strong sales, promotional, and community service skills essential. This all new station programming Adult Standards is in a fantastic growth market. Experience is and/or residency in the Palm Beaches helpful.
See Radio Careers

Program Director
WCJK-FM/Nashville, JACK formats. Candidates will have experience, a proven track record, a true flair for creativity and, oh yeah, a JACK attitude. No calls.
See Radio Careers

Account Executive(s)
Reach Media seeking experienced AE's to represent and sell various media products. Immediate openings in Dallas, New York, Chicago & Atlanta. Resume, references & salary history. EOE.
See Radio Careers

Editorial & Sales Reps
Working for a print trade with no growth? RBR and TVBR looking for experienced pro's. Capitalize on your experience, contacts, relationships, and secure your future growth. NO Relocation necessary. Contact Jim Carnegie in confidence at [email protected]

Hard finding that key person
to fill the important position at your organization? Media HeadHunters is the place that key media firms use to get results. See Media HeadHunters and get results with service--Period.

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