RBR's Daily Morning Epaper

Volume 21, Issue 222, Jim Carnegie, Editor & Publisher

Friday Morning November 12th, 2004

Radio News®

RBR Observation:
Hello Houston you now have a
TX size PPM problem
Big time as Fran Kennish, Chairman, AAAA Media Research Committee, Senior Partner, Director of Media Research, Strategic Planning, Mediaedge:cia has fired off a message to all radio in the market and especially the hold out groups of Infinity, Cox and Radio One or anyone that are not participating in the Aribtron PPM trial. Bottom line radio people: The advertisers want the test and the hold outs are making radio look like obstructionists to progress and better ratings. Many agree that the PPM will elevate radio on the playing field but can not figure out why radio business is not supporting it. Here is the problem - and we have said it before - radio is its own worst enemy. We look at the signals of some of the hold outs and some do not have equal signal capabilities. In three words to the radio business with PPM and Houston hold outs - Suck It Up - and get on board no matter what the results. Can't fix it if you don't know what is broken. Kennish email tells the whole story. | More... |

FCC stays out of Ryan dispute, so will PTC
More than 20 ABC affiliates decided to stay away from the airing of an uncut version of "Saving Private Ryan" last night. The FCC declined to make a ruling on the movie's decency in advance. Meanwhile, at least one leading exponent of the anti-indecency movement, the Parents Television Council, has stated that it will not dispute the airing. Stations owned by Citadel, Pappas, Belo, E.W. Scripps, Cox, Hearst-Argyle, Tribune and Sinclair were among those with cold feet. Uncut versions of the film have aired over ABC in 2001 and 2002. Its inclusion of the f-word was said by the FCC to have drawn one complaint, which was denied. However, the use of the f-word by rock group U2 frontman Bono in 2003 on NBC led to an FCC ruling which made it seem that any broadcast of the word, under any circumstances, would be liable for punishment. | More... |

Adelstein may return in package deal
Republicans in the Senate are looking to get anywhere between 80-100 names confirmed in the current lame duck session, mainly judicial nominees. The speculation is that Jonathan Adelstein's return to the FCC may be offered as a deal sweetener to get the package through before year's end. The roll of political football is certainly not new for the Tom Daschle protege. His nomination was held hostage twice before his initial confirmation, once each, for different reasons, by John McCain (R-AZ) and Trent Lott (R-MS). Although Adelstein has not seen eye to eye with the administration on a number of issues, most notably ownership deregulation, he is lauded by senators on both sides of the aisle for his work on rural communications and other issues, and a large number of Republicans in the Commerce Committee have signed on to efforts to put him on the Commission for what would be his first full term. He is currently finishing off the expired term of Gloria Tristani. Traditionally, the two parties have been reluctant to play hardball with one another when it comes to putting people into seats which legally go to one or the other - - floor fights have generally been confined to cases where there have been severe objections. The White House decision to hold up Adelstein's renomination had even the Republicans on Commerce Committee scratching their heads. It would seem that his close relationship with Daschle was almost certainly a factor.

RBR observation: Some, including those of us here at RBR, have speculated that the Bush administration would look for a FCC candidate which could be used for political purposes. We thought they possibly would discuss it with the next minority leader, which at this point looks like it will be Harry Reid (R-NV). However, an article in Communications Daily noted that at least one Republican Hill staffer thought that offering Adelstein up in exchange for 80 or so judges was more than fair.

FCC denies three CC radio apps in Denver
The FCC denied three key Clear Channel Radio FM applications in Denver which we reported on several months ago. (6/6/03 RBR Daily Epaper #111). Affected are KFMD, KBPI and KRFX. All are located in the Lookout Mountain tower farm on the Front Range. CC Radio's applications were part of a plan to provide permanent homes for FM stations being displaced by digital TV implementation in Denver. As part of Denver DTV, the KCNC-TV Channel 4 tower will be dismantled and rebuilt by the Chicago-based Lake Cedar Group. This tower will no longer have room for FM antennas. Meanwhile, Clear Channel has rebuilt a tower they control to accommodate their homeless FM stations. The rub for CC Radio is that their tower is shorter - - short enough to fail even the new C-zero class minimum height requirement. CC Radio had sought special dispensation from the FCC. They wanted their FMs to be treated as full Class C stations, even though the FCC rules actually define them as class C1. The full C classification forces other broadcasters to build further away from Denver - - desirable from a competitive standpoint if you are Clear Channel. CC Radio argued that other FM broadcasters have been given so-called Denver Waivers going back to the late 1980s. They sought to avoid another "Dallas situation" where several tall towers are home to FM signals north of the metro area - in the direction of population growth. The FCC disagreed, citing the value of competition and the negative effect on new and existing stations in more rural areas west of Denver. This is consistent with the FCC's overall policy mandate to provide as many different diverse broadcast voices as possible. It is unknown whether CC Radio will accept the FCC staff decision or appeal.

Malone blows kisses to Murdoch
News Corporation CEO Rupert Murdoch may be worried about a possible takeover play by John Malone's Liberty Media (11/9/04 RBR Daily Epaper #219), but Malone insists that his intentions in raising Liberty's stake in News Corporation are purely honorable. He just thinks the company as a good investment. "We view ourselves as allies of News Corporation and the Murdoch family, and we have no hostile intentions," Liberty Media CEO Robert Bennett said in his company's quarterly conference call. Despite those reassurances, Murdoch isn't taking any chances. News Corporation's board of directors is expected to meet next week to ratify the "poison pill" anti-takeover measure that was announced early this week.

Hall of Fame class of 2004
National Radio Hall of Fame and Museum president Bruce DuMont (left) joined Angel and Paul Harvey (front) to induct five legendary broadcasters - - (second from left to right) Dick Purtan, Bob Edwards and Larry Lujack, along with (not pictured) Lowry Mays and the late Walter Winchell - - during a gala celebration in Chicago. The Museum of Broadcast Communications, which houses the Hall of Fame, announced that it has raised half of the 18 million needed to construct its new building in downtown Chicago. The new museum's public program venue will be named the "Angel Harvey Center" in appreciation of her more than two million in contributions.

Look for 4:30pm this afternoon

Adbiz©

NASCAR lifts liquor sponsors ban
NASCAR lifted a decades-old ban on liquor ads on cars Wednesday, opening the door for teams to be sponsored next season by distilled spirits. "We felt the time was right," Mike Helton, NASCAR President told the AP. "Attitudes have changed, and spirits companies have a long record of responsible advertising." NASCAR already allowed beer companies into the sport, but has restricted what liquor companies could do since at least the early 1970s, most recently denying a bid from Roush Racing in June to put a liquor company on the car that Jeff Burton drove. Following the 11/10 announcement, UK-based Diageo announced its Crown Royal whiskey will be the sponsor on another Roush car next season.

Finish Line names Starcom media AOR
Starcom USA Chicago has been named media AOR for athletic specialty retailer The Finish Line. The assignment includes all planning and buying - - previously handled in-house and by EchoPoint Media Indianapolis. Effective immediately, the assignment entails consumer-centric media strategy and investments across Finish Line's range of product offerings, including retail operations, performance and fashion footwear products, branded and private apparel lines as well as accessories. Finish Line operates nearly 600 stores throughout the U.S. and www.finishline.com .

Nike, NBA expand advertising relationship
Nike has signed a new global marketing agreement with the NBA. The five-year, 100 million contract announced will allow the league and the sportswear giant to expand their global reach with TV ads using Nike's stable of NBA players in uniform. Nike promotional campaigns will appear during nationally televised NBA games, including on NBA TV, NBA Inside Stuff and on ABC. Though America is basketball's birthplace, the sport has soared in popularity in Europe and Asia. This year, 81 foreign players began the year on NBA rosters, and more than half of the hits on NBA.com, were from users outside the US. Nike will also be allowed to use NBA players in promoting its Converse brand, one of Nike's recent acquisitions.

Look for 4:30pm this afternoon

Media Markets & MoneyTM

Beloit buy creates a new group
Edward Moskal's Alliance Communications is picking up its second station, WGEZ-AM, from Betsy Trimble's Rego Ltd. for 325K dollars. According to broker Dick Kozacko, the Beloit WI Oldies station will take up slot #2 in the Alliance portfolio. Moskal already owns WPNA-AM Oak Park IL, part of the Chicago market. Beloit is across the Illinois border, just north of the Rockford IL market.

Gold Coast noncoms on the block?
Barry University is thinking about putting its FM and television stations on the block, and at least two other educational institutions and a citizens' group have expressed interest, according to the South Florida Sun-Sentinel. The stations, both licensed to West Palm Beach, are 90.7 WXEL-FM and Channel 42 WXEL-TV. The radio station is a Classical/NPR outlet, while the television station carries PBS fare. Expressing interest in the stations are Florida Atlantic University, Nova Southeastern University (which already has Channel 2 WPBT-TV in Miami), and a group described as Palm Beach County community leaders.

Where are multiples these days? Still high - - Part 1
If you've been waiting years for cash flow multiples to go down so you can go out and buy a few radio stations - - you can keep waiting. Brokers on the market's frontlines tell us that Wall Street worries about the radio business haven't hurt pricing and multiples remain at the heights where they've been since 1999. If anything, prices have firmed for smaller markets, which is where a lot of the transaction activity is these days. What's keeping prices high is a lack of inventory. Consolidators, for the most part, aren't parting with the stations they've acquired since deregulation in 1996. So when desirable properties come on the market, there are far more potential buyers than there are stations available to buy. "There's a lot of money on the sidelines chasing fewer deals. Even in the smaller markets - - what I would describe as larger unrated markets - - we're working on some projects now where the multiples are still very high. We're seeing stuff in the 10-11 range in large unrated markets. There's a lot of private equity money on the sidelines chasing deals, which is driving multiples up. They're certainly not cooling at all," said broker Todd Fowler of American Media Services. This article appears in its entirety in the October issue of RBR Solutions magazine. To subscribe to the all new January debut issue of Radio and Television Business Report - The Real Business Magazine, see below to receive it - or call April McLynn here to get your free copy: 703-492-8191.

2005: Year of Local Muscle

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Monday December 6th, 2004.

Washington Beat

New AG may be tough nut
for reporters to crack
President Bush wasted no time filling the slot of Attorney General. The ink was barely dry on John Ashcroft's hand-written letter of resignation before the name of Bush counsel and protege Alberto R. Gonzales was put forth as Ashcroft's successor. At least one watchdog organization has questioned his efforts to shield administration activities from the press. On a general note, one way of assessing Gonzales is to note that he has already taken potshots from members of both the left and right wings of the American political scene. Democrats in the Senate are said to view him as a relatively moderate candidate for the position, and despite the concerns of many, he is not expected to have a difficult time gaining confirmation there. However, watchdog organization Alliance for Justice focused in part his relationship with the press. AFJ President Nan Aron said, "Gonzales has consistently pushed the limits of executive privilege in order to shield the Bush administration from oversight by Congress or scrutiny by the American people." Gonzales gained notoriety for calling provisions of the Geneva Convention "quaint," and in light of that Aron is particularly concerned about Gonzales' failure to make POW-related material public.

FCC, NTIA compare notes
FCC Chairman Michael Powell and Assistant Secretary of Commerce for Communications and Information Michael D. Gallagher got together earlier this week to discuss and coordinate spectrum policy issues. By law, the two agencies are required to work together on allocation of the scarce resource. Powell said, "I am pleased that the FCC and NTIA teams are continuing to work closely on these challenging issues that are important to the continued development of new and enhanced spectrum-based services for businesses, consumers and the military and other federal users. With mutual cooperation and a strong technical foundation, we are making great progress both on the introduction of new technologies and the identification of spectrum for those technologies, as well as improving our IT processes. I look forward to working with Assistant Secretary Gallagher to achieve our common goals." Gallagher added, "The close cooperation and mutual respect between NTIA and the FCC has led to a strong level of achievement. We have met President Bush's call for creating an innovation environment by implementing policies that support advanced wireless services, next generation networks, ultrawideband, and most recently, broadband over power lines. I am proud to say that we have made more spectrum - - both licensed and unlicensed - - available for new purposes than ever before, while continuing to protect critical government systems from harmful interference. I am thankful for Chairman Powell's leadership and contribution to our joint efforts."

RBR observation: If Steve Irwin were here, he may well be saying, "Danger, danger, danger!" For the governed, the government in action often means problems old and new left in its wake, and even more new problems ahead. Let's hope that whatever the FCC and NTIA are cooking up steers well clear of the regulatory environment faced by broadcasters, which is already complicated enough. We should be OK this time, anyway. As TVBR Executive Editor Jack Messmer has frequently poiwnted out, the almost completely toothless NTIA's job is basically to churn out occasional papers spelling out what it might do if it were the FCC.

Transactions

KNGY-FM San Francisco (Alameda CA) from 3 Point Media - San Francisco LLC to Flying Bear Licensing LLC.

WDLC-AM/WTSX-FM Newburgh-Middletown NY (Port Jervis NY) from Port Jervis Broadcasting Co. Inc. to PJ Radio LLC.

| More... |

Stock Talk

Broadcast stocks trail the market
Thursday was an up day for most stocks, with oil prices falling again. But radio stocks were mostly lower and TV stocks were mixed. The Dow Industrials gained 84 points, or 0.8%, to close at 10,470.

The Radio Index was down 0.909, or 0.4%, to 227.711. Citadel lost 2.7% as the worst performer. Spanish Broadcasting System led the gainers, up 2.2%.

Radio Stocks

**Here's how stocks fared on Thursday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		38.31	-0.22	Jeff-Pilot	JP		50.40	+1.00
Beasley	BBGI		17.17	+0.07	Journal Comm.	JRN		17.19	+0.19
Citadel	CDL		14.97	-0.18	Radio One, Cl. A	ROIA		13.90	-0.25
Clear Channel	CCU		33.92	+0.03	Radio One, Cl. D	ROIAK		13.89	-0.21
Cox Radio	CXR		15.54	-0.08	Regent	RGCI		5.78	-0.03
Cumulus	CMLS		15.70	-0.09	Saga Commun.	SGA		18.25	-0.15
Disney	DIS		26.59	-0.07	Salem Comm.	SALM		26.75	-0.44
Emmis	EMMS		19.54	-0.30	Sirius Sat. Radio	SIRI		3.85	-0.01
Entercom	ETM		35.19	-0.26	Spanish Bcg.	SBSA		10.95	+0.24
Entravision	EVC		8.28	-0.03	Univision	UVN		29.80	-0.20
Fisher	FSCI		48.25	unch	Viacom, Cl. A	VIA		36.52	+0.19
Gaylord	GET		35.85	+0.14	Viacom, Cl. B	VIAb		35.76	+0.18
Hearst-Argyle	HTV		25.70	-0.04	Westwood One	WON		22.25	-0.21
Interep	IREP		0.90	unch	XM Sat. Radio	XMSR		34.01	+0.17
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

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Arbitron Radio Advisory Council Election Results

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Competing Media

Big investor in
Hispanic magazines
Mexico's broadcast giant Grupo Televisa, which also happens to be a huge magazine publisher in the Spanish-speaking world, is entering the US market in a four million-buck transaction to acquire 51% of a new publishing company being formed with Hispanic Publishing Group, which will own 49%. The company will begin with HPG's two existing titles: Hispanic Magazine, with a 280,000 circulation, and Hispanic Trends, with a 75,000 circulation, both of which are published in English.

October Digital
Solutions Magazine

Who Will Sit on the Throne?
The election -What is in it
for Broacasters?

One On One
with PHD's Patrick McNew -
The man that over sees spot
for Chrysler Group.

Engineered For Profit
'05 budgets and capital expenditures, our close up look at who's planning to buy what next year.

October Zinio Solutions Magazine
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RBR Radar 2004

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

Look for Radio's morning drive
to get longer
Commute times are getting longer and longer everywhere and quite a few stations nationwide already have their morning drive talent beginning work at 5:00 am. But since Arbitron officially measures drive time as beginning at 6:00, advertisers often won't pay top rates for that first hour. People Meters: 800 of the devices deployed in Houston for the next PPM test set in Houston, TX but Arbitron is still negotiating with hold-out radio groups Infinity, Cox and Radio One. Ex. VP of Saga Communications Steve Goldstein is outgoing Council Chairman as VP of Operations for Rubber City Radio Group Nick Anthony is in. is also looking into ways to improve the look of the PPM device. Major issue with young men, age 18-24, remains a sore spot, no matter what the methodology. RBR observation: Hate us for saying this and it also applies to TV, get on with life and test the People Meters. Work with it and do the necessary work in progress. Or live with the paper diary as our world and business in radio and television are now more paperless. You are reading this observation on your computer not a paper fax. Get It? By the way, the three hold outs should suck it up and get on board no matter what the results. Can't fix it if you don't know what is broken.
11/11/04 RBR #221

LPMs welcomed at Granite
Other TV group owners may be grousing about lower ratings under Nielsen's Local People Meters, now deployed in five markets, but LPM is being greeted like manna from heaven at Granite Broadcasting as COO John Deushane told analysts that the company's KBWB-TV San Francisco is getting a boost from LPM measurement, due to its skew toward younger demos as a WB affiliate, while the big four affiliates with their heavy news orientation have been taking hits under LPM.
RBR observation: What did we say above with the Arbitron PPM? People get on with life with the People Meter. 11/11/04 RBR #221

Hello DC - We have a Problem
NAB postpones battle
with satellite radio
The National Association of Broadcasters has dropped an attempt to head off the inclusion of local content on satellite radio services XM and Sirius. The content in question is primarily traffic and weather reports at this time.
RBR observation: XM is jumping for joy while the NAB has decided to punt and says it wants to "...assess new information demonstrating the growing trend towards transforming what was intended to be a national radio service complementary to local broadcasting into one that will have a highly detrimental impact on local broadcasters' ability to serve the needs of their listeners." Problems? We got them. 11/10/04 RBR #220

20th Television, CC Entertainment, XM partner for major Malcolm promo
To promote the off-net syndication of its award-winning sitcom "Malcolm in the Middle," 20th Television has entered into a major relationship with Clear Channel Entertainment and XM Satellite Radio on the "Malcolm in the Middle 'With You' Sweepstakes." The promo is built around the production and distribution of a dedicated song and promo music video to differentiate the series and its five days a week run in syndication from other programs in the marketplace. RBR observation: This may be one of the first large-scale cooperative ventures where traditional radio and satellite radio have been used together for a major promotion, each helping the other-and syndicated television as well in the process. Lesson for the day: Radio, satellite radio and television all may be competitors, but as we move forward in this ever-complicated, changing media environment, these different media are facing more similar challenges. The sooner they can effectively learn to use each others' assets to their advantages in a cooperative manner, the better. The above story is a prime example of why one media shouldn't always consider another as its competitor. Learn more along these lines in the January debut issue of Radio and Television Business Report - The Real Business Magazine or call April McLynn here to get your free copy: 703-492-8191. 11/10/04 RBR #220

NFL: One TV deal to go
New six-year contracts worth about 25% more to the NFL will keep pro football on Fox and CBS on Sunday afternoons through the 2011 season, but negotiations are still continuing with Disney's ABC and ESPN for their primetime packages. Those negotiations could drag on for a while. Fox paying approximately 712 million per year for the NFC's Sunday afternoon games and Viacom's CBS paying approximately 622 million annually for the AFC's Sunday afternoon games. The NFL gets 3.5 billion bucks, five-year extension of its contract with DirecTV for exclusive subscription TV rights extending the satellite company's NFL Sunday Ticket through 2010. TVBR observation: The NFL is the marquee sports product for television, but deals still have to make some business sense. CBS claims it is making money Fox may be closer to break even, or maybe a slight loss, but it was the NFL contract it snatched from CBS in 1994 which catapulted Fox into TV's big leagues. (CBS got back into football by taking the AFC from NBC in '98.) "Monday Night Football" continues to be a big ratings draw for ABC, the network is reportedly losing as much as 170 million a year under the current contract, so it's not going to easily agree to the 25% increases that Fox and CBS signed for. Although Disney says its intention is to retain the primetime NFL packages for ABC and ESPN, there could be some tough negotiations ahead. And there's always NBC waiting in the wings. 11/10/04 TVBR #220

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