RBR's Daily Morning Epaper

Volume 24, Issue 224, Jim Carnegie, Editor & Publisher

Thursday Morning November 15th, 2007

Radio News ®

Interep posts positive quarter
In its quarterly report to the SEC, Interep showed Q3 operating income before depreciation and amortization of 13.8 million, as opposed to a loss of 3.9 million a year ago. However, the bulk of that positive number was due to recording 11.9 million in contract termination revenue for the quarter, mostly from Emmis ending its representation by Interep at the end of Q3 to move to Katz. Commission revenues for the quarter were down 2.7% to 17.4 million, with the decrease largely due to the loss of the former Susquehanna stations, now owned by Cumulus Media Partners and repped by Katz. But Interep had some good news for investors in noting that selling expenses were down 32.1% to 13.7 million, largely due to the severance programs implemented in 2006 and this year to cut overhead at the rep company. On the bottom line for Q3, net income applicable to common shareholders was 7.6 million, vs. a loss of 9.5 million a year ago. Interep is primarily a national rep for radio, but recently launched its second TV rep firm, both targeting Hispanic stations.

RBR observation: Aside from operating improvement, which is showing up in its quarterly financials, the big task facing Interep Chairman Ralph Guild and CEO David Kennedy is refinancing the company's 99 million in bonds coming due July 1, 2008. Interep recently disclosed that it had retained Jefferies & Company to help with that task (11/7/07 RBR #218).

Stuck in the middle
If anybody out there thinks FCC Chairman Kevin Martin got it exactly right with his proposal for a limited rollback of cross-ownership restrictions, they don't seem to be talking. There is, however, no shortage of people who think he went too far or didn't go far enough. Take a look under the click.

RBR observation: Most inside-the-Beltway actions worthy of comment attract both pros and cons. Martin has managed the feat of attracting cons and cons, but seems to be a little short on the pro side. That is one of the special attributes of communications issues. Just ask the NAB, which often gets stuck in the middle of internecine warfare among its constituents, who have many goals in common but a seemingly equal number of concerns that pit one subgroup against another. Although we knew Martin's proposal would have detractors, we actually thought for a few moments yesterday that the spirit of compromise seemingly built into Martin's proposal would turn a hot ongoing story into a quieter, cooler affair. It seems the regulatory climate will remain deep in the hottest equatorial zone. We suggest that Martin begin wearing a rhetorical pith helmet.
| Cons and cons here |

Univision, Entravision, ImpreMedia
key Hispanic voter drive
Multimedia powerhouses Univision, Entravision and ImpreMedia are in the enviable position of furthering civic public interest goals -- encouraging participation in the 2008 elections -- in a manner which holds the potential to direct political money from campaign treasuries into their own. The voter drive, It's Time, Go Vote! (we'll spare your in-box the Hispanic lettering and punctuation, but the slogan translates to Ya es Hora, ve Vota!). The three companies are pushing the drive, along with Mi Familia Vota Educational Fund, the National Association of Latino Elected and Appointed Officials (NALEO) Educational Fund, and the National Council of La Raza (NCLR). Broadcast, print and grassroots elements will be incorporated into the campaign, which encourages eligible Hispanics to apply for citizenship if necessary and register to vote if possible. The coalition hopes to register millions in 2008. The three Hispanic media companies between them claim 99% reach into the Hispanic community over various electronic media. And an NCLR poll reveals that 52% of Hispanics respond and take action when seeing ads from the coalition.

RBR observation: And they may well respond and take action if political candidates put the right message over Hispanic airwaves. Immigration is a white hot issue. The Hispanic population is expanding rapidly but is still concentrated in a limited number of jurisdictions. In those districts or states with heavy concentrations, the Hispanic vote may well be a deciding factor on Election Day. We expect Hispanic media will get their share of the political pie this time around.

Spitzer's popularity takes a tumble
Since Eliot Spitzer rode into the New York Governor's Mansion partly on the backs of radio broadcasters from his phony payola probe as the state's attorney general, broadcasters may be heartened to learn that Spitzer has pretty much derailed his own political career in only 11 months in office. First he was embroiled in scandal when it was learned that some of his top aides were illegally using the state police to investigate his political enemies. (Spitzer himself denied any knowledge of the misdeeds.) And more recently he ran into a buzz-saw of public criticism with a proposal to issue New York drivers licenses to illegal aliens - a plan he has now abandoned under pressure. A year ago Spitzer won the governorship with 69% of the votes. A Siena College Research Institute survey released this week found 64% of New Yorkers disapprove of Spitzer's job performance. Only 25% of voters now say they would vote for Spitzer, while 49% favor "someone else." Even among fellow Democrats, only 37% say they would vote to reelect Spitzer.

RBR observation: Couldn't happen to a more deserving guy.

Sumner pockets some cash
The Associated Press took notice this week when Sumner Redstone made an SEC filing showing that he had sold 503,529 shares of Viacom for nearly 20 million bucks. The shares were sold back to Viacom itself by National Amusements, the Redstone family company that controls both Viacom and CBS Corporation. In fact, National Amusements has been selling stock back to Viacom on a fairly regular basis. It has an agreement with Viacom to participate on a pro-rata basis in the media company's stock buyback program. Neither National Amusements nor Redstone himself has sold any CBS stock recently.

RBR observation: We would note, however, that all of the shares that Redstone sold back to Viacom were non-voting Class B shares. He has not sold a single one of the 46.8 million-plus Class A shares by which he, via National Amusements, holds voting control of Viacom. A similar share class structure exists at CBS.

Wall Street Business Report TM

Revenues down for SWMX
Online media ad transaction platform company SWMX, operator of the SoftWave Media Exchange, reported that Q3 revenues fell to 321,930 from 632,579 a year earlier. The company's net loss increased to 3.4 million from 2.8 million. If your company is owed money by SWMX, you will be interested in this statement from the quarterly SEC filing: "Over the past quarter the delinquency of our accounts payable to media organizations has increased significantly. This increase has adversely affected our business and relationships. Certain media organizations have referred us to collection agencies. Others have refused to accept orders from our customers placed through our marketplace. In addition, some of our customers have refused to pay outstanding receivables. We have been and continue to attempt to remediate this situation through the following steps:

1. On October 3, 2007, we restructured our credit facility with BlueCrest, providing us with the ability to borrow up to 3.5 million to fund operations, through January 31, 2008.
2. We have begun to repay amounts owed to media organizations.
3. We are communicating with our media vendors to keep them informed of our progress and the steps we are taking to remedy the situation.
4. We are seeking to complete a financing transaction, which would satisfy the requirement to repay BlueCrest by January 31, 2008, properly fund our company and allow us to satisfy our payables that are in arrears.

Although we believe these steps are helping to remediate the situation and reduce our risk, there can be no assurance that we will be successful in executing these steps or that if successfully executed these steps will improve the adverse affects that may have already been caused."

Big Ben gets transparent
Federal Reserve chief Ben Bernanke announced a move to provide more public disclosure of the inner workings of the Fed. Instead of issuing economic projections twice a year, the Fed will now put them out four times yearly - and they will provide more detail. The first such report will be issued November 20th, when the Fed releases minutes of its monetary policy making Federal Open Market Committee (FOMC) meeting from October 30-31. Since 1979 the Fed had issued its projections of economic growth, unemployment, and inflation semiannually in its reports to Congress on monetary policy. From now on, it will compile and release projections four times each year rather than twice a year. In addition, the projection horizon will be extended to three years, from two. FOMC meeting participants will now provide projections for overall personal consumption expenditures (PCE) inflation, as well as for real gross domestic product (GDP) growth, the unemployment rate, and core PCE inflation. Projections of nominal GDP growth will be discontinued. Summaries and explanations of the projections will be published along with the minutes of the FOMC meeting at which they were discussed. These descriptions will provide a fuller discussion of the projections, covering not only the outcomes that most meeting participants see as most likely, but also the risks to the economic outlook and the dispersion of views among policymakers.

"The changes will provide a more-timely insight into the Committee's outlook, will help households and businesses better understand and anticipate how our policy decisions respond to incoming information, and will enhance our accountability for the decisions we make. But the changes are also evolutionary, in that they build on long-established practices; in that respect, they represent just one more step on the road toward greater transparency at the Federal Reserve. The Committee will continue to look for ways to improve the accountability and public understanding of US monetary policy making," Bernanke said yesterday in a speech to the Cato Institute's 25th Annual Monetary Conference in Washington, DC.

Executive Comment

Arbitron responds
to Charlie Ferguson
Regarding yesterday's Executive Comment from Charlie Ferguson of Northern Broadcast Inc., we received this response from Thom Mocarsky (pictured), Arbitron Sr. VP of Press and Investor Relations:

On randomly selecting radio station personnel: The sampling rate is so high in Traverse City that it¹s inevitable that households with radio station employees get selected. With each survey, approximately on out of every 45 households gets selected to be in our starting sample. And, once the survey is done, one out of every 129 people in the market ends up in our survey.Despite the odds of getting selected, people in the radio industry are remarkably honest. It is an uncommon event for us to re-issue a report because of media affiliation. (Only once this year, and we issued almost 800 separate quarterly reports.)

On keeping a list of radio station personnel: This would be a logistical nightmare and it raises significant privacy issues. (Remember, we track diary/PPM entries from nearly 14,000 separate radio stations and sample more than a million and half people each year.) We already spend a lot of time getting an up to date Station Information Package from stations. As I've said before, media affiliated respondents are not a common occurrence.

On software processing: While it is possible to "average the averages" in the Smart Plus software, there is a warning right on the front page after an agency signs in to get the data which cautions against averaging small market books.
| See it here |

Additionally, there is additional reference information regarding this in the SmartPlus help system. Also, when we began the two-book averages in select markets, we spent time educating the users of the software about the proper use of the data. This is certainly something we can revisit.

Ad Business Report TM

MindShare begins PPM-based radio posting
Looks like radio will soon be working with guarantees similar to television in terms of audience delivery, via PPM. This trend may be started with a memo from Kathi Claire, MindShare, Partner, Senior Broadcast Negotiator to all Houston stations:

"To Our Houston Radio Partners:

MindShare is now going to post radio for all PPM markets. This will affect everything placed in Houston from this date forward, as well as for the 2008 Burger King already placed. I can now discuss ratings and demos with you. All buys will have to be guaranteed to deliver 90% of the total points for the estimate, with underdelivery weight run as requested at a later date.

I'll re-send the 2008 1Q and 2Q BK skeds with the ratings soon. If anyone wants to drop out based on having to make a guarantee, you'll have a week to do so after I send the numbers. Nothing already booked in 2007 will be posted (except through BK's audit company which started doing this after the fact). Please make sure that all of your managers are aware of this. Thank you."

Kathi Claire mentioned that all calls on this go to Kathy Crawford, MindShare President/Local Broadcast. She, like others in the business were in a MRC meeting all day yesterday.

Concerns from radio on the issue could be summed up in a comment from one broadcaster, who did not want to be identified: "Logically, do I want to agree to posting when PPM shows Oldies WCBS-FM is the #2 Station among Men 18-24 in NYC or the #1 Station among Women 25-34 in Long Island...or more laughable....the #4 stations with teens in NYC?"

Media Markets & Money TM

EMF scores two more FMs
Ever-growing Educational Media Foundation, which broadcasts the noncommercial Christian Contemporary K-LOVE Network, has found another pair of FMs to acquire. The stations are in Arkansas and Mississippi. EMF is known to operate on both sides of the reserved band; this time the stations are coming from another noncom, George S. Flynn Jr.'s Broadcasting for the Challenged. They are KKDU-FM in El Dorado AR and WLRK-FM in Greenville MS. The price is 320K.

RBR observation: For the purposes of radio, both markets are unrated, but they are not completely off the measured market radar screen. Both receive television numbers from Nielsen.

Washington Business Report TM

Cochran will try
to return to Washington
There has been some speculation that Senator Thad Cochran (R-MS) would call it quits when his fourth term expires next year, but it can now be laid to rest. Cochran will indeed campaign for another six years on Capitol Hill. The announcement is good news for Republicans, who also face the prospect of defending five open seats. Exiting are John Warner (R-VA), Chuck Hagel(R-NE), Pete Domenici (R-NM), Wayne Allard (R-CO) and Larry Craig (R-ID).

RBR observation: The early betting has Warner's seat going to another Warner, former Democratic governor Mark Warner, and Colorado and New Mexico may prove tough for Republicans to hold. Nebraska looks safer now that former seat-holder Bob Kerrey has indicated he won't run. Nobody expects the Democrats to take Idaho (except some Dems with the rosiest of colored glasses). We suspect the Mississippi seat would have fallen into that category as well. Cochran won his last electoral contest with 85% of the vote. It's still good news for Republican planners, who can leave Cochran to fend for himself while they direct their resources elsewhere.

Ratings & Research

Consumer spending continues to show restraint
October retail sales were up, though only slightly, signaling a slow down in consumer spending as the retail industry begins its holiday season. According to the National Retail Federation, retail industry sales for October (which exclude automobiles, gas stations, and restaurants) rose 4.4% unadjusted over last year and 0.1% seasonally adjusted from September. October retail sales released by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.2% seasonally adjusted from last month and 6.7% unadjusted year-over-year.

HD Radio 2007

CEA names HD Radio / iTunes tagging a top innovation
iBiquity Digital announced that iTunes Tagging with HD Radio Technology is featured in two products that were Honorees of the Consumer Electronics Association's (CEA) prestigious Innovations Awards: Alpine Electronics of America's TUA-T550HD in the In-Vehicle Audio category and Polk Audio's new I-Sonic Entertainment System 2 in the Enabling Technologies category. HD Radio receivers featuring iTunes Tagging will be on display during the 2008 International CES in Las Vegas. iTunes Tagging enables consumers using HD Radio receivers, equipped with a Tag button, to "tag" songs they hear on FM HD Radio stations, sync with their iPods and then be presented with the option to buy the selected songs on iTunes.

TVBR TV News

Local TV likely to snare Fox spins
It's hardly surprising that Local TV LLC was a bidder for the nine Fox stations that News Corporation put up for sale in June (6/14/07 TVBR #116). What is surprising is that, due to the current tight credit market, Local may have been the only bidder. Is a deal going to be announced soon? When News Corp. announced that it wanted to divest these nine stations there was lots of interest from private equity firms wanting to get into television. But that was before the credit markets took a big hit from the subprime debacle. Reuters reported that when it came time to bid this week, Local, backed by Oak Hill Capital Partners, was the only firm to submit a bid, reportedly in the 1.1-1.2 billion range. If Local, run by Randy Michaels, is the buyer, it would greatly expand the group begun by acquiring the former New York Times stations and move it up considerably in market size. Of the nine markets offered by News Corp., Local is in only one, Memphis. It doesn't look like a real duopoly is doable there, so we would likely find out if Michaels has lined up a virtual duopoly partner to take the excess station.

**Fox stations offered for sale by News Corporation**
CALLS	Ch.	Market	Rank	Rev.'06 (000)
WJW-TV	8	Cleveland-Akron, OH	17	72400
KDVR-TV	31	Denver, CO	18	44900
KTVI-TV	2	St. Louis, MO	21	39000
WDAF-TV	4	Kansas City, KS-MO	31	42900
WITI-TV	6	Milwaukee, WI	34	34900
KSTU-TV	13	Salt Lake City, UT	35	29200
WBRC-TV	6	Birmingham, AL	40	38500
WGHP-TV	8	Grnsboro-HighPoint-Winston Salem, NC	46	23950
WHBQ-TV	13	Memphis, TN	47	22000
		Total		347750

Source: BIAfn Media Access Pro

TVBR observation: Back when these stations were put on the market we had envisioned a higher price tag. But we have since learned that these stations do not have the same sort of high margins that Fox is known for in its largest markets. That could well explain why News Corporation decided to put them up for sale.

Transactions

400K KLSN-FM Lufkin-Nacogdoches TX (Hudson TX) from Peggy Sue Marsh, Administrator, Estate of Harold J. Haley to The Turning Leaf LLC (Vance Barbee, Margaret Reidhead, Lora Decker). 25K escrow, 25K cash at closing, 300K note. [File date 10/29/07.]

Stock Talk

Broadcasting stocks hit hard
Stock prices ended lower amid continued uncertainty about the fallout from the subprime credit market. The Dow Industrials fell 83 points, or 0.6%, to 13,224.

Radio stocks, though, were almost all down, with no news to account for the drop. Just a day earlier broadcasting stocks had gotten a boost from retail giant Wal-Mart reporting better-than-expected Q3 results. The Radio Index fell 6.368, or 5.6%, to 107.711 - back to its lowest point since 1998. The hardest hit were Emmis, down 12%, and Citadel, which fell 11.8%.

Radio Stocks

**Here's how stocks fared on Wednesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		51.08	-0.45	Google	GOOG		641.68	-18.87
Beasley	BBGI		7.17	+0.07	Hearst-Argyle	HTV		21.31	-0.04
CBS CI. B	CBS		27.28	-0.61	Journal Comm.	JRN		9.20	+0.33
CBS CI. A	CBSa		27.31	-0.60	Lincoln Natl.	LNC		62.10	-0.57
Citadel	CDL		2.62	-0.35	Radio One, Cl. A	ROIA		2.51	-0.27
Clear Channel	CCU		35.25	-1.21	Radio One, Cl. D	ROIAK		2.53	-0.27
Cox Radio	CXR		12.49	-0.58	Regent	RGCI		2.13	-0.04
Cumulus	CMLS		9.35	-0.19	Saga Commun.	SGA		7.43	+0.03
Debut Bcg.	DBTB		0.80	unch	Salem Comm.	SALM		7.78	-0.21
Disney	DIS		31.80	-1.21	Sirius Sat. Radio	SIRI		3.51	-0.12
Emmis	EMMS		4.17	-0.57	Spanish Bcg.	SBSA		2.12	-0.06
Entercom	ETM		18.29	-0.64	SWMX	SMWX		0.02	unch
Entravision	EVC		6.83	-0.17	Westwood One	WON		2.28	-0.62
Fisher	FSCI		43.16	-0.75	XM Sat. Radio	XMSR		14.25	-0.81

Bounceback

Send Us Your Opinions We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]

I would guess that Clear Channel lost 77.9 million (11/9/07 RBR #220) when they allowed Roy Laughlin to leave the fold. Roy is the brightest, most aggressive radio seller with whom I've ever dealt. And I've dealt with hundreds.

To quote Charlton Heston:
The green is people!

Regards,
Ben McGiffert
Radio Marketing Specialist

Below the Fold

Ad Business Report
MindShare begins
PPM-based radio posting, this will affect everything placed in Houston from this date forward...

Executive Comment
Arbitron responds
To Charlie Ferguson from yesterday's RBR, it is heating...

Media, Markets & Money
EMF scores two more FMs
Ever-growing Educational Media Foundation buys but they are unrated...

Washington Business Report
Cochran will try to return
To Washington there has been some speculation that Cochran (R-MS) would call it quits...

Stations for Sale

100kw CP
attractive, rated SE coastal
growth market.
Top 10 AM
Cash flowing SE small market combo.
Suburban St Louis FM
These opportunities and more at Satterfieldandperry.com.

Market your Stations For Sale
in our daily epapers.

Contact
June Barnes
[email protected]

Arbitrends

Arbitron
Market Results
| Bakersfield |
| Detroit |

Radio Media Moves

Neeley to Virginia
Melissa Neeley has joined Monticello Media as News Director for its recently acquired cluster of stations in Charlottesville, VA. Neeley will also serve as morning news anchor on WCHV-AM. She was previously an anchor and reporter for Cox Radio's WHIO-AM & FM Dayton, OH.

Upped at WW1
Westwood One announced the appointment of Peter Sessa to Vice President, Marketing & Communications, making him responsible for developing, supervising and facilitating the Company's marketing, creative and communications strategy. Sessa had been Director of Marketing & Communications. WW1 also announced the appointment of Johanna Shandalow to Sr. Director, Marketing & Special Events, up from Director of Corporate Operations. Shandalow will be responsible for the execution of all Company events including radio remote broadcasts, client events and ticketing. Both Sessa and Shandalow will be based in Westwood One's New York office.

Lee Logan joins
Shane Media
Lee Logan-best known for his major market Country programming experience in Houston, San Francisco, Chicago and Nashville-has joined Shane Media Services as Programmer/Consultant. Most recently, Lee's been in Albuquerque, overseeing programming in Southwestern markets for American General Media.

Photo: Lee Logan, Pam Shane and Ed Shane on Lee's first day as Programmer/Consultant at Shane Media.

More News Headlines

RFD-TV confirms Imus simulcast
Rural Media Group Inc. announced that it has signed a 5-year agreement to simulcast the "Imus In The Morning" program from new radio flagship WABC-AM New York exclusively on RFD-TV and RFD HD. The show will air live on the cable/satellite network weekdays from 6-9am (ET). "Imus in the Evening," a rebroadcast of the morning's program, will air in primetime on RFD HD from 6-9pm and will be featured on video-on-demand enabling West Coast viewers and millions of fans to experience the show at their convenience. RFD, now available mostly on rural cable systems, is expected to use the Imus show to seek carriage by the major MSOs.

NABOB books a hotel
The Twenty-Fourth Annual Communications Awards Dinner of the National Association of Black Owned Broadcasters is on the calendar. The event will be held at the Marriott Wardman Park Hotel in Washington DC on 3/5/08. Co-sponsoring is the NABOB Telecommunications Education and Management Foundation.

RBR Radar 2007

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

Lovett or leave it?
Royalties down the Hatch?
Music talents Lyle Lovett and Alice Peacock held forth before the Senate Judiciary Committee on the topic of performance royalties, better known to broadcasters as a performance tax. Commonwealth Broadcasting's Steven Newberry made an effective argument against, but there's a problem. Orrin Hatch (R-UT) has recordings out there and he wants a helping of broadcaster cash, too.

RBR observation: The big piece of information we want to see is exactly how much of this money would go to artists and how much to corporations. Are broadcasters being asked to come to the aid of a lone folk singer with a guitar or a multinational corporation headquartered on foreign soil? Unfortunately, nobody from a major label was there to describe to Hatch what his cut would be.
11/14/07 RBR #223

Dereg, Martin style: Just a nibble
Watchdogs have been howling at the moon for about a month now, in preparation for the nefarious plans of FCC Chairman Kevin (R) to gift-wrap what's left of the broadcast spectrum and hand it over to the nation's biggest communications companies. It turns out, however, that his one modest proposal is to allow newspapers to have a limited broadcast presence, and that only in the nation's top 20 media markets.

RBR observation: This really, truly is a very modest piece of deregulation. It's so small you'd think the watchdog community would accept it as a major victory and move on to help craft the localism and minority ownership proceedings to their liking. It will come as bad news to small market television operators hoping to get a chance to build duopolies, ((Also in this mess Copps, Adelstein push back and in return Dorgan pushes back more in RBR).
11/14/07 RBR #223

News Corp. ready to
set WSJ.com free
Rupert Murdoch told reporters back in his native Australia that News Corporation is already pacing ahead of its guidance for its fiscal Q2 and he seems anxious to take control of Dow Jones & Co. Murdoch confirmed that he plans to make the Wall Street Journal website, generally regarded as the most successful subscription site on the Internet, free
11/14/07 RBR #223

RBR Classifieds

New Listing
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JonesTM in Dallas, home of the Cowboys and the opportunity to work with the best talent in the business today as we need a top RSM with 2-5 yrs pro sales experience; with heavy outbound e-mail and phone prospecting; solid presentation, computer skills. Drug screening is a condition of employment. EOE. There is a lot more to this opening. See Radio Careers

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