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Volume 23, Issue 235, Jim Carnegie, Editor & Publisher
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Tuesday Morning December 5th, 2006
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Radio News ®
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 Coen sees another lackluster
year for radio
After overestimating radio growth for several years running, Universal McCann Sr. VP and Director of Forecasting Bob Coen is more conservative in his radio forecast for 2007. He is projecting that local radio ad revenues will be up 1% next year. After originally forecasting that local radio would grow 4% in 2006, Coen revised that down sharply to flat back in June and now says he expects local radio to finish this month down 1% for the year. Local was weak pretty much across the advertising spectrum in 2006. "Consolidation at the local level is killing people," Coen said yesterday in his annual presentation to the UBS 34th Annual Global Media & Communications Conference. He wasn't referring to media consolidation, but rather to advertiser consolidation, such as in the department store sector where Federated Department Stores has rebranded lots of regional chains as Macy's. For all of the media he tracks, Coen said local advertising was up 2.2% in 2006, well below his original forecast of 4%. He is projecting only 2.7% overall local ad growth in 2007. National business was better in 2006 and looks better for 2007, with 5.9% overall growth projected. National radio (network & spot) is projected to be up 4% after gaining 3% this year.
RBR observation: We were skeptical a year ago when Coen predicted such a strong year for radio, with local up 4.5% and national 4%. Other forecasters had generally expected much less. With the RAB reporting yesterday that local was down 1% and national up 3% for the year through October, it isn't likely the final two months of data will change that picture much. We would like to be able to say, for a change, that Coen is underestimating the year ahead, but there isn't yet any indication that 2007 will bring any more than a modest improvement from this very tough year of 2006.
Bob Coen's advertising forecast for 2007
| Media |
Dec. '06 Forecast
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Ad spend (millions)
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| Four TV networks |
3.0%
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$17,442
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| National spot TV |
0.0%
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$11,144
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| Cable TV |
6.5%
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$20,362
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| Syndication TV |
6.0%
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$4,301
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| National radio (net &
spot) |
4.0%
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$4,588
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| Magazines |
5.0%
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$14,096
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| National newspaper |
1.0%
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$7,313
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| Direct mail |
7.5%
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$64,405
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| National yellow pages |
3.0%
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$2,229
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| Internet |
15.0%
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$10,715
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| Other national media |
5.7%
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$39,045
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| TOTAL NATIONAL |
5.9%
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$195,640
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| Local newspaper |
2.0%
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$41,277
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| Local TV |
4.0%
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$15,572
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| Local radio |
1.0%
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$15,355
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| Local yellow pages |
1.5%
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$12,370
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| Other local media |
5.6%
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$18,559
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| TOTAL LOCAL |
2.7%
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$103,133
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| GRAND TOTAL |
4.8%
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$298,773
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| Source: Universal McCann |
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National fuels black October for radio
The latest Radio Advertising Bureau revenue figures are in, and they show a welcome uptick in revenue for October compared to the same month in 2005. A double-digit surge in national dollars (and non-spot revenue, too) shot business up a combined 6%. To be specific, national was up 14% and non-spot increased 15%, building on a modest 2% gain in local revenue. YTD, the monthly results left local down 1%, national up 3% and non-spot up 10%. While a curly number in black ink has to be seen as a good thing, it elicited a less-than-resounding ho-hum from analyst Marci Ryvicker at Wachovia Capital Markets. She pointed out that the 6% gain was built on the ashes of a 7% decrease in October 2005, meaning that the earlier loss was not quite recouped, and that the numbers look even worse when compared to 2004. She credited growing focus on the Internet for the continuing success of the non-spot category.
RBR observation: Political business had to help radio this year, both directly and via spillover as it heavy use of television forced some advertisers off that medium and over to radio. Radio continues to hover right around par on the local side. That is the number that has to come up if the industry is going to resume its historic tradition of steady, dependable high-single-digit revenue growth.
 Bayh, Brownback take first steps
Sen. Evan Bayh (D-IN) has formed an exploratory committee as a prelude to a possible run for the White House in 2008. He'll be looking to provide a centrist option in what may well be a crowded field of candidates, and he does come with a broadcasting connection. His wife Susan sits on the Board of Directors at Emmis Communications. Another exploratory committee has formed from the other side of the aisle, as Sen. Sam Brownback (R-KS) added substance to his musings about a possible presidential run. He will be pursuing the Republican nomination from the conservative side of the party. The Associated Press put out a scorecard of actual and potential candidates. On the Democratic side, there is Sen. Joe Biden (D-DE), Sen. Chris Dodd (D-CT), Bayh, Sen. Hillary Rodham Clinton (D-NY), former Gen. Wesley Clark, former Sen. and VP candidate John Edwards (N-DC), Sen. and former presidential candidate John Kerry (D-MA), Gov. Bill Richardson (D-NM), outgoing Gov. Tom Vilsack (D-IA), Sen. Barack Obama (D-IL) and possibly former Sen./VP Al Gore (D-TN). On the Republican side, possibilities/likelies include Brownback, former Speaker Newt Gingrich (R-GA), Sen. Chuck Hagel (R-NE), Sen. John McCain (R-AZ), former Gov. Mike Huckabee (R-AR), outgoing Gov. Mitt Romney (R-MA), Rep. Tom Tancredo (R-CO), Rep. Duncan Hunter (R-CA), former Gov. Tommy Thompson (R-WI), and perhaps Secretary of State Condoleezza Rice.
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Polarization and the Media: Part 3
Here's some more on how the media feeds public political polarization, from the Brookings Institute presentation by Diana C. Mutz of the University of Pennsylvania. She noted that the media does not lead people to extreme positions, it tends to follow elite opinion-makers and politicians to those positions. When a well-known figure takes a strong position, as many Democrats did in opposing members of their own party in the late 1960s in calling for an end to the Vietnam War, that extreme position is repeated in the media and "brackets" one parameter of acceptable public opinion. So according to her study of the matter, although the media may get the blame for polarizing the general population, it is merely passing on the polarization that actually exists among the people directly involved in making the decisions. That is not to say that certain members of the media do not have an effect on this. Whereas the Walter Cronkite moment during Vietnam was once a rarity, nowadays putting forth a schedule of air personalities with strong opinions is a major part of the News-Talk business model on both radio and television. The intimacy of television, according to Mutz, which makes it seem as though you are sitting very close to an in-your-face host in a debate with an equally-in-your-face guest, elicits an emotional response from the viewer that just isn't replicated if the same exchange were to be reported in the cold black and white ink of a newspaper. It also often makes for great television. The recent verbal saber-duel between Fox's Chris Wallace and ex-President Bill Clinton is a prime example. The topic Clinton was interested in promoting were eclipsed by the verbal battle, which went on to a life of its own on the Internet.
RBR observation: The lesson here is that we got through three pieces on this topic, detailing four distinct ways that the electronic media almost inadvertently, by its very nature, contributes to political polarization. And not one of them involved media consolidation. That's not to say that consolidation does not play a role, but it is instructive to note that a lot of this will happen because of influences completely outside of broadcasting, and simply due to the structure of broadcast media. Nor does it address the fact at times, depending on where you sit on the political spectrum, and depending on your agenda, polarization may be a good thing. Bottom line: take any charge that it's all the media's fault with a good strong shaker of salt.
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Ad Business Report TM
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Lehman Bros. predicts 2007 ad spend to grow 3.3%
The Lehman Brothers U.S. Media and Internet team estimates that 2007 total U.S. advertising will likely grow 3.3% to 300.5 billion. This compares with Lehman Brothers Economic team forecast of 2.6% 2007 GDP growth (4.7% nominal GDP growth). For 2007, Lehman Media expects national advertising to outpace local, with national growing 4.9% to 171.2 billion and local up 1.1% to 129.3 billion. Radio: As time spent listening continues to decline, in our view, the radio broadcasting industry lacks appropriate pricing power and new technologies continue to take listenership and thus ad dollars away from radio. With few indicators heading into 2007 suggesting improvement from 2006 trends, we expect radio broadcasters to exhibit continually softening fundamentals in 2007, driving our radio industry revenue forecast of 1% year-over-year declines.
| See Lehman's estimates for other media |
 Dial-Global to rep House of Blues;
big announcement coming today
The House of Blues Radio Hour and House of Blues Breaks - America's longest-running syndicated blues radio series - will be represented to stations and advertisers by Dial Global beginning 1/1. Dan Aykroyd will host the daily House of Blues Breaks series and weekly House of Blues Radio Hour series as Elwood Blues. The series continues to be produced by veteran syndicated radio producer, Ben Manilla. Currently broadcast on nearly 200 stations coast-to-coast, the series celebrates American-based music of all stripes from gutbucket blues to soul, R&B, and Rock. Elwood's recent guests have included Bonnie Raitt, James Hunter, Shemekia Copeland, Eric Burdon, Derek Trucks, George Thorogood, Buddy Guy, the North Mississippi All-Stars, Bettye Levette, Susan Tedeschi, and Ike Turner. Past guests have included Ray Charles, Robert Plant, Eric Clapton, Aerosmith, John Lee Hooker, Ruth Brown, Keb' Mo' and Al Green. "We're excited to be working with the innovative folks at Dial Global and look forward to seeing the House of Blues radio programs continue to spread the word about this vital American art form." said Dan Aykroyd, host and creator of the House of Blues Radio. Stay tuned - later today Dial-Global has a whopper of an announcement in the works.
Hallmark commercial depicts radio as old fashioned
Over the weekend on NBC and other networks you may have seen a spot for The Hallmark Store that features a girl decorating a Christmas Tree that has plenty of icons of new technology hanging-MP3 players, CDs, wireless devices, etc. Her grandfather, meanwhile, is decorating the tree with an old-time radio. The little girl, who has no idea what it is, asks him and he spells out "R A D I O." All under the theme of sharing old memories and making new ones.
RBR observation: Is this how advertisers see our medium now? Is this how our youth see it? Kind of a slap in the face, but hopefully not one of reality! They may not have officially be poking fun of radio, but the message was there.
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| Washington Media Business Report TM |
Clock ticking on FM Auction No. 68
The pile of FM sticks still on the FCC's shelves, leftovers from Auctions No. 37 and No. 62, are moving toward the first gavel 1/10/07. The bell rings on the next deadline for 32 qualified applicants next Monday 12/11/06, when upfront payments are due. It is also the deadline for 19 others with incomplete or otherwise deficient applications to get their acts together. Here's what the FCC has in stock: Covelo CA, Class A on 96.9 mHz, opening bid 7.5K; Tecopa CA, Class A on 106.1 mHz, opening bid 1.5K; Cedar Key FL, ClasAs on 100.1 mHz, opening bid 1.5K; Perry FL, Class A on 93.5 mHz, opening bid 15K; Kihei HI, Class C2 on 107.5 mHz, opening bid 90K; Outlook MT, Class C on 105.7 mHz, opening bid 10K; Ocracoke NC, Class C1 on 92.7 mHz, opening bid 150K; Meyersdale PA, Class A on 98.5 mHz, opening bid 90K; Parowan UT, Class C2 on 107.9 mHz, opening bid 15K.
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| Media Markets & Money TM |
Karmazin doubles up Cleveland
Craig Karmazin is acquiring a second AM in the Cleveland market, where he already owns WBKC in Painesville, a station that currently simulcasts Classical WCLV-AM & FM Cleveland when it isn't carrying play-by-play sports. Now he has a seven million bucks deal to buy WKNR-AM Cleveland from Salem Communications. The station is a Sports/Talk station that is obviously a none-core asset for the Religious specialist, which retains three other stations in the market. "Our decision to sell WKNR is consistent with our stated strategy of selectively divesting certain non-strategic or under-performing radio station assets. We believe that the sale of this station, which is in a non-strategic format, is the best means to maximize return on investment for our shareholders," said Salem CEO Ed Atsinger.
Close encounter in Fort Wayne
Doug Ferber of Star Media group has checked in to announce the closing of the sale of WXTW-FM, serving Fort Wayne IN from city of license Auburn IN. Three Amigos Broadcasting, headed by Christine M. Kostopoulos, is the buyer. John Jacobs and his Summit City Radio Group LLC pick up 1.35M according to documents filed with the FCC.
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| Entertainment Media Business Report TM |
A quarter-century of cheesesteaks
Classic Rock superstars Joan Jett and the Blackhearts will headline the 25th Annual DeBella DeBall this Thursday, which will also celebrate the 25th anniversary of John DeBella, pictured, as an on-air personality in Philadelphia. That run began at WMMR-FM and ran through a series of call letters, all in Philly, until DeBella landed at his current home, doing the wake-up shift on Greater Media's WMGK-FM since 2002.
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| Internet Media Business Report TM |
 CNBC relaunches with more video
CNBC relaunched its website yesterday with more video and newsmaker interviews, coinciding with ending a five-year deal with MSN Money. CNBC ran its own website from 1998-2001, when it began providing content to Microsoft's MSN portal. CNBC.com now carries several new features, including web-only video clips and market updates, video from news events and interviews with CEOs and other newsmakers. Customers 9.95 per month also have access to premium features including archived video and live feeds from global CNBC channels. Mark Hoffman, CNBC's president, said the network has hired an additional 55 people to work on the website, according to The AP.
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| Transactions |
5K WJCG-FM Monee IL from The Moody Bible Institute of Chicago (Robert Gunter) to Life on the Way Communications Inc. (James Tolle, Gary Curtis). Cash. [File date 11/15/06.]
N/A WPRH-FM CP Paris TN from Abundant Life Broadcasting (Francis C. Price) to American Family Association (Donald E. Wildmon). Seller is donating station to AFA in order to bring AFA programming to Paris TN. CP is for Class C3 on 90.9 MHz with 14.5 kw @ 289'. [File date 11/15/06.]
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| Stock Talk |
Stocks close higher
Was it the models from Victoria's Secret who dropped by the NYSE to ring the closing bell and light the exchange's Christmas tree? Something had traders in a good mood, that wasn't even dampened by Pfizer canceling what had been a promising drug. The Dow Industrials rose 90 points, or 0.7%, to 12,284.
Radio stocks rose as the media sector got extra attention from both UBS and Credit Suisse holding annual conferences on media stocks in New York. The Radio Index gained 2.425, or 1.6%, to 150.317. Cumulus was the star, up 4.3%. Westwood One gained 3.4%.
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| Radio Stocks |
Here's how stocks fared on Monday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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44.73
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+0.73
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Hearst-Argyle
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HTV
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25.75
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+0.13
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Beasley
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BBGI
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7.06
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+0.05
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Journal Comm.
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JRN
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11.97
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+0.06
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| CBS CI. B |
CBS |
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30.20
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+0.45
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Lincoln Natl.
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LNC
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63.73
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+0.68
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| CBS CI. A |
CBSa |
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30.20
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+0.44
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Radio One, Cl. A
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ROIA
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6.54
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+0.12
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| Citadel |
CDL |
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9.74 |
+0.34 |
Radio One, Cl. D
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ROIAK
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6.55
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+0.13
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Clear Channel
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CCU
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35.39
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+0.02
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Regent
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RGCI
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3.02
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-0.02
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Cox Radio
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CXR
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16.44
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+0.40
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Saga Commun.
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SGA
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8.89
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+0.11
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Cumulus
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CMLS
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10.59
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+0.44
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Salem Comm.
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SALM
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11.43
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-0.30
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Disney
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DIS
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33.44
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+0.35
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Sirius Sat. Radio
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SIRI
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4.17
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-0.08
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Emmis
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EMMS
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8.52
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+0.02
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Spanish Bcg.
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SBSA
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4.23
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unch
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| Entercom |
ETM
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27.60
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+0.43
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Univision
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UVN
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35.42
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-0.03
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Entravision
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EVC
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7.57
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+0.20
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Westwood One
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WON
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6.79
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+0.22
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Fisher
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FSCI
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45.19
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+0.74
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XM Sat. Radio
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XMSR
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14.61
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+0.16
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Gaylord
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GET
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49.60
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+1.08
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Bounceback
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 We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]
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Below the Fold
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Ad Business Report
More predicting for 2007
Lehman Brothers U.S. Media and Internet team estimates out...
Hallmark commercial
Depicts Radio as old fashioned...
Media Markets & Money
Close encounter in Fort Wayne
Closed the sale of WXTW-FM...
Washington Media Business Report
Clock ticking on FM Auction No. 68
Pile of FM sticks still on the FCC's shelves leftovers from Auctions No. 37 and No. 62...
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Stations for Sale
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Upgradeable Albany AM
License, equipment, and engineering study for upgrade, all available now. Includes property and new solid state transmitter. $240k, owner will finance. NO cash flow.
877-541-5250 (NO BROKERS)
Southern Market w/PCF
Near Major University
Owner finance - $950K
Ken Hawkins 334-514-2241
Satterfield & Perry
[email protected]
5 FM / 1 AM station NEast
2 markets, 3 station clusters.
Revenue @ 2.5M, CF pacing at
1M in 06, Asking 12.3M,
[email protected]
or 781-848-4201
Market your Stations For Sale
in our daily epapers.
Contact June Barnes
[email protected]
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Radio Media Moves
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 Hammel
to 'FAN
Anthony Hammel has been named General Sales Manager of CBS Radio's WFAN new York. His 16 years in NYC radio includes a previous stint at 'FAN, but he was most recently with Clear Channel as General Sales Manager of WAXQ-FM NYC.
Chen moves up
Michael Chen has been named President and CEO of the Global Media and Communications business unit at GE Commercial Finance, succeeding Robert Stefanowski, who was recently named President and CEO for GE Commerical finance - Corporate Financial Services Europe. Chen had been General Manager for Global Airports and US Aviation in the Aviation Financial Services business of the GE commercial lending company.
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More News Headlines
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WDBO reups with ABC
Cox Radio-owned Newstalk 580 WDBO Orlando announced that it has renewed its affiliation with ABC Radio News for another five-year term. The station is also the home of ABC Radio's legendary Paul Harvey and talk host Sean Hannity.
That other
Connecticut city
Alert reader Bud Wilkinson in Connecticut notes that the largest newspaper owned by Journal Register Company, as mentioned in Monday's RBR, is indeed named Register, but is in New Haven, not Hartford.
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Ideas Working Now TM
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In January's Special Journal Report
1. Media Assoc. Presidents Forecasting '07. These are your Leaders Folks this is where Your dues go to so get involved and read, learn and 'What does it mean to your business?'
2. RBR/TVBR Business News: Google: threat, savior or non-issue. Google is after your inventory.
3. One-on-One--Alan Frank, CEO Post-Newsweek Stations his view from the inside today's Media biz.
4. TV station deal making outlook, Mark Fratrik, Brian Cobb, Kalil, others with insight '07
Contact & Discuss how you can Partner with RBR/TVBR
June Barnes: 803 731-5951
Carl Marcucci: 703 492-8191 ext 202
Jim Carnegie: 813 909 2916
Ideas Working Now TM
 View '07 Content Focused
Reports Calendar
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RBR Radar 2006
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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Buyer expects Radio Spend
to be Flat to Down in '07
Bank of America hosted the second of its Fall '06 Media Buyer lunches. The guest is the president of local broadcast media buying at a major agency. Key takeaways included four key areas of concern. 1. GOOG/dMarc initially will serve direct response advertisers and smaller advertisers. The buyer does not believe that GOOG/dMarc's offering initially will be able to serve a media agency with time-sensitive ad buys or that is working off of a complex media plan. (there is more) 2. Radio spending likely will be flat to down in '07. Unit pricing is expected to be flat to down for spot TV and radio, with radio experiencing slightly larger declines. 3. Digital budgets are doubling for many advertisers next year. 4. The Portable People Meter (PPM) likely will receive MRC accreditation very soon.
12/04/06 RBR #234
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Website Director
2007 the year of Challenge and RBR-TVBR is looking for an aggressive and progressive Media Website take charge Director. Will be working side by side with all aspects of RBR-TVBR's editorial, sales, marketing and production staff in a new era of today's media business. RBR-TVBR is moving forward with a Pro-Active Strategy see what is required as RBR-TVBR begins our 24th year in the media business and independently owned.
See Radio Careers
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