RBR's Daily Morning Epaper

Volume 22, Issue 28, Jim Carnegie, Editor & Publisher

Wednesday Morning February 9th, 2005

Radio News®

D-Day in the House
That's D as in Decency. The House of Representatives' Energy and Commerce Committee is scheduled to vote on the Broadcast Decency Enforcement Act (BDEA) today - - depending on how the day goes, a vote will come just before or just after lunch. Look for the bill to move forward. The bill, which would raise maximum FCC fines for indecent broadcast content to as much as 500K per offense, passed this same hurdle last year almost without opposition. Only Jan Schakowsky (D-IL) voted against the measure in committee, where it passed by a vote of 49-1 (3/4/04 RBR #44). However, lawmakers were unable to overcome differences in the House and Senate versions of the bill, and efforts to attach a stripped-down version of the bill to must-pass appropriations legislation late in the year also failed.

RBR observation: This should sail through committee again. Almost nobody in either party wants to stand up for the rights of former Clear Channel Tampa jock and still unemployed Bubba the Love Sponge and his ilk, or at least, almost nobody has the kind of political capital that makes them think they can afford to stand with Bubba against the nation's children. However, last year, we thought this legislation was a mortal lock for passage. Indeed, in an election year, we thought it was one of the few items on the agenda which was generating any bipartisan cooperation at all. Yet it failed. A major reason for the failure to write the bill into law was the use of the BDEA in the Senate to continue the battle against the FCC 6/2/03 media ownership ruling. If it appears that ownership dereg measures have been successfully derailed by the Third Circuit, such hindrances to ultimate passage may be removed. Even if they are not, we still think that somehow, some way, some form of this proposal is going to make it into the law books.

Senators renew battle for LPFM
Senators John McCain (R-AZ), Maria Cantwell (D-WA) and Patrick Leahy (D-VT) are teaming up to introduce the "Local Community Radio Act of 2005," a bill to expedite the construction of low power FM stations. The bill would not provide 3rd adjacent channel protection to existing full-power stations, and the NAB is already girding for battle.
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Radio One honchos pay down loans
Back in the summer of 2002, Radio One's stock took a surprise hit when company loans to key officers suddenly became a hot topic and Congress banned such loans going forward as part of the Sarbanes-Oxley law to clean up Wall Street. Never mind that Radio One made its loans when the practice was ok and that the loans were used to buy company stock - - presumably giving the executives a financial incentive to do well for their shareholders. They were suddenly a bad mark on the company. In one of the earliest issues of the RBR Daily Epaper (7/15/02 RBR #6) we detailed the suddenly-suspicious "related-party transactions" which had brought investor scrutiny to Radio One and also looked for similar transactions at other broadcast companies. Now, nearly three years later, the issue has died down, but Radio One announced yesterday that two of its officers had paid down what they owe the company. Under the terms of the loans, CEO Alfred Liggins has made repayments in cash and stock to the point that his original loan balance of 21.1 million is now 5.9 million - - and that is due in full in April. CFO Scott Royster repaid a 750,000 loan in full last month, but another loan in the original amount of seven million isn't due for several more years. Also outstanding is a two million loan to General Counsel Linda Vilardo. As a result of the stock which was used in part for the repayments, Radio One has retired those shares and the number of outstanding shares of its Class D stock has been reduced by 1,145,000.

Interest in satellite radio
already weakening
That's the key conclusion of JP Morgan media analyst Barton Crockett from the firm's second consumer survey on satellite radio. The survey of more than 1,600 people found that 35% of households were interested in satellite radio - - down from 43% in the first survey last May. Of course, with penetration at only 3.8%, there's still plenty of growth potential, but Crockett still sees the decline in consumer demand as "incrementally negative." As noted yesterday, when JP Morgan entertainment analyst Spencer Wang also issued a report on the survey's findings (2/7/05 RBR #27), commercial-free music is the main factor driving demand, not exclusive content. Nevertheless, Crockett believes that its content deals with the NFL and Howard Stern will help Sirius achieve retail share parity with XM. 12% of non-subscribers preferred the Sirius package, compared to 6% for XM. But the survey also found that while 31% of non-subscribers were willing to pay up to XM's monthly rate of 10 bucks, only 18% were willing to go to the 18 bucks pricetag for Sirius. With their current lofty stock prices, Crockett has "neutral" ratings on both stocks - - and he's sticking with those ratings. However, he does expect to see XM begin to generate free cash flow in 2006 and Sirius in 2007. Eventually, he expects the satellite radio companies to have cash flow margins in the 40% range - - just like their terrestrial cousins.

Tribune in play?
Don't bet on it, but Crain's Chicago Business is out with an article suggesting that Tribune Company could be a takeover target, due to its depressed stock price. The scenario offered would have Time Warner buy Tribune for its TV station group - - mostly big market affiliates of the WB network - - then sell off the unwanted parts of the company. The WB is primarily owned by Time Warner, but Tribune holds a 22% stake. The local business paper figures Tribune's newspapers could be worth 11.76 billion. It values the broadcasting and entertainment division at 8.05 billion. In all, after subtracting for debt, Crain's Chicago Business figures the breakup value of Tribune is about 58.86 per share - - well above the current trading level of just over 40 bucks.

RBR observation: With Time Warner current bidding many billions in partnership with Comcast to buy Adelphia Communications, we doubt that it would be in any position to make a play for Tribune as well. But if the Adelphia bid falls short, who knows?

Disney dissidents tone down protests
There won't be a knock-down, drag-out fight at this Friday's annual shareholders meeting for Disney in Minneapolis as there was last year in Philadelphia, but it won't be a love-fest either. Dissident leaders Roy Disney and Stan Gold aren't working around the clock to line-up votes against CEO Michael Eisner, so it's unlikely he'll see a repeat of the 47% no-confidence vote of last year. Nevertheless, the two say they're still going to withhold their votes from all of the current directors, including Eisner, saying they want results, not just talk. Read their latest statement. | More... |

Conference Calls Q4 2004

Jefferson-Pilot fills in some details
Although it reported its Q4 results on Monday, Jefferson-Pilot Corp. didn't conduct its conference call with analysts until yesterday. Of course, most of the call dealt with the insurance business, but we did learn a bit more about the company's broadcast unit. CFO Theresa Stone, who is also President of Jefferson-Pilot Communications, noted that full-year results for 2004 put the broadcast unit back above the revenues of 2000, prior to the prolonged advertising recession. 2004 revenues were up 11.3% to 241.1 million and Q4 up 6.6% to 68 million. And while some of that was due to political advertising, she said the radio and TV stations were also building their core business. Broadcast cash flow rose 18% last year to 101.1 million and Q4 BCF was up 9.1% to 31.8 million.

Adbiz©

Clear Channel's "Less is More" a success, say studies
CC Radio CEO John Hogan promised more details were coming, and here they are: CC Radio has released more on its independent studies that found listeners love the longer programming blocks, actively noticing fewer commercials, shorter commercial breaks and more music. The studies also found that listeners are retaining advertising content better in the improved listening environment. | More... |

EDS taps Bartle Bogle
Electronic Data Systems (EDS), business and technology consultant, has named Bartle Bogle Hegarty NY as AOR of its worldwide account, which had been handled since 1999 by Fallon Worldwide Minneapolis. Billings were estimated at 5-10 million. The decision came after a three month review. A TV and print campaign from Bartle Bogle is scheduled to begin in May.

Karma Media to run PSAs for UN World Food Program
Karma Media announced that it will air PSAs on behalf of the United Nations' World Food Program on the nearly 600 television stations that carry KRMA's international hit television series "Estelle's Paradise" starring Estelle Reyna. The announcements focus on disaster relief, providing an additional opportunity for the growing "Estelle's Paradise" audience to help the UN's massive relief effort for those affected by the recent tsunami and other disasters throughout the world. Karma Media controls approximately four minutes of commercial airtime per each half-hour episode of the show. Under the preferred media provider agreement, which commenced 1/6 with the World Food Program, the initial value of air-time dedicated to this crucial outreach program is equal to or greater than 50,000 per month. During the initial awareness campaign, dedicated to the Asian tsunami disaster, Karma Media shall allocate no less than 250,000 of commercial broadcast television spots across its network of broadcasters.

March Radio & Television Business Report

2005 Technology Odyssey...
The Changing Landscape
Ipods up to 4 million sold over Christmas and radio doesn't have a problem?

Nexstar's Perry Sook goes exclusive One-On-One and is very vocal on why he is standing alone and tall against the Cable MSO's.

Brace yourself as media top gun Irwin Gotlieb tells all Radio & TV what he really thinks and if you don't like it - "Then change careers."

Ad / Marketing Space is still available reaching all key media decision makers in Ad Agencies, Radio, TV, and Wall Street. See www.rbr.com for circulation.

Advertising/Marketing Placement - Contact
Jim Carnegie - 813 909 2916
June Barnes - 803 731 5951

Not Receiving The Official Business Media Magazine? Then here is your Last Chance to a Trial - Read. Your order must be place by February 18th.

Media Markets & MoneyTM

Ohio ministry triples its portfolio
Kayser Broadcast Ministries, which owns and operates noncom WXML-FM in Upper Sandusky OH, has struck a deal with Donald Wildmon's American Family Association which will usher the organization into the ranks of radio group ownership. It'll be picking up WBIE-FM in Delphos, just west of Arbitron-rated Lima, and WAUI-FM Shelby, in unrated territory not far from Mansfield. AFA will pick up 1.5M, all of which will be paid pursuant to a promissory note.

Washington Beat

Spectrum tax proposal back again
In what is becoming an annual event and traces back to the Clinton White House, the administration is attempting to slip a spectrum tax on broadcasters who are running parallel stations in the pending phase of the DTV transition. The tax would apply to unreturned analog spectrum beginning in 2006, and would shoot for a government payday of a half billion dollars. The congruent annual event is the successful effort by the National Association of Broadcasters to blow the spectrum tax out of the water. "For more than a decade, Congress has wisely rejected spectrum taxes on broadcasters because lawmakers recognized the timetable for transitioning to digital television will be determined by consumer acceptance of this new technology and not by arbitrary, budget-driven timelines. With roughly 1,400 local TV stations now transmitting digital and high-definition TV pictures, broadcasters have done our part to complete the digital transition. Applying a spectrum tax on local TV stations would slow the DTV transition and ultimately harm consumers who rely on over-the-air broadcasting for news, entertainment and public interest programming."

SHVERA county list now posted
The county-by-county list, which shows significantly viewed broadcast television stations on an over-the-air basis, is now posted on the FCC website (fcc.gov), along with an NPRM detailing the list's application to DBS providers. The list has long been applied to cable operators.

Programming

Tom Joyner and Donna Richardson attend
Stellar Awards
Reach Media's Tom Joyner and his wife, wellness expert Donna Richardson, presented Bishop T.D. Jakes with honors at the 2005 Stellar Awards. Centering around the Gospel Music Industry's best and brightest, the 2005 Stellar Awards were held 1/15 at the George R. Brown Convention Center, Houston.

Ratings & Research

Urban radio listeners are big spenders
Listeners of Urban Radio are big spenders in many significant retail categories, including automotive, sports apparel, wine and wireless, according to a new study by Scarborough Research. This new study found that Urban Radio listeners: | More... |

Nielsen Monitor-Plus announces
brand-level activity for spot
Nielsen Monitor-Plus announced an advancement in its coverage of brand-level detail for spot radio in the US,. The expanded radio coverage now monitors the top 26 markets 24/7, utilizing electronic fingerprinting technology, as opposed to watermarking/IDing. As a result of expanding the depth and breadth of its coverage, Monitor-Plus now measures more than 35 Spanish-Language stations in 13 markets. These 13 markets represent 56% of Total Hispanic households. Jeff King, SVP & Managing Director, Monitor-Plus says, "This improvement will bring our total number of reported radio stations to more than 500, representing a growth of 68%. We are delighted to make this enhanced capability available to our clients." Beginning in January, Monitor-Plus began measuring radio advertising in Atlanta, Baltimore, Boston, Chicago, Cincinnati, Dallas, Denver, Detroit, Honolulu, Houston, Indianapolis, Los Angeles, Miami, Minneapolis, Nashville, New York City, Orlando, Philadelphia, Phoenix, San Antonio, San Diego, San Francisco, Seattle, St. Louis, Tampa and Washington, DC.

Transactions

WLII-TV/WSUR-TV Puerto Rico (Caguas, Ponce) from Raycom Media Inc. to Univision Communications Inc.

KJHY-FM Boise ID (Emmett ID) from First Western Inc. to Bustos Media of Idaho

| More... |

Stock Talk

Stocks barely higher
There wasn't much excitement on Wall Street, but traders managed to push stocks barely higher. The Dow Industrials rose eight points to 10,725.

Most radio stocks were up, but not by much. The Radio Index rose 1.775, or 0.8%, to 218.778. The leaders were SBS, up 2.9%, and Saga and Cumulus, each up 2.3%.

Radio Stocks

**Here's how stocks fared on Tuesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		41.73	+0.19	Jeff-Pilot	JP		49.85	-0.64
Beasley	BBGI		16.55	+0.19	Journal Comm.	JRN		16.23	+0.08
Citadel	CDL		14.00	unch	Radio One, Cl. A	ROIA		14.65	+0.07
Clear Channel	CCU		34.37	+0.40	Radio One, Cl. D	ROIAK		14.65	+0.11
Cox Radio	CXR		15.21	-0.13	Regent	RGCI		5.30	+0.08
Cumulus	CMLS		14.25	+0.32	Saga Commun.	SGA		17.10	+0.38
Disney	DIS		29.84	-0.04	Salem Comm.	SALM		23.23	-0.47
Emmis	EMMS		17.82	+0.14	Sirius Sat. Radio	SIRI		5.93	-0.23
Entercom	ETM		31.28	+0.04	Spanish Bcg.	SBSA		10.35	+0.29
Entravision	EVC		7.96	+0.07	Univision	UVN		26.06	-0.04
Fisher	FSCI		50.60	+0.53	Viacom, Cl. A	VIA		37.86	-0.08
Gaylord	GET		40.22	+0.09	Viacom, Cl. B	VIAb		37.50	-0.11
Hearst-Argyle	HTV		25.75	+0.18	Westwood One	WON		24.55	+0.25
Interep	IREP		0.68	unch	XM Sat. Radio	XMSR		31.18	-0.23
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

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Bounceback

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

Appreciation for RBR/TVBR POV...

RBR daily email is my daily MUST READ for media business intelligence and analysis. The first thing I do when I get on the train, is check "more all" on my blackberry to get your entire email. I appreciate your interpretations and recommendations. You're one of the few radio people to attend the Four A's (American Association of Advertising Agencies conference) and the ANA (Association of National Advertisers event). Bravo! Thanks to you and your staff for your impressive work.

Warmest regards,

Pierre Bouvard
President, Portable People Meter
Arbitron Inc.

Upped & Tapped

Emmis realigns
in Terre Haute
Calling it the "end of an era," Emmis announced that WTHI-FM & TV and WWVR-FM Terre Haute, IN VP/GM Dave Bailey is retiring effective March 4th. That's led to two promotions. WTHI-TV General Sales Manager Todd Weber will become VP/GM of the TV stations, while WTHI-FM & WWVR-FM Station Manager James Conner will become VP/GM of the radio stations.

Stations For Sale

Saginaw/Bay City/Midland FM
WSAG-FM 104.1 Mhz Class A, Pinconning, Michigan. ARB ranked #130, revenue ranked #97, 23M. Newly on the air. New owned 350' tower. 4,600 watts ERP, new 5KW solid state transmitter, ERI 3 bay antenna. No revenue yet, no sales staff, only minimal personnel. Running oldies format with BSI computer system. New studio facility will be needed for new owner. Minimal studio equipment, with EAS equipment, STL, etc. New construction project, currently
owned by an engineering company. Operating company needed to be brought in to finish project. Priced as "stick" value. Asking $950,000.00.
[email protected]

Phoenix AM Bankruptcy Sale
KFNX 1100, 50,000 Watt AM radio station in Phoenix, AZ, will be sold for the highest and best offer on March 31, 2005 at 10:00 a.m. MST
at the US Bankruptcy Court in Phoenix, AZ. An initial bid of $3.6 million has been received. The sale of the business is "as is/where is". Please go to www.1100kfnx.com for station information, and
call 602-277-1100 x.499 for details.

More News Headlines

ABC to launch Hispanic net
via SBS shows

Planet Hollywood Resort & Casino pacts with CC Entertainment

Mike & Mike double ratings
in NYC, Chicago

RAB and BMI team for FastStart minority scholarship program

Competing Media

Two Minute Television introduces first series
More content for video webcasting over cellphones: Two Minute Television Network (2MTN), an original content producer, has introduced its first two minute series "Genius On A Shoestring", the first two minute reality series, to the broadcast and cable industry, websites that video-stream content, web enabled television, and cellphones. | More... |

TVBR - TV News

NCTA fires back
on multicasting
Outgoing NCTA President/CEO Robert Sachs has fired off a letter to members of Congress in response to a flurry of activity on the part of supporters of broadcast multicast must-carry rules. Those siding with broadcasters in the dispute have been calling for either full cable carriage of all program streams, or at the very least, have sought a delay of FCC action in favor on single-stream carriage. Sachs first argues that there has been plenty of time and consideration spent on the matter - - four years. He says the issues on the table include the First Amendment rights of cable operators, the needs of programmers and viewers, and the extent of programming diversity. "...NAB is asking the government to require cable operators to carry as many as half a dozen digital channels for every single broadcast station in the country, regardless of whether these channels consist largely of infomercials, home shopping or other low value content. Indeed, the record before the FCC contains scant evidence of commercial broadcasters' plans for programming multiple digital channels and no evidence that 'multiple must carry' is necessary for the survival of free over the air television..." Sachs argues that numerous basic cable program services compete for limited "shelf space" - - whereas multiple must carry would allow broadcasters to add five additional channels not through competition but by government fiat.

RBR Radar 2005

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

FCC seeking over 300M for FY 2006
Telling President Bush that it will require 304.057M dollars to get its job done during fiscal year 2006. The figure represents an increase of over 11M from the 292.958M it wanted for FY 2005. The FCC says it needs the extra money for mandated salary and benefits increases and for inflationary trends in rent, supplies, printing and contractual services. It also wants to upgrade its Columbia MD facility and upgrade it electronic filing system, among other things.
RBR observation: Wonder where all that money goes? Ah, website photo gallery. Here is a real case where a federal agency needs real down sizing or a better business plan and a level of management operations which is held accountable to someone besides to - themselves. C'mon! Are you kidding me? Tell us something we don't know. Don't forget Ipods that were sold last quarter to the tune of 4 million and growing. 02/08/05 RBR #27

Survey says: "No commercials" is big draw for satellite radio
Satellite radio companies may be shelling out big bucks for sports rights and big name talent like Howard Stern and Opie & Anthony, but a survey for Wall Street's JP Morgan finds that content is not what's selling XM and Sirius. Rather, the top draw is "no commercials." The survey of 1,600 consumers.
RBR observation: C'mon! Are you kidding me? Tell us something we don't know. Don't forget Ipods that were sold last quarter to the tune of 4 million and growing.
02/08/05 RBR #27

TiVo report details Super Bowl ads
Super Bowl and the commercials within it got the typical huge global audience. But despite efforts to scale back tastelessness and sex in the game and advertising, the commercials that pushed the envelope the furthest still drew the most enthusiastic viewership, according to TiVo's annual audience measurement of the big game.
RBR observation: See the chart of what was replayed and you will see GoDaddy.com at number three. The ad that got their 2.5 million was GoDaddy - Censorship Hearing. That spot ran a number of times on news channels, morning shows, you name it before it aired on the Super Bowl. Now that my Friends is called ROI - Return on Investment. Period. 02/08/05 RBR #27

General or Local
Sales Manager
Shreveport's fastest growing radio cluster, Cumulus Broadcasting has an immediate opening depending on experience. If you are motivated by winning and by money we have the job for you. Five station cluster moving into showcase studios. Cumulus, EOE, the best radio company in America.

See Radio Careers for more info.

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