Volume 21, Issue 29, Jim Carnegie, Publisher
Thursday Morning February 12th, 2004

Radio News ®

Indecent chatter on Capitol Hill
Commerce Committee members in both houses on Congress gathered yesterday to discuss indecent broadcasting. Sen. John McCain (R-AZ) hosted all five FCC Commissioners for a discussion, while Rep. Fred Upton (R-MI) held a session with Viacom's Mel Karmazin and the NFL's Paul Tagliabue which went into overtime and then some. RBR observation: At least the FCC commissioners didn’t get drilled as in the past on indecent or anything else. Remember last June 4,’03 when the Senators grilled Powell & Co. That scene resembled a carnival shooting gallery when Sen. McCain's borrowed prayer: "May the words we utter today may be tender and sweet because tomorrow we may have to eat-them." This is just the first act! 6/5/03 RBR #110. Yesterday, Chairman Powell noted that the FCC was planning to begin issuing fines for repeat indecent incidents within a single program. Wow – some how this reads indecent!| Full Story Click Here |

Karmazin: Indecency rules
too vague to be followed
You can't obey what you can't understand, and Viacom President/COO Mel Karmazin told the Telecommunications and the Internet Subcommittee that current indecency laws and regulations are so vague, and enforcement so inconsistent, that broadcasters have no chance to figure out how to comply. RBR observation: Rules too vague to be follow? – Ah, come on guys how about some common sense as it comes with the driver’s license. Maybe when new rules are written a mandatory vision test will also be required. Bravo ‘Zen Master’ as your bus pulls away from the curb glad to know the bus hasn’t hit anyone – yet, just a few minor fender benders. Bad news is your insurance rate just went up…. May want to call that insurance company with the lizard!
| Full Story Click Here
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Reps of the indecency warpath
Republicans and Democrats alike are tearing it up in the House of Representatives on the topic of indecency. They have a bill on the table which would increase the FCC's indecency fining capacity tenfold, and are considering a three-strikes provision which could lead to automatic license revocations for repeat offenders. RBR observation: Fasten your seatbelts or we could be indecent and say: Bend over and grab your socks! Here comes Sen. ‘Why Not-Minot’ Dingell with these words - "Broadcasting is an industry that has failed to control itself."
| Full Story Click Here
| RBR Observation |


Senators speak out on indecency
There is a definite bipartisan meeting of the minds when it comes to broadcast indecency. Everyone is against it. | Full Story Click Here |

Oral arguments presented at the 3rd Circuit
Almost every facet of the FCC 6/2/03 media ownership ruling has been challenged by somebody, and many have been challenged in too ways. Some think a particular rule went too far, while others say it didn't go far enough. Partisans on both sides argue that the FCC overstepped its authority one way r another. The venue for these arguements is the 3rd Circuit Court in Philadelphia. The FCC is also at the Court, defending its actions. Meanwhile, in Congress, efforts are afoot to repudiate the entire ruling, and in effect telling the FCC to start over. There is no timetable for a 3rd Circuit ruling on this matter, and we may not get one for months. Stay tuned.

Comcast makes bid for Disney;
Eisner may not be staying

Comcast, the largest US cable MSO, launched an unsolicited bid yesterday to buy Walt Disney Co. for more than $54B in stock. Comcast valued the deal at $66B, including the assumption of $11.9B in debt. The deal would put Comcast on the same level as Time Warner and News Corp.-major media conglomerates with vertical integration of programming and distribution. Disney and Comcast together had $45B in revenues last year. RBR observation: Ok fine but remember when we stated Roy Disney was taking on an anti-Eisner fight to shareholders. Remember we said, ‘The small guys roll with the punches but the big guys throw them.’ The real fight bell is set to ring on March 3rd and in the city of 'Rocky Balboa' - Philadelphia. 01/28/04 RBR #19. Well, Comcast has Eisner in the corner and punching his lungs out. Comcast says “We want to make this as friendly as possible.” Anyone ever see the movie Rocky?
| Full Story Click Here
| RBR Observation |


Conference Calls, Q4 2003

Profits on the rise at News Corp.
Although Fox Television suffered a flat, its parent, Rupert Murdoch's News Corp., enjoyed a 19% surge in total revenue to $5.6B, and a 4% change to the good in consolidated operating income, to $729M. Results are for the company's fiscal Q2 2004.
| Full Story Click Here
|

Disney earnings outpace estimates
Disney reported stronger than expected Q1 earnings yesterday, releasing the news several hours before it had planned in reaction to the Comcast bid, which was announced before the start of stock trading. For Q1, net income of $688M, or 33 cents per share was reported in the three months ended 12/31, compared to $36M (2 cents per share) in the same period a year earlier. | Full Story Click Here |


Adbiz ©

4A's convention underway
If the expression on the members of the 4a's staff is any indication the show is already a winner. Reportedly the attendance has surpassed 1,000 - a figure that the event has not seen since 2001. RBR/TVBR is there to cover all that is happening in the advertising business. The first day started off with a status report on the EDI efforts by the 4A's with help of the trade associations - RAB, CAB, and TVB. Kathy Crawford President of Local Broadcast for MindShare and Greg Smith EVP CIO of Universal McCann co-moderated the discussion. (More in upcoming days)

Online Media ad share increases to 3.3%
While we reported yesterday that the value of Britain's Internet advertising market will surpass the commercial radio sector within three years there, it is still only 3.3% here in the US. Still, online media increased its share of ad dollars in 2003, according to research released this week at the iMedia Brand Summit. Online media's share of advertising grew to 3.3% in 2003, up from 3.1% in 2002, according to Charlie Buchwalter, senior analyst with VNU's Nielsen/NetRatings. Online retail grew faster, from 2.5% of all retail commerce in 2002 to 3.2% in 2003.

Old Navy launches review
Gap's Old Navy unit has opened a review for its first creative AOR. Since '94 (the company's launch), advertising has been handled in house. Old Navy hired Pile & Co. Boston to handle the search. Semifinalists will be named by March. A final decision is expected later in April. According to TNS/CMR, Old Navy spend was $132M in the first 10 months of last year. Most was spent on TV-the campy song and dance routines revolving around clothing. PHD handles TV buying; JL Media radio buying (Rich Russo, SVP/Director of Broadcast Services); and Vidal Partnership handles Hispanic creative, according to AdAge. The three are not part of the review.


Media, Markets & Money tm

Meredith may be getting into radio with Michigan buy
RBR sources say Meredith Broadcasting President Kevin O'Brien has been making some noise about buying some radio stations to pair them up with their TV holdings in certain markets. The first deal may be in Saginaw, MI, with WKNX-AM. Meredith also owns WNEM-TV (CBS) in that market. Apparently, Meredith is planning to build a radio studio at the TV station, if the deal goes down. There is a CP pending on WKNX to increase the power from 1-Kw to 5-kW days. RBR/TVBR left messages with WNEM GM Steve Sabato and O'Brien.


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Washington Beat

FCC's Powell promises scrutiny of Comcast-Disney bid
While all regulatory and government antennae were up full-mast over media issues of indecency (and tricked down a bit to cross-ownership), the Comcast bid to acquire Disney got immediate response from FCC Chair Michael Powell. He announced a promise of close scrutiny if Comcast succeeded in purchasing Disney. "I don't know if Comcast will get Disney or not...if it does, a merger of that magnitude will unquestionably go through the finest filter at the commission, I can assure you, as possible," Powell said in response to a question during the congressional indecency hearing.

Congressman comments on
potential Comcast-Disney deal
Meanwhile, Rep. Bernie Sanders (I-VT) issued a scathing statement praising the potential merger as the creation of "one of the world's leading entertainment and communications companies with an unparalleled distribution platform and an extraordinary portfolio of content assets." Sanders, a leader in Congress on media reform issues, called Comcast's statement "corporate double-speak for a new level of monopoly media power." | Full Story Click Here |

Programming program scheduled by the FCC
With indecency issues on everybody's front burner in Washington, the broadcaster's designated in-town player is taking steps to make sure its constituents have the know-how to avoid getting burned. It will host a summit to address responsible programming aimed at all corners of the broadcasting industry. NAB President/CEO Eddie Fritts said,, "Broadcasters have a long history of being responsive to community needs, whether it be Amber Alerts, coverage of local issues, emergency weather warnings, or providing airtime for charities. The time has come for a full and frank dialogue with our media colleagues on voluntary programming responsibility." A date has not yet been set, but it will be in the early spring. It will include local broadcasters, networks and other stakeholders. Scheduling info is expected by next week.


Programming

O'Reilly apologizes on WMD claims
The NY Daily News reports Fox News/Westwood One talker Bill O'Reilly has apologized for accepting President Bush's claim that Iraq had weapons of mass destruction: "I'm sorry," O'Reilly said on ABC's "Good Morning America" in a stunning mea culpa. "I think all Americans should be concerned about this, for their families and themselves, that our intelligence isn't as good as it should be," he said. O'Reilly was one of the loudest voices calling for Saddam Hussein's ouster at the "We report, You decide" network and called him a "killer with huge stocks of anthrax and other deadly weapons." Now, O'Reilly said he has become "much more skeptical about the Bush administration" since weapons inspector David Kay voiced doubt that Saddam had any weapons of mass destruction. O'Reilly, who had promised last year he would publicly apologize if the weapons were not found, was not happy to eat crow. "What do you want me to do, go over and kiss the camera?" he said.


Transactions

$15,000,000 KFME-FM Kansas City (Garden City MO). 60% of 1051FM LLC from Jesscom Inc. (Frank Copdisas) to Susquehanna Radio Corp. (David Kennedy, pres et al). Cash. Superduopoly with KCMO AM & FM, KCFX-FM. Deal is pursuant to purchase option signed 2/15/01. [File date 1/12/04.]

$93,000 WIPS-AM Ticonderga NY from Calvin Hugh Carr to Bisiblue LLC, a subsidiary of Crown Point Telephone Corp. (Patricia L. Knapp, Robin L. KNapp, Shana R. Knapp, Gregg L. Trask). Cash. LMA until closing; will conclude LMA with Lake Placid Radio. [File date 1/12/04.]


Stock Talk

Everything's on the up and up
It was another good day for broadcast stocks. Only four on the RBR radio list had to resort to red ink, and even there, one of them had a split decision. That was Viacom, and it's dual minor changes almost balanced out on a per share basis, with the B version gaining seven cents while the A team lost nine cents.


Radio Stocks

Here's how stocks fared on Wednesday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

$44.70

+$0.24

Jeff-Pilot

JP

$54.05

+$0.51

Beasley

BBGI

$18.50

+$0.15

Journal Comm.

JRN

$20.13

+$0.13

Citadel CDL $19.02 +$0.27

Radio One, Cl. A

ROIA

$19.47

+$0.56

Clear Channel

CCU

$46.80

+$0.74

Radio One, Cl. D

ROIAK

$19.41

+$0.61

Cox Radio

CXR

$23.32

+$0.32

Radio Unica

UNCA

$0.69

unch

Cumulus

CMLS

$22.00

+$0.57

Regent

RGCI

$7.47

+$0.10

Disney

DIS

$27.60

+$3.52

Saga Commun.

SGA

$18.75

-$0.19

Emmis

EMMS

$27.40

+$0.68

Salem Comm.

SALM

$25.88

+$0.23

Entercom

ETM

$48.90

+$1.35

Sirius Sat. Radio

SIRI

$3.01

-$0.01

Entravision

EVC

$11.00

+$0.10

Spanish Bcg.

SBSA

$11.97

-$0.02

Fisher

FSCI

$51.22

-$0.28

Univision

UVN

$37.10

+$0.70

Gaylord

GET

$29.63

-$0.17

Viacom, Cl. A

VIA

$41.26

-$0.09

Hearst-Argyle

HTV

$27.53

+$0.13

Viacom, Cl. B

VIAb

$41.17

+$0.07

Interep

IREP

$2.25

unch

Westwood One

WON

$31.90

+$0.37

International Bcg.

IBCS

$0.03

unch

XM Sat. Radio

XMSR

$23.45

+$0.52


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RBR Radar 2004
Click on these issues for Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Anheuser-Busch looking at old US ads/branding for foreign markets
Anheuser-Busch is updating some of its past US campaigns and seeing if they fit the tastes of audiences overseas. For example, Busch's "Ants" campaign, not seen in the US since the late '90s, is being shown in China and has proven to be a hit. Editor's Note: Those oldies but goodies remind me of you!
02/11/04 TVBR #28

Super Bowl advertisers
complaining to NFL
America's biggest marketers are mulling whether to return to the Super Bowl. Longtime big spenders such as Pepsi and Gillette have communicated in harsh words to NFL Commissioner Paul Tagliabue that if the league does not clean up the halftime act, they might take a pass in 2005. Editor's Note: Remember, in an election year – everyone is looking for a deal deal! 02/11/04 TVBR #28

The Dees Tease leaves KIIS-FM
What many in the biz feel could have been an on-air stunt in that 22-year KIIS-FM, LA morning legend Rick Dees leaves or has left the building at KIIS is true. Rick Dees has said bye-bye, buy bonds and don’t forget to play his only hit record ‘Disco Duck’. Editor's Note: Clear Channel could have made it an exit with a little more class. 02/11/04 RBR #28

Publishers Perspective
RAB 2004 'Accountability'
A Melting Pot boiling over...
President Fries spoke on accountability and EDI but it was delivered a little awkward. It was the 'State of the Industry' speech to an audience that not all were on the same verbal or intelligence level of the issues facing radio that have been long discussed behind closed corporate board meetings, ad agency and client world doors. Publihser Note: Puzzling or pathetic department deals with the press themselves…Pathetic!
02/10/04 RBR #27

FCC’s Michael Powell
threatened to pull CBS licenses
Considered holding a dramatic license revocation hearing against CBS after last week's Super Bowl breast mess. "A furious Powell vocalized the "license revocation" option against CBS-owned broadcast outlets to senior staff at the FCC in the hours and days after the event, a top source said from Washington. Several FCC commissioners believe CBSVIACOM has repeatedly violated indecency rules. Editor's Note: The way these FCC commissioners are stumping you thing they are running for re-election. Hello… you are appointed to the position you have. 02/10/04 RBR #27

PastieGate update:
Mixed decision for Viacom
We're not sure what the other 53% would pick, but Reuters is quoting a Time/CNN poll which has 47% of Americans agreeing that the Janet Jackson/Justin Timberlake incident at the Super Bowl halftime show represents "a new low in bad taste." However, the same poll said that 68% did not believe that the act warranted punishment for CBS Television. Editor's Note: And the Beat Goes On.. Ta Dum! 02/10/04 RBR #27

Belo chief: Broadcasters
own enemy on indecency
With five CBS affiliates among his 19 TV stations, it's not surprising that Belo CEO Robert Decherd was asked for his take on the Janet Jackson incident and Washington's current focus on indecency. Editor's Note: A classic example of how we, the media, are our own worst enemy! 02/09/04 RBR #26

House subcommittee schedules indecency markup
All of the House Telecommunications and the Internet Subcommittee members who joined Rep. Fred Upton (R-MI) declared that H.R. 3717 was on the legislative fast track weren't kidding. RBR observation: The squeaky wheel gets the grease, and all the wheels in Washington are squeaking. Everyone wants to get their licks in. Indecency is like the hysterical woman in the movie "Airplane." The entire Congressional roster is lined up, ready to smash it. There's Upton with a baseball bat; then comes Markey with a truncheon; there's Tauzin wielding a revolver; here comes Dingell with a cutlass; and hey - - here comes McCain with a bazooka!
02/09/04 RBR #26

Viewer sues Viacom
over Super Bowl flash
You knew this was coming. A woman in Tennessee has filed a federal lawsuit against Viacom and everyone involved in last Sunday's Super Bowl halftime show, claiming she was injured by the broadcast image of Janet Jackson's breast.The lawsuit claims that Carlin, a Knoxville bank employee, and millions of other Americans were injured by "sexually explicit conduct" during the halftime show. Editor's Note: Humna Human Humna! 02/06/04 RBR #25

Senate jumping into
indecency game as well
Unwilling to let members of the House hog the spotlight for attacking broadcast indecency, the Senate is launching its own review of Janet Jackson's bare breast and other allegedly indecent broadcasts. Sen. John McCain (R-AZ) has scheduled a hearing. Editor's Note: Set your VCR’s. 02/06/04 RBR #25

Carlin case lawyer see
FCC impotent on indecency
Although he lost the Supreme Court case on a narrow 5-4 vote, the lawyer who represented Pacifica Foundation's WBAI-FM New York in the famous George Carlin indecency case doesn't think the FCC is going to get anywhere with its current effort to crack down on indecent broadcasts. Rather, David Tillotson sees the Commission racing toward actions which it will be unable to defend in court. RBR observation: With the current FCC hell-bent on compounding the problems with its indecency rules, rather than fixing them, it appears that the courts are the only hope for eventually straightening out this mess. Unfortunately, we don't see than happening in the foreseeable future. Editor's note: You can hear the actual Carlin piece here, but be warned, these are the actual 7 banned words. 02/05/04 RBR #24

Analyst sees another
soft month in January
Broadcasters may be looking for a much better year in 2004 than the final report on 2003 issued this week by the RAB. RBR observation: The gurus see good times ahead, but now it's still time to work like we're still in a recession. In truth, we're not out of the woods yet. Bob Coen of Universal McCann, Mark Fratrik of BIA Financial Network, Robin Flynn of Kagan World Media. Down load February’s Solutions Magazine in digital just by clicking here and read what all 6 Ad Chiefs forecast. Compare. 02/04/04 RBR #23


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