|
Radio News ®
|
|
|
DOJ approves CCU buyout, but requires divestitures
Thomas H. Lee Partners and Bain Capital now have the last regulatory approval needed to close their 26.7 billion bucks deal to take Clear Channel Communications private - but there are conditions attached. The US Department of Justice Antitrust Division is concerned about the stakes that TH Lee and Bain have in Cumulus Media Partners and that TH Lee has in Univision, even though those ownership interests have been made non-attributable in the eyes of the FCC. So, the DOJ is requiring Clear Channel to divest stations in markets where the antitrust legal beagles have determined that there is a risk of the commonly owned companies charging higher prices to advertisers. Those divestiture markets are Cincinnati, Houston, Las Vegas and San Francisco. Those station sales must be to buyers approved by the DOJ. "Without the divestitures obtained by the Department, advertisers that rely on radio advertising in the affected cities likely would have faced higher prices. The divestitures will ensure that advertisers will continue to receive the benefits of competition," said Thomas O. Barnett, Assistant Attorney General in charge of the Department's Antitrust Division.
| Read the DOJ announcement |
RBR observation: Have you heard of a market lately where anyone has accused Clear Channel of working to push rates up? In any case, DOJ can tell the taxpayers that their money is being put to use - and Clear Channel can get on with closing this long-pending buyout. The company appeared to be anticipating this outcome. We heard yesterday of a sale rumor already floating around the Houston market, so these divestitures may already be in the works. By the way, Clear Channel's stock price finally moved back above 30 bucks in after-hours trading yesterday once this DOJ approval was announced. But the stock is still well below the 39.20 buyout price.
 Double digit declines for Journal; Q1 also down
Cost control efforts came up more than once in the company's quarterly conference call with Wall Street analysts as Journal Communications reported Q4 results that came in below expectations. CEO Steve Smith also noted that the company had divested some non-core assets in 2007, including its former telecommunications business, and is focused on its local markets and digital initiatives. Although the publishing side is now experiencing the cost benefits of staff reductions taken in Q4, the company told analysts to expect publishing revenues to be down, reflecting continuing challenges in classified advertising, partially offset by continued strength in online, commercial printing and commercial distribution," but CFO Paul Bonaiuto didn't quantify just how much print revenues will be down this quarter. He said both radio and television revenues are expected to be down slightly.
Q4 revenues for Journal Broadcast Group were down 19.2% to 56.7 million and operating earnings plunged 55.2% to 10.3 million. The company noted, though, that if you exclude the quarter's extra week in 2006 and political revenues, broadcast revenues were down only 0.7% for the quarter. Of course, political spending will be back this year, mostly in the second half, and Smith was also upbeat on the broadcast group's focus on developmental revenues, which were up 17% in 2007. Radio revenues fell 13.8% in Q4 to 21.4 million. Excluding the extra week and political, revenues were off 1.2 million. Operating earnings for radio were down 40.6% to 5.4 million, but that falls to a drop of 18.3% excluding the gain on the sale of a station in Q4 of 2006. TV revenues in Q4 were down 22.1% to 35.3 million and operating earnings dropped 64.8% to 4.9 million. Excluding the extra week and political, TV revenues were up a million bucks.
|
|
|
Settlement with bond holders may nix Citadel dividend
Citadel Broadcasting hasn't paid a dividend to shareholders since its special dividend just before the merger acquisition of ABC Radio from Disney. There had been expectations that Citadel would resume quarterly dividend payments this year, but that may not happen due to the settlement that the company has reached with bondholders who'd been fighting in court over whether Citadel had to immediately pay off its bonds because of the ABC deal (2/13/08 RBR #30). After looking over the terms of the proposed settlement, Bear Stearns analyst Vic Miller told clients not to expect any dividend payment from Citadel this year. "Under the terms, CDL will redeem $55MM face value of the converts for $49.5MM in cash (90%). Interest on the notes will rise to 4%. CDL, with cash on hand (estimated $63MM at YE 2007), 2008 FCF (estimated at $150MM) and asset sales, needs to reduce the converts to less than $165MM by YE or face a 2% retroactive interest rate hike for 2008 and a post 1/1/09 interest rate increase that will bring CDL converts to par (estimated at 12.5% now). CDL can also make open market purchases of the converts. In 2008, expect CDL to focus on debt reduction not paying dividends," Miller concluded.
 FCC clears equity groups
for Clear Channel investment
The FCC is allowing Providence Equity Partners and Thomas H. Lee Partners to restructure their stakes in certain broadcast companies in order to allow them to participate in the privatization deal for Clear Channel properties. All+ five commissioners approved at least in part. Stakes held by the companies in Univision via their role in acquisition group Broadcast Media Partners will be modified to non-attributable status. PEP's stake in Univision and Freedom Communications Holdings are involved, as are Lee's BMPI and Cumulus stakes. The approval hinges on concerting various stakes to nonvoting stock, which has long been considered non-attributable. Michael Copps (D) agreed that the moves were legal under exiting rules, but noted that the rules make non-attributable and non-existent equal terms as far as determining ownership concentration levels is concerned. "Our attribution rules attempt to strike a balance -- trying on the one hand not to discourage investment in media companies, while on the other hand trying to identify those investments that actually could bestow influence." He noted that this is "not an exact science," and said that it may be time to "take a fresh look at our broadcast attribution rules."
DTV transition is on, er, something
The transition to digital television is moving along just as expected, or it isn't, largely depending on whether you sit on the Democratic or Republican side of the aisle in the House of Representatives. However, it can be stated generally that progress is being made. Whether there is enough progress would be the question.
| Read More... |
CNN, Univision score Dem debate
Hillary Clinton (D-NY) had signaled her willingness to participate in a number of additional debates, including offering an olive branch to Fox News Channel, which has thus far been boycotted by the Democratic field. However, chief rival Barack Obama (D-IL) said there have been plenty of debates already, that he did not sense a great clamoring for any more, and said maybe he'd do one. One has been added to the schedule. It will be hosted jointly by CNN and Univision, and is on the calendar for 2/21/08. It will be held at the LBJ Library in Austin, and will occur less than two weeks in advance of a critical primary face-off in Texas where the Hispanic vote is expected to be a major factor in the results.
|
|
|
|
| Wall Street Business Report TM |
Westwood shareholders approve CBS deal
Not that the outcome was ever in doubt, but shareholders of Westwood One have formally approved a new long-term arrangement with CBS Radio running through 2017 that was worked out last October (10/3/07 RBR #193). The new agreement ends CBS Radio management of Westwood One, but continues to give WW1 the right to syndicate CBS Radio programming and place network inventory on CBS Radio stations through March 2017.
|
|
|
|
|
Ad Business Report TM
|
 KYW launches "Hear Philly!"
As we mentioned yesterday (2/13/08 RBR #30), CBS Radio's KYW-AM and the Greater Philadelphia Tourism Marketing Corporation (GPTMC) are launching Hear Philly!, an Internet radio station devoted to sounding off on all of the great things to do in Philly. Accessible exclusively on gophila.com, Philadelphia's official tourism site, and kyw1060.com, Hear Philly! reports on events, exhibitions, attractions, restaurants, shops, performing arts and more. In the coming weeks, local listeners with HD radios will be able to listen to Hear Philly! on 94WYSP's HD-3 channel. The broadcasts, anchored by KYW Newsradio's Krista Jasillo and supported by editorial content from GPTMC and several KYW reporters, will be updated daily. The ad-supported Internet station already has clients lined up to participate in the new venture. Starr Restaurants will be the primary advertiser during the first month. Thirty-second radio spots on Hear Philly! are available to advertisers, who can include a hyperlink on the hearphilly.com webpage. In addition, video pre-roll ads on the Hear Philly! player will catch the eye of everyone who logs onto the online radio station.
J&J to sponsor AURN College Football Awards
American Urban Radio Networks (AURN) announced Johnson & Johnson Consumer and Personal Products will be a major sponsor of the 34th annual SBN Sports Black College All-American Awards, which will be presented in Atlanta this Saturday. The event recognizes the accomplishments of athletes from the nation's Historically Black Colleges and Universities. Linzell Harris, vice president, global supply chain strategy, Johnson & Johnson Consumer and Personal Products Worldwide, will present two major SBN Awards: the SBN Sports Doug Williams Offensive Player of the Year Award (to Jacary Atkinson, quarterback for Tuskegee University) and the SBN Sports Mel Blount Defensive Player of the Year Award (to Ronnie McCullough, linebacker for Bethune-Cookman). In conjunction with these honors, Harris will present 10,000 donations to the general scholarship funds of each of the two schools.
|
|
|
|
| Media Business Report TM |
Optimedia, Publicis Launch Optimedia Inside
Susan Gianinno, Publicis USA CEO and Antony Young, President, Optimedia US, announced the launch of Optimedia Inside, a new joint venture designed to bring additional firepower to developing media neutral strategic solutions for clients. Paul Hindle has been appointed to the newly created post of Managing Partner, Optimedia Inside New York and will report jointly to Mark Hider, EVP/Director of Engagement Strategy, Publicis USA and Antony Young, President, Optimedia US. Hindle will be located at Publicis NYC offices and lead a team from Optimedia New York that will employ a full range of media resources for Publicis clients. Young says this is an effort to connect media, creative messaging and digital into an organic, idea-led communications platform. "The Optimedia Inside team will constantly look for ways to embed media earlier into the strategic channel and creative development process. Clients can't afford not to integrated their marketing communications effort, and nor can we." Previously, Hindle served as EVP/Director of Channel Planning at Young & Rubicam and was Director of Strategic Planning at OMD.
|
|
|
|
| Media Markets & Money TM |
 EMF strikes again
This time Educational Media Foundation is moving into Lafayette IN, and it is another foray into commercial FM territory for the noncommercial Religious specialist, according to Star Media's Doug Ferber, who brokered the deal. EMF will be getting WGLM-FM, licensed to 106.7 MHz in West Lafayette IN from Kelly V. Busch's KVB Broadcasting for 1.2M. EMF's version of an LMA, a network affiliation agreement for its K-LOVE Network, will have to wait four years for a true anniversary -- it's scheduled to kick off 2/29/08.
Close encounter out West
The deal sending a wagon train load of radio stations from Clear Channel to Skip Weller's GAPWEST Broadcasting is now complete, according to brokerage house Kalil & Company. The deal was pegged at 74.776M, according to documents filed with the FCC, and included stations in 12 small markets in the states of Idaho, Montana, Washington, Wyoming, Minnesota and Iowa.
|
|
|
|
| Washington Business Report TM |
 Commerce Chairs go straight
to the top on DTV
Senate Commerce Chairman Daniel Inouye (D-HI), pictured, and House Commerce Committee Chairman John Dingell (D-MA) aren't messing around. They would like an interagency task force put together to oversee the final year's run-up to the 2/17/09 DTV conversion, and have asked President George W. Bush to put it together. They warned, "If the transition is not successful, millions of American who rely solely on over-the-air broadcasts may be left in the dark." They would like Bush to put government resources "to help educate and prepare all Americans for this potentially disruptive change in our broadcasting system." They would make the FCC the lead agency. They received instant support from FCC Commissioner Jonathan Adelstein (D), who said, "For over a year now, I've been urging the FCC to create a federal interagency task force with NTIA and the many other federal agencies involved, such as the Administration on Aging, Health and Human Services, and the Veterans Administration. It is long overdue for the federal government to coordinate our efforts. This multi-agency task force would develop benchmarks and a timeline to achieve nationwide awareness and give consumers the tools they need to have a smooth transition. It would be accountable to Congress and the American people. The DTV chain of communication has many weak links principally because we never created a coordinating mechanism between government, industry and the public. Communication is the FCC's middle name, but we haven't lived up to it. As the Government Accountability Office found, the FCC does not have a plan, and nobody is in charge. And as a result, there is not coordinated, national effort to educate the American people about the details and they need to deal with the transition."
RBR observation: Given the often glacial pace of action in Washington, the establishment of this task force could easily be accomplished by April or May. We're just not sure it would be April or May of 2008. It may be wiser to identify an FCC staffer already performing an executive role in the transition and name this person DTV coordinator, someone who can stay on top of the activities of various stakeholders and the reports and studies being done by some of the watchdogs; make a list of tasks to be accomplished and benchmarks to meet along the way; and report frequently to Congress and the stakeholders on how it's going. We would allocate to this most unfortunate person a year's supply of highly caffeinated coffee and a heavy-duty brewing machine, all on the government's tab.
Session cancelled
The Senate Commerce Committee has called off today's hearing on the DTV transition, which would have come just 24 hours after a similar session in the House. It frees FCC's Kevin Martin and NTIA's Meredith Attwell Baker from the task of repeating yesterday's testimony. However, no reason was given for the postponement.
|
|
|
|
| Entertainment Business Report TM |
Generational format move
The hits got newer this week on GHB Broadcasting's FM at 106.1 in Charlotte, but not that new. Rather than Adult Standards WNMX, the station is now WOLS "Oldies 106.1" proclaiming that it plays the greatest hits of all time, from The Beatles and Beach Boys to Elvis Presley and the Bee Gees. "Our play list reads like the Rock and Roll Hall of Fame, as a matter of fact we got our play list from the Rock and Roll Hall of Fame," the station declared in announcing the format switch. GM Tom Gentry told RBR "it's a younger cousin of what we've been doing." The 60s-70s Oldies niche had been open in Charlotte since Clear Channel flipped one of its FMs out of the format in 2004, although the Charlotte Observer noted that out-of-market WTHZ-FM Lexington, NC (Greensboro-Winston Salem) makes a showing in the local Arbitron ratings.
|
|
|
|
| Ratings & Research |
PPM measures Super tune-in
 Arbitron says Portable People Meter weekly data estimated that over one million people tuned in to CBS Radio's WFAN-AM "Sports Radio 66" on Super Bowl Sunday. Despite the game being televised, WFAN posted an audience share of 18.7 for persons 2+ during the game, well over three times normal for Sunday listening. The audience shares rose dramatically immediately following the game, as people apparently tuned in to the local Sports outlet after watching the hometown New York Giants triumph over the New England Patriots.
| View the numbers |
NRF: Consumers spent on essentials in January
January retail sales demonstrated that consumers last month were focused on buying necessities more than discretionary items. According to the National Retail Federation, retail industry sales for January (which exclude automobiles, gas stations, and restaurants) rose 2.0% unadjusted over last year and 0.1% seasonally adjusted from December. January retail sales released by the Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.3% seasonally adjusted from last month and 4.6% unadjusted year-over-year.
|
|
|
|
| Engineering Business Report TM |
KPRI now atop Mt. Soledad site
Compass Radio Group's Rock KPRI-FM San Diego has moves its transmitting antenna to a new site atop Mt. Soledad in La Jolla, giving it a signal that is competitive with all of the other major stations in the San Diego market. The move caps an 11 year campaign by KPRI to improve its signal. Said COO Jonathan Schwartz: "There were a number of hurdles for us. In addition to getting approval of the FCC, we also had to get permission from Mexico's 'FCC' because the San Diego market is so close to the Mexican border. It took a long time, but eventually the two governments agreed." The move does not change the City of Encinitas, CA as city of license. Mt Soledad is used as a transmission site by most of San Diego highest rated radio stations including KMYI, KYXY, KLQV, KIOZ, KIFM, and KFMB-FM.
Audemat-Aztec becomes Audemat
Audemat has officially changed their name from Audemat-Aztec to Audemat to ease their communication. With recent acquisitions, Audemat now owns two companies Ecreso (TV and FM transmitter Manufacturer) and Nortek (TV monitoring and Test and Measurement equipment manufacturer). Said Bruno Rost, President of the Audemat Group: "It is like a return to old times when we were called Audemat, before the acquisition of Aztec" The new Audemat logo will slowly replace the old Audemat-Aztec logo over a period of one year, on marketing materials, product front panels, technical manuals etc. Audemat also has a new domain, audemat.com.
|
|
|
|
| Transactions |
830K KALM-AM Thayer MO/KAMS-FM Mammoth Springs AR from Ozark Radio Network Inc. (Shawn Neatheryh Marhefka) to E-Communications LLC (Robert C. Eckman, Rebecca Eckman). 50K escrow, balance in cash at closing. LMA 1/1/08. [File date 1/14/08.]
|
|
|
|
| Stock Talk |
Stocks rise on retail news
Wall Street rallied after the Commerce Department reported an unexpected rise in January retail sales. The Dow Industrials gained 179 points, or 1.5%, to 12,552.
Radio stocks joined in the celebration. The RBR Radio Index rose 0.773, or 0.9%, to 82.733. Entercom gained strongly, up 7.1%. Emmis gained 6.5%. Journal Communications fell 9.6% after delivering its Q4 results.
|
|
|
|
| Radio Stocks |
Here's how stocks fared on Wednesday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
|
Arbitron*
|
ARB
|
|
41.04
|
+0.92
|
Google
|
GOOG
|
|
534.62
|
+16.53
|
|
Beasley*
|
BBGI
|
|
5.39
|
-0.32
|
Hearst-Argyle
|
HTV
|
|
21.87
|
-0.06
|
| CBS CI. B |
CBS |
 |
25.43
|
+0.71
|
Journal Comm.
|
JRN
|
|
7.46
|
-0.79
|
| CBS CI. A |
CBSa |
|
25.41
|
+0.78
|
Lincoln Natl.
|
LNC
|
|
53.28
|
+0.75
|
| Citadel* |
CDL |
|
1.42 |
-0.03 |
Radio One, Cl. A
|
ROIA
|
|
1.66
|
+0.02
|
|
Clear Channel*
|
CCU
|
|
29.49
|
-0.05
|
Radio One, Cl. D*
|
ROIAK
|
|
1.68
|
+0.02
|
|
Cox Radio*
|
CXR
|
|
11.98
|
+0.19
|
Regent*
|
RGCI
|
|
1.23
|
+0.06
|
|
Cumulus*
|
CMLS
|
|
5.78
|
-0.51
|
Saga Commun.*
|
SGA
|
|
5.96
|
+0.09
|
|
Debut Bcg.
|
DBTB
|
|
1.02
|
unch
|
Salem Comm.*
|
SALM
|
|
3.90
|
-0.04
|
|
Disney
|
DIS
|
|
32.78
|
+0.75
|
Sirius Sat. Radio
|
SIRI
|
|
3.18
|
+0.08
|
|
Emmis*
|
EMMS
|
|
3.12
|
+0.19
|
Spanish Bcg.*
|
SBSA
|
|
1.68
|
-0.01
|
|
Entercom*
|
ETM
|
|
12.61
|
+0.83
|
Westwood One*
|
WON
|
|
1.93
|
+0.10
|
|
Entravision
|
EVC
|
|
6.79
|
+0.02
|
XM Sat. Radio
|
XMSR
|
|
13.25
|
+0.30
|
|
Fisher
|
FSCI
|
|
31.64
|
+0.34
|
-
|
-
|
-
|
-
|
-
|
*Component of the RBR Radio Index
|
|
|
|
|
|
Bounceback
|
 We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]
|
|
|
Below the Fold
|
|
Ad Business Report
KYW launches "Hear Philly!"
An Internet radio station devoted to sounding off on all of the great things...
Media Business Report
Optimedia,
Publicis Launch Optimedia Inside joint venture designed to bring additional firepower...
Media Markets & Money
EMF strikes again
This time is moving into Lafayette...
Ratings & Research
PPM measures Super tune-in
Over one million people tuned in to CBS Radio's WFAN-AM...
|
|
|
Stations for Sale
|
 Market your Stations For Sale
in our daily epapers.
Contact
Jim Carnegie
[email protected]
|
|
|
Radio Media Moves
|
 Changes in Ft. Myers-Naples
Beasley Broadcast Group has named Matt Johnson to the new position of Director of Programming for WXKB-FM, WRXK-FM and WJBX-FM Ft. Myers-Naples, FL, as well as Program Director for WJBX. Additionally, he will continue as Program Director for WXKB. At the same time, Mark "Steele" Mathews has been appointed Program Director for WRXK-FM. In the new PD responsibilities, the two succeed John Rozz, who had been PD of WJBX and WRXK.
|
|
|
More News Headlines
|
CCU settling lawsuit
The Providence Journal reports that Clear Channel Communications has tentatively agreed to pay 22 million bucks to settle a lawsuit brought by victims of the 2003 fire at The Station nightclub which killed 100 people and injured more than 200 others. Clear Channel had denied that its WHJY-FM Providence had any involvement in planning or operating the concert, but failed in an attempt to be dismissed as a defendant. WHJY DJ Michael Gonsalves was one of the people killed when a band's pyrotechnics display ignited the building's foam soundproofing. The 22 million would bring the total settlement cash offered by the various defendants to 71.5 million.
NABOB honorees set for March fete
The NABOB 24th Annual Communications Award Dinner is on track for 3/5/08 at the Marriott Wardman Park Hotel in Washington DC. This year's honorees include Idris Elba, Louis Gossett Jr., Eartha Kitt, Ne-Yo, and Nancy Wilson. Kool and the Gang will be on hand to provide entertainment.
|
|
|
RBR Radar 2008
|
|
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
|
Ratings data crunched
on Wall Street
Two analysts are out with their take on the Fall Arbitron ratings, but it you think it is just simple math, think again. Chris Ensley at Bear Stearns declared Emmis one of the biggest gainers on a revenue-weighted ratings basis, while Marci Ryvicker at Wachovia listed Emmis as one of the worst performers year-over-year. It's all in the methodology and assumptions, of course..
RBR observation: Don't ask us to referee this. We do, though, find the difference in analysis interesting. Both analysts noted that PPM ratings data from two large markets complicated the calculations. Ryvicker decided to exclude Houston and Philadelphia from the overall analysis, then noted how PPM data would have adjusted the numbers for each group. Ensley included the two PPM markets, then added a note on how much the numbers would change with Houston and Philadelphia excluded. But that doesn't have anything to do with the difference of opinion over Emmis, which has no stations in either market.
02/13/08 RBR #30
XM/Sirius: Analyst argues that time not of the essence
Tyler Savery of seekingalpha.com says he's amused by many of the theories bouncing around as to why the regulatory is taking so long to announce a decision on the merger of satcasters XM and Sirius. The length of time is seen as both a positive and a negative, depending on who is doing the viewing. However, looking at the negatives, he said if the merger was a slam-dunk denial as some argue, then it would have been dispensed with long ago. The positive view, that the agencies are taking a long time to make sure all details are triple-checked before granting what figures to be a controversial approval, holds only a little bit more water, since that process has been ongoing from the beginning anyway.
RBR observation: We continue to agree with the antitrust experts we've heard. These companies were chartered as being forever apart and in competition with one another for a reason; they provide a service that no other company can; and merging them will be a detriment both to consumers and suppliers that deal with either.
02/13/08 RBR #30
CCU getting ducks in a row
Clear Channel Communications reports its Q4 earnings this Thursday, with the Thomson/First Call analysts' consensus that the company will report revenues down 4%, but earnings per share flat. But more important is how the company is moving toward a Q1 completion of its going private buyout. FCC approval has already been received. Bear Stearns analyst Vic Miller believes Clear channel filed for antitrust clearance from the Department of Justice on January 14th. If so, he says DoJ approval could come as soon as Wednesday if Clear Channel, as it hopes, gets early termination of the waiting period.
RBR observation: Hardly a day goes by without some Wall Street money manager calling RBR to try to find out if we have any behind-the-scenes information on whether or not this deal is going to closing. Sorry, but we don't work that way. What we know is what we've published. And when we find out anything new, you, our readers, are the first to know. As we've noted repeatedly, nether Clear Channel management, Thomas H. Lee Partners, nor Bain Capital has done or said anything which would indicate that this deal will not close as scheduled this quarter. But the CCU stock price still shows a lot of nervousness on Wall Street.
02/12/08 RBR #29
Triton Media Group realigns;
launches Triton Digital Media
Oaktree Capital Management-powered Triton Media Group, the leading independent radio network operator and supplier of digital products and services to local media brands, announced at RAB the re-alignment of its business units into two distinct operating entities: Triton Digital Media (including its MJI Interactive, Stream the World, Music To Go and Mass to One/M2O divisions) and Triton Radio Networks (encompassing Dial-Global and Excelsior Radio Networks). Triton Digital Media will now consist of two divisions; MJI Interactive and Triton Digital Distribution. It launches with over 2,500 affiliates in hand.
02/12/08 RBR #29
|
|
|
RBR Classifieds
|
Hard finding that key person
to fill the important position at your organization? RBR Classifieds, Results with Service. Contact April McLynn at [email protected]
|
 |
|
|
|
|
