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Volume 23, Issue 37, Jim Carnegie, Editor & Publisher
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Wednesday Morning February 22nd, 2006
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Radio News ®
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 Clear Channel says
corner has been turned
Clear Channel has weathered the tough year. The loss of inventory due to its less is more (LIM) initiative caused a 6% loss in radio revenue over the course of 2005, but the positive effect has been an increase in ratings, thanks to stations with less commercials and fewer breaks. Clear Channel's standing as the top non-Hispanic ratings gainer for 2005 was noted in a recent Lehman Brothers study, and Clear Channel was able to shed light on it in yesterday's investor conference call. CCU cited Miller Kaplan Arase & Co. number for January which showed a 6.3% revenue gain for Clear Channel in the applicable markets, against an industry average of 1.5%. Joel Hollander said that this was in keeping with its ratings gains, showing that the money was finally following the audience. CCU execs also noted that despite the losses in raw revenue for radio, upward pressure was successfully applied to pricing, creating higher yields per spot, a benefit which will help fuel growth in the year ahead. Further success was noted in the increasing acceptance of shorter spots. Execs said that in January 2005, :30s accounted for about 25% of spots sold, a number which increased to 35% in January 2006. CCU's Hispanic inititative has also been a strong performer, exhiting quick growth, especially in Atlanta, San Jose, Dallas and Orlando.
RBR observation: Weathered the tough 2005 is correct and now the hard work begins as all clear eyes will be on 'LIM' by comparing the apples to apples. The radio medium waits for the Q1 2006 conference call results as many report that pacing for first quarter is way off in many markets and second quarter as of today is so-so.
Publisher note: Next Wednesday begins the annual 4A's ad agency conference which always brings interesting talk and various road map courses of where and what the agencies will be focusing on beside key issues they are facing in their media world. RBR will be there and reporting to you - stay with us.
 Moving into the future
When a company as big as Clear Channel moves, everyone else is pretty much forced to shift their position as well. CCU execs noted that their LIM initiative was widely imitated, if for no other reason than to remain competitive in the ratings wars. The result is better radio in general, which in turn draws more advertiser cash into radio in general and helps to float all boats. But there's more on the CCU drawing board - - or to put it another way, there will be further stress placed on items already on the drawing board. In particular, CCU execs noted the increased reliance by the automotive category in the Internet. There are many excellent opportunities provided by the Internet to bond with core listeners as it is, but CCU is looking to exploit its investment in compelling websites to tie in with dealers and bring them strongly back into the radio fold. It's looking for other ways to monetize its website investment. CCU is also looking for ways to exploit HD radio - - they said their use of side channels is already generating buzz among both listeners and advertisers. It's request for proposals for new electronic ratings measurement is also on track. The company has invited and accepted representatives from other companies to go over the proposals, an initial cut has been made, and surviving proposals will be closely examined. The goal: More consistent, reliable and timely tabulation of listeners.
RBR note: Pardon us but next Thursday a special panel on "How to be a Media Mogul : 2006" is scheduled at the up coming 4A's, which RBR editors are attending and Mark Mays will be sitting on this panel but not with other radio executives. This time co-panelists are of the like of Stephen Burke of Comcast Corporation - Mike Shaw from ABC Television Network -Tim Armstrong at Google. The moderator: Randall Rothenberg from Booz Allen Hamilton. This should be lively discussion and yes RBR will report the out come.
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Watchdog keeps pressure on for decency bill
Focus on the Family is acutely aware that a bill which passed the House of Representative by a wide margin is languishing in the Senate. The Broadcast Decency Act has already worn the tags "of 2004" and "of 2005," and enjoys considerable support in the Senate, as well as having passed twice in the House. Where, FOF wants to know, is the action? Why is Ted Stevens (R-AK) sitting on it? Senior Analyst for Media and Sexuality Daniel Weiss said, "Broadcast indecency is a continuing problem that Americans want addressed and they are not being silent about it. They are complaining about greater numbers of programs than ever before. However, the mere threat of legislation hasn't proved to be a deterrent. Only the passage of meaningful legislation will change a corrupt broadcast culture. Despite this torrent of outrage about appalling shows airing during the hours when children are most likely to be watching television, Sen. Stevens maintains that there is not enough support for legislation to give the FCC more teeth to enforce the law."
RBR observation: Stevens would love to pass indecency legislation. The reason he's sitting on it because he knows that any such legislation, no matter what, will immediately draw a Monopoly Community Chest card that says "Go to court. Go directly to court. Do not pass Go." It will not matter how carefully it is crafted. That's why he's willing to give family tiers a shot, along with Jack Valenti's anti-indecency educational initiative. Meanwhile, the wait for the FCC indecency NALs/exonerations promised before the end of 2005 continues...
 MN station finds reason
to turn down pro-war ad
A St. Paul television station has found a reason to refuse a Progress for America Voter Fund ad supporting the war in Iraq. Among other things, the ad claims that the media is distorting the relevant facts. Hubbard's ABC Channel 5 KSTP-TV says that as far as its own station is concerned, the statement is not true. KARE-TV is one, which allowed it on and responded to disgruntled viewers by saying, "The station neither agrees nor disagrees with the messages in advertising, but one of our responsibilities is to be an advocate for freedom of expression and to provide a marketplace of ideas." According to the New Richmond News, another station running it was WCCO-TV ran it, but also ran a news story debunking some parts of it.
RBR observation: Interesting turn-down reason. But KSTP's claim is itself a matter of opinion, and the public airwaves should not shut out differing points of view. We continue to believe that the best and safest policy is to run 'em all. If audience confusion creates a need to disassociate the station from something in a given ad, then disclaim away. And if the ad seems to stray from the facts, then follow WCCO's example and make it a news item. What we would not want to do is be forced to explain why we ran an ad for Interest Group X, then turned down one from opposing Interest Group Y or vice versa. If it meets community standards of decency, run it.
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| Wall Street Media Business Report TM |
Clear Channel back on an even keel
Radio's 800-pound gorilla has bulled through its first full year of LIM with a 6% loss in radio revenue, both for Q4 and for the year - - a loss mitigated by gains in its outdoor business. However, the company is reporting signs that the fundamentals of its LIM initiative are beginning to pay off. Q4 broadcasting revenue numbers were 909.4M, down from 964.5M in 2004. For the year, broadcasting brought in 3.534B, compared to 3.754B in 2004. Outdoor worked the other way, jumping to 734.6M from 685.7M Q4, and from 2.666M from 2.447M for the year. The company as a whole reported a Q4 net income of 461.6M, after posting a massive loss in Q4 2004 based on a change in accounting principle net of tax. For the year, it took in 935.6M, also on top of a big 2004 loss resulting from the same accounting procedure.
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Ad Business Report TM
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 Radio kicks off first phase of campaign for HD Radio
The HD Digital Radio Alliance announced the launch of the first phase of a 200 million advertising campaign designed to accelerate the adoption of HD digital radio. 12 radio companies are airing specially created ads nationwide on more than 250 stations in the first 28 markets where HD Radio has been launched. The campaign is spearheaded by the HD Digital Radio Alliance and includes spots developed by longtime radio advertising specialists Dick Orkin and the Radio Ranch. In an unconventional approach, radio companies will devote a portion of the ad time to promoting the receiver makers, retailers and automakers who make early commitments to HD digital radio. In this first wave, some 25% of the spots highlight Boston Acoustics' Receptor Radio HD. Citing expanding popularity of HD digital radio broadcasts and the launch of HD2 multicast channels, Boston Acoustics lowered the price on its Receptor Radio HD model to 299 dollars, effective 2/1. The first wave - some 16 ads in both 30- and 15-second versions - introduce "Jake and Josh", Jake's new girlfriend, and "Big Announcer" in interrelated segments that highlight HD digital radio's crystal-clear, CD-quality sound and dramatically increased local entertainment choices. Listeners are referred to www.hdradio.com for more information.
 Long John Silver's to ask lottery winner
to become spokesperson for campaign
Although yet to be identified, the newest millionaire in the U.S. has already received a first commercial endorsement offer. Long John Silver's wants the winner of the largest-ever lottery to be the company's official spokesperson for its new Buttered Lobster Bites. "We think this is a first in the history of business," said Steve Davis, President of Long John Silver's. "We've selected a product spokesperson without even knowing the person's identity, age, gender, marital status or occupation. What matters to us is that the winner represents what our new Buttered Lobster Bites are all about - that everyone in America can enjoy a taste of the good life." If the mystery winner accepts the offer, Long John Silver's can add some fame to the record-setting fortune by offering the winner an opportunity to appear in advertising and marketing materials for the company's new Buttered Lobster Bites, which allow fast-food customers to enjoy a "taste of the good life." America's newest millionaire could be featured in television and point-of-sale advertising, on the company's web site and in public relations materials for print, radio and television. In addition, the lottery winner will have the opportunity to don the official Long John Silver's lobster costume and visit restaurants from coast to coast. The winner also would be given VIP treatment and flown by private plane to Long John Silver's headquarters to meet Davis and other company executives. The product is available for a limited time at participating Long John Silver's restaurants beginning 2/27.
Pharmasee TV signs with ABC New Media Sales
PharmaSee TV, the in-store pharmacy television network reaching more than 60 million consumers annually at over 300 locations and growing, has chosen ABC New Media Sales, a division of ABC National Television Sales, as its exclusive national ad sales rep. In the deal, ABC New Media Sales will handle advertising sales for PharmaSee TV's satellite delivered broadcast information content. Presented in a 'morning show format," PharmaSee TV reaches consumers at the point of care and point of sale. PharmaSee TV's Mike Schweitzer commented: "ABC New Media Sales has the expertise, contacts and track record to help PharmaSee TV heighten the brand awareness opportunities and value our network offers advertisers seeking to reach both shoppers and employees at pharmacies across the U.S. We look forward to working with ABC New Media Sales and its parent ABC National Television Sales to expand PharmaSee TV's important in-store advertising."
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| Washington Media Business Report TM |
 McCain to offer two-pronged
approach to cable reg
There is a great deal of pressure on the cable industry to provide a la carte channel options for subscribers, giving the subs control over both their bill and the content coming into their home. In return, he will attempt to offer participating cable operators regulatory relief from the existing patchwork quilt of local franchising authorities. According to the National Journal, McCain's proposed change to franchising would not eliminate local involvement, but would streamline it by creating a blanket approach at the state or national level. The same streamlined system would apply to new cable entrants, or new entrants into the MVPD business, such as telcos, as long as they, too, offer an a la carte menu option.
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| Media Markets & Money TM |
 SBS prizes a lack of interest
Radio and now television group Spanish Broadcasting System has brought some daylight to its balance sheet. Or more specifically, some K-DAYlight and then some more KDAI-light. It has taken 101M in proceeds from the recently closed sale of the LA-area stations to Styles Media to completely pay off a debit item affectionately referred to as Second Lien Credit Facility. CFO Joseph A. Garcia explained, "This is a significant step in our deleveraging plan, which reduces our interest expense by approximately $9 million and strengthens our balance sheet. Moving forward, we will continue to assess our financial position with the goal of maintaining a strong balance sheet and financial flexibility." The 100M term loan was opened 6/10/05 and didn't mature until 6/10/13. SBS easily beat the deadline to cash in on a 1% prepayment premium by paying off the loan on or before 6/10/06.
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| Ratings & Research |
Arbitron: Cell-phone-based radio measurement
inherently biased
While The Smart Cell Phone, which The Media Audit plans to use in its new media measurement system, in the USA received a vote of confidence from RAJAR, Britain's industry consortium that oversees radio measurement (2/21/06 MediaMix), Arbitron released the results from studies of how consumers use cell phones that point out the weaknesses of a "dual-use" survey device such as a cell-phone-based radio meter. The findings indicate that consumer attitudes about cell phones and their resulting behaviors will introduce significant bias in the radio survey results, bias that is not seen with the Arbitron PPM system.
| Read More... |
Jerry Doyle showing strong ratings
The Jerry Doyle Show just added Clear Channel's KNEW, San Francisco from Noon to 3 p.m., Monday through Friday (PST) airing just before The Michael Savage Show. Doyle's ratings coast to coast report strong growth according to Jerry Doyle's ratings report card. Here's some excerpts from the nationwide Debut to Fall '05 Jerry Doyle Ratings Report Card:
| Read More... |
Simmons' NCS receives MRC accreditation
Simmons Research announced its flagship survey, the National Consumer Study (NCS), has been awarded accreditation by the Media Rating Council (MRC), an association of leading television and radio broadcasters, cable networks and MSOs, print and Internet organizations, advertising agencies and advertisers as well as Industry trade associations that audits and accredits measurement services meeting the MRC's Minimum Standards. Having been accredited by the MRC Board of Directors, the Simmons NCS is now authorized to show the MRC Double-Check logo on its National Consumer Study. "After years of hard work, Simmons is proud to be awarded this accreditation for our National Consumer Study," said Chris Wilson, president and COO of Simmons Research. "The NCS is a thorough measurement of the American consumer; from the products we buy, the brands we prefer and where we buy them, to our attitudes, lifestyles and the media we consume. Our adherence to the MRC Minimum Standards earned this accreditation and our commitment to quality will continue to earn our clients support."
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| RBR Stats |
MediaMonitors: Guitar Store tops Alternative radio
Here's an examination of spot advertising on radio stations in top-rated North American markets for the 7-day period of February 13-19, 2006 is based on data from spot monitoring company Media Monitors.
| Read More... |
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| Transactions |
1.475M WFRL-AM/WFPS-FM Freeport IL from Maverick Media of Freeport License LLC (Gary S. Rozynek) to Green County Broadcasting (Ronald Spielman, Scott Thompson). 100K escrow, balance in cash at closing. Superduopoly with WEKZ AM & FM Monroe WI, WQLF-FM Lena IL. LMA until closing. [File date 2/3/06.]
12.5K WQMS-AM Quitman GA from Conquer Communications Inc. (Joe Dunagan) to Stephen C. Hellinger. 3,750 escrow, balance in cash at closing. [File date 2/2/06.]
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| Stock Talk |
Another mixed bag with little change
Radio stocks yesterday were mostly uneventful-even CCU after its conference call only gained a dime. CBS continues its ups and downs, losing 0.55 for the day; Jeff-Pilot was the winner, up 0.75.
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| Radio Stocks |
Here's how stocks fared on Tuesday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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38.64
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+0.02
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Hearst-Argyle
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HTV
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23.95
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-0.22
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Beasley
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BBGI
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13.95
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-0.05
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Interep
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IREP
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0.15
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-0.09
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| CBS CI. B |
CBS |
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25.30
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-0.55
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Jeff-Pilot
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JP
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60.12
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+0.75
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| CBS CI. A |
CBSa |
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25.26
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-0.51
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Journal Comm.
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JRN
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12.56
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-0.20
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| Citadel |
CDL |
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11.58 |
-0.09 |
Radio One, Cl. A
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ROIA
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10.00
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+0.05
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Clear Channel
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CCU
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28.20
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+0.10
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Radio One, Cl. D
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ROIAK
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9.97
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-0.08
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Cox Radio
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CXR
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13.87
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+0.14
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Regent
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RGCI
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4.53
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-0.07
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Cumulus
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CMLS
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11.80
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-0.01
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Saga Commun.
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SGA
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9.89
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-0.11
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Disney
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DIS
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27.16
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+0.25
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Salem Comm.
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SALM
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14.16
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-0.04
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Emmis
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EMMS
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16.69
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-0.32
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Sirius Sat. Radio
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SIRI
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5.18
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-0.08
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| Entercom |
ETM
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28.70
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+0.42
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Spanish Bcg.
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SBSA
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5.73
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-0.15
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Entravision
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EVC
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7.09
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-0.13
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Univision
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UVN
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33.75
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+0.08
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Fisher
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FSCI
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42.49
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-0.50
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Westwood One
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WON
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14.36
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+0.06
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Gaylord
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GET
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42.90
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-1.15
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XM Sat. Radio
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XMSR
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21.96
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+0.39
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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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Wall Street Media Business Report
Clear Channel back
On an even keel with Outdoor pulling the weight...
Ad Business Report
Yet to be identified
Long John Silver's to ask lottery winner...
Media Markets & Money
SBS prizes a lack of interest
Brings some daylight to its balance sheet...
Ratings & Research
Cell-phone-based research
Radio measurement inherently biased...
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More News Headlines
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NABOB fete
on the horizon
The 22nd Annual Communications Awards Dinner of the National Association of Black Owned Broadcasters (NABOB) and the NABOB Foundation is on the sked for Friday, 3/10/06 at 7:00 PM p.m., at the Marriott Wardman Park Hotel in Washington. Steve Harvey will preside over the ceremonies, which will honor Alicia Keys, S. Epatha Merkerson, Etta James, Dr. Maya Angelou, Albertina Walker and Robert L. Johnson. Queen of Soul Aretha Franklin will also be on hand.
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TVBR - TV News
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Pax has been completely bought out by NBC?
In the deal they did last fall when NBC and Pax settled, there's an 18-month window where NBC can buy the rest of Pax. We've heard from a source that is exactly what is happening. However, NBC spokesperson Julie Summersgill, speaking to NBC head of business development Bruce Campbell, said there was "no movement," but "it's still in the early days of making that decision. Obviously, we're interested in finding a partner, or if circumstances change with FCC rules, things could change." So if it were to go through, NBC would indeed have to turn around and sell big pieces of it to clear ownership/duopoly rules.
TVBR observation: Maybe NBC should take all of the assets of Pax's stations and duplicate what Sinclair sometimes does with its shared services/intellectual property method. Sinclair doesn't buy the station per se, they buy all of the intellectual property--the contracts, the logo, the copyright, the goodwill, the relationships with the syndicators, networks, etc. Then the physical assets are held under another corporation. That corporation agrees to let Sinclair exhibit the intellectual property and programming on that signal for ad infinitum.
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RBR Radar 2005
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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NAA investing 50M to push newspaper advertising
Not surprisingly, newspaper publishers think that newspapers are the most effective vehicle for advertisers to gain some ROI. The Newspaper Association of America is spending 50M to get that message out.
RBR observation: Too bad the ads are only going into newspapers and online. Maybe they'd be more effective if they used broadcast to get the word out. We personally read the newspaper yesterday, part of it anyway (some minor travel prevented as thorough a reading as usual). Hmmmmm...(chinstroke chinstroke)... we can't remember a single ad, though. What was that on the sports page, tires? Yeah, probably - - there are usually some tires there. But we're not sure. Certainly no clue which tires, if any... Don't get us wrong - - we love the newspaper. It just doesn't often get us into a particular store to buy a particular item. How about you?
02/21/06 RBR #36
If Ya Need One, Just For Laughs
Sent to the editors of RBR/TVBR a song all about the FCC. So we share, if you need a laugh this morning, FCC Family Guy
|  Watch It Here |
Predictions for radio research: challenges and opportunities
2006 will be a very important and pivotal year for media research in general and for radio research in particular. In 2006, the radio industry will be given the opportunity to make some important decisions regarding research. The choices will not always be easy and some will have significant financial implications.
02/21/06 RBR #36
Hedge funds are changing the
broadcasting lending landscape
They're the new kids in town - - and these are big kids with lots of money. Over the past year or two, hedge funds have discovered the radio and television station business. They've become aggressive players in the lending market and have made other lenders become more competitive as well. All in all, it's been good news if you've needed to borrow money for a broadcast acquisition or refinancing.
RBR note: If you did not see this special report read issue
02/20/06 RBR #35
RBR Close-Up
Upton wants to loosen radio caps
Believes its time to loosen the local caps on radio station ownership, he's written a letter the FCC Chairman Kevin Martin to make his point. He also delivered substantially the same message in an address before the Media Institute. Where is the logic? But wait, there's more so read back to see the details.
RBR overview: It is no wonder that analyst after analyst forecasts anemic growth for broadcast radio for the foreseeable future.
02/20/06 RBR #35
XM director quits,
warns of "crisis" looming
Saw its stock take a hit on Wall Street. It wasn't because of any surprise in the company's Q4 numbers, which were pretty much what analysts had expected, but because the company announced the resignation of a member of its board of directors who disagrees with how the company is being run. In his letter of resignation, Pierce J. "Jack" Roberts Jr., a former Bear Stearns official, said he did not believe XM was being run in the best interests of the company's shareholders and that he had decided to resign rather than "just go along" with the current course.
RBR observation: RBR has forecasted consistently that word 'Churn' and seems 'Jack' Roberts agrees. Churn has to get under control as being a public company has responsibilities to the public not just a free ticket to due as they please. RBR means all public media companies - Period.
02/17/06 RBR #34
Howard Stern tipped
XM's hand on spending
XM CEO Hugh Panero says the company spent more on promotion than it had planned in Q4 to counter the media blitz surrounding Howard Stern as he prepared to launch in early January on rival Sirius. But that wasn't a negative.
RBR observation: The number we're most focused on is EBITDA. If XM is really going to achieve cash flow break even sometime in 2006, you'd think that its EBITDA loss would be decreasing. But, just as in the previous quarter, the EBITDA loss increased in Q4 - - from 139.7 million a year ago to 199.4 million in Q4 of 2005. We wait to see whether XM can actually achieve cash flow break-even this year.
02/170/6 RBR #34
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Companies Looking
1. Clear Channel RSM in Twin Cities
2. Arbitron Account Manager
3. Sales Rep in Washington, DC
4. Sales Manager for Reno Reps
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