Welcome to RBR's Daily Epaper
Volume 23, Issue 54, Jim Carnegie, Editor & Publisher
Friday Morning March 17th, 2006

Radio News ®

On second thought...
Remember back in January when Emmis' radio growth guidance of 1-2% for the current quarter disappointed Wall Street? (1/10/06 RBR #6) Well, now that everyone else has done their conference calls, Wachovia Securities analyst Marci Ryvicker has revisited Emmis and says its outlook is not so bad after all. "Now that we look back, Emmis' outlook is actually rosier than many of its peers and suggests a potential 150-250 basis points of sector outperformance, which is realistic (in our view) given the company's average 170 basis points sector outperformance gap over the past eight quarters," Ryvicker said in a note to clients. But even though it looks like Emmis is outperforming other radio companies, the Wachovia analyst isn't advising anyone to buy the stock. She notes that there's yet no word on the remaining station sales from Emmis' TV division and she is dead set against CEO Jeff Smulyan's plan to have Emmis invest 100 million as a minority investor if he succeeds in buying the Washington Nationals baseball team. So, she's maintaining her "market perform" rating on the stock.

Dickeys eye baseball
The latest radio guys to want to own a baseball team are the Dickey brothers - - Lew, David, John and Michael - - who have been approved by Major League Baseball to bid on the Atlanta Braves. The Atlanta Journal Constitution reports this is strictly a family deal and Cumulus Media won't be involved. Even so, the company's stock took a little hit yesterday after the word came out. But we hear from Wall Street sources that investors have been more concerned lately that Cumulus won't be able to meet its Q1 guidance, which was stronger than that of other general market radio companies.

RBR observation: The greater fool theory is always in effect when talking about pro sports franchises. They're a big headache and they don't make much money, if any, but eventually you get to sell it to another newly rich guy who wants to be able to brag about owning a pro sports team. That said, the brothers are to be applauded for not trying to drag their public company shareholders into the transaction, which would likely be a drag on Cumulus' stock - - as Jeff Smulyan's bid for the Washington Nationals is for Emmis. Also, the only way a pro sports team really makes any economic sense prior to the final cash out is if you own local broadcast stations so you can put the games on your own airwaves. Dan Snyder recently figured that out in DC. And, what do you know, it just so happens that the Dickey family, independent of Cumulus, already owns three AMs with Sports formats (one is in Spanish) in the Atlanta market.

CBS Radio to encode
for Smart Cell Phone test

CBS Radio is the third company with stations in Houston to say it will encode for this spring's first US test of the Smart Cell Phone radio audience measurement system proposed by The Media Audit/Ipsos - - and the first to do so who is already encoding for Arbitron's PPM test. The first two were the PPM holdouts, Radio One and Cox Radio.

RBR observation: It would seem logical that every company which is participating in the Next-Generation Electronics Ratings Evaluation Team - - which CBS Radio is - - would be willing to have its Houston stations (for those who are in the market) encode for the Smart Cell Phone test. Otherwise, what's the point?


Senators look to define
satcaster parameters

A bipartisan trio of senators has introduced legislation designed to maintain the strength of local radio by forcing an FCC ruling on the provision of local programming on national satellite audio services, prominently XM and Sirius. The concern is while technology offers the satcasters ways to shoehorn in a little local content, they won't have anybody there in person in times of emergency. The trio includes Olympia Snowe (R-ME), Max Baucus (D-MT) and Trent Lott (R-MS). The bill, S. 2418, the "Local Emergency Radio Service Preservation Act of 2006," has a companion in the House already, H.R. 998, which has no less than 111 legislators signed on as co-sponsors. NAB President/CEO David Rehr said, "NAB applauds Sens. Snowe, Baucus and Lott for introducing legislation designed to preserve the rich tradition of local broadcasting. It is crystal clear that both XM and Sirius - - with nearly USD1 billion in combined losses last year and having failed as a national programming service - - are skirting the intent of their original FCC licenses. This bill holds satellite radio accountable to those licenses. With introduction of today's legislation - - coupled with a companion bill in the House - NAB looks forward to educating lawmakers on the invaluable role played by free, local radio every day in communities all across America.".

CBS, NBC promise indecency defense
Two of the companies hit in the FCC TV indecency dragnet indicated that the battle is not over. CBS said, "We will continue to pursue all remedies necessary to affirm our legal rights. Today's decision by the FCC is just another step in the process." NBC/Universal, hit for a movie on its LA Telemundo O&O, said, "If the FCC adheres to its ruling, we intend to challenge it in court."

RBR observation: We're still trying to digest the entirety of the FCC indecency ruling, which runs into the hundreds of pages. However, we were struck right away by an aspect of the ruling. In the case of the Super Bowl ruling, only the O&O affiliates of CBS were fined. In the case of the fine against CBS's "Without A Trace," every affiliate was fined, regardless of ownership (if they were located in the Central or Mountain time zones). In the case of WB's "The Surreal Life," everyone got off except for the Washington DC affiliate. Is that clear? Can you say arbitrary and capricious? To continue, if the FCC begins to make a practice of making an example of just one affiliate as it wages its war against indecency, then the Washington stations are in deep trouble. Washington is the market in which the Parents Television Council does most of its program monitoring, and from whence most complaint campaigns originate.
| Read the CBS and NBC statements here |

Kaline clarifies PPM stance
Yes, a slide that Ford Global Media Manager Mark Kaline used in his presentation Wednesday at an RAB event in New York (3/16/06 RBR #53) did say "Activate PPM. What are you waiting for?" - - but that was apparently misinterpreted by many in his audience and in our story. Kaline, who is the only advertiser rep in the Next-Generation Electronics Ratings Evaluation Team which has named three finalists from Clear Channel's RFP, says he was using "PPM" as shorthand for electronic measurement, not a specific device. "I remain open minded about the other finalists in the Clear Channel RFP initiative, but I think it is up to these challengers to demonstrate that their solutions are clearly better than what Arbitron has ready to go," Kaline told RBR yesterday.


Ad Business Report TM

McGavren Guild Radio Sales
adds Davidson Media Group

Interep announced McGavren Guild Radio has added 32 Hispanic radio stations owned by the Davidson Media Group (DMG) to its client list. DMG - - a two-year old company - is the most rapidly expanding broadcast group in Hispanic and ethnic radio. The DMG stations span the Southeast, Midwest and Northeast regions of the county. Lisa Sirotka-Sonnenklar, President of McGavren Guild Radio Sales, said, "We are thrilled that the Davidson Media Group chose McGavren Guild as their national rep above all other companies. Our company is committed to the growth and marketing of Hispanic media. Adding the DMG properties to Interep's growing list of Hispanic radio and television properties significantly expands our reach in this community and makes our overall Hispanic footprint even stronger." Sonnenklar also oversees SBS/Interep - - the exclusive radio rep firm for all of the Spanish Broadcast System radio stations.

Alcone Marketing Group named Q-Tips AOR
Unilever announced today Alcone Marketing Group has been named promotional marketing AOR for the Q-Tips Cotton Swabs business. Alcone will handle promotion planning and implementation beginning immediately. The account will be managed out of Alcone Marketing Group's Darien, CT offices.


Media Markets & Money TM
Flint tries on some new Styles
Kevin Dowdy's Flint Media is getting a trio of radio stations from Thomas DiBacco's Styles Media Group. Licensed to Styles Alabama, they are actually across the border in an unrated portion of Georgia which is also not far from Florida. The stations are WBBK-AM Blakely GA and WSEM-AM/WGMK-FM Donalsonville Georgia. Styles will get 525K for the trio. They will form a double duopoly (two AMs and two FMs) with Flint's WBGE-FM Bainbridge GA. The stations are within a triangle formed by Albany GA to the northeast, Tallahassee FL to the southeast, and Dothan AL to the west. The town of Blakely is only about 20 miles away from the center of the Dothan market. An LMA will kick in until closing.


Washington Media Business Report TM
McDowell clears Commerce Committee
FCC nominee Robert McDowell has gotten the approval of the Senate Commerce Committee by voice vote. That leaves one last waystation on his road to the 8th Floor of the Federal Communications Commission: The floor of the full Senate.

RBR observation: McDowell should have no problems there, either. Unless...perhaps he's chatted with Jonathan Adelstein. Adelstein found himself playing the role of political football both during his initial nomination and during his nomination for a second term. Nominated by - - at the time - - former Majority Leader Tom Daschle (D-SD) (thanks to the Jim Jeffords defection from the Republican party), he was held hostage by Trent Lott (R-MS) after Daschle blocked a judicial appointment Lott favored. That was eventually resolved. John McCain (R-AZ) has been known to hold whatever hostages are available to get his way on entirely unrelated matters, and Adelstein was caught again. Then, the Bush administration dragged its feet on his re-nomination despite bipartisan Commerce Committee support - - most people thought it was to gain leverage over more judicial confirmations. However, we are not aware of any plans to block the McDowell nomination. Stay tuned.

Tate headed for Vegas
The NAB already had Democratic FCC Commissioner Jonathan Adelstein signed on for the Business, Law & Regulation Conference at NAB2006 in Las Vegas, scheduled for 4/25/06. They've now announced a doubling of the commissioner total. Republican Deborah Taylor Tate will now be joining in. According to the NAB, the thrust of the session is to bring "...federal regulators and legal experts together to highlight the most important legal issues of the day to assist broadcast managers, station owners and station counsel in managing ever-evolving technology policy."


Internet Media Business Report TM
Scripps pays 366M for UK comparison shopping site
Management at E.W. Scripps Company is so pleased with the Shopzilla Internet-based comparison shopping site that it bought for 525 million last year, it's now paying 366 million for its UK cousin, uSwitch. The British company isn't quite as broad-based as Shopzilla. It began by offering comparison shopping for deregulated energy providers, but has since expanded into other home services, such as phone and broadband service - - even loans and credit cards. "The addition of uSwitch to our portfolio of interactive businesses, including Shopzilla, is intended to position Scripps to take full advantage of the rapid growth of online comparison shopping for both products and essential home services," said Scripps CEO Ken Lowe. Scripps expects the acquisition to be dilutive to 2006 earnings per share by 10-15 cents. Over the long term Scripps expects uSwitch to generate segment profit margins in the 40-50% range. The management team in the UK will remain in place. Scripps says uSwitch and Shopzilla are the foundation of a newly created interactive media division for the company. Tim Peterman, Sr. VP of Interactive Media for Scripps, will oversee their development.


Station Sales
The art of negotiation
By Greg Guy, VP/Patrick Communications
(from February's RBR/TVBR Solutions Magazine)

Every day the trade publications are full of station sale announcements. Stripped down to their essential elements of buyer, seller, call letters and price, these announcements do not mention the months of negotiation that have gone into reaching that point. In the radio business, as in any business, negotiating skill is a key element of success.
| Read More... |


Transactions
5.75M WBEC-FM Springfield MA (Easthampton MA) from Great Northern Radio LLC (Bruce G. Danziger) to Entercom Springfield License LLC, a subsidiary of Entercom Communications Corp. (David J. Field). 287.5K escrow, balance in cash at closing. [File date 2/27/06.]

5M WLRK-FM Wausau-Stevens Point WI (Wausau WI) from Seehafer Broadcasting Corp. (Donald Seehafer) to NRG License Sub LLC, a subsidiary of NRG Media LLC (Norman W. Waitt Jr., Mary Quass et al). Swap for WDLB-AM Marshfield, WOSQ-FM Spencer and WFHR-AM Wisconsin Rapids WI plus 3.7M cash. Superduopoly with WLJY-FM, WGLX-FM & WYTE-FM. Total value is an RBR estimate. [File date 2/27/06.]


Stock Talk
Broadcast stocks drop in mixed day
Tame consumer inflation gave many stocks a boost yesterday, with the Dow Industrials rising 43 points, or 0.4%, to 11,253 and the S&P 500 also up. But the tech heavy Nasdaq Composite was down and media stocks took a beating as the market digested reports of soft newspaper ad sales by Belo and Media General.

The Radio Index declined 0.375, or 0.2%, to 161.161. Almost all radio stocks were lower. Citadel, Cumulus, Radio One (Class A) and Saga were all down a bit over 1%.


Radio Stocks

Here's how stocks fared on Thursday

Company Symbol Close Change Company Symbol Close Change

Arbitron

ARB

34.70

+0.25

Hearst-Argyle

HTV

23.43

-0.10

Beasley

BBGI

10.53

+0.13

Jeff-Pilot

JP

59.31

-0.06

CBS CI. B CBS

24.22

-0.12

Journal Comm.

JRN

12.26

unch

CBS CI. A CBSa

24.21

-0.14

Radio One, Cl. A

ROIA

7.88

-0.09

Citadel CDL
11.33 -0.12

Radio One, Cl. D

ROIAK

7.90

-0.06

Clear Channel

CCU

29.50

-0.19

Regent

RGCI

4.36

+0.09

Cox Radio

CXR

13.07

-0.08

Saga Commun.

SGA

9.19

-0.11

Cumulus

CMLS

11.59

-0.12

Salem Comm.

SALM

13.44

-0.07

Disney

DIS

28.68

-0.07

Sirius Sat. Radio

SIRI

4.51

+0.03

Emmis

EMMS

17.00

-0.10

Spanish Bcg.

SBSA

5.04

+0.06

Entercom

ETM

28.91

-0.26

Univision

UVN

33.76

-0.11

Entravision

EVC

7.80

-0.07

Westwood One

WON

11.74

+0.24

Fisher

FSCI

42.93

-0.07

XM Sat. Radio

XMSR

20.17

-0.38

Gaylord

GET

45.19

+0.09

-

-

-

-

-


Bounceback

Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments and
a photo to [email protected]

Regarding Arbitron's Accelerated PPM Rollout (3/15/06 RBR #52);

The Arbitron acceleration of its PPM rollout which has come on the heels of their aggressive, advertising agency endorsement campaign last month, appears a bit hurried or maybe a little frantic, when you consider the Next Generation Electronics Evaluation Team (NGEET) winner will be selected in a few months with field tests already being planned today...
| Read More |

Rodney H. Rainey
RadioMetrix Solutions




Below the Fold

Ad Business Report
McGavren Guild Radio Sales
Adds Davidson Media Group...

Internet Media Business Report
Scripps pays 366M
For UK comparison shopping site...

Media Markets & Money
Flint tries on some new Styles
Is getting a trio of radio stations...

Washington Media Business Report
McDowell clears Commerce
Has gotten the approval of the Senate...


Radio Media Moves

Santos returns to Power
Former WWPR-FM New York "Power 105.1" staffer Nadine Santos is returning to the Clear Channel station as Music Director, effective next Monday (3/20). She was most recently executive assistant to Julie Greenwald, President of Atlantic Records.


Stations for Sale

Exclusive Listing
FM Radio Station in South
Florida. Great start-up opportunity
for a radio entrepreneur or a great addition for a radio group.
Please contact Joel B. Day
202-478-3737 (x3)




More News Headlines

March RBR/TVBR
Digital Magazine

Where Do We
Go From Here?
In this issue, we take a look at the broadcast financing market in '06; hear from OMD's Natalie Swed Stone how radio is reinventing itself; interview Publicis Groupe Media CEO Jack Klues and Ford's Global Media Manager Mark Kaline; talk with Dial-Global Co-CEO David Landau and find out how radio can "Do what an iPod can't.


Read RBR/TVBR in 2 simple steps:
1.Create a simple account with Zinio and download the Zinio Reader.
2. You can then download the
March Issue of RBR/TVBR


RBR Radar 2006
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

Ford has a better idea: PPM now
"What are you waiting for?" asked Mark Kaline, Global Media Manager of Ford Motor Company as he made a pitch for radio to implement Arbitron's Portable People Meter (PPM). Kaline argued that "Radio cannot afford to wait for the perfect solution,"

RBR observation: Kaline is correct in his observation of 'good research also important and MRC accreditation "a must." Radio executives 'Stop trying to Re-Invent the Wheel.' Radio is already looked at as a 3rd class medium and this is not a limbo contest to see how Low Can You Go.
03/16/06 RBR #53

Iger gets a thumbs-up from Moody's
Rewarding the company for improving its performance and its balance sheet. The ratings service also praised new CEO Bob Iger and his Pixar deal which added Steve Jobs to the Disney board. "The upgrade and stable outlook reflect Disney's sustained improvement in operating performance over the last two years and the stronger resulting financial position.

RBR observation: RBR agrees with the thumbs-up on Iger as we too were skeptical but seeing his moves with ABC Radio and the best one is getting to iPod first. Iger is following the video.
03/16/06 RBR #53

'06 as tough year for radio
The quarterly round of radio company conference calls is complete, and Goldman Sachs analyst Mark Wienkes didn't find much that sounded encouraging for 2006. "Subpar fundamentals and uncompelling valuations keep us on radio's sidelines, as stronger pricing power is needed to lift revenue growth, investor perception, and valuations. Of terrestrial radio operators, we rate only Clear Channel outperform, on superior fundamentals and discount valuation," Given radio's "anemic revenue growth," the analyst thinks pricing increases will be held to 3% in 2006. On the M&A front, he says to look for only a few private groups to sell.
03/15/06 RBR #52


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