RBR's Daily Morning Epaper

Volume 23, Issue 64, Jim Carnegie, Editor & Publisher

Friday Morning March 31st, 2006

Radio News ®

Hoax time at hand: Are you ready?
April 1st is always a dangerous date for radio stations. "April Fools" jokes are a long American tradition and it's always tempting for air talent to come up with a clever gag to pull on listeners. The problem is, the FCC's hoax and contest rules remain in effect on April 1 just like any other day - - as demonstrated more than once by stations being fined for April Fools jokes that went too far. Station management needs to be especially concerned this year because April Fools Day, tomorrow, falls on a Saturday, when many stations have their least experienced DJs on the air. That also means that a situation involving the local police, fire department or elected officials could quickly escalate into a crisis with no one on hand to answer the phones in the business office. The FCC isn't likely to be sympathetic to a station's plea that a hoax was carried out because the air talent wasn't aware that what they were doing was wrong. And if they were to run a phony contest, your station could end up being on the hook for delivering a real prize, no matter how expensive.

RBR observation: Our advice is that PDs and GMs need to touch base today (if you haven't already) with everyone who is going to be on the air tomorrow and make sure they understand the ground rules. No April Fools pranks that haven't been pre-cleared by management for compliance with the FCC's rules are allowed. No exceptions. No second chances.

No going private for Clear Channel
It seems simple enough. If Clear Channel enjoyed success with the restructuring it did last year - - selling 10% of Clear Channel Outdoor in an IPO to trade as a separate stock and spinning off its entertainment business, now Live Nation - - why not go all the way, sell off other non-core assets and take Clear Channel Radio private? "We've looked at everything, and we're going to continue to look at everything. That doesn't mean we will do anything," Clear Channel Communications President & CFO Randall Mays said when asked that question yesterday at the Bank of America 2006 Media, Telecommunications and Entertainment Conference in New York. "There have been some reports out there that we should spin Outdoor and take the parent company private. That's all great except that analyses failed to take into consideration tax, which would be significant in a transaction like that - - so significant it would make it pretty undoable," Mays concluded. So, while management is considering all options, he said the focus now is on growing cash flow. Now that Less is More has run for more than a year, Mays said Clear Channel is comfortable with where its radio inventory levels are now, although he noted that the company is still working on the right mix of commercial lengths for its stations. He's hopeful of seeing advertiser demand for :30s grow - - and idea he said has been more readily accepted in smaller markets than in large ones.

Diaries aren't going away
While the Arbitron Radio Advisory Council spent a lot of its meeting this week on PPM, resulting in Arbitron's agreement to await MRC accreditation before commercial deployment (3/30/06 RBR #63), Council Chairman Bill Kelly, Clear Channel's Youngstown Market Manager, notes that diaries are going to be around for some time in many markets. So, Council members were also focused on diary ratings quality. "The Council is committed to working with Arbitron in making sure that the diary continues to improve and be a good tool for the markets that are going to be remaining diary markets. We cannot as a Council concentrate solely on PPM, without working with Arbitron on the diaries as well," Kelly told RBR. Although the big news out of the Council this week was that Arbitron had agreed to hold off on any commercial deployment of PPM in Houston until it gets MRC accreditation, Kelly said that doesn't necessarily rule out a July launch. "It is entirely possible, from what we know about the MRC - - and certainly I am not putting a timetable on that group - - but it's certainly possible this [accreditation] could happen in time for everything to roll according to schedule," he noted. But Kelly said the Council was unanimous in agreeing that MRC accreditation is critical before PPM can go forward.

Fault lines emerge in new House telecom bill
Greasing the wheels for new competition in the delivery of wireline video programming is one of the major components of the new telecom bill working its way through the House Energy and Commerce Committee. Democrats are willing to join Republicans in backing a new national franchising regimen, but have serious problems with other components of the bill. The fault lines were spelled out in yesterday's Subcommittee on Telecommunications and the Internet hearing on E&C Chairman Joe Barton's (R-TX) Communications Opportunity, Promotion and Enhancement Act of 2006. Subcommittee Chairman Fred Upton (R-MI) says the measure is on track for initial subcommittee mark-up next week and final mark-up by the full committee before spring break. Subcommitte Ranking Member Ed Markey (D-MA), pictured, said that the measure was on track for full bipartisan support, including for the national franchise option, but two basic things derailed it. First was the lack of teeth in the provisions for Internet network neutrality. Also a problem was the lack of a build-out requirement for new entrants into the business, and the ability of cable to switch from local to national franchising as soon as one household was served by a new competitor. This would allow telcos moving into the business to cherry pick neighborhoods, potentially leaving low income or outlying neighborhoods without the benefits of competition. Worse, cable companies would be able to respond to the telcos only in the cherry picked neighborhoods, and would be free to treat the non-competitive neighborhoods however they wish - - Markey said for some the bill as written will likely result in higher prices, shoddier service. Barton noted that he did have bipartisan support for the bill, but could only name one Democratic supporter - - Bobby Rush (D-IL).

More on the California alco-ad bill
The California Broadcasters Association is fighting California bill SB 1180, which among other things would impose a 15% audience threshold on stations running ads for beverages containing alcohol, meaning no more than that percentage of a station's audience may be under legal drinking age. In a letter to State Sen. Dean Florez, Chair of the Senate Governmental Organization Committee, CBA President/CEO Stan Statham laid out the case to shoot the bill down. In the broad sense, Statham said CBA was opposing it "...because of serious First Amendment concerns, its reliance on unworkable audience measurement criteria, and the bill's failure to account for the dynamic nature of content/advertising in the new media landscape." Statham argued that there are no studies which reasonably support the notion that advertising is the cause of underage drinking, and there are no bright line tests to say when one influence is appealing to a certain demo and when it is not. Statham said, "Since the bill overreaches and may result in the cessation of advertising to audiences of legal age, it is overbroad and vague and does not directly advance the government interest." Statham further notes a structural problem with the bill - - there is no uniform way to reliably measure the audience being reached. He wrote, "...the use of audience measurement data for this purpose is not a tool with sufficient credibility, predictability and accessibility to accomplish the goal of SB 1180..." CBA is acting on behalf of 982 member broadcast radio and television stations.

Both sides digging in on VNU bid
Just who will own the parent company of Billboard, The Hollywood Reporter and the Nielsen TV ratings company a few months from now is anybody's guess. Reports from Europe say VNU management is refusing to withdraw its endorsement of a nine billion bucks private equity buyout, even though it looks like the vote won't even come close to the required 95% shareholder approval. Both the Financial Times and Wall Street Journal quote the company's CFO, Rob Ruijter, as threatening that if the deal is rejected, he and most other members of the supervisory and executive boards will quit. He may well have to deliver on that threat. The FT report says nearly half of VNU's shareholders will not accept the buyout bid announced early this month (3/9/06 RBR #48). Regardless of the level of opposition, Ruijter vowed that management will see the bid through to next month's conclusion and keep trying to persuade shareholders to tender their shares.

RBR observation: What happens then? That's the big question mark. CEO Rob van den Bergh has already announced plans to depart. If Ruijter and the board members quit as well, VNU would be left without anyone in charge. Dissident shareholder Knight Vinke Asset Management says it has candidates for a new CEO in mind - - and the investment group has also laid out its plan for how VNU should be split up and much of it sold off. But other big investors haven't committed to Knight Vinke's plans. Presumably, life and business would go on as usual at the operating units, such as Nielsen Media Research, AC Nielsen and the publishing group while the company's owners hash out what to do with the company - - and whom to hire to do it.

Ad Business Report TM

Miller, Kaplan details Top 100 advertisers
For nearly 30 years, Miller, Kaplan, Arase & Co. has provided data services for the radio industry with its topline Market Revenue Reports and its Media Market X-Ray program. For the first time, they are releasing some of this data to the mainstream. "Radio's Leading Advertisers" profiles spending by the Top 100 advertisers in U.S. Radio. It composites data from 732 radio stations and aggregates radio advertiser expenditure data from 33 U.S. markets (including 24 of the top 25 markets) accounting for approximately 60% of U.S. Nationwide spot radio revenues. It also profiles the nationwide spot radio spending trends of leading advertisers alphabetically, by rank, and by station. The Top 50 advertisers in each of 21 formats are also listed. Here are some samples, from Q4 '04 data - - The leading 100 advertisers and advertisers ranked in News/Talk. We will continue this in a series.
| See charts here |

Six Flags and Papa John's
announce marketing alliance
Papa and Six Flags struck a multi-year strategic marketing alliance and sponsorship agreement under which Papa John's will become a Six Flags corporate alliance partner and the exclusive pizza at Six Flags theme parks across the country. Six Flags will provide Papa John's with in-park presence in Six Flags parks in the U.S., with the opportunity to reach millions of Six Flags guests annually through a variety of methods, including: -- A branding and product alliance under which Six Flags will sell Papa John's pizza and related products at approximately 60 locations within Six Flags parks; -- Web-based and e-mail co-marketing efforts promoting Papa John's to Six Flags online customers; and -- In-park distribution of Papa John's coupons and promotional items. Under the agreement, Six Flags will receive an annual sponsorship payment from Papa John's and have the opportunity to reach Papa John's extensive customer base through a variety of methods, including: -- Papa John's pizzas, carried out or delivered, will display a Six Flags advertisement on pizza boxtops throughout the summer operating season at up to 1,100 Papa John's restaurants within a 100-mile radius of a Six Flags U.S. theme park; -- In-store point-of-sale promotions at up to 1,100 Papa John's restaurants within a 100-mile radius of a Six Flags U.S. theme park; -- The summer distribution by Papa John's of a promotional Six Flags DVD that showcases the attractions and special events at Six Flags parks; and -- Web-based and e-mail co-marketing efforts promoting Six Flags daily and season pass ticket sales to Papa John's online customers.

Media Markets & Money TM

Another Domino for Monahan in Manchester
Domino Pizza founder and radio group entrepreneur Thomas Monahan will be getting a third station in the Manchester NH market, courtesy of Steven Silberberg's Devon Broadcasting Co. Devon, related to Northeast Broadcasting Company, is selling WKBR-AM to Monahan's Catholic-oriented Absolute Broadcasting for 1.6M cash (an LMA should already have kicked off). Absolute already has two AMs in the area. WGAM-AM and WSMN-AM are both licensed to Nashua NH. However, according to the contract, they constitute another oddity under the new BIA/Arbitron/geographical market definitions which have replaced to old contour overlap method. It seems that BIA lists WGAM in Manchester but has WSMN attributed to Boston. It should not be a big deal if challenged, however - - Manchester is a big enough market to support a three-AM cluster.

Washington Media Business Report TM

Judge says FEC unreasonable
when it comes to 527s
During the 2004 elections, so-called 527 groups gained notoriety for their ability to advertise at will using soft money - - unregulated donations in which specific donors could hand over an unlimited amount of cash to any organization which fell under the appropriate section of the tax code. A judge at the United States District Court for the District of Columbia has issued an opinion on the case brought by the House shepherds of the Bipartisan Campaign Reform Act (BCRA), Marty Meehan (D-MA) and Christopher Shays (R-CT). BCRA is often prefixed with the relevant senators, John McCain (R-AZ) and Russ Feingold (D-WI). According to watchdog Democracy 21, the judge, - - Emmet G. Sullivan - - said the FEC "...failed to present a reasoned explanation" for treating 527s on a case-by-case basis, and called that approach, as executed in 2004, a "total failure." Democracy 21's Fred Wertheimer, who was also on the legal team representing Shays and Meehan, said, "The FEC must recognize from this decision that it has no choice now but to issue new rules to regulate 527 groups, since it is simply not going to be able to demonstrate there are reasonable grounds for dealing with 527 groups by case-by-case adjudication." The FEC must either better explain its approach - - something Sullivan does not expect since "...Cases arising from the 2004 campaign have languished on the Commission's enforcement docket for as long as 23 months, with no end in sight, even as the 2006 campaign has begun." - - or come up with new rules.

Ratings & Research

Listeners paying close attention to
live traffic reports, sponsors
A recent study conducted by Edison Media Research found that almost three-quarters of radio traffic listeners pay more attention to commercials read live by the announcer of a traffic or news report than they do to pre-recorded commercials. The Edison Metro Traffic Study also concluded that 78% of those commuters requiring traffic information for suburban roadways gained this traffic information from their regular local traffic stations. Additionally, the study found that traffic reports demonstrated an ability to pull people away from CD players, MP3 players and Satellite Radio. One in four respondents indicated that they listened to something other than radio in their cars, but then switched back to AM/FM radio specifically to hear traffic reports. Those with exceptionally long commutes (greater than 60 minutes each way) reported an even greater propensity to switch to AM/FM radio for traffic reports, as nearly half of those listeners indicated they listen to CDs or MP3s, but switch to hear traffic. More than 90% of radio traffic listeners pay close attention to traffic reports. "Clearly, traffic reports are extremely 'sticky' content for radio listeners," noted Tom Webster, VP/Edison Media Research. "Listeners know where to find localized traffic reports, especially in suburban areas, and rely on them to help them navigate their increasingly longer commutes."

BIGresearch's media consumption clusters put consumers at center of media planning
Customer centricity, ROI and engagement are the buzzwords in today's marketing world. However, from words to practice, a moat has been created from a lack of consumer insights which are rarely, if ever, incorporated into ROI models during a campaign's planning stage. BIGresearch's new media consumption clusters give media planners a consumer centric tool which incorporates media consumption and product consumption to enhance ROI before a campaign is undertaken.
| Read More... |

Entertainment Media Business Report TM

Cox Radio launches format "designed by listeners"
Cox Radio announced the launch of The New 96.7 The Coast radio format. This format is developed by Fairfield County, Connecticut's coastal residents including Greenwich, Stamford, New Canaan, Darien, Norwalk, Westport, Weston and Wilton. The new format will play Fairfield County's favorite Greatest Hits every hour throughout the day, including songs from the 60's through today. It will also feature Lower Fairfield County's traffic, news and local event information. "[The] launch of The New 96.7 The Coast highlights the strong relationship we have with our local audiences," said Robin Faller, The Coast VP/GM. "Using micro-targeted local research, The Coast has been specifically designed to super serve the lifestyle of Fairfield County by playing our listeners' favorite hits."

Internet Media Business Report TM

WMA announces 2006 Internet
Advertising Competition Awards winners
The Web Marketing Association announces the winners of its annual Internet Advertising Competition (IAC) Awards, an effort to honor excellence in online advertising and to recognize the individuals and organizations responsible for the best in Internet marketing. The IAC Awards are the first and only industry-based advertising award competition dedicated exclusively to online advertising. 2006 Best of Show Awards were awarded in each of the online medium categories.
| This year's winners include |

Transactions

12M WVKO AM & FM Columbus OH (Columbus, Johnstown OH) and WASN-AM, WGFT-AM, WRBP-FM Youngstown-Warren OH (Youngstown, Campbell, Hubbard OH) from Stop 26 Riverbend Licenses LLC D.I.P. (Bradley E. Scher, chief restructuring officer) to Bernard Ohio LLC (Daniel B. Zwirn). Bankruptcy auction. Credit for seller's indebtedness to buyer. LMA until closing. [File date 3/7/06.]

N/A WHBS-AM Moultrie GA from Sailor Broadcasting of Georgia Inc. to Christ in You the Hope of Glory Church Inc. (Franklin P. Walden). Debt cancellation, buyer returning station to former owner. Station is noncommercial. [File date 3/9/06.]

Stock Talk

Inflation worries...again
Stock prices moved lower as investors fretted about the latest government report on GDP growth, which reignited inflation worries. The Dow Industrials fell 65 points, or 0.6%, to 11,151.

Radio stocks were mixed. The Radio Index gained 0.195, or 0.1%, to 163.430. The best performer was SBS, up 4.2%, and the worst Emmis, down 2.5%.

Radio Stocks

**Here's how stocks fared on Thursday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		33.77	+0.05	Hearst-Argyle	HTV		23.32	+0.03
Beasley	BBGI		12.13	+0.31	Jeff-Pilot	JP		55.98	-0.02
CBS CI. B	CBS		24.24	-0.20	Journal Comm.	JRN		12.41	+0.01
CBS CI. A	CBSa		24.39	-0.12	Radio One, Cl. A	ROIA		7.59	-0.16
Citadel	CDL		10.94	-0.03	Radio One, Cl. D	ROIAK		7.56	-0.17
Clear Channel	CCU		29.30	-0.17	Regent	RGCI		4.43	-0.03
Cox Radio	CXR		13.27	+0.05	Saga Commun.	SGA		9.29	-0.18
Cumulus	CMLS		11.24	+0.08	Salem Comm.	SALM		14.98	-0.05
Disney	DIS		27.87	+0.01	Sirius Sat. Radio	SIRI		5.05	+0.06
Emmis	EMMS		15.96	-0.41	Spanish Bcg.	SBSA		5.49	+0.22
Entercom	ETM		27.87	-0.02	Univision	UVN		34.70	+0.42
Entravision	EVC		8.77	+0.14	Westwood One	WON		11.05	-0.04
Fisher	FSCI		43.28	+0.29	XM Sat. Radio	XMSR		22.41	+0.61
Gaylord	GET		45.80	+0.58	-	-	-	-	-

Bounceback

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

Regarding Thursday's article about XM Radio and regional news/talk programming (3/30/06 RBR #63), you should know that Senators Snowe (R-ME), Baucus (D-MT) and Lott (R-MS) have introduced legislation (S. 2418) to hold satellite radio accountable to the terms of their national-only licenses. Among other things, this legislation would also order the FCC to investigate the legality of satellite's intention to put local content on nationally distributed channels. This bill would also prevent satellite radio from using new technologies to deliver localized content in violation of the terms of their licenses. Radio station employees throughout the nation should learn more about this proposal and consider contacting their Senators asking them to support this legislation.

Kind regards,
Jay Ahuja
Charlotte, NC

Editor's note: You can read about S. 2418 in another recent issue
(3/17/06 RBR #54).

Below the Fold

Ad Business Report
Top 100 advertisers
Details by Miller, Kaplan...

Media Markets & Money
Another Domino for Monahan
Domino Pizza founder getting a third station in...

Washington Media Business Report
Judge says FEC unreasonable
When it comes to 527s...

Ratings & Research
Media consumption clusters
Put consumers at center of media planning...

Arbitrends

Radio Media Moves

Red Zebra adds
another stripe
Red Zebra Broadcasting announced Jim Weiskopf has joined the company as Vice President of Business Development, where he will focus on developing broadcasting and new media partnerships. Weiskopf's 20-year career in radio sales and management includes CC Radio DC, where he was AM Station Manager.

From Sacto to NYC
Sonia Jimenez has been named Director of Promotions for Clear Channel's WWPR-FM "Power 105.1" New York, moving cross-country from being Marketing Director at co-owed KFBK-AM & KHYL-FM Sacramento.

Upped in Pittsburgh
CBS Radio's "News Talk 1020" KDKA-AM Pittsburgh announced the promotion of John McIntire to the permanent evening host. "The Flip Side with John McIntire" can be heard 8-10 pm weekdays.

XM programming
staff changes
XM Satellite Radio has named Priestly as music director of its popular hits channel, "Top 20 on 20." In his new role, Priestly, who currently serves as on-air talent and music director of "The 90s," XM's 90s hits channel, will join Michelle Cartier, program director and on-air personality of Top 20 on 20. Priestly will assume his duties as music director for Top 20 on 20 on April 17. XM Satellite Radio's "PJ," on-air personality for The 90s channel, will move to XM's new modern hits channel, "Flight 26." PJ will serve as an on-air personality and familiar voice for Flight 26, beginning April 17 when the channel launches.

Davis lands at ABC
ABC Radio Networks announced the appointment of Carey Davis to the position of Vice President, Multicultural Sales. Davis was previously VP/GM of Spanish Broadcasting System's WSKQ-FM & WPAT-FM New York.

Stations for Sale

9 Station Cluster
Upstate New York
9x cash flow $6.5m
George Kimble - Kozacko Media
520-465-4302
[email protected]

More News Headlines

Right words,
wrong speaker
Although the BofA webcast listed Entravision CEO Walter Ulloa as presenting at Wednesday's conference in New York (3/30/06 RBR #63), it was actually CFO John DeLorenzo who appeared and made the comments we reported about both Entravision and Univision.

TVBR - TV News

NAB battles to preserve retrans consent
The FCC has recently reviewed the retransmission consent process in existence between broadcasters and cable, and found it to be in fine working order. Allbritton Communication's Jerald Fritz appeared on Capitol Hill yesterday to try and make sure it remains in place as telcos enter the fray. Fritz told the House Subcommittee on Telecommunications and the Internet that broadcasters welcome the enhanced competition. He pointed out, though, that when it comes to carriage, both broadcasters and MVPDs bring value to the table, and a number of complex elements often are on the table as well. Each market and situation is different, making a fair cookie-cutter solution an impossibility. Fritz used the FCC's own review as his key argument: "The Commission emphasized that the carefully balanced combination of copyright, exclusivity rules and retransmission consent provides the benefits Congress had foreseen. It strongly opposed altering just the retransmission consent regime without also addressing the other integral components of the balance."
| Read Fritz's full testimony here |

RBR Radar 2006

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

Advisory Council puts
MRC hold on PPM
Arbitron Radio Advisory Council insisted that Media Ratings Council (MRC) accreditation is absolutely essential before Arbitron's Portable People Meter (PPM) can be commercially deployed for radio ratings in the US. Arbitron has accepted that position and agreed not to begin using PPM as a ratings currency until it gets the MRC stamp of approval. That could mean that Arbitron's announced plan to launch PPM commercially this July in Houston will be delayed.

RBR observation: But then, Arbitron is far ahead of its would-be competitors in the Next-Generation Electronic Ratings Evaluation Team as far as the MRC is concerned. The Media Audit/Ipsos has just begun the MRC accreditation process, while PPM is well along in Houston. Mediamark Research hasn't yet scheduled a US test which could be used for MRC auditing. This is good common sense thinking and decisions on all sides of this table for Arbitron and the radio business.
03/30/06 RBR #63

California looking at
new alcohol ad bill
S.B. 1180 is getting its hearing in the California legislature making it illegal to advertise any beverages containing alcohol in any manner that encourages consumption by minors. Since that is a difficult standard to define, it would make any ad legal if it is in a media that has a 15 % or less "youth" audience based on industry data.

RBR observation: Trouble - Trouble and more Trouble if this gets a green light for all broadcasters.
03/30/06 RBR #63

Private capital is king
Back in the 1990s, it seemed that every broadcaster wanted to go public - - fill up the company coffers with cash from an IPO, make the founders and all of the long-time managers rich (at least on paper) and expand rapidly by acquiring smaller privately held broadcast companies - - with cash, stock or a mixture of both. But the past few years have been a tough dose of reality.
03/29/06 RBR #62

Hard finding that key person to fill the important position at your organization? RBR's - Media HeadHunters is the place that key media firms use to get results. See www.mediaheadhunters.com and get results with service--Period.

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