RBR's Daily Morning Epaper

Volume 22, Issue 67, Jim Carnegie, Editor & Publisher

Tuesday Morning April 5th, 2005

Radio News®

"Less is More" - - everybody's doing it
Wachovia analyst Jim Boyle says it's not just Clear Channel that's taking "Less is More" to heart. By his calculations, radio spot loads are down across the board. He's expecting radio's pricing power to be revived in another 3-6 months. "We had seen Clear Channel shouldering most of its inventory reduction initiative in January and February. A new trend has evolved in March. Other radio groups, public and private, are now paring back their spot loads," Boyle said in his latest update on radio spot loads. Based on tracking by Media Monitors' AirCheck service, the analyst said the FM stations owned by public radio companies in 12 large markets saw their spot loads decline from an average 12 units per hour in February to 11.5 in March. "Repairing the self-inflicted ad rate cutting and inventory-loading should take at least 3-6 months," said Boyle, noting that we're now three months along the road. "While current trends are encouraging, there is no guarantee that this is not a headfake. We would like to see these positive trends continue in the heavier months of the year, such as May and June," he noted. Who has the lowest spot loads? Here's Boyle's chart.

**Average units/hour, drivetime, March 2005**
Entravision	8.1	Service	11.5
Crawford	9.3	Cox Radio	11.6
Entercom*	10.0	Bonneville	11.6
WEAZ-FM	10.1	Howard Univ.	12.4
SBS	10.6	Liberman	12.7
Univision	10.7	Greater Media	12.7
Radio One	10.9	Infinity*	12.9
Clear Channel*	10.9	ABC Radio*	13.0
Salem	11.1	Jeff-Pilot	13.3
Susquehanna*	11.2	Beasley*	13.6
FM Average	11.4	-	-

*FM stations only
Source: Wachovia Securities, Media Monitors

RAB: February was flat
At least it wasn't a negative number! The Radio Advertising Bureau (RAB) reports that February radio revenues were flat with a year ago. And, it noted, the month had one less day this year. Local revenues were flat, while national spot slipped 1%. Non-spot revenues were down 5% for the month. So, with two months down for 2005, local is up 1% year-to-date, national is up 2% and total spot is up 1%. Non-spot is down 2% year to date.

RBR observation: How much is Clear Channel's "Less is More" holding down revenues? We won't know until we have 20/20 hindsight. For the sake of the whole industry, lets all hope that LIM really works as it is supposed to.

Give me just a little more time
The Supreme Court had expected commentary on the FCC's petition of certiorari asking for review of the Third Circuit's ruling on the infamous 6/2/03 rulemaking by 4/14/05. It has now added a little more than two weeks to the filing time in "FCC and US, Petitioners v. Prometheus Radio Project et al." The new deadline is 5/2/05. The attorneys of record in the case are the Acting Solicitor General of the DOJ on behalf of the FCC, and Elaine Goldenberg of Jenner & Block LLC for Prometheus.

Product Placement is Hot
Getting Hotter and pacing Up fast
The marketing practice known as product placement is growing by leaps and bounds, according to a new study from PQ Research. It accounted for 3.46B dollars in 2004, a whopping 30.5% increase over the previous year. It is projected to easily surpass 4B in 2005. The growth of the technique in broadcast television is even more sloped - - it shot up 46.4% to 1.87B, claiming over half of the placement pie. Although it's also used in movies and other media, the category has largely been tethered to broadcast, cable and syndicated TV, where it's use is seen as a way to avoid the commercial-zapping capabilities increasingly at the disposal of viewers. In particular, reality TV has provided an attractive venue for placements, especially for products seeking 18-34 year olds, according to PQ. PQ also cites specialty cable channels, which appeal to the producers of related goods and services. The cash is coming out of the hide of traditional media, according to PQ's Patrick Quinn. "Technological advances, most notably PVRs, and continued audience fragmentation, due to the growing popularity of new media like the Internet and videogames, have led major marketers who are already skeptical of their return on investment in traditional advertising to become even more dispirited with the old means of reaching a target audience." PQ is looking for a 22.7% increase in placement cash expended for 2005, to 4.24B.

RBR observation: For the record, RBR and especially TVBR stated that product placement would catch fire back in January '04 and said it publicly at the RAB and TVB conferences of that same year. The best product placement was last November in a collaborated effort by Ford Motor, NBC's 'American Dreams' producer Jonathan Price and J Walter Thompson. Result - ROI and more of it will arrive and we trust less clutter. (see below on American Dreams) If you have not viewed this film then use this link and look at your future today in a 5 minute mini-movie by Ford with Mustang and former Ford executive Rich Stoddart explains how it happened 11/29/04 TVBR #231.

A non-elective Hill debate on indecency
A cable operator, a broadcaster and a thinker will be getting together Friday, 4/8/05 to discuss on of the top issues facing the industry today, and the title of the event - - "The Indecency Debate: Should Congress Extend Broadcast Rules to Other Media?" - - tells you all you need to know about the incendiary topic. The panelists include Jill Luckett of NCTA representing cable; Jerald N. Fritz of Allbritton Communications Company representing broadcasting; and Adam Thierer of think tank The Progress & Freedom Foundation, which is sponsoring the event. It will be held from 12N-2P in the Rayburn House Office Building.

Seven lawmakers heading to Vegas
Seven members of the 109th Congress will be featured panelists at the NAB2005 Congressional Breakfast held Monday, April 18th at the Las Vegas Hilton: Senate Commerce Committee member Conrad Burns (R-MT); House Commerce Committee Chairman Joe Barton (R-TX); House Judiciary Committee Chairman Jim Sensenbrenner (R-WI); House Telecommunications Subcommittee Chairman Fred Upton (R-MI); and House Commerce Committee members Michael Bilirakis (R-FL), Gene Green (D-TX) and Greg Walden (R-OR). Former ABC News chief White House correspondent Sam Donaldson, who now hosts the radio show "The Sam Donaldson Show - - Live in America," syndicated nationally by ABC Radio Networks, will moderate the event.

Publishers Perspective

Upfront coming...
NBC's Pump and Dump can become ABC's American Dream
Wednesday, 3/30/05, Critic's corner USA Today - NBC's American Dreams airs season and possibly series finale...and brace yourself for bad Dreams news. Bad for NBC but good Dreams for The American Broadcasting Company if new Disney CEO Bob Iger has any programming common sense. NBC Entertainment President Kevin Reilly - - you have, or had, a hit on your hands but never had the commitment or gut instinct to see it through. You marginally marketed and ran a few promo ads, but your research clipboard said no numbers - - so dump it. A major publicly traded TV group CEO with a number of NBC affiliates recently told me off the record, "Jim, If NBC didn't pay me for the crap programming like Third Watch on Friday Night I would dump them in a heartbeat for better content." NBC gurus - -You have no gut instinct. History - - ABC picked up Bandstand in 1957 under one condition, that Dick Clark add "American" to the brand. Bandstand breathed the air of youth into a company that was then and possibly still known as the Almost Broadcasting Company. The A in ABC stands for American as it is in American Dreams. Hello! NBC dumps American Dreams? ABC - - the home of American Bandstand - - Pick It Up!! ABC affiliates forward this perspective to your ABC affiliate rep in Hollywood. (Content is King, as history will tell. And American Bandstand is one of the binding threads found throughout American Dreams check it out) | More... |

Conference Calls Q4 2004

Interep revenues up; company looking at alternatives
Interep reports that Q4 commission revenues were up 5.1% to 22.4 million, although they were down 10.6% for the full year. Declaring that Q4 market a turning point for both Interep and the national radio ad market, CEO Ralph Guild said national spot demand is increasing and the company is on track to exceed financial expectations in Q1. But looking further out, he's looking at financial alternatives for the rep company. "Our liquidity has improved and as part of a new financial strategy, we are in the final stages of appointing a financial advisor to assist with initiatives in growing the company, and provide new capital for growth and repayment or refinancing of our bonds maturing in 2008," he said. For Q4, Interep posted a net loss attributable to common shareholders of 1.7 million, or 16 cents per share.

Adbiz©

Russo on Jack
Yes, the "Jack" format and others like it that play hit songs from the last 40 years is sweeping most markets right now, and getting good responses. But remember, these are still all the same songs we've all heard over and over - - just more of them, which is a still a start. Rich Russo, JL Media's SVP/Director of Broadcast Services had a few additional reservations and funny observations, which he offers to share with you. | More... |

ProtectYourCheck.org launching Social Security effort
A new organization created to defeat President Bush's plans for Social Security intends to open a television ad campaign this week depicting the proposal as the tip of an iceberg that will cut benefits and raise the national debt. Erik Smith, a spokesman for ProtectYourCheck.org, told the AP the group will spend nearly 1 million to show the commercial on cable stations nationally over the next three weeks. Other ads will follow on broadcast stations, he said, aimed at individual lawmakers of both parties. The spot opens with the picture of an iceberg jutting above the water. "The plan that George Bush and his backers in Congress have to privatize Social Security. Look below the surface and you'll find...benefit checks cut almost in half. 5 trillion in new debt," says the announcer. "This makes the anti-privatization argument of benefit cuts and increased debt," said Smith.

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Media Markets & MoneyTM

I left my Mozart...in San Francisco
Saul Levine's Mount Wilson FM Broadcasters is exiting the San Francisco with the sale of its KMZT-AM, a rare commercial AM Classical station. The buyer is California radio specialist Mapleton Communications, led by Adam Nathanson, which has been on somewhat of a buying spree lately. It'll pay 5.1M for the station, 1.1 of which will be in the form of a promissory note. The deal leaves Mt. Wilson with an AM-FM combo in the Los Angeles area. Levine was getting ink last year for his effort to have broadcast indecency standards extended to satellite radio services.

Close encounter in the OH-WV border
Educational Media Foundation is now in possession of the deeds and the keys to WMBP-FM Belpre OH and WVRP-FM Ripley WV, according to Greg Guy of Patrick Communications, who handled the deal. The seller, Lower Ohio Valley Educational Corp., gets 700K. Both stations are on the left side of the border between the reserved and the commercial portions of the FM band, which, although appropriate for a noncommercial outfit such as EMF, is not the only way the Contemporary Christian group operates. It frequently picks up sticks on the commercial side. WMBP is in the Parkersburg-Marietta market, while WVRP is in unrated territory just to the south.

Washington Beat

Give me just a little more time, again
Another Media General TV/newspaper combo has come under assault at license renewal time, and as before, Media General has asked for more time to file its opposition. As in the other cases, the complainant filing to break up the combos is watchdog Free Press. This time the station in question is WRBL-TV in Columbus GA. Media General says it is busy replying to earlier challenges, and asked for an extension to 6/1/05, which the FCC granted.

RBR observation: Free Press says Media General knew the risk it was taking when it put its TV/newspaper combos together, hoping the new rules the FCC planned to put in place in 2003 would have long ago rendered them completely legal. We think otherwise - - as we've said in the past, the Third Circuit actually admitted that there seemed to be merit in TV/newspaper combos, not in terms of economic efficiencies for the owner, but the more easily defensible prospect of better news coverage for the public. The quibble the court had was with the FCC's diversity index which was used to create numerical station/newspaper cap numbers. The court made clear that it saw no problem with this kind of combination, and requiring the break-up due to events beyond the control of the owner is patently unfair, and as the court indicated, not necessarily in the best interests of the public. Most if not all existing TV/newspaper combos should bet a blanket waiver until this matter is concluded.

Programming

K-Rock launches
Indie Rock webstream
Hallelujah, finally somebody has done something. Hopefully it's a litmus test for a new national format launch: Infinity's WXRK-FM has launched "K-Rock2," a new Indie Rock webstream dedicated to playing the latest music offerings from today's new artists (www.krockradio.com), including bands such as My Chemical Romance, The Killers, Mars Volta, Arcade Fire, Taking Back Sunday and Interpol. Probably the most mainstream bands we heard were Audioslave and The White Stripes. Additionally, the station announced it has expanded its on-air playlist to include more of the best rock music from the 80s, 90s and today. Said Infinity CEO Joel Hollander: "We did something similar with WHFS in DC. We put WHFS online. We took a huge hole in Washington with El Zol, and then we super-served an existing audience." Infinity Director of Programming Rob Barnett tells us KROCK2 may add commercials to the new stream. "It's commercial-free at the moment. We think honestly that there might be some great sponsor opportunities there, especially for the music community. And were going to not just promote to KROCK2 from the mothership, but we think there's an opportunity to share programming back and forth. The initial feedback on both has been great."

RBR observation: KROCK2 is pretty good. Congrats to Infinity NYC. Suggestion? Blow up WNEW-FM New York and place KROCK2 there, as well as online (keep the call letters!). Take the classic dance tunes on WNEW-FM and mix them into WCBS-FM's playlist. This would solve another huge listening hole...in NYC.

Ratings & Research

NAB awards broadcast research grants
NAB's Research and Planning Department has announced the award of five research grants to academic scholars as part of its annual "Grants for Research in Broadcasting Program." Each year, this highly competitive program attracts research proposals from broadcast scholars throughout the country. David Allan, St. Joseph's University, "Comparative Effectiveness of 30- versus 60-Second Radio Commercials on Recall." Carolyn A. Lin, University of Connecticut, "Audience Adoption Intentions and Action in a Competitive Radio Marketplace: Testing a Technology-Choice Model." Jennifer E. Moore, University of Minnesota, "Negotiating Consolidation: The State of Small Radio Groups." Kartik Pashupati and Alice Kendrick, Southern Methodist University, "HDTV and the Advertising Industry: A Survey of Factors Inhibiting and Aiding Adoption in Ad Agencies." Debora Halpern Wenger, Virginia Commonwealth University, "Resource Allocation and Managerial Oversight of Morning Television Newscasts."

TVBR - TV News

WWE moves to NBC Universal
After Viacom's Spike TV declined to pay the freight to renew the highest rated shows on ad-supported cable (3/14/05 TVBR #51), NBC Universal has stepped up and signed to put the World Wrestling Entertainment (WWE) shows on its main cable net, USA Network - - plus specials on NBC and a Spanish version of the top WWE cable show, "Monday Night Raw," on Telemundo. The agreement, effective in October, marks a return for "Raw," which began its 12-year run on USA before moving to Spike. "The WWE's return to USA Network and our arrangement with the other NBC Universal properties, is indicative of how we as a company can offer unique cross-networking opportunities. 'Raw' will put USA and NBC Universal Cable into an incredibly competitive position and I couldn't be happier about this relationship," said Jeff Gaspin, President of NBC Universal Cable Entertainment and Cross-Network Strategy. In addition to "Monday Night Raw," USA will air a one-hour weekend Raw-branded program. The specials on NBC will be at least twice a year, airing for 90 minutes late-night on Saturdays. WWE's main broadcast TV property, "SmackDown," continues to air on Viacom's UPN. The new agreement with NBC Universal can't be directly compared to the arrangement with Spike, which runs through September. WWE sold most of the commercial inventory for its programs on Spike, while it will get a rights fee from NBC Universal, whose networks will sell the ads themselves.

Stock Talk

Oil prices hold down gains
Stock traders kept a wary eye on oil prices Monday as crude pushed above 58 bucks a barrel, but then settled a bit lower for the day. Most major indices managed small gains for the day. The Dow Industrials were up 17 points, or 0.2%, to 10,421.

Not so for radio stocks, which were slightly lower. The Radio Index slipped 0.109, or 0.05%, to 219.943. The bookends were Saga, up 2.9%, and Cox Radio, down 2.4%.

Radio Stocks

**Here's how stocks fared on Monday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		43.33	+0.36	Jeff-Pilot	JP		48.85	+0.40
Beasley	BBGI		17.80	+0.12	Journal Comm.	JRN		16.89	+0.40
Citadel	CDL		13.86	+0.02	Radio One, Cl. A	ROIA		14.72	-0.13
Clear Channel	CCU		34.54	+0.37	Radio One, Cl. D	ROIAK		14.77	-0.11
Cox Radio	CXR		16.93	-0.42	Regent	RGCI		5.34	+0.04
Cumulus	CMLS		14.18	-0.08	Saga Commun.	SGA		16.14	+0.46
Disney	DIS		28.43	-0.15	Salem Comm.	SALM		20.00	-0.32
Emmis	EMMS		18.94	-0.23	Sirius Sat. Radio	SIRI		5.45	-0.11
Entercom	ETM		34.90	-0.36	Spanish Bcg.	SBSA		10.00	+0.06
Entravision	EVC		8.65	-0.02	Univision	UVN		27.47	-0.15
Fisher	FSCI		51.11	-0.03	Viacom, Cl. A	VIA		35.24	+0.14
Gaylord	GET		40.44	-0.12	Viacom, Cl. B	VIAb		35.18	+0.31
Hearst-Argyle	HTV		25.54	-0.07	Westwood One	WON		20.06	+0.02
Interep	IREP		0.50	-0.02	XM Sat. Radio	XMSR		30.98	+0.25
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

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Bounceback

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

Who wins if radio stations pull shows that are also on satellite? (4/4/05 RBR #66)

Saga has announced it will cancel syndicated shows also heard on satellite? Owners: Aside from any concerns your attorneys may have about competing groups conspiring to restrain trade of syndicated shows, there are 6 very practical reasons this naïve chest-pounding is a BIG mistake. Why management ego should NOT cost radio The Sean Hannity Show and other syndicated fare that's also on Sirius or XM: | More... |

Holland Cooke
News/Talk consultant

NAB Daytime Planner

The following brokers will be attending the NAB. Call or email to make your appointment in advance.

Cliff Gardiner, Clifton Gardiner & Company, 303-758-6900,
Bellagio,
[email protected]

Andy McClure/Dean LeGras,
The Exline Company, Bellagio,
Office 415-479-3484

Frank Boyle,
Frank Boyle & Co., LLC,
Venetian Hotel,
203-969-2020,
[email protected]

John L. Pierce, John Pierce & Company LLC,
Mirage Hotel,
859-647-0101, cell 859-512-3015, [email protected]

Jamie Rasnick, John Pierce & Company LLC,
Mirage Hotel,
859-647-0101, cell 513-252-1186, [email protected]

Dick Kozacko/George Kimble,
Kozacko Media Services,
Bellagio,
office 607-733-7138, cell 607-738-1219, [email protected]

Chuck Lontine,
Marconi Media Ventures, Inc.,
303-382-1000, cell 720-341-4722, [email protected]
www.marconi.cc

Elliot Evers, Media Venture Partners, LLC, 415-391-4877,
[email protected]

Larry Patrick/Greg Guy,
Patrick Communications,
Bellagio, 410-740-0250, [email protected]

Todd Fowler/David Reeder
American Media Services-
Brokerage, LLC
843-972-2200/903-640-5857
Bellagio,
americanmediaservices.com

Arbitrends

Upped & Tapped

Univision Radio names new VP/Programming
Univision Radio announced the appointment of J.D. Gonzalez to Vice President, Programming Services, effective immediately. Gonzalez will be responsible for overseeing the creation, implementation and execution of Univision Radio's programming and scheduling. Based in Houston, Gonzalez will report to Gary Stone, COO, Univision Radio.

Clark jumps to Arbitron
Former Nielsen//NetRatings sales exec Carolyn Clark has joined Arbitron as a senior account manager in the National Radio Services department. She will be responsible for serving as the principal Arbitron contact with networks, syndicators, representative firms and other key national accounts.

May - Radio & Television Business Report
The First Real Monthly
Business Media Magazine

Upfront looms on
the horizon

May Radio & Television Business Report focuses on One-On-One interviews with the money Ad Players: David Verklin, Steve Grubbs, Harry Keeshan, Jon Mandel, Ray Warren, Ira Berger, Jean Pool and others that read TVBR religiously. They're participating because they want you to know what they need to help make informed decisions. They comment on programming that they view promising for this upfront; they examine thoroughly the real issues that affect the marketplace as all are getting busy. This is a large story already and getting bigger.

Watch for the May Issue of
Radio & Television Business Report. The 2005-2006 Upfront Examined.
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RBR Radar 2005

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

Publisher Perspective
Read the smoke signals Cochise
Advertisers aren't going to pay for the increasing cost of shuffling paper and manually re-keying information. Kathy Crawford, President of Local Broadcast at Mindshare, said, "If we don't do this I can tell you it will be a great impediment to the future use of spot television." Asked what local TV stations can do to get more business, the panelists pointed to communication. They said stations need to listen to what each brand is trying to do. And they need to tell buyers and planners well in advance of special opportunities-not wait until they have avails to sell. There is no real separation between Cable, Network TV or Local TV - - it is all TV - - period - - and the advertisers want their cash registers to ring. Local TV has to be a part of the process, or go home. Word to the wise - - as it was said to me: Have a one-on-one talk with your rep firm, because they are part of the problem. Many rep executives fear losing national spot and the account going direct. Resolve the current issues facing you right this minute as you will see a new Up Front season. The two: EDI and LPM. Lastly, on the EDI accountability front - - again told to me by a high level agency executive: Radio reps are doing a better job than TV. This is the first time in three years I have heard of radio doing something better than TV. This is a wake up call, people! Read the smoke signals in the sky. 04/04/05 TVBR #66

More broadcasters may cancel
satellite-friendly syndication
It's not just Saga that's thinking about it: Ed Christian, Saga CEO, tells RBR that behind the scenes, other groups are contemplating throwing 90-day cancellation notices at syndicators who put their radio shows on XM or Sirius. It's even a concern at Clear Channel, which has a stake in XM. Several programming execs tell RBR they don't like having programming airing on their stations duplicated on satellite, but it's going to be up to the group heads to decide whether to take action as Saga has done. 04/04/05 RBR #66

Buyers push for automation
Agencies still spend 40-60% of their time processing the paperwork from buying spots, so panelists at the TVB management conference in New York pushed for stations to move faster to implement not only electronic invoicing, but electronic ordering as well. Warning that advertisers aren't going to pay for the increasing cost of shuffling paper and manually re-keying information.
RBR observation: Media executives in TV and Radio you have come to the end of the line of putting this off until tomorrow. There is NO tomorrow. 2005 is the year to engage, no talk but action on EDI as well as LPM and PPM. If you don't do you lose and go home as Cable and other media outlets will be bought around you, Period. 04/01/05 RBR #65

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