RBR's Daily Morning Epaper

Volume 23, Issue 76, Jim Carnegie, Editor & Publisher

Tuesday Morning April 18th, 2006

Radio News ®

Indecency wars still front and center
The FCC noted late last week that it had received further opposition from CBS regarding indecency forfeitures assessed for a broadcast of "Without a Trace." It indicated it would, as usual and as a matter of course, review the broadcaster's remarks, but also said it believed its rulings were correct. Tamara Lipper spoke for the Commission, saying, "The episode of CBS's 'Without A Trace' that the Commission found to be indecent depicts a teen orgy as well as a teenage girl straddling (and apparently engaging in intercourse) with one boy while two others kissed her breast. Additionally, in its recent order the Commission again rejected CBS's argument that the broadcast of the Super Bowl XXXVIII halftime show was not indecent. That argument runs counter to Commission precedent and common sense. The Commission however, will review any request for reconsideration."

RBR observation: We always thought that the whole thing about the Janet Jackson episode was that it was pretty much unprecedented. Frankly, we've seen hundreds of wardrobe malfunctions on those blooper and home video shows where the malfunction is not fleeting at all. And that is to say nothing of the endless fascination with pratfalls involving various missiles, projectiles or stationary objects and a certain portion of the male anatomy. We wish CBS and the other networks well in their battle for some kind of indecency policy that makes sense - - we sure don't have one now.

Broadcast financing is hot,
even in small markets
Are market conditions good or bad for radio and TV station owners (or would-be owners) looking for financing this year? To take the temperature of the lending market, RBR/TVBR assembled a panel of experienced broadcast lenders. We began by asking Dave Meier of Wells Fargo Foothill, is it a good market for people looking for financing or is it getting more difficult? "I think there is a lot of activity out there both in terms of new M&A activity and in terms of lender participation. From my standpoint there is a lot of competition out there even in the smaller end of the market, which is where I participate. My focus is really 1-10 million transactions. I do believe there is a lot of activity out there for radio. For television we have a little bit of a different per view just because of the size range that we operate in. We tend to see a lot of independent transactions and guys that are looking to do digital build-outs and things of that nature. I don't think the competition is quite as fierce in that end of the market, meaning the smaller end of the market for television as it is in radio, but I do think there are plenty of participants out there looking to do transactions," Meier said. This is an excerpt from part one of a roundtable discussion with four lenders that appeared in the March issue of RBR/TVBR Solutions Magazine.
| Read it here |

"Me first" is the cry for 2008 primary battle
The Democratic party has been working on front-loading its 2008 presidential primary schedule with a collection of contests in geographically and demographically diverse states. So far, eight have stepped forward angling for a spot in the front of the schedule. The season traditionally kicks off in January with a caucus in Iowa and a primary in New Hampshire. The new schedule, if approved, would allow both to retain their lead-off positions, but would insert a couple other caucuses directly after Iowa and a couple of primaries right after New Hampshire. According to the Associated Press, the states angling for the early-bird worm include Alabama, Arizona, Arkansas, Colorado, Michigan, Mississippi, Nevada and South Carolina.

RBR observation: This is certainly geographically diverse, if a little South-heavy. With Iowa representing the central Midwest and New Hampshire representing New England, the representative state from Middle Atlantic is about the only missing element. The importance for broadcasters is obvious. The earlier the contest, the more competitive candidates remain standing, and the more competitive they are, the more money they will spend getting their message out. By the time the 50th state gets to cast its votes, there may be no reason to advertise at all.

Payola goes non-com
The practice of accepting free meals and tickets to various events was rampant at WUOM-FM, the National Public Radio station in Ann Arbor, MI, according to the attorney for one of three former employees accused of trading on-air mentions for big-ticket gifts. Attorney Tom Moors, reported the Kalamazoo Gazette, said several other employees at Michigan Public Media, including station managers and organization leaders, also received personal benefits in the form of meals and tickets to Detroit Tigers games, concerts, museums and local theaters. Michigan Public Media is the umbrella organization for a network of University of Michigan-owned public radio and television stations statewide, including WVGR-FM 104.1 in Grand Rapids. "The exact thing was going on from top to bottom,'' Moors told the paper before the start of a preliminary court hearing last week. "They were all having a party over there.'' The three former employees -- Michael Coleman, Justin Ebright and Jeremy Nordquist -- are charged with embezzlement because they allegedly brokered in-kind trade deals with sponsors that benefited them personally instead of Michigan Public Media. The sponsors received on-air mentions reportedly worth tens of thousands of dollars. After the hearing, Coleman and Nordquist were ordered to face trial on embezzlement and conspiracy charges, each punishable by up to five years in prison. The case against Coleman, 40, the company's former deputy director, stemmed from a trade agreement he allegedly made with owners of a bar in Ann Arbor that was never disclosed to other station management. Coleman is accused of signing off on $3,518 worth of purchases at the bar over a three-year period; he allegedly was the only person who could benefit from the trade agreement since he was the only one who knew it existed. Nordquist, 28, a former AE, is accused of getting a pool table and two Persian rugs collectively valued at $1,300. Ebright, 35, the former development director, pleaded no contest to one count of embezzlement less than $20,000 and agreed to pay at least $10,000 in restitution for patio furniture, Persian rugs, and a golf club membership he misused. He faces up to five years in prison and a $10,000 fine, or three times the amount embezzled, whichever is greater, at sentencing 5/18.

Wal-Mart set to prop up competitors?
Retail giant Wal-Mart has long been a fixture on the media, mainly advertising its stores on television. It has added radio to the mix in the last few years, largely to promote the company's image in the face of activist attacks on its business model. Now comes word that it may go so far as to assist some of the small businesses it has long been accused of driving out of business. According to the Associated Press, Wal-Mart is looking to expand into "blighted urban markets" and will try to ease its way in by keeping local small business in their new neighborhoods up and running. It's even planning to put out free advertising for these smaller competitors.

RBR observation: Before you try to cash in directly on this corporate good neighbor policy, it should be noted that the free advertising will likely be aired on the company's in-store sound system. Ads for small businesses will not be headed to your station courtesy of Wal-Mart. However, a good neighbor policy isn't much use if nobody knows about it, so perhaps these new outlets can be persuaded to get on your station to let everyone know just how well they are working and playing with their new retail neighbors.

Jackson mayor selectively
excluding the press
Frank Melton, mayor of Jackson MS, has retaliated against a local television station and newspaper by excluding them from a city council meeting in which reporters from other stations and papers were welcomed, according to The Reporters Committee for Freedom of the Press. The station is the local ABC affiliate, WAPT-TV, owned by Hearst-Argyle, and the paper is The Clarion-Ledger, part of the Gannett chain, and the top paper in town, according to BIAfn. Melton claims the newspaper in particular has it in for him, and according to the Clarion-Ledger, he objected specifically to a story about his use of "...police officers for personal security." There were other stories as well in the past that Melton did not like. A journalism professor at the University of Mississippi named Jeanni Atkins said, "The action of selectively barring reporters from a press conference clearly violates the First Amendment." According to RCFP, the managing editor of the newspaper was first barred from the meeting, and went next to the mayor's office. The editor, along with a reporter and camera operator from WAPT were then escorted out the office by a bodyguard.

Ad Business Report TM

Maryland may spend 18 million
promoting highway projects
The Maryland Transportation Authority plans to spend as much as $6 million over the next three years to promote new highway projects including the Intercounty Connector, the expansion of toll lanes in Harford County and other major projects. The state transportation agency has recommended two ad firms in the Baltimore area for the job, but one, GKV Communications, has withdrawn its name for consideration. That leaves Strategix/NobleSteed of Hunt Valley as the AOR for the transportation authority should the Board of Public Works approve the three-year contract, reported the Baltimore Business Journal. The state agency, a division of the Maryland Department of Transportation, plans to hire an advertising firm for the first time as it embarks on an ambitious and controversial $2.4 billion east-west highway that will link areas of Prince George's County and Montgomery County. About two-thirds of the ad budget would be spent on television and radio advertising, according to the request for proposals. The state also would spend money on print, outdoor, public relations and Web design. The ad contract's dollar value is less than some other major state marketing initiatives.

Verizon taps Andrea Fant-Hobbs
as VP of Brand Management
Verizon announced the appointment of Andrea Fant-Hobbs as VP/brand management, reporting to Jerri DeVard, SVP/marketing and brand management. Fant-Hobbs will develop and execute all branding, corporate advertising, media planning and buying, as well as sponsorship activities, designed to build and extend the Verizon brand. Previously, Fant-Hobbs was vice president and account director for Vigilante, where she managed the Manhattan-based advertising agency's largest client, General Motors. She was principal architect of the multi-million- dollar Oprah Winfrey deal for the launch of GM's Pontiac G6 on the top-secret "Wildest Dreams" season premier show special, where each member of the audience of school teachers got a free car. The event won a Cannes Gold Lion award and an Effie.

Media Business Report TM

Do what an iPod can't do
By Jesse Walker
(from March's RBR/TVBR Solutions Magazine)

The next time you're surfing the Web, look for some of those sites where people post what they've loaded onto their iPods. A fellow named Scott Dunlap has a playlist just for when he runs marathons; the tracks range from Metallica to early Michael Jackson. Lee Long's list has room for both Andrew Lloyd Webber's sugary show tunes and the gritty gospel of the Blind Boys of Alabama. One anonymous iPodder has posted a playlist that stretches from Frank Sinatra to Depeche Mode. Some bloggers like to play a game where they generate random playlists from their collections and post them online. One of them discovered the nu metal rockers Limp Biscuit segueing into the late reggae godfather Bob Marley. Another found himself hearing a George Carlin routine followed by a Snoop Dogg rap. That last combination makes a perverse sort of sense: Carlin has the soul of an angry rapper, and I understand that he and Snoop have smoked some of the same illicit herbs. But outside of a freeform community station or a low-watt college outfit, you'd never hear that segue on the air. Not on any of the regular formats, and not on one of those "Jack" stations that pride themselves on allegedly sounding like an iPod shuffle either. It's too individual, too unplanned: It's geared to the eccentric tastes of one particular listener, not to any familiar demographic. You can't replicate that with research, no matter how hard you might try-and given that you'll want to have an audience much larger than one, you probably wouldn't want to do it anyway.
| Read More... |

Media Markets & Money TM

Price revealed in Colorado
Last week's announcement that News-Press & Gazette was getting a pair of Colorado television stations, along with and AM radio and an LMA for an FM station came without a pricetag. The paperwork has hit the FCC database, so now we know - - with a nod to broadcast icon Paul Harvey - - the rest of the story. The deal, which will move KRDO AM-TV Colorado Springs and KJCT-TV Grand Junction over to News-Press from the Hoth family, officially clocks in at 45M. It includes a non-complete, and in Colorado Springs, an LMA for KSKX-FM that dates back to 7/30/92. On paper, the transaction is from licensee Pikes Peak to new licensee Pikes Peak - - but reading further down the respective lines on the application, it goes from Pikes Peak Broadcasting Co. to Pikes Peak Television Inc.

RBR observation: The Hoth family retains KRDO-FM in Colorado Springs. Often, when similarly-call-lettered stations are broken up, the contract stipulates that one or the other party must start the process of finding new calls to operate with. However, in this case, the contract stipulates that the KRDO calls as they apply to each station are part of the intellectual property, transferred to the buyer in the case of the AM and TV, and retained by the seller in the case of the FM.

Metter heads west
As promised, BusinessTalkRadio.net has another station acquisition to announce following its purchase of WBET-AM in Boston. This time, it's going almost clear across the continent to snag an AM in fast-growing Las Vegas. It'll be picking up KNUU-AM from CRC Broadcasting Company. According to brokerage firm Kalil & Co., which handled the deal, the pricetag is 3.9M. The buyer's Michael Metter said, "Las Vegas is an outstanding market and KNUU is a great radio station. We are excited about the incredible growth opportunities that both offer." The station will stay on the same formatic path, which according to BIAfn is News-Talk.

Washington Media Business Report TM

NAB: Hit the brakes on unlicensed devices
National Association of Broadcasters President/CEO David Rehr has asked powerful Senate Commerce Committee Chairman Ted Stevens (R-AK) to slow down as his committee looks to maximize use of the broadcast spectrum by allowing unlicensed devices to go into operation in white spaces in the television spectrum. Two events scheduled to be completed in 2009 combine to make it a preferable date for opening the spectrum over any proposal which would do so sooner, he argued. First, the DTV conversion will be complete then by congressional mandate, providing both certainty as to where all the white spaces really are, since all broadcasters will be on their new digital frequency, and there will be much more white space available, since side-by-side analog/digital operation will be over with and a great deal of spectrum will be returned to the FCC. Second, technical standards are being developed (IEEE 802.22) which will offer a "framework for unlicensed devices operation," and will include interference mitigation technologies. It too is on track for completion in 2009. He asks that the Committee consider "...an approach that involves extensive lab and field testing of candidate devices, so that we might better measure their potential to cause interference and lessen the disruption to television viewers."

NAB Day Time Planner

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

EQUIPMENT Les Kutasi, Sales Manager; Stainless, Booth #C2447, 215-631-1313, [email protected] BROKERS Todd Fowler/David Reeder/Gene Ferry, American Media Services, Bellagio, 843-972-2200, [email protected], [email protected], [email protected] Cliff Gardiner, Clifton Gardiner & Company, 303-758-6900, The Wynn Hotel, [email protected] Andy McClure/Dean LeGras, The Exline Company, The Wynn Hotel, 415-479-3484, [email protected] Frank Boyle, Frank Boyle & Co., LLC, Hilton Grand Vacations Villa, 702/765-8300, [email protected] Gordon Rice, Gordon Rice Associates, 843-884-3590, Treasure Island, [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, The Wynn Hotel, office 607-733-7138, cell 607-738-1219, [email protected] Elliot Evers/Brian Pryor/ Adam Altsuler/Tim Beach Media Venture Partners, LLC, 415-391-4877, [email protected], [email protected] Larry Patrick/Greg Guy, Susan Patrick Patrick Communications, Bellagio, 410-740-0250, [email protected] Glenn Serafin, Serafin Bros., Aladdin Hotel, office 813-885-6060, cell 813-494-6875, [email protected] Larry C. Wood, Wood & Company, Inc., Alexis Park, office 513-528-7373, cell 513-225-5100, [email protected]. LAWYERS Gregg P. Skall Womble Carlyle Sandridge & Rice, PLLC 202-857-4441, Wynn Hotel [email protected] SALES Regional Reps Corp., Broadcast Sales Representatives, Stuart J. Sharpe, 216.535.3975, [email protected], Gail F. Lawing, 404.504.7030 [email protected],

Transactions

350K KSML-FM Huntington TX from Verna A. Phillips to KASA Family LP (Stephen W. Yates, Karla Yates, Anny Yates). Cash. Duopoly with KSML-AM Diboll TX, KRBA-AM/KYBI-FM Lufkin TX. [File date 3/28/06.]

N/A WGJK-AM Rome GA from Triple J's Broadcasting LLC (Greg Kamishlian) to Woman's World Broadcasting Inc. (Suzanne B. Stone). Debt assumption. Superduopoly with WTSH-FM and pending acquisition of WZOT-AM Rockmart GA and husband Paul C. Stone's WRGA-AM/WQTU-FM Rome GA licensed to McDougal Broadcasting Corp. McDougal is also running th Rockmart stations in an LMA. [File date 3/27/06.]

Stock Talk

Gold, oil up; stocks down
It wasn't the fault of broadcasters, but everybody pays at the pump - - and with the price of a barrel of crude topping 70 bucks, a lot of stocks ended up taking their lumps. Gold prices also were peaking, adding fuel to the slide. However, most broadcast losses were modest, and a few - - led by Fisher - - managed to poke their heads above the black-ink line.

Radio Stocks

**Here's how stocks fared on Monday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		33.08	+0.08	Hearst-Argyle	HTV		23.21	-0.13
Beasley	BBGI		9.98	-0.65	Journal Comm.	JRN		11.79	-0.04
CBS CI. B	CBS		24.71	-0.14	Lincoln Natl.	LNC		55.14	-1.16
CBS CI. A	CBSa		24.76	-0.12	Radio One, Cl. A	ROIA		7.85	unch
Citadel	CDL		10.66	-0.10	Radio One, Cl. D	ROIAK		7.87	+0.05
Clear Channel	CCU		28.72	-0.18	Regent	RGCI		4.72	+0.09
Cox Radio	CXR		13.40	unch	Saga Commun.	SGA		9.05	unch
Cumulus	CMLS		11.06	-0.20	Salem Comm.	SALM		14.61	-0.06
Disney	DIS		27.65	-0.23	Sirius Sat. Radio	SIRI		5.12	-0.20
Emmis	EMMS		15.00	+0.02	Spanish Bcg.	SBSA		5.12	+0.03
Entercom	ETM		27.67	-0.16	Univision	UVN		34.69	-0.16
Entravision	EVC		8.50	+0.01	Westwood One	WON		10.24	-0.16
Fisher	FSCI		42.42	+0.33	XM Sat. Radio	XMSR		22.83	-0.48
Gaylord	GET		43.34	-0.57	-	-	-	-	-

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 HD radio. I look at it as a free license to broadcast another channel of content and generate additional revenues. I don't think it revolutionizes radio nor is it an alternative to satellite. It really is a moot point because it won't matter when the auto manufacturers are installing computer receivers in their vehicles and the public can have their choice of thousands if not millions of content channels. Ironic that it will be the auto manufacturers that control the distribution method, which brings up an interesting question regarding the role of the FCC in regulating the Internet.

Doug Burkizer
KFYI/KGME
Clear Channel Radio
Phoenix, AZ

Below the Fold

Ad Business Report
Maryland getting ready
To spend 18 million...

Media Business Report
Do what an iPod can't do
Next time you're surfing the Web, look for...

Media Markets & Money
Price revealed in Colorado
News-Press & Gazette getting a pair of Colorado TV's and radio...

Metter heads west
BusinessTalkRadio.net has
another station acquisition...

Washington Media Business Report
NAB: Hit the brakes
On unlicensed devices...

More News Headlines

Art Bell re-marries
Coast to Coast AM weekend host Art Bell has remarried after the death of his former wife Ramona Bell in January from an asthma attack. During the first hour of his show last weekend, Art shared the story of how he met, fell in love with, and married a Filipino woman, Airyn Ruiz. Art also announced that he will be moving to the Philippines on 4/29 to be with Airyn, but will continue doing weekend Coast to Coast AM programs from that location.

RBR Radar 2006

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

Finally! An Ad guy saying it
HD Radio isn't ready for prime time. Rich Russo's comments are right on the mark. Even if we ignore the technical issues, there need to be receivers of the type people actually use (battery operated) and programming that's taken as seriously as the main/analog channels. We need showbiz on HD2. Otherwise, the one chance we'll have to sell a receiver will be lost to dull programming. Bounce Back
04/17/06 RBR #75

Fighting back on indecency
The FCC is finally going to have to defend its indecency standard in court. ABC, CBS, Fox, NBC, Hearst-Argyle and the various network affiliate associations filed a slew of appeals in federal courts all over the country challenging several of the indecency rulings the FCC issued last month.

RBR observation: It has been nearly three decades since the US federal courts have ruled in a broadcast indecency case and there can be no doubt that the FCC's standards for what is or is not indecent has been all over the road during that time. In recent years, the trend has been toward an ever more schoolmarms approach - We see two possible outcomes: review them in
04/17/06 RBR #75

Top Ad Agency Execs Unimpressed
by HD/HD-2 Radio rollout
Jon Mandel, Chairman/MediaCom US and Chief Global Buying Officer MediaCom Worldwide, the topic drifted to HD Radio. He's not so sure the latest campaign is going to drive people to the stores: "I think the HD and HD-2 thing is too little, too late. I was in LA earlier this week and heard ads from Tweeter. But other than that, I have never heard anything promoting it; it doesn't really explain what the hell it is, other than no static and no monthly fees. Big $%&@ing deal. Nobody is talking in detail about how I can get all these other formats. What are they, what station is offering what? They're screwing it up." Rich Russo, JL Media's SVP/Director of Broadcast Services tells us HD-2 could have been rolled out a bit better: "HD equals Huge Debacle or Highly Debatable and here's why: It is not ready, so why launch it? The unit is beyond inadequate to say the least and there are numerous flaws with the HD alliance itself.

RBR observation: As we said on 3/23/06, HD-2 formats need to compete with the format variety of satellite. They should be perceived and promoted as the free, viable alternative to satellite in each market, even if some formats don't "test" well yet. Each market's HD-2 channels need to be absolutely refreshing and unique to get (especially) the younger listeners' attention - More details and suggestions see Ad Biz
04/14/06 RBR #74

Entercom fires back at Spitzer
has gone on the offensive against the "corporate payola" lawsuit filed by New York Attorney General Eliot Spitzer. The radio company has filed a motion to have the whole case thrown out of court, arguing that Spitzer hasn't alleged anything that's actually illegal.

RBR observation: Bravo! Someone is finally fighting back at this self-styled national cop who's making the rules up as he goes. As we've demonstrated previously, Spitzer's interpretations of the federal payola law and the FCC's sponsorship identification rule are just plain wrong - - not to mention that he has no authority to enforce them in the first place.
04/14/06 RBR #74

Group offers 1.10
per share for Interep
Interep's long languishing stock price stock shot up to 88 cents at one point after Oaktree Capital Management went public with an offer to buy the company for 1.10 per share, a 439% premium to Tuesday's closing price of 20 cents. But saying it is frustrated by months of negotiations, Oaktree has given Interep's board of directors a deadline of April 21st to act on the 14.3 million bucks offer. Oaktree is Interep's largest bondholder.

RBR observation: Things have been improving (other than its stock price) for Interep since Oaktree first went public with its call for Guild's ouster and a restructuring. Business has improved in the radio rep business and Interep has made its first foray into TV representation with Azteca America Spot Television Sales. But balance sheet issues remain. Interep sold its IPO at 12 bucks a share in December 1999 and the stock traded for a while above 13, but it long ago dropped into penny stock territory. With a stock that's been trading for two bits or less on the pink sheets, Interep's directors are going to be under pressure from shareholders, many of whom are Interep employees, to take the cash.
04/13/06 RBR #73

Interep says no to buyout bid
"We're willing to talk to anybody," says Interep CEO Ralph Guild, but he and the company's board of directors are not accepting the 1.10 per share buyout bid by Oaktree Capital. Guild notes that Interep's 100 million in bonds have been out for more than seven years and the company has never missed a payment - - and that Interep will have no problem making the twice annual payments of five million bucks to Oaktree and other bondholders.
04/13/06 RBR #73

More softness seen in radio
As radio groups prepare to report Q1 results, Goldman Sachs sees no improvement in a soft ad market. He's expecting most groups to hit their Q1 targets, but guide downward for Q2. Rather than improving, analyst Mark Wienkes says it appears that pacings are down in the mid single digits for Q2.

Publisher observation: Ok folks line up and get ready for the real results of 'Less is More' or Follow the Leader to victory or agony of defeat. This could even turn out to be a new TV series for one of the new networks. No more excuses as nothing will fall short of honesty. Maybe between now and the start of the 2nd half of this year someone is going to awake up and start paying attention to the needs of the local market. You ask? What Games? Just remember the entire BS over the last year.
04/12/06 RBR #72

Legal eagles hold forth:
Prohibited product advertising
Questions frequently arise regarding the legality of advertising certain "red flag" products. The products that might be placed in the "red flag" category include alcohol, tobacco, casino gaming and weight-loss plans. This you should print out
04/12/06 RBR #72

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