Volume 21, Issue 79, Jim Carnegie, Editor & Publisher
Thursday Morning April 22nd, 2004

Radio News ®

Indecency worries hit the newsroom
With the FCC's Bono decision expanding the threat of indecency fines, a session on avoiding indecency was a late add to the schedule of the [email protected] convention. News directors are worried that their newscasts could be hit with fines - - and for good reason. RBR observation: Rod Fritz WRKO-AM Boston News Director said it best - "The FCC is now saying that with inadvertent comments, you can be held liable for that," and strongly suggested that Rush Limbaugh may have to stop referring to "John F-ing Kerry" because of the Commission's ruling that Bono's fleeting use of the f-word as an adjective. One more time from RBR - It's open season on broadcasters. The FCC has thrown away the rule book and is firing wildly. As erratic and unpredictable as the FCC's indecency enforcement was before, it's just gotten much worse. | Full Story Click Here |

Recovery in full bloom, says Goldman Sachs
Analysts at Goldman Sachs have been taking to media companies, and based on these discussions have declared March 2004 as the official beginning of a serious recovery in the radio industry that is carrying forward into second quarter. Mid-single digit revenue gains in Q2 are starting to look like the low end of the spectrum, with high-single digits becoming a realistic goal for many. The company sees potential in radio stocks, spreading forward into 2005. Goldman Sachs calls the sector attractive, and gives an outperform rating to Clear Channel, Viacom B, Citadel and Westwood One.

Air America settles - ready to grow again
After a court date earlier this week, Air America and Multicultural Broadcasting/Arthur Liu worked out a negotiated settlement to leave its programming on WNTD-AM Chicago until April 30. KBLA-AM in LA will not be carrying the net. Air America is now actively looking for affiliate replacements in those markets. RBR observation: A source at Air America tells RBR, "In some senses, this is not a fatal thing, it's just a pain in the ass.." We say to Air America as we have said it to all in the radio business that content is king with presentation the queen and with those two elements you get consumers in this case affiliates. | Full Story Click Here |

ABC looking at tough times
Analysts at CIBC World Markets say that the shakeup at ABC Television Network may be a welcome development for investors. However, a disappointing ratings season, which is tracking toward a 9% shortfall in viewership guarantees, has the potential to cost the company over $130M ini make-goods. Otherwise, they say, parent Disney is in the midst of a period of general improvement. Nonetheless, the problems at the network are putting a projected break-even target of FY 2005 in jeopardy. CIBC notes the hitless nature of ABC's current schedule. nevertheless, CIBC wrote, "...we don't believe ABC management had the wrong programming strategy..." Maybe it isn't the wrong strategy, but if that's the case it obviously needs some more time in the oven.

Hicks getting out of Clear Channel?
A British publication, MediaWeek UK, is saying that US money man Tom Hicks is getting ready to retire next year, and that before he does so he'll likely spin off his $1.5B stake in US media giant Clear Channel Communications. The sale is not expected to have any affect on the balance of power in the media businesses in which the company operates. It's primary business, of course, is radio, augmented by a presence in television, outdoor and talent and venue management. The stake, which amounts to 6% of the company's total value, is expected to attract mutual funds, insurance companies and other institutional investors, and is not seen as a likely target for other media companies.

Looking ahead at Belo
Belo Corp.'s television division is expecting mid- to high-single digit growth for Q2 2004, based on current pacings. About $4M-$5M of that is expected to come from the hot political category. Other gains for the year are expected to come out of a "new product" initiative, which was implemented in two markets last year (Phoenix and San Antonio). The products are locally-produced and oriented programs, three of which were kicked off with almost instant profitability, combining low production costs with an instant surge in air inventory. Belo intends to launch similar ventures in other markets. | Full Story Click Here |

From the NAB...

2004 NAB Crystal Radio Awards presented
The NAB has named 10 winners of the NAB Crystal Radio Award competition. Established in 1987, the NAB Crystal Radio Award recognizes radio stations' efforts to improve the quality of life in their surrounding communities. Selected from a pool of 40 finalists, the following 10 stations were given the award: KDFC San Francisco, CA, KFOG San Francisco, CA, KFOR Lincoln, NE, KSTP-FM Minneapolis, MN, KSTZ Des Moines, IA, KTCZ Minneapolis, MN, WDEL Wilmington, DE, WDRV Chicago, IL, WLUP Chicago, IL, WSYR Syracuse, NY. Photo: Back Row: KTCZ, Dan Seeman, Vice President of Marketing/Operations; WDEL, Pete Booker, President/General Manager; WDRV, Jerry Schnacke, Vice President/General Manager; KFOR, Rolland Johnson, Chairman/CEO, Three Eagles Communications.Front Row: KFOG, David Kennedy, President - Susquehanna Radio; KDFC, Bill Lueth, Operations Manager; WLUP, Cris Ohr, Vice President/General Manager; WSYR, Jim Lerch, Program Director; KSTP-FM, Leighton Peck, Program Director. Not pictured: KSTZ.

Upbeat convention wraps up today
The upbeat buzz at NAB2004 in Las Vegas has been borne out by the attendance tally. 'This year we had a great bounceback," said NAB President Eddie Fritts, reporting that 97,544 had attended the convention. That's up from 88,000 last year, though still below the peak years when attendance topped 100,000. This year's convention concludes today. | Full Story Click Here |

Quello still much loved by broadcasters
This week's NAB convention may have set a record for the most birthday celebrations for a single individual. We were aware of three 90th birthday salutes to former FCC Commissioner Jim Quello, with hundreds of broadcasters offering congratulations to the long-serving public servant, who was a broadcaster himself before his 23 and a half years on the FCC. Quello's birthday was celebrated at events by the Michigan Broadcasters Association, the Broadcasters' Foundation and attorney Erwin Krasnow.

Conference Calls

Sirius reports strong Q1; subscriber base up 35%
Sirius CEO Joe Clayton continues to turn Sirius Satellite Radio around, improving revenues by 88% over last quarter and upping the subscriber base by 35%. At the close of Q1, Sirius had 351,663 subscribers-a net subscriber addition of 90,602 during the quarter, a 138% increase over the net subscriber additions. Sirius continued to score gains in the retail aftermarket channel, fueled by strong post-holiday activations, increased product availability, and increased awareness. During the quarter, the company added more than 65,500 subscribers from the retail channel, 154% more than were activated in Q1 '03. Wal-Mart has now been added to the list as well. Sirius added over 24K subscribers through its automotive, boating and trucking relationships. Recently, exclusive automotive partner DaimlerChrysler announced an extensive factory install program for beginning with 11 2005 vehicle lines. | Full Story Click Here |

Things looking up at Belo
Yet another media company beat expectations in G1 2004 - - Belo Corp., which makes most of its money in television and newspapers, registered gains of five cents a share, amounting to a 36% surge into black ink territory. As has been the case for many, a presence in the political battleground states provided a shot in the arm.
| Full Story Click Here

Adbiz ©

More on AHAA study on marketing to Hispanics
From the AHAA conference in Miami: Growth in Hispanic advertising has outpaced that of the general market by four times since 2000, according to a new study released today by the Association of Hispanic Advertising Agencies (AHAA). Hispanic print and television media combined now garner more than 5% of national corporate ad budgets. | Full Story Click Here |

AHAA issues more side-by-side
Hispanic marketing comps

More from the AHAA conference in Miami: The first-ever side-by-side comparison of actual measured media expenditures for America's top 250 corporate advertisers was released by the Association of Hispanic Advertising Agencies. The list provides comparisons among the top 250 advertisers, ranked by combined spending in general market and Hispanic market television and print media, to reveal the percentage of overall spending invested in these segments of Hispanic media. Of the 250 companies on the list, 61 companies are spending nothing in Hispanic print and TV while 49 are spending less than 1% in these outlets. | Full Story Click Here |

Campaign ads tested with brain sensors
The NY Times reports political consultants are testing subjects' blood flow to their brains in an effort to measure campaign ad effectiveness. The subjects lay inside an M.R.I. machine, watching commercials playing on the inside of his goggles as neuroscientists from UCLA, measured the blood flow in his brain. Excerpts from the story: | Full Story Click Here |

Media, Markets & Money tm

Simmons settles into St. Louis
Salt Lake City-based Simmons Media Group has been undertaking a quiet expansion of late,, and its latest move has taken it out of its traditional Rocky Mountain haunts all the way down to the Mississippi River, where it's getting a standalone AM for just over $2M. The station is KSLG-AM, a ratings-challenged station perched at 1380 kHz. It is coming from New Horizon 7th-Day Christian Church Inc. for $2.05M cash. An LMA is scheduled to kick off 5/1/04 with a $4K monthly rental fee until the deal closes. In addition to the KSLG acquisition, Simmons has deals in the fire in Utah, Wyoming and Texas.

How will Crawford spice is Birmingham soup?
When WQOP-FM finally winds up in the Donald Crawford/Kimtron portfolio, what exactly is Mr. Crawford going to do with it? Broker John Pierce, who handled the deal, offered RBR some color on this matter. Speculation is that it'll go to the Religious WDJC side of the Crawford cluster (WYDE AM & FM are in the News-Talk business). WDJC-FM will hold the fort with its highly successful Contemporary Christian format. The new FM may well be used to extend the range of the more standard Religious fare of WDJC-AM, which has 50 kW during the day but only one at night. Since the WQOP calls stay with seller Christopher Williams, Crawford will more than likely make WQOP-FM a like-named station with the AM, with the Contemporary Christian station going it alone. Pierce said he will not be surprised to see the Williams use the proceeds of the sale to find a new home in Birmingham for WQOP-FM's current Catholic format.

Washington Beat

A taxing situation for Clear Channel
Clear Channel (CCU) has a bill from the IRS to the tune of $25.1M for transactions which ocurred way back in 1999, according to the San Antonio Business Journal (SABJ). Stations in Tampa and Cleveland are involved. CCU structured the deals as tax-free exchanges with buyers CBS Radio/Infinity and Cox Radio. The IRS is saying that calling them such was incorrect, saying that the deals resulted in a $121.8M taxable gain. Clear Channel is challenging the new assessment. Both sides in the dispute told SABJ that they were unable to discuss any details. The spin-offs came about as a result of Clear Channel's 1998 acquisition of Jacor.

Ratings & Research

Scarborough announces new
Radio Advisory Council members

Scarborough Research announced the election of several new members to its Radio Advisory Council. The council brings together research, sales and marketing execs from radio stations and networks with senior leadership from Scarborough and its partner company, Arbitron. The Council is a forum for: addressing issues affecting the radio business; advising Scarborough on how its product can be enhanced to meet the evolving needs of the radio consumer marketplace; and fostering relationships within the radio industry. The 2004 members: | Click Here For List |


$3,000,000 KOTB-FM Salt Lake City (Evanston WY). 100% of Rocky Mountain Radio Network Inc. from Millcreek Broadcasting LLC to Bustos Media Holdings of Utah.

$150,000 WSRA-AM Albany GA from Lifeline Radio Corp. to Agape Life Ministries Inc.

$50,000 KJMP-AM CP Fort Collins-Greeley CO (Pierce CO) from Jo-Mor Communications Inc. to Radio Frontier Broadcasting LLC.

| Full Details Click Here

Stock Talk

Media companies flatten out
After yesterday's all out plunge, owners of broadcasting stocks were no doubt happy with today's results, particularly if they have diversified broadcast holdings. That's because most stocks stayed within a dime or two of where they started the day, and mostly went up. And the bigger shifts were almost all upward. Gaylordand the Washington picked up almost two bucks.

Radio Stocks

Here's how stocks fared on Wednesday

Company Symbol Close Change Company Symbol Close Change













Journal Comm.




Citadel CDL $18.59 +$0.01

Radio One, Cl. A




Clear Channel




Radio One, Cl. D




Cox Radio












Saga Commun.








Salem Comm.








Sirius Sat. Radio








Spanish Bcg.
















Viacom, Cl. A








Viacom, Cl. B








Westwood One








XM Sat. Radio




International Bcg.








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Upped & Tapped

ABCRN names Ron Rivlin, Eric Stanger Directors/Affiliate Relations
ABC Radio Networks announced the appointment of Ron Rivlin and Eric Stanger to the positions of Director, Affiliate Relations. Both will be based in New York and report to Dave Kaufman, VP/Affiliate Relations for the radio network.

Tom McGurn named GSM at B96
Tom McGurn has been named GSM of Infinity's B96 (WBBM-FM) Chicago. He's currently LSM of Infinity's WBBM-AM in Chicago. Prior to WBBM-AM, he was Sales Manager of the Chicago Bears Radio Network.

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NAB President Eddie Fritts staying; Trouble brewing on NAB board
NAB board that apparently led to such rumors are heating up and could lead to a bitter re-election battle for Joint Board Chairman Phil Lombardo at the June board meeting. Lombardo told RBR that he is not seeking Fritts' ouster. "I'm negotiating his contract renewal." Radio board member Bill Stakelin, who years ago held the same post inside NAB, was blunt, "There is a lot of concern that his (Lombardo) Neanderthal ways are hurting the association. RBR observation: Contract negotiating is appropriate but Neanderthal ways? 04/21/04 RBR #78

"60 Minutes" gets FCC indecency complaint from familiar face
Attorney John Thompson, whose complaints about Howard Stern helped garner Clear Channel's ($495K) and Infinity Broadcasting's recent fines, has faxed a complaint to the FCC over last weekend's 60 Minutes airing, where singer Mary J. Blige uttered an utterly indecent "sh*t." RBR observation: OK, here's the test-will the FCC actually start treating TV with the same malice as radio, or give another get out of jail free card as with Bono? We have a complaint coming from the same person over a similar event-that aired twice! 04/21/04 RBR #78

ANA publishes study on
client-agency relations
Released a benchmark study on client-agency relations.. The survey of more than 100 major advertisers revealed that: * Advertisers want agencies that are responsive (95%) and provide outstanding service (95%). This is consistent regardless of type of industry or size of company. In short it is called accountability and the real McCoy. RBR observation: In short it is called accountability and the real McCoy. For complete details and knowledge take a click. 04/21/04 RBR #78

Lawmakers take tough line on smut
Members of Congress hung tough on increasing indecency fines and is clearly a hot button with lawmakers, with no one questioning the FCC's crackdown or the current legislative effort to dramatically increase fines. RBR observation: Realize that the majority of legislators on Capitol Hill - - all of the reps and about a 1/3 of all senators - - are resubmitting resumes to their constituents to be rehired for another two or six years. The only people who take the trouble to say anything are those who Hate the likes of the Stern's. Congress look at the ratings and see in them a large segment of the population their constituents that actually like the Sterns, and while doing so, try to work in some consideration of the constitutional implications of this issue. Defending anything considered indecent and ugly, unrewarding, and close to Election Day has caused the vast majority of both parties to take the path of least resistance. 04/20/04 RBR #77

Fight or flight?
Two groups, two reactions
Animal behaviorists define two basic reactions to danger: fight or flight. While there virtually unlimited possible reactions to a given threat, most of these reactions can be easily placed in one category of the other. In the current indecency flap, Clear Channel has quite obviously chosen to flee. Viacom, on the other hand, looks like its ready to stand and fight. RBR Observation: Would Randy Michaels have been capable of replicating Hogan's performance? We think not. 04/20/04 RBR #77

General Manager
Needed at the NEW WINX/Shore Country 94.3, Easton, on Maryland's Eastern Shore, just minutes from Annapolis. WINX needs a special creative radio mind from a real radio General Manager. If you can:

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