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Volume 23, Issue 8, Jim Carnegie, Editor & Publisher

Thursday Morning January 12th, 2006

Radio News ®

Dan Snyder shows his stripes
The target - - radio, television and the Internet. The company - - Red Zebra Broadcasting. The CEO - - Bennett Zier (pictured). NFL Washington Redskins owner Dan Snyder is ready to start his own group, which he intends to make a cornerstone of the team's broadcast empire. The group's initial acquisitions are expected to be announced shortly. There have already been rumors in the market that the first buy will be Mega's trio of radio stations. Veteran broadcast exec Zier said, "This is a tremendous opportunity for me to run my own business as CEO and enjoy the support of the great entrepreneurial spirit and success of Dan Snyder. I look forward to building a dynamic company with great people and a unique esprit de corps." Red Zone LLC will be the Snyder company under which Red Zebra operates. It recently became majority stockholder of the Six Flags theme park company.

RBR observation: Since NFL TV rights are pretty much tied up at the network level, the obvious first area of concern for Red Zebra will be radio. It will find slim pickings in the Washington market, unless it is able to talk a major operator out of a viable stick. However, there may be ample opportunity to build a fairly extensive network of radio stations in the surrounding region, particularly in Virginia, where Red Zone is incorporated. As for other expansion plans, will Red Zebra try to tie in somehow with other Six Flag locations? It will be interesting to see what tack this fledgling outfit chooses.

Stern and Buchwald are sitting pretty
He may have escaped scrutiny by the FCC, but Howard Stern now has to deal with the SEC. We're betting he doesn't mind. Sirius Satellite Radio has delivered the 34 million plus shares it owed Stern and his long-time agent, Don Buchwald, because Sirius exceeded subscriber targets for 2005 after signing Stern (1/6/06 RBR #4). The shares have now been registered with the SEC so that Stern and Buchwald may, if they wish, sell all or part of them. Because of the filing, we know the exact split of the booty. One Twelve Inc., owned by Stern, got 31,125,000 shares, worth 204.5 million bucks at Monday's closing price. Chipombe LLC, owned by Buchwald, got 3,125,000 shares, worth just over 20 million.

RBR observation: An article in yesterday's Wall Street Journal suggested that Stern's 500 million paycheck over five years (and it's now up to 610 million, we would note) may add to the trend to inflate CEO pay. We question that thinking. It's not unusual for top entertainment talent to be paid more than their corporate bosses. Stern was paid more than Mel Karmazin at Infinity/CBS/Viacom and again now that they're reunited at Sirius. Oprah Winfrey makes more than Roger King at KingWorld. In fact, it's quite common for a market-leading morning DJ or an established local TV news anchor to be paid more than the station GM. Those things have nothing to do with how a board of directors should compensate their company's CEO.

Matt Mills retires
Greater Media announced that Matt Mills is retiring as VP/GM of its Boston cluster. He'll stay on until a successor is named, then serve as an advisor to CEO peter Smyth during the transition. His official retirement date is April 14th. "It has been a great honor and pleasure to work with someone of Matt's caliber. He is the ultimate professional and I am sad to see him leave, but happy for him and his family. Most people can only dream of the success Matt has achieved in his career," said Smyth. Mills began his radio career in 1968 as a salesperson for WEEZ Chester, PA. He worked his way up through various markets to eventually head Clear Channel's Boston operation, then moved to Greater Media in 2001. Last note, Mills NAB board seat which he represents District: (1) New England will have to be given up and the NAB Radio board will have to find a replacement.

Delay threatens to sue ad-running broadcasters
KHOU-TV Houston, the Belo-owned CBS affiliate nearby the congressional district of Tom Delay (R-TX) is reporting that the embattled former majority leader is threatening to sue any station that runs an ad for which a pair of public interest groups are seeking airtime. Campaign for America's Future and Public Campaign Action Fund are the groups, and they're taking their campaigns to the districts of Delay and Bob Ney (R-OH), using broadcast television and cable in Delay's and radio/billboard in the more rural area represented by Ney. The Delay ads detail his relationship with lobbyist Jack Abramoff. According to KHOU, Delay is calling the ads "false and defamatory" and is threatening any station that runs them with a lawsuit. KHOU said in its newscast that it was reviewing the ad and had not yet decided if it would run it or not.

RBR observation: It would seem Delay would have a tough time. The ad in question sources all of its claims, mostly to the Associated Press. He's a public figure involved in a very public issue. It's not like CAF and PCAF are putting interviews with judges on the air. Attacking the medium upon which the message runs rather than answering CAF/PCAF would seem to be a misplaced tactic in any case.

Moonves closes cable sports buy
Once split from the cable-dominated part of Viacom, the new CBS Corporation didn't waste any time closing its 325 million acquisition of College Sports Television Networks (CSTV) that was announced in November (11/4/05 RBR #217). CBS paid 25 million in cash and shareholders of the former CSTV Networks Inc., including Founder and CEO Brian Bedol, who's staying on to run the unit for CBS, are in line to receive 300 million worth of CBS Class B stock on February 1st, with the exact number of shares to be determined under a formula based on trading for a period preceding closing. Based on the current price, that looks to be around 11.3 million shares. CBS CEO Les Moonves has said he doesn't plan to have CBS compete in cable in Viacom's strongest areas - - children's programming and music channels - - but that CSTV is a good fit with CBS Sports and the CBS SportsLine web operation.

RBR observation: CBS Radio has some Sports/Talk O&Os, but no 24/7 national service to compete with Disney/ABC's ESPN Radio. With CBS increasing its in-house availability of sports content - - and Les Moonves and Brian Bedol aren't stopping with just what CSTV has now - - we wonder whether Joel Hollander and Peter Kosann might be looking at how CBS Radio and Westwood might be able to compete with ESPN Radio.

RBR Condolences
Late last night RBR was informed by Gordon Hastings, Pres. Of the Broadcasters’ Foundation of a dear friend passing - Lucille Luongo, she was a young 58 years old who had been ill with cancer since last September. Ms. Luongo was a past national president of the American Women in Radio and Television, a former Sr. Vice-President of Corporate Communications for Katz Media Corporation, and a decade long director of the Broadcasters’ Foundation. Lucille was an excellent broadcaster, friend and we shall miss her. The family requests that in lieu of flowers those wishing to do so may make memorial gifts to the Broadcasters’ Foundation Endowment Fund, 7 Lincoln Avenue, Greenwich, Connecticut.

Ad Business Report TM

IPG signs for PPM
The Interpublic Group (IPG), which represents more than 30% of all of radio's national spot dollars, has committed to using the ratings provided by the PPM to plan and buy radio once Arbitron deploys its electronic measurement service. However, this does not commit Arbitron to a specific timetable for PPM deployment. Arbitron still has not yet made a decision regarding when and for which markets it will deploy the PPM system to measure local market radio audiences, but it has been testing in Houston and Philadelphia; it is currently deployed in Montreal. The agreement covers the US-based radio planning and buying of IPG companies including: Campbell-Ewald; Campbell Mithun; Carmichael Lynch; Dailey & Associates; Deutsch; Foote Cone & Belding; Gotham Inc; Hill, Holliday, Connors Cosmopolus; Howard Merrell & Associates; ID Media; Initiative; Jay Advertising; The Martin Agency; Mullen; Siboney; Tierney Communications and Universal McCann.

Jean Pool, EVP/Director of North American Operations,
Universal McCann, Chairman of Media Policy at the AAAAs,
tells us this is "Wonderful. It's simply better research. And God only knows we are so far behind Europe and much of the rest of the world in the research product that we value our inventory on." Pool tells us she was involved in the due diligence behind the decision, working with Universal McCann SVP, Director of Media Knowledge Susan Nathan on it. She adds, "By getting out there early with this and getting the publicity, we're trying to encourage Nielsen to carry through with that [PPM] relationship and get involved. Because that kind of funding will just help it to move more quickly."

Irene Katsnelson, Universal McCann VP,
Director of National Broadcast,
tells RBR/TVBR she's looking forward to utilizing the improvement for her clients: "Anything that will give more accurate information is exciting, because what radio has been using before is pretty archaic. Any technology that takes radio to the next level is welcome and good news." IPG clients include Safeway, MasterCard, CVS, American Airlines, Sony, UPS, Dunkin' Donuts, NASCAR, Alltel, Home Depot, AOL and Arby's.

RBR observation: This is a great vote of confidence from IPG. When more agencies make similar proclamations of intent-to-use, the case should become easier to make with broadcasters - - and Nielsen. Bottom line - - agencies want reliable data to make their clients the most ROI. PPM may not be proven as perfect yet, but it's much, much more accurate than diaries.

AFA targeting "Daniel" advertisers
Advertisers for NBC's controversial "The Book of Daniel" have been targeted by conservative activist org American Family Association (AFA), which condemned it as anti-Christian. The show itself ran only about 24 national spots during the two-hour back-to-back episodes that composed the premiere of "The Book of Daniel" from 9 to 11 p.m. last Friday. NBC reportedly offered lower prices for the spots, as well. This, in addition to general complaints to the media from the AFA about the contents of the program. The complaints led 5 of NBC's 232 affiliates to pre-empt the series. In the series, which will still return on Friday in its 10 p.m. slot and run through 2/3, Aidan Quinn portrays Daniel Webster, an Episcopal priest who lives in suburban NYC with his dysfunctional family, which includes a daughter who sells pot, a gay son and another son who is a teen Romeo. To compensate for the lack of demand from advertisers last Friday, NBC ran some 38 tune-in spots to promote its other primetime shows and the Olympics. AFA has circulated the following e-flyer for folks to complain to the show's advertisers.
| See it here |

Media Markets & Money TM

Lots of TV stations for sale
There's been a lot of excitement in radio over the 1.2 billion sale of Susquehanna Radio to Cumulus Media Partners and the ongoing process of Disney (maybe) selling ABC Radio. It's been a rash of major station inventory after a long period of drought. But there's also quite a bit of inventory available in television. RBR/TVBR sources confirm that NBC Universal is shopping four of its smaller market O&O stations - - not so much for the 600 million or so that they're expected to bring, but so that NBC can look to buy and build NBC/Telemundo duopolies in growth markets with large Hispanic populations. Birmingham, AL, Columbus, OH, Providence, RI and Raleigh, NC don't fit that profile, so NBC is looking for buyers. UBS is said to be handling the sell-off. Add those to the 19 stations already being publicly shopped by Emmis, Raycom and Nexstar and you have 23 stations known to be up for sale. Here's the NBC shopping list:

Market rank Market Calls Channel 2004 billings

29 Raleigh, NC

WNCN

17

32.6M

32

Columbus, OH

WCMH

4

52.0M

40

Birmingham, AL

WVTM

13

23.7M

51

Providence, RI

WJAR

10

39.2M

Source: BIAfn Media Access Pro

Washington Media Business Report TM

Watchdog on telco cable entry
The Center for Digital Democracy is saying that any new regulatory regime that allows telephone companies into the cable business and does not include local franchising will ultimately damage the consumer. CDD's Jeff Chester argues that the companies are motivated by profit, and the provision of consumer-oriented and public-interest offerings now enforced by local authorities will quickly go by the wayside. "From connections that promote education and public safety to the funds and infrastructure that help provide for public access community programming, agreements made between local officials and cable companies are the last vestige of what is supposed to be a bedrock FCC policy - - localism," wrote Chester. "Without such a policy, phone and cable companies will be unaccountable to the communities they are supposed to serve, essentially holding them hostage to ever-increasing prices and ever-diminishing public interest obligations." He is calling for Commissioners Michael Copps and Jonathan Adelstein to put up a fight, and for concerned citizens to contact the FCC and make their opinion known.

Traffic

What's new for 2006? Part III
As many GMs and traffic managers will be looking to update their traffic and billing systems this year, RBR/TVBR asked a few current (and new) vendors to detail their latest and upcoming offerings. As well, what sets their systems apart from the rest. Continued from yesterday.
| Read More... |

Ratings & Research

Univision Online to deliver behavioral targeting
Revenue Science, a behavioral targeting provider, has been selected by Univision Online, the interactive division of Univision Communications, to help the company deliver more relevant advertising through behavioral targeting. This agreement marks the first time Revenue Science's technology and services have been deployed for a Spanish-language website. "Throughout 2005, Univision.com had more advertisers than any other Spanish-language Web site and we are always looking for new ways to help these advertisers reach their target audiences," said Javier Saralegui, president of Univision Online. "Revenue Science's industry-leading behavioral targeting technology and service will bring major benefits to our advertisers, by expanding the amount of valuable inventory available and enabling the precision delivery of campaigns to a variety of large, high-quality consumer audiences." "Working with Revenue Science will enable our advertisers to deliver their campaigns directly to high-value audiences such as Automotive, Personal Finance, and Wireless, no matter what page of our site they are on," said Tom Arrix, SVP of Sales at Univision.com.

Transactions

300K KDLS-AM Des Moines IA (Perry IA) from Perry Broadcasting Co. (Chester P. Coleman) to Coon Valley Communications Inc. (Patrick J. Delaney). 25K escrow, balance in cash at closing. Seller retains KDLS-FM. LMA 1/1/06. [File date 12/14/05.]

250K WHGT-AM Hagerstown MD-Chambersburg-Waynesboro PA (Chambersburg PA) from M. Belmont VerStandig Inc. (John D. VerStandig) to Emmanuel Baptist Temple (Trenton Rowles, Larry Bird, Larry Aikens, Robert Mullinax). Charitable donation. LMA until closing. [File date 12/15/05.]

Stock Talk

Radio Index back below 2006 starting point
Concerns about weak pacings against easy comps are continuing to take their toll on radio stocks. Most were down yesterday, even as the Dow Industrials advanced 32 points, or 0.3% to 11,043 on comments by a Fed official that inflations is "quite moderate."

The Radio Index fell 0.848, or 0.5%, to 180.891. Emmis - - which began this week's slide with its disappointing guidance on Monday - - finally got a break. It was up 1.1%. The day's biggest loser was Salem, down 2.8%.

Radio Stocks

**Here's how stocks fared on Wednesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		39.25	-0.40	Hearst-Argyle	HTV		24.00	+0.04
Beasley	BBGI		13.60	+0.11	Interep	IREP		0.39	unch
CBS CI. B	CBS		26.18	-0.38	Jeff-Pilot	JP		58.25	-0.04
CBS CI. A	CBSa		26.27	-0.22	Journal Comm.	JRN		13.99	-0.02
Citadel	CDL		13.18	-0.12	Radio One, Cl. A	ROIA		10.39	-0.04
Clear Channel	CCU		31.61	-0.39	Radio One, Cl. D	ROIAK		10.34	-0.11
Cox Radio	CXR		14.16	-0.03	Regent	RGCI		4.68	-0.05
Cumulus	CMLS		13.23	-0.04	Saga Commun.	SGA		10.18	-0.02
Disney	DIS		25.56	+0.24	Salem Comm.	SALM		16.49	-0.47
Emmis	EMMS		18.49	+0.20	Sirius Sat. Radio	SIRI		6.12	-0.38
Entercom	ETM		30.38	-0.11	Spanish Bcg.	SBSA		5.27	+0.05
Entravision	EVC		7.07	-0.06	Univision	UVN		31.33	+0.13
Fisher	FSCI		42.10	+0.05	Westwood One	WON		16.15	-0.10
Gaylord	GET		43.99	+0.06	XM Sat. Radio	XMSR		29.52	-0.06

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]

While Brad Nimmons' article (1/10/06 RBR #6) makes valid points on the surface, he ignores the coming changes to television measurement theories that are becoming more prominent in clients' thinking. The whole basis of Nielsen and Arbitron is to measure audience size and viewing or listening habits based on diary methods, PPM and other equations that try to measure audience size. Clients today have been moving quickly to find new ways of measuring advertising costs to sales results. In other words, audience size does not necessarily matter as much as the quantifiable sales results of the advertising.

None other than General Motors, whose stock is delicately balanced these days and has had weak sales has now gone to more of a Direct Response mode of TV expenditures to find a more cost effective way to KNOW how much success the advertising is providing to actual sales. Companies are getting very highly skilled in producing programs, software and theories to measure these very important results. The wave of the future is here. "How effective is my advertising" now means "tell me how our sales are in direct proportion to our advertising - - and if you can't, I'll find someone who can." Who said size is everything??

Stan Elgart
President
Felsgart Communications

Below the Fold

Ad Business Report
IPG signs for PPM
Represents more than 30% of all of radio's national spot, has committed...

Washington Media Business Report
Watchdog on telco cable entry
The Center for Digital Democracy is Kicking up its heels over cable...

Media Markets & Money
Lots of TV stations for sale
RBR sources confirm that NBC Universal is shopping four...

Radio Media Moves

New museum boss
Pat Mitchell has been named President of the Museum of Television & Radio, creating a vacancy at PBS, where she has been President & CEO. Also, Christy Carpenter has been promoted from VP to Executive VP and COO of the museum, which has facilities in New York and Los Angeles.

Joining corporate
at Cumulus
Radio veteran Caren Berry has joined Cumulus Media as Director of National New Business Development and will be based in Cumulus's Atlanta corporate office. For the past 10 years Berry has worked in Sacramento as General Manager, National Sales Manager and General Sales Manager for Entercom, Infinity and First Broadcasting.

Stations for Sale

Houston 50 kW AM
New transmitter site
& transmitting equipment
John W. Saunders
(713) 789-4222 or e-mail
[email protected]

Suburban NYC AM
Time Leased, profitable.
Comes w. 14 acre T/studio
site. 1.6M firm.
[email protected] or
lv msg @ 781-848-4201

Atlanta & Charlotte
New AM CPs Available
Daytimers/Great Dial Positions
Call Gordon Rice Associates
(843) 884-3590, or email
[email protected]

WOLF Call Letters For Sale
WWOF-AM/WWOF-FM
AM-$10,000 FM-$50,000
Both-$54,000
Contact [email protected]

More News Headlines

PD caught in sex sting
The Orlando Sentinel reports that Gary Wheeler, who goes by Adam Cook as Program Director of Clear Channel's WXXL-FM, was arrested by Citrus County Sheriff's deputies after an Internet sting operation. Wheeler is alleged to have gone to a park where he'd arranged in an Internet chat room to have sex with a 14-year-old girl. The "girl" turned out to be a male detective.

Sirius to be found
in Rolls-Royces
Rolls-Royce Motor Cars and Sirius Satellite Radio announced an exclusive agreement for the inclusion of Sirius radios as standard equipment in all Rolls-Royce vehicles sold in the US, including a lifetime subscription to the service.

TVBR - TV News

Pay VOD
future doubted
A study from Points North Group and Horowitz Associates, Inc. casts doubt on the viability of a pay-to-see model for television programming. Respondents, in an instance where they missed their favorite TV show, were asked if they'd like to be able to access it for free with commercials, or for 1.99 without commercials. The results weren't even close. Free with commercials won 62%-17%, with 21% undecided. The more tech-savvy 18-34 demo was more willing to make a choice, with only 5% undecided, but also came down overwhelmingly against paying for the show, 68%-26%. "Video downloads for $1.99 will have limited appeal. Consumers will grow tired of having their credit cards charged $1.99 every time they download a rerun of CSI," said Points North Group analyst Craig Leddy.

RBR observation: We're not sure if some version of audio-on-demand is seen as a segment of radio's future HD business m.o., but this study would seem to indicate that it's not likely to gain much traction if it's put on a pay-as-you-go basis.

RBR Radar 2005

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

Could broadcast stocks
Fall double digits this year?
That's the warning to investors from Harris Nesbitt analyst Lee Westerfield, who says new mobile tech and advertising risks create an equity downside of 15-20% in 2006 for broadcast stocks. That's on top of the losses that almost all radio and TV stocks suffered in 2005. Just back from the Consumer Electronics Show in Las Vegas, Westerfield sees threats from mobile broadband and PC-to-TV video convergence. "Announcements at CES foreshadow events ahead in 2006, such as a) deepening web media partnerships between mobile broadband players and the likes of Yahoo! and Google; and b) launch of Microsoft Vista [new operating system] with its media functionality this coming fall," the analysts said in a note to investors. As such, Westerfield is maintaining his "Negative" rating on the broadcasting sector (although he does like the Hispanic specialists). He expects pure-play radio company values to contract from their current multiples of around 11.5 times EBITDA to 10 times and pure-play TV from 10.5 to nine times.

RBR observation: We and a few others have been saying for years that mobile broadband, not satellite radio, is the big threat that terrestrial radio is going to have to deal with. In fact, we don't see how either XM or Sirius will be able to stay in business once mobile broadband becomes widespread. Terrestrial radio broadcasters will have to figure out how to compete with their own broadband offerings, as well as HD Radio, to compete as thousands of Internet audio streams become available to every car driving around in their local market. But realize the Facts - Technology is waiting for no one including the broadcasters and related companies doing business in the media. Traditional means of conducting business have finally have seen closure. Technology waits for no one - Period. Trying to slow it down will only result to self imploding.
01/11/06 RBR #7

Sales Manager
Reno Radio Representatives is seeking candidates. The FM station is one of the markets best rated and the company encourages both women and minorities to apply.
See Radio Careers

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