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Volume 24, Issue 82, Jim Carnegie, Editor & Publisher
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Thursday Morning April 26th, 2007
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Radio News ®
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 Tribune begins stock tender
Phase one of the plan to take Tribune Company private is underway, with the company launching a tender offer to buy back 126 million shares of its stock for 34 bucks each - some 4.3 billion bucks in all. Phase two to buy the remainder will have to wait for FCC approval. This is all part of the recapitalization and going private plan announced at the start of this month (4/2/07 MBR) which will eventually, assuming all regulatory approvals are obtained, have Sam Zell and an Employee Stock Ownership Plan owning all of Tribune Company. Zell made his initial 250 million bucks investment on April 23rd and that cash, plus new debt, will pay for the first round tender. "This tender offer will return significant capital to Tribune shareholders, including employees who currently own about 23 million shares of stock," said CEO Dennis FitzSimons, noting that with Sam Zell now onboard as in investor and the tender offer launched, "the first stage of our transaction that will result in Tribune Company going private is underway." The Chandler Trusts, who hold more than 20% of Tribune's common stock, have agreed to tender all of their shares. If more than 126 million shares are tendered in phase one by the May 24th deadline, which is likely, the buyout will proceed on a pro rata basis (other than buying back all odd lots of fewer than 100 shares).
RBR observation: This is the easy part. We expect that way more than 126 million shares will be tendered, since there is no way of knowing when phase two, at the same 34 bucks per share, will take place - or even if it will at all. If Tribune can't get the FCC to grant needed waivers to keep its existing newspaper/broadcast combinations intact, the remaining public shareholders will remain public shareholders - and participants in Sam Zell's big turnaround plan.
39 bucks is all they have to give
If you are a Clear Channel shareholder waiting for Thomas H. Lee Partners and Bain Capital to raise their bid a second time, you may be waiting forever. According to CNN, Lee co-president Scott Sperling told a financial conference in New York that the financing sources for the proposed buyout can't provide any more money and "we don't have anything left." The shareholders vote on the buyout, which requires two-thirds approval, is now set for May 8th.
RBR observation: We are inclined to believe him. Sperling was reluctant to raise the original 37.60 bid (4/12/07 RBR #72) and did not get to the 40 bucks mark that would have probably guaranteed acceptance. Now we wait to see if 39 bucks will get the job done - or not.
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 Local station holsters gun spot
New York City Mayor Michael Bloomberg is mounting a nationwide campaign to shoot down a perennial congressional appropriations amendment that limits law enforcement access to firearm information. Although it launched Sunday, 4/22/07, it wasn't seen by viewers of KWCH-TV in Wichita. The amendment is from Todd Tiarht (R-KS), who happens to represent part of the Wichita DMA. The legal plank is supported by the NRA as a protection of gun-owner privacy. Bloomberg, in association with "over 200 mayors and dozens of law enforcement organizations," according to his Deputy Mayor Ed Skyler, is trying to make it easier to track gun movement (and prosecute those who sell them illegally) by allowing cross-jurisdictional data sharing, including information held by federal enforcement agencies. The Media General station said that local law enforcement agencies can get specific information for prosecutions and investigations, and concluded that renders the Bloomberg misleading. Bloomberg counters that full data sharing is needed for more effective enforcement and that the station lacks objectivity.
RBR observation: All we know is that KWCH has left itself open to criticism the next time it runs an issue ad that someone - anyone - doesn't like. This will be especially true, of course, if the NRA ever wants to buy time on the station. Is every would-be issue advertiser now required to present all sides of the issue in its :30 or :60 seconds on KWCH? We cannot imagine why a station would want to put itself in the position of message umpire. Better to take the money and run the ad, so long as it isn't blatantly and obviously false or indecent, if only for the benefit of station's shareholders and bank account. That's because there is every chance that it will simply lead to more cash in the form of a response ad.
Supremes hear issue ad case
The attack of Wisconsin Right to Life on provisions of McCain-Feingold which restrict issue advertising within 30 days of a primary election or 60 days prior to a general election went to the Supreme Court yesterday. WRtL won an Appeals Court ruling on First Amendment grounds, arguing that they have a right to run issue-oriented advertising without being bound by election advertising rules. The problem was the fact that their 2004 ads which brought the case into the judiciary in the first place mentioned candidate Russ Feingold (D-WI), a co-sponsor of the bill, who happened to be up for re-election to the Senate. WRtL's opposition claimed that WRtL was perfectly free to run the ad so long as they complied with political funding rules, and that they could run an ad that didn't mention a candidate. They said that bringing up Feingold - the ad urged Wisconsinites to contact him regarding the abortion issue and confirmation of judicial nominees - was a transparent attempt to bring soft cash into the campaign to defeat his candidacy. They noted that there was no bill or judicial nominee on the docket when the ads ran (indeed, Congress was not in session) and that WRtL did not bother to inform constituents how to contact either Feingold or colleague Herb Kohl (D-WI, also mentioned but not up for re-election). WRtL argued that it was a simple freedom of speech issue and that they should be allowed to pursue their non-electoral agenda whenever they pleased. The court ruled in favor of the law three years ago in a similar case, but two new justices are benched now - Chief Justice John Robers and Samuel Alito. The trade of Alito for Sandra Day O'Connor could lead to a different result when an announcement is made, probably during the summer.
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 Brits keep food
on the front burner
A recent study by the University of Liverpool took 60 children aged 9-11, showed them a junk food ad, then a cartoon, then allowed them to select some food to eat (apparently versus a control group not seeing the ad). According to Reuters, children who were already overweight were found to more than double consumption afterwards, with normal weight children not far behind, and in all cases, went for the most fat-saturated options available. What was more telling was that the ads were generic in that even though they seemed to induce increase consumption, the item consumed was not necessarily the item advertised - the ads seemed to heighten the child's urge for junk in general. A researcher said this debunked claims that ads did not affect consumption but were mainly used to influence brand choice. Britain has instituted a ban on junk food commercials during children's programs, but they are exposed to them nonetheless while watching general audience fare.
RBR observation: Anybody who deals with the ratings game knows that 60 is a miniscule sample, so we would caution that peer review would certainly seem to be called for to see if these specific results hold up for a larger group of children. Regardless, this issue is getting very warm in Washington this year. Stay tuned.
FCC weighs in on DTV
The FCC meeting originally scheduled for 9:30 AM eventually began at around 7:00 PM. If the FCC's deadline is almost two years into the future, ours is not, so we'll keep this short and sweet so you can read about it this morning. It you're a retailer, and you want to sell an analog-only television receiver, you must make sure that the buyer knows that it possibly will become no more than a paperweight on 2/17/09. Second, even though most broadcast television stations are now operating with some form of side-by-side digital platform, the FCC will require that a readiness questionnaire be filled out for posting on the FCC's website so that anyone will know what steps will be necessary to get on the right channel and up to full power by that date. These two items passed unanimously. Finally, the problem child, the issue of forcing cable to provide dual digital/analog must-carry after 2/17/09. Should cable be forced to do this? Most of the commissioners wanted more time on this one, on both practical and constitutional grounds, and it appears the possibility of modification has been left open. The vote went as follows: Copps: Yes. Adelstein: Yes. Tate: Yes. McDowell: Yes. Martin: Yes. In short, as it stands, the third vote was unanimous too.
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Ad Business Report TM
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Partnership for a Drug-Free America
unveils "Time to Talk"
The Partnership for a Drug-Free America will launch in August a new, year-round cause-marketing campaign called Time to Talk (www.timetotalk.org). The campaign is focused on encouraging and supporting parents and caregivers to have frequent and positive conversations with their teens to keep them healthy and drug free. Time to Talk will provide parents with practical tips, tools and information to not only start the conversation, but to keep it going. It is also a unique opportunity for corporations and family-centric brands to own a leadership position, championing efforts that will resonate with millions of parents. To support the campaign, the Partnership is collaborating with Yahoo! to create a new community of mutual support among parents. Through social networking on the Yahoo! Groups platform, parents can share experiences and insights about teens' drug and alcohol use and connect with other parents in similar situations. The Yahoo! Group will provide links to Partnership content, such as the latest news and research on Yahoo's Health, Relationship and Lifestyle Channels and to the Partnership's Time to Talk Web site (www.timetotalk.org). Time to Talk will leverage the Partnership's 20 years of leadership in research-based public education efforts. It will be supported by a national PR effort and ad campaign.
Air America to be
repped by Westwood
 Air America Radio announced it has signed an agreement with Westwood One, after announcing recently it was parting ways with Jones Media Group after three years. Beginning 6/1, Westwood will oversee all network ad sales for Air America in addition to affiliate ad sales, in conjunction with the network's in-house affiliate relations department. The network will end its three year relationship with Jones Media Group.
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| Media Markets & Money TM |
To air is human, to spin is Devine
Christopher Devine's College Creek Media, the company under which he did a lot of bidding for FM CPs in recent auctions, is spinning another pair of them off. Taking two in Nebraska will be Joseph Jay Vavricek's Legacy Communications. He'll pay 475K cash for two co-located, identically-endowed FM CPs, one licensed to Paxton NE on 93.5 MHz and the other at Sutherland NE on 100.7 MHz. They both belong to Class C1 with 100 kw @ 753'. The towns are on I-80 between North Platte and Ogallala. Legacy already owns one AM and five FMs in the state, including stations in McCook some distance to the south of the two incoming DIY projects.
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| Washington Media Business Report TM |
LMA is no excuse
OK, repeat after us: The licensee is solely responsible for the compliance of a broadcast facility. A station may be LMA'd to another entity. Programming, sales and administrative functions can be brokered out. But when the towers are not adequately fenced in; when the red obstruction light on one of them has burned out; when the local FAA has not been informed of this hazard; when the daytime-only station is operating up to an hour and a half past sunset; and when an FCC agent finds these conditions on three separate inspections, the licensee is the one that is going to make atonement. In this case, Siga Broadcasting Corporation, licensee of KTMR-AM in Edna TX is the responsible party. It said it had recently resumed hands-on operation of the station but that the problems were left by the LMAing second party. It will come as no news to regular readers of this space when the FCC noted that it has "...consistently refused to excuse licensees from forfeiture penalties for4 the acts and omissions of employees and independent contractors." This total bill for this laundry list comes to 21K.
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| Entertainment Media Business Report TM |
 Stephanie Miller
next to fill in for Imus
The next radio host to fill in at MSNBC for Don Imus's old morning slot will be JRN's Stephanie Miller. She will reportedly appear Monday-Wednesday next week. WPHT-AM Michael Smerconish gets an extended stay-instead of ending his run yesterday, he'll run thru Friday.
JRN to distribute
John Mellencamp special
Jones Radio Networks announced it will be the exclusive audio distributor for John Mellencamp-Live from Walter Reed Army Medical Center. Mellencamp will perform for the patients at Walter Reed tomorrow. The show will be presented commercial free. If affiliates are unable to air the concert live, the show can be made available via CD.
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| Ratings & Research |
AM/FM radio listening still dominates
use of digital audio platforms
Arbitron and Edison Media Research say AM/FM radio listening still dominates use of digital audio platforms. The study, "The Infinite Dial 2007: Radio's Digital Platforms," found average time spend listening to AM/FM radio by persons 12+ was 2 hours, 37 minutes per day -- but those who use digital platforms listen a full to 2 hours, 45 minutes per day among those who use radio's digital platforms. Fewer than 1 in 10 report reduced listening to broadcast radio due to time spent with their iPod or MP3 player. Awareness of both satellite radio companies is flat in the past year. 19% of all respondents said that AM/FM radio has had a big impact on their lives; ranking second only to mobile phones (35%) as the audio platform/device that has the biggest impact on the lives of its users. The weekly Internet radio audience remains steady over the past year at an estimated 29 million. 11% of the U.S. population 12+ have listened to Internet radio in the past week; 16% of persons age 18-34 and 14% of persons 18-49 have done so. iPod/Portable MP3 player ownership continues to rise. 30% of Americans 12+ own an iPod or other brand of portable MP3 player; this figure has risen from 22% in 2006 and 14% in 2005. More than half (54%) of those Awareness of HD Radio nearly doubled in the past year, but that has not yet translated into high interest. In January 2007, 26% said they had heard or read about HD Radio recently, compared to 14% in January 2006; however, only 6% said they were "very" interested in HD Radio.
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| HD RADIO 2007 |
 "Moms, Dads and Grads" rebate
offers savings on HD Radios
A new HD Radio Rebate Program in celebration of Moms, Dads and Grads was announced that will effectively reduce HD Radio receiver prices by 40 bucks. The program applies to most HD Radio receivers - from tabletops to car connect adapters - and runs from April 29 through July 3, 2007 (beginning Sunday, April 29, the $40 rebate certificate will be available at www.hdradio.com/rebate). The following vendors' products are eligible for the rebate: Accurian, ADA, Alpine, Boston Acoustics, Cambridge SoundWorks, DaySequerra, Denon, DICE, Directed Electronics, Eclipse JVC, Kenwood, Integra / Onkyo, Metra, Niles, Panasonic, Polk Audio, Radiosophy, Rotel, Sangean and Visteon.
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| Engineering Business Report TM |
WNTP-AM Philly completes signal upgrades
Salem's News Talk 990 AM WNTP Philadelphia announced the completion of a multi-year project to further improve the station's 50,000 watt signal. "Following an FCC-approved study of WNTP's coverage area, we determined that our coverage area could be expanded," reports WNTP Vice President and General Manager Russ Whitnah. "Under Chief Engineer Rene Tetro's leadership, we upgraded and improved reception in the Chester, eastern Berks, northern Montgomery, and Bucks County areas. In addition, a new broadband antenna system was installed to improve the sound fidelity of the station."
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| Transactions |
3.25M KNLJ-TV Columbia-Jefferson City MO (Jefferson City MO) from New Life Evangelistic Center Inc. (Lawrence W. Rice Jr., Raymond Redlich) to Christian Television Network Inc. (Robert D'Andrea, Wayne Wetzel, Virginia Oliver, Jimmy Smith, Robert S. Young). 162,500 escrow, balance in cash at closing. Includes non-compete. Station is noncommercial independent on Channel 25 (DTV 20). [File date 4/2/07.]
760K KLKI-AM Anacortes WA from Berry Entertainment Inc. (William T. Berry) to Robert and Jennifer Uteda. 50K escrow, 330K cash at closing, 380K note. [File date 4/3/07.]
400K WFMO-AM Fayetteville NC (Fairmont NC) from Pro-Media Inc. (James Clark) to Davidson Media Station WFMO Licensee LLC, a subsidiary of Davidson Media Group LLC (Peter Davidson). Cash. Combo with WSTS-FM Fairmont NC. LMA 7/16/05. [File date 4/3/07.]
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| Stock Talk |
Whoo-hoo! Dow 13K!
Generally strong Q1 earnings reports gave traders the confidence to push the Dow Jones Industrial Average above the 13,000 mark for the first time. The Dow ended the day up 136 points, or 1.1%, at 13,090.
Radio stocks joined the rally. The Radio Index rose 1.444, or 0.9%, to 164.945. Journal Communications rose 2.9%, a day after reporting Q1 results. Entravision was up 2.6% and Lincoln National gained 2.5%.
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| Radio Stocks |
Here's how stocks fared on Wednesday
| Company |
Symbol |
Close |
Change |
Company |
Symbol |
Close |
Change |
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Arbitron
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ARB
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49.57
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+0.07
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Hearst-Argyle
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HTV
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27.51
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+0.17
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Beasley
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BBGI
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9.01
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-0.01
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Journal Comm.
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JRN
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13.17
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+0.37
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| CBS CI. B |
CBS |
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32.00
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+0.45
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Lincoln Natl.
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LNC
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71.18
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+1.75
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| CBS CI. A |
CBSa |
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31.97
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+0.39
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Radio One, Cl. A
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ROIA
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7.48
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+0.04
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| Citadel |
CDL |
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9.81 |
+0.10 |
Radio One, Cl. D
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ROIAK
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7.50
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+0.08
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Clear Channel
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CCU
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35.89
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+0.10
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Regent
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RGCI
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3.50
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+0.02
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Cox Radio
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CXR
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15.19
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+0.17
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Saga Commun.
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SGA
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10.19
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+0.07
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Cumulus
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CMLS
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10.01
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+0.09
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Salem Comm.
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SALM
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13.50
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+0.22
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Disney
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DIS
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35.32
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+0.41
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Sirius Sat. Radio
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SIRI
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2.83
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+0.06
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Emmis
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EMMS
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10.34
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+0.07
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Spanish Bcg.
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SBSA
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3.69
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-0.01
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| Entercom |
ETM
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28.85
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+0.26
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SWMX
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SMWX
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0.65
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-0.05
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Entravision
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EVC
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10.31
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+0.26
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Westwood One
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WON
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6.81
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+0.07
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Fisher
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FSCI
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49.96
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+0.06
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XM Sat. Radio
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XMSR
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11.01
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+0.08
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Bounceback
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 We want to
hear from you.
This is your column, so send your comments and
a photo to [email protected]
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Below the Fold
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Ad Business Report
Air America to be repped by
Westwood One, after parting ways with Jones...
Media Markets & Money
To air is human, to spin
Is Devine, College Creek Media is spinning another pair of CPs off...
Washington Media Business Report
LMA is no excuse
OK, repeat after us: The licensee is solely responsible for the compliance...
Ratings & Research
AM/FM radio listening still
Dominates use of digital audio platforms...
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Stations for Sale
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CA Coastal Class A
Rated Market $1.5M
CO Rated Market C.P.
Class C1 $400K
Brett Miller - 805.543.3466
[email protected]
OR Coastal Class A FMs
Positive Cashflow $795K
ND Small Market C.P.
Class C1 $150K
Brett Miller - 805.543.3466
[email protected]
 Market your Stations For Sale
in our daily epapers.
Contact
June Barnes
[email protected]
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Radio Media Moves
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Ex-Congressman
back to radio
Former US Rep. JD Hayworth, one of the Republicans dislodged from DC in last November's election, has returned to his previous career, radio talk host, and even at the same station. He is back on the air today as afternoon drive host (4-7 pm) on Clear Channel's KFYI-AM Phoenix.
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More News Headlines
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FCC sends violence report to Congress
As predicted the FCC adopted a report on TV violence yesterday which concludes that violent programming is a problem, particularly where children are concerned, and that the V-chip doesn't do enough to deal with it. But the Commissioners have kicked the ball to Congress, saying that legislative action is needed before anything can be done to crack down on violent programming. The report suggests that Congress could pass legislation to restrict violent programming, just as it already does indecency, but that the law would have to be narrowly crafted to comply with court precedents.
Let's call the
whole thing off
The dispute between CBS Radio and KCAA-AM Loma Linda CA has been resolved without resorting to the legal system. The station has been airing reruns of the Don Imus morning show, which CBS said infringed on its copyright. KCAA's licensee, Broadcast Management Services, had planned on ending the reruns as of Friday 4/27/07 in any case, and will still hold to that plan. According to the local newspaper, The Press-Enterprise, along with the repeated entertainment portion of the show, the original ads are running, and KCAA can not double-bill those advertisers. It will therefore be replacing the program out of financial necessity.
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RBR Radar 2007
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Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.
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Hip-Hop flip-flop
Reversing course from a statement issued just two weeks ago (4/16/07 RBR #74), Hip-Hop Summit Action Network founders Russell Simmons and Benjamin Chavis are now calling for record labels to ban three particularly inflammatory words: bitch, ho and that racial epithet so vile it is usually referred to in polite company as the "n-word."
RBR observation: The heat is on. Who could have imagined that Don Imus would prove to be the catalyst for a movement to take the degradation of women out of hip-hop and rap? It is unfortunate that C. Delores Tucker did not live to see this day - if there is indeed going to be an era of new social responsibility by the record labels.
04/25/07 RBR #81
Free-FM NY's
JV and Elvis suspended
CBS Radio suspended two hosts from its Free FM WFNY-FM NY after an Asian-American advocacy organization complained about the broadcast of a six-minute prank phone call ordering food to a Chinese restaurant that was replete with ethnic and sexual slurs. The call's dialogue, seemingly generated by a computer voice.
RBR observation: Interesting that they used a computer voice, which showed no emotion or humor. While we did hear some implied ethnic slurs, like "flied lice," there was nothing particularly mean-spirited. We've heard much worse come out of Howard Stern's show, with a call to a Korean clock store. However, it appears likely there was an FCC violation in airing a phone call on a broadcast station without first getting permission from the person on the other end of the line. So, there could well be a fine coming. Will that and the local outrage be enough to get the duo fired?
04/25/07 RBR #81
Shareholders revolt at Gray Lady
In what appears to be a record for a US public company, 42% of Class A shareholders withheld their votes for the four New York Times Co. directors up for election at yesterday's annual meeting. All directors, however, vowed to keep their seats. Dissident shareholders, led by Hassan Elmasry, who manages an investment portfolio for Morgan Stanley clients, have demanded stronger performance by the company and an end to the two-tiered stock structure that gives the Ochs-Sulzberger family voting control of the company via their Class B shares. (more on the Gray Lady see TVBR)
04/25/07 TVBR #81
Dissident shareholder renews pressure on Emmis
Noting recent rumors that Emmis has been shopping WQCD-FM New York for 200 million bucks or more, dissident shareholder Frank Martin of Martin Capital Management is again putting the screws to CEO Jeff Smulyan to return value to shareholders. The latest letter from Martin, which has been filed with the SEC, includes some personal attacks on Smulyan's integrity, (to read the letter in detail see this RBR page)
RBR observation: In one word on the letter, Ouch.
04/24/07 RBR #80
Sharpton targeting record labels
Fresh from getting Don Imus fired for using a slur against black women, Rev. Al Sharpton is renewing his effort to clean up rap and hip-hop lyrics. This time he is targeting corporate headquarters.
RBR observation: We noticed repeated criticism of Sharpton during the Imus controversy for taking offense at what Imus said while not objecting to similar terms in rap and hip-hop music. That is not true. Sharpton was for many years aligned with the late C. Delores Tucker in campaigning against violent and sexist lyrics. We wrote about Sharpton calling for radio stations to drop violent songs from their playlists two years ago (3/28/05 RBR #61). So it is not true that this is a new cause for Sharpton. What is true is that he so far has virtually nothing to show for his efforts. Will Imus pushing the issue to the front burner change that?
04/24/07 RBR #80
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Hard finding that key person
to fill the important position at your organization? Media HeadHunters is the place that key media firms use to get results. See Media HeadHunters and get results with service--Period.
Need assistance
contact Cathy Carnegie
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