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Welcome to RBR's Daily Epaper
Volume 24, Issue 85, Jim Carnegie, Editor & Publisher
Tuesday Morning May 1st, 2007

Radio News ®

Closing the information GAP
The paperwork for George Laughlin's soon-to-be-acquired chunk of Clear Channel is in at the FCC. The 11-market, 52-station deal will clock in at 139M on the transaction Richter scale. The stations being acquired by GAP Broadcasting are mostly in small-market Texas with a few exceptions. The Texas portion of the deal includes six stations in Abilene; five in Amarillo, six in Lubbock; four in Lufkin; five in Odessa-Midland; five in Tyler-Longview, three in Victoria and four in Wichita Falls. Then there's one more deal partially in Texas, Texarkana to be exact (stradding the Arkansas border), where GAP picks up five stations. Finally, there are three stations in Lawton OK and six in Shreveport LA.
| Complete station list here |

A peak inside the
Lincoln portfolio

Should Lincoln Financial Group decide to get out of broadcasting - which, we would note, is still only a rumor - some very attractive properties will be coming on the market. All of the radio properties are in top 40 markets and the TV stations are long-established news leaders in high growth southeastern markets. In reporting the rumor that a broadcast divestiture was under consideration, the Wall Street Journal quoted sources as estimating that the stations could bring about 1.5 billion if put on the market. That looks like a pretty reasonable figure. Detailed data on the broadcast group has become a bit harder to come by since Jefferson-Pilot was acquired by Lincoln early last year. But for 2005, what was then called Jefferson-Pilot Communications had 110.8 million of broadcast cash flow (BCF) on revenues of 246.6 million. At 13 times that BCF, based on other recent major deals, the price tag would be 1.44 billion, but revenues and BCF were likely a bit higher in 2006 due to political advertising. Lincoln reported that its broadcast operation had 188 million in revenues from the April 3rd closing of the acquisition to the end of the year. BIAfn estimates that revenues for the full year were 243.6 million, based on individual station estimates, but that appears to be low given the final figure from the previous year. Here's a look at what might - just might, mind you - be put up for sale.
| View the List |

RBR observation: The best arguments for Lincoln Financial Group to sell Lincoln Financial Media are that the private market for broadcast stations, both radio and TV, is healthy right now - as demonstrated by the recent sales by CBS Radio, Disney's ABC Radio, NBC, New York Times and Media General in television, and others. Also, while the broadcast division had accounted for 11% of revenues for Jefferson-Pilot (like Lincoln, primarily an insurance company), it accounts for only 4% of revenues for Lincoln Financial Group. There is, however, one very strong argument against a sale. The stations still carry the tax basis from J-P and J-P had owned them for a very long time. Uncle Sam will get a big cut if Lincoln Financial Group decides to cash out of broadcasting.

CCU sets annual meeting (and bonuses)
Will it be the last? Clear Channel had already postponed its annual shareholders meeting until after the May 8th vote on going private. But even if the vote is yes, closing won't come immediately, so shareholders will have their annual get together on May 22nd in San Antonio. No new members will be joining the board of directors for what might be a short term - or a full year if the 39 bucks per share buyout is voted down. Up for re-election are Alan D. Feld, Perry J. Lewis, L. Lowry Mays, Mark P. Mays, Randall T. Mays, B. J. McCombs, Phyllis B. Riggins, Theodore H. Strauss, J. C. Watts, John H. Williams and John B. Zachry. Regardless of the vote outcome, the three members of the Mays family and Clear Channel Radio CEO John Hogan will be getting bonuses based on the company's performance in the past year.

The Executive Performance Subcommittee of the board's Compensation Committee reported how it arrived at the figures: "The Subcommittee met in February 2007 and measured Clear Channel's performance against the performance goals established by the Subcommittee for the 2006 fiscal year. Based on those performance results, the Subcommittee determined the amount of preliminary bonus to which Lowry Mays, Mark Mays, Randall Mays and John Hogan were entitled. The Subcommittee then considered a downward adjustment to the preliminary bonus amounts, based on Clear Channel's performance relative to its Media Peers and taking into account each individual's performance. The Subcommittee then awarded Lowry Mays 3,312,500 in cash incentive bonus, Mark Mays 6,625,000 in cash incentive bonus, Randall Mays 6,625,000 in cash incentive bonus and John Hogan 987,552 in cash incentive bonus. In addition, the Subcommittee determined that Lowry Mays was entitled to receive 53,000 stock options and 53,000 shares of restricted stock, Mark Mays was entitled to receive 132,500 stock options and 106,000 shares of restricted stock, Randall Mays was entitled to receive 132,500 stock options and 106,000 shares of restricted stock and John Hogan was entitled to receive 30,000 shares of restricted stock."

Legal eagle takes apart violence report
A lot of people have weighed in on the FCC's report to Congress on televised violence, which essentially recommended that legislators give the FCC the necessary teeth so they can go after it. Peter Gutmann of Womble Carlyle Sandridge & Rice PLLC has given it a thorough going over. You'll find his thoughts through the click below.
| Commentary here |

FBI seeks source
of threatening letters

The FBI field office in Portland, OR and the US Postal Inspection Service have asked for the public's help in identifying who is responsible for dozens of strange, threatening letters sent to broadcast/cable outlets, college athletic departments and individuals in a number of states. Some of the letters contained various powder substances, which the FBI Laboratory determined was a potentially harmful insecticide. The sometimes hard to follow letters complain primarily about TV camera crews focusing on close-ups of cheerleaders and female athletes, apparently convinced that the camera operators are seeking some sort of erotic gratification, but then they also complain that the only shots actually broadcast are of cheerleaders in long-sleeve, less-revealing outfits. The first batch of letters arrived last September bearing postmarks from Portland, OR. Others since have been postmarked in Seattle, WA and Chicago, IL. Anyone with information is asked to contact their local FBI office or call toll-free 886-915-8299. A 5K reward has been offered for information leading to the identification of the person or persons sending the letters.
| Read excerpts distributed by the FBI |

Another source for little loans
RBR is always on the lookout for new broadcast lending sources in the low end of the market because our readers tell us how difficult it is to find anyone doing radio and TV loans below 10 or 15 million bucks. So we are happy to report that Dover Capital Partners, headed by veteran broadcaster Peter Ottmar, is doing senior debt in the 1-6 million range. You read that right - one million to six million. "We like the space a lot. We like working with good management teams," Ottmar told us. Dover will lend as high as six times cash flow, but prefers five times or less. Yes, Ottmar will look at stick deals. For radio he prefers multiple station deals, but adds, "I'll take a hard look at anything." There are obviously fewer TV deals to be done the 1-6 loan range, but Ottmar says he has done LPTVs as well as full powers. With a small team, he says Dover can move quickly to give a yes or no. Some of the funding comes from a hedge fund and Ottmar notes that he has his personal funds in every deal. You can reach him at 401-723-1063, extension 103.

Ad Business Report TM

More buyers comment on Philly PPM data
We asked agency buyers yesterday what they thought about Arbitron's initial PPM data release for Philly (4/30/07 RBR #84). The commentary continues today with Natalie Swed Stone, US Director, National Radio Investment, OMD, and Pat McNew, PHD EVP/Local Media Network (LMN) Director of Operations:

Any comments in general about the
Philly PPM numbers coming out?
Said Swed Stone: "We will be looking at the results to determine how radio listening may differ from any previous assumptions-affecting reach, turnover, dayparts, commercials and formats, etc. More detailed and timely research will ultimately change the way programmers and broadcasters program their stations. We will expect to see changes in commercial positioning and other formatting changes on the heels of this type of research."
| Read More... |

NYMRAD's outdoor campaign brings business to NYC
New York Market Radio has achieved results from its outdoor ad campaign, which debuted in the beginning of the year. Several NY and Suburban Radio stations received new business orders directly resulting from NYMRAD's effort. NYMRAD advertised the value and power radio has to reach individuals, with taglines touting "We Wake Up 93% of New Yorkers Every Morning" and "We Reach 2.4 Million New Yorkers Every 15 Minutes." Due to the success of the outdoor campaign, NYMRAD is continuing to publicize radio's benefits by advertising in trade mags and running PSAs on radio stations. Opening up even more doors and reiterating NYMRAD's mission to help connect advertisers to their customers.

Media Business Report TM
AHAA names new leadership team
The Association of Hispanic Advertising Agencies (AHAA) announced the transition of leadership to new Chairwoman Jackie Bird, president/CEO of winglatino. Jose Lopez-Varela, ADN Communications CEO, assumed the role of chair-elect and Laura Marella, SVP/chief growth officer for Casanova Pendrill was elected to the position of vice chair. The AHAA Board of Directors created and approved the new Vice Chair board seat last year to ensure continuity in the association leadership and vision. Carl Kravetz, chairman/chief strategic officer of cruz/kravetz:IDEAS steps down from his role as AHAA chairman but remains a critical leader on the board for the organization's research initiatives. AHAA's new research plans to explore the complexity of Latino identity and benchmark the value that Hispanic advertising agencies provide to advertisers will be announced in the coming weeks.

Washington Media Business Report TM
Attack on licensees rebuffed
Emmis, Journal, LIN, Radio One and Montecito Broadcast Group all shared a distinction recently. They were under petition to have all of their pending license renewals turned down. The company objecting to their fitness to operate under public license was Broadcast Company of the Americas. BCA was still smarting over the complaints of the group above about its XHBCE-FM in Endensada in Baja North California, Mexico. The group of US companies claimed that BCA had improperly constructed the facilities of its station and further, was pointing its signal northwest and into interference with Lazer Broadcasting's KXRS-FM. BCA admitted that its station was constructed improperly, but claimed it was not AS improperly contructed as claimed, claiming that the above companies were therefore guilty of abuse of process and unfit to control a license. The FCC rejected an earlier BCA attempt on the licenses, and said that this was a mere rehashing with absolutely nothing new to add to the "supposed misrepresentations" made by the US companies. BCA's petitions were again rejected out of hand.

FCC rejects Illinois time share proposal
Millikin University does not broadcast 24/7 from its WJMU-FM in Decatur IL, and R B Schools decided to take advantage of the station's most recent license renewal to see if it could get a piece of the frequency for itself via time sharing. The process exposed a number of problems. For starters, RB seems to have neglected to attempt to negotiate a time-sharing arrangement, one of the hurdles the FCC says it must clear. It did proceed to find defects with MU, however. For starters, the GM signed the renewal application, even though he is not an officer of director of the licensee. Since in all other respects the application was OK, the FCC allowed this to be corrected, following precedent. RB complained that MU was out of bounds in soliciting testimony in its favor to be delivered to the FCC, and violated ex parte rules by not serving these papers to RB. The FCC agreed that these constituted violations. MU explained that it is little, does not have its own communications attorney, was ignorant of these rules, and did not repeat any of the actions once informed. The FCC as usual noted that ignorance is no excuse, but that the infraction was minor, and in the end, it did not substantially impede RB from making its case. That case was not deemed strong enough to warrant grant of the time sharing arrangement. In the end, MU received an admonition and RB had its petition dismissed.

Media Markets & Money TM
Polnet heads south
Walter Kotoba is adding Florida to his radio portfolio with the acquisition of a pair of AMs along the state's western coast. He's getting WRXB-AM in St. Petersburg Beach and WTMY-AM Sarasota from Mark Acker and his Metropolitan Radio Group. According to broker John L. Pierce, the price is 1.1M. Pierce also noted that this will mark the end of the radio road for Mark Acker, who has gradually been thinning his herd for the past five years or so. Polnet is active in New York, Long Island and Chicago.

Toppled Tower deal spurs hunt for buyer
Towers Investment Trust has stations for sale. It thought that it did not, but a confidential agreement in principal to sell the group seems to have fallen through, and the group is looking for a new buyer. Seven are in Texas, licensed to Wichita Falls, Paris, Texarkana, Pearsall, Charlotte, and two in Del Rio. It also has another in Americus GA and a CP for a C2 in New Bern NC. Details, complete with asking prices, are available at Company president Bill Brothers notes that a Dick Kozacko-brokered deal to sell KFZA-FM in Flagstaff AZ to Walker Radio for 2.5M is still on track.

Entertainment Media Business Report TM
ESPN Radio to air
Kentucky Derby for first time

ESPN Radio's inaugural broadcast of the Kentucky Derby will originate from legendary Churchill Downs racetrack in Louisville on Saturday, 5/5, at 5 p.m. Host Brent Musburger will be joined by Hall-of-Fame jockey Jerry Bailey, Hank Goldberg, Jeannine Edwards, and Bob Valvano. "The Kentucky Derby is one of America's greatest sporting spectacles," said Traug Keller, SVP/ESPN Radio. "We're proud to add this signature event to our already solid roster of signature events." ESPN Radio scores the Derby from Premiere Radio Networks. Be sure to check out our OneonOne interview with Keller in July's SmartMedia Magazine.

Ratings & Research
Arbitron suspends eDiaries
Sometimes the real world doesn't work out quite like a test. Arbitron had high hopes for its online eDiary alternative to paper diaries when it announced that they would be used for the Winter 2007 survey. Unfortunately, while the number of people electing to use the eDiaries proved to be in line with testing - about one in 20 respondents - Arbitron found from analyzing the eDiaries that there was a negative impact on return rates, that is, the percentage of diaries sent out that are completed, returned and become intab. To compensate, Arbitron has increased its audience sample to compensate. "We regret that this occurred because we expected positive results from eDiary. We have suspended use of the eDiary starting with the Spring and will not redeploy it until we are comfortable that e-Diary will have no negative effect on the diary return and response rates," Arbitron said in a communication with clients. Here are the markets with a greater than normal variation in their monthly samples: El Paso, Little Rock, Fresno, Baltimore, Baton Rouge, Puerto Rico, Orlando, Omaha-Council Bluffs, Johnson City-Kingsport-Bristol, Providence-Warwick-Pawtucket, Tucson, West Palm Beach-Boca Raton, Milwaukee-Racine, Oklahoma City, Syracuse, Rochester, NY, Portland, Or, Tampa-St. Petersburg-Clearwater, Hartford-New Britain-Middletown, Huntsville and Phoenix.

RAB announces new plan;
taps former TW exec

The final draft of a new strategic plan for the Radio Advertising Bureau was presented to the Executive Committee of the Board of Directors during their semi-annual meeting. The plan will be the road map for the RAB's activities over the next three to five years and reflects three key priorities for the RAB:

1) Enhancing the marketing of radio in the media marketplace
2) Improving the transaction process for radio
3) Embracing new visions for growth

As part of the implementation of the RAB plan, Tammy Greenberg, formerly VP/Client Partnerships, Time Warner Global Media Group, will join the RAB on 5/7 as SVP/Marketing in support of the "Key Advertiser Focus," an initiative to steer more dollars into radio through long-term, solutions-based client relationships.

4.75M KXXX-AM/KQLS-FM Colby KS; KGNO-AM/KOLS-FM/KZRD-FM Dodge City KS; KSSH-FM Ingalls KS; KZLS-FM Great Bend KS; KGTR-FM/KNNS-AM Larned KS; KILS-FM Minneapolis KS; KQNS-FM Lindsborg KS; KWLS-AM Pratt KS; and KYUU-AM/KSLS-FM Liberal KS from NRG License Sub LLC/Waitt Omaha LLC, a subsidiary of NRG Media LLC (Mary Quass et al) to Rocking M Radio Inc. (Monte M. Miller, Christopher D. Miller, Doris Miller). 200K escrow, balance in cash at closing. LMA 4/1/07. [File date 4/16/07.]

2.4M WBZH-FM Harriman TN from Southern Media Group Inc. (Kirk Tollett) to Progressive Media Inc. (Barry Culberson, David Smith, Lynne Blair, Charles Lestor, Dottie Culberson. 25K escrow, 1.2M tax credit, balance in cash at closing. [File date 4/12/07.]

Stock Talk
Retreat from record territory
With mixed economic news on Monday, traders pulled back and the Dow Jones Industrial Average pulled back from the record high it set of Friday. The Dow closed down 58 points, or 0.4%, at 13,063.

Radio stocks joined in the retreat. Salem plunged 6.1%. Cumulus fell 5.4% and Radio One saw its Class A drop 5.2%, while Class D was down 5.1%.

Radio Stocks

Here's how stocks fared on Monday

Company Symbol Close Change Company Symbol Close Change













Journal Comm.







Lincoln Natl.







Radio One, Cl. A




Citadel CDL
9.18 -0.20

Radio One, Cl. D




Clear Channel








Cox Radio




Saga Commun.








Salem Comm.








Sirius Sat. Radio








Spanish Bcg.
















Westwood One








XM Sat. Radio





Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments and
a photo to [email protected]

We occasionally see anecdotal evidence that one reason Clear Channel may be struggling is that no matter how local a large company tries to be, it simply isn't an easy task to pull off from one building in San Antonio. The top of a hierarchy can't help but try to govern the entire group, with varying effects down the line. Let us hope that many of the medium and smaller multi-city broadcasters realize this too - those companies that wanted to be the next Clear Channel or Cumulus and those owners that wanted to be Lowry Mays or Lew Dickey. Local radio is still about being involved, giving to the community as much as taking from it.

Robert T. Ganzak
Fusion Creative Marketing
Valdosta, GA

Below the Fold
Ad Business Report
Philly PPM data
More buyers comment. Today Natalie Swed Stone, OMD, and Pat McNew, PHD...

Media Markets & Money
Polnet heads south
Walter Kotoba is adding Florida to his radio portfolio...

Toppled Tower deal
Spurs hunt for buyer...

Ratings & Research
Arbitron suspends eDiaries
Sometimes the real world doesn't work out quite like a test...

Stations for Sale

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Market your Stations For Sale
in our daily epapers.

June Barnes
[email protected]

Radio Media Moves

Getting interactive
Journal Broadcast Group has promoted Jeff Kuether to Director of Interactive Media Sales, effective immediately. Kuether will continue to serve as Director of Sales for Journal's Milwaukee radio stations, a position he's held since 1997.

Two join Coleman
Coleman announced the hiring of Bob Bedi and Matt Bailey as senior research analysts for the media research firm. Bedi joins from Media Integrations and Bailey from 10 years of programming and creative services experience at radio stations mostly in the Atlanta area.

More News Headlines

Irving Waugh
dead at 94

The Tennessean newspaper in Nashville reports the death of former WSM radio and TV President Irving Waugh. The paper said he died Monday of heart failure at age 94. As longtime head of the stations, Waugh is also credited with helping to bring the Opryland theme park to life and working to put the Country Music Association awards show on network TV. Waugh retired from broadcasting in 1977 and was appointed Commissioner of Tourist Development under Gov. Lamar Alexander, a post he held for two years. Waugh continued as executive producer of the CMA Awards Show through 1992.

CRB Update: Webcasters take to Washington DC
According to RAIN (, a large group of webcasters, musicians and independent record label execs will convene in DC today for the "Hill walk" organized by the coalition. The group has meetings scheduled with Reps in Congress whom they will meet with to promote the passage of the Internet Radio Equality Act (H.R. 2060)-(4/30/07 RBR #84).

RBR Radar 2007
Radio News you won't read any where else. RBR--First, Accurate, and Independently Owned.

First "currency" data
from Philadelphia PPM
Arbitron released the first "currency" radio ratings from the Philadelphia PPM ratings, covering 3/8-4/4. One compelling new finding is the dramatic increase in the composition of the radio audience (persons 18+) who are employed Full Time compared to what was reported by the diary. See charts in this page report of RBR and also see Ad Business Report on Agency comments.
04/30/07 RBR #84

Humpty Clear Channel
apart for good?
Former FCC Commissioner Harold Furchtgott-Roth says that the break-up of Clear Channel, for some, is a "bitter pill" in an essay called "Dismembering Clear Channel" published last week in the New York Sun. He notes that the fate of the current per-share offering for the company is uncertain, but that a sell-off is going on in any case. "Once the company is dismembered, it can never be put together again.

RBR observation: We occasionally see anecdotal evidence that one reason Clear Channel may be struggling is that no matter how local a large company tries to be, it simply isn't an easy task to pull off from one building in San Antonio. The top of a hierarchy can't help but try to govern the entire group, with varying effects down the line. For example, the effects of a new challenge in Hooterville are immediately apparent to Mom & Pop's Hooterville Broadcasting Company. If nothing else, the GM at the Clear Channel cluster across town may have to get blessings from Corporate to do what Mom and Pop did three weeks ago. Anyway, what investors see as a "bitter pill" may be seen as "blessed relief" by fans of local broadcasting. Any thoughts? That's what our Bounceback section is for [email protected] .
04/30/07 RBR #84

Wall Street pressure to spin NBC
General Electric stock jumped a buck on Friday after Citigroup analyst Jeffrey Sprague issued a research report that called on GE to set free three units which are not core to the industrial giant. One of those is NBC Universal, which Sprague said "has no meaningful synergy with the rest of the portfolio."

TVBR observation: Don't rule it out. There had been previous hints that Immelt had gotten more directly involved in how NBC Uni is run to prepare the company for a spin off from the mother ship. Of all the units at GE, the TV/entertainment unit is clearly the odd duck. Would it be better valued by Wall Street as a standalone operation? And then, of course, there are those rumors that Google might take out its checkbook to buy its way into another area of media in a big way...
04/30/07 TVBR #84


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