RBR's Daily Morning Epaper

Are you reading this from a forwarded email?
New readers can receive our RBR Morning Epaper FREE for the next 60 Business days! SIGN UP HERE

Volume 22, Issue 94, Jim Carnegie, Editor & Publisher

Thursday Morning May 12th, 2005

Radio News®

Journal has its sights on Emmis TV
Just hours after the group went on the auction block, Journal Communications CEO Steve Smith was telling a Robert W. Baird investor conference in Chicago that his company was interested in buying the Emmis TV group. In fact, Smith said he'd called Jeff Smulyan before last month's NAB2005 and told him that if Emmis were ever to consider selling its TV stations, that Journal would be interested. "Our first priority would be to grow where we have radio," Smith said, noting how well the Journal Broadcast Group operations work in Milwaukee and Boise, where it has both radio and TV properties. "We think there are opportunities because we know the advertisers well and also have the ability to leverage costs," he said. How well do they match up? "They're in Omaha, they're in Wichita, they're in Tulsa. We're in Omaha, we're in Wichita, we're in Tulsa. They're in Green Bay, we're already in Green Bay with television, so certainly it was an interesting announcement this morning," the Journal CEO told the gathering. However, Smith also said there's still a question of where values are in the market today, although he said that's less of an issue in TV than in radio.

Latest rumor: Disney may sell radio
With Susquehanna Radio and Emmis TV up for sale, the latest rumor to make the rounds is that Disney CEO-to-be Bob Iger may be interested in selling the ABC Radio group. The New York Post quoted a source as saying that Disney is still deciding whether radio fits with its core businesses - - "But it's still in the early stages," they added. Asked about the rumors in the company's quarterly conference call,

Iger didn't deny that selling radio is a possibility. According to BIAfn, ABC's 73 O&O radio stations (including a couple which are LMA'd to other companies) had 445 million in revenues in 2004. It's not clear whether ABC Radio Networks might also be sold, or whether it would make any sense for anyone else to buy the network operation and lose its ties to ABC Television. RBR sources say ABC Radio Networks has billings in the neighborhood of a quarter billion.

RBR observation: This rumor seems to pop up about once each year. The only thing that might give it more credence this time is the changing of the guard at Disney. With Bob Iger taking over as CEO, he's looking at what sort of company he wants to be running going forward. But Disney has always been much more of a buyer than a seller, so don't be surprised if the radio operation stays right where it is. Also, there's the question of whether this is a great time to sell. With stock prices so low for the public companies, they can't pay a premium price for even beachfront properties - - at least nothing this big. That would greatly limit the pool of potential bidders.

VNR panel set
The Senate Commerce Committee has named witnesses for today's session on video news releases (VNRs). Headlining will be Democratic FCC Commissioner Jonathan Adelstein, who will be joined by FCC Acting General Counsel Austin Schlick. The senators will be considering a bill from John Kerry (D-MA) and Frank Lautenberg (D-NJ) which would require clear source identification whenever the government produces and distributes such a release. The two from the FCC are tentatively scheduled to lead off a three-panel session. The second group includes Susan Poling, Managing Associate General Counsel, Government Accountability Office and Barbara Cochran, President, Radio-Television News Directors Association. The third group will feature Douglas Simon, President & CEO, D S Simon Productions Inc. and Judith Turner Phair, President & Chief Executive Officer, Public Relations Society of America. As usual, RBR will be there so you don't have to be.

Watchdog calls for drug ad regulation
The AIDS Healthcare Foundation (AHF) says that drug companies can't be trusted to regulate themselves, particularly when it comes to promoting its products. Basically, it says that industry promises to develop voluntary advertising guidelines should be taken with a pillar of salt. "The safety of the public's health is simply too important to allow private industry - - namely, big pharma - - a role in regulating its own advertising and marketing," said AHF's Michael Weinstein. "Recent studies have shown that direct-to-consumer advertising creates the market for many drugs. Such advertising is critical to a drug's success. We believe Congress and the FDA delegated too much responsibility and oversight back to the industry in a careless way. We call on the FDA to take back its rightful role in safeguarding the health and welfare of the American public by eliminating or, at a minimum, clamping down on runaway direct-to-consumer drug advertising and stepping up its regulation and oversight of the industry."

FTC ropes media into
childhood obesity fight
The Federal Trade Commission wants children to lighten up - - literally - - and it wants food advertisers and the media to help. A workshop will be held at the FTC Conference Center in Washington to that end, which will focus on industry self-regulation, marketing issues and the media's role in public education. The session will run two days, 7/14/05 and 7/15/05, and will include representatives from a wide variety on stakeholders. FTC Chairman Deborah Platt Majoras said, "Obesity is one public health issue that must be addressed from all angles. This workshop will bring together a wide range of voices to examine ways, including self-regulation, to best promote competition among marketers of healthy foods and the dissemination of good information so that consumers can make healthy food choices." The FTC is looking, among other things, for research regarding the effects of marketing on children's health, and efforts which "media or entertainment companies, government, public advocacy groups and others" can make to better education parents and children about nutritional issues.

RBR observation: The DC office of RBR includes a mother and two fathers, representing six young children, and we are proud to report zero cases of childhood obesity. However, it is stunning how much our children know about nationally-marketed, sugar-infested products. Simply putting out PSAs isn't enough, and what is put out has to be honest - - our children will see right through a campaign such as "Brussels sprouts - - nature's candy." Though we acknowledge the simple fact that as parents we have the most control over our own children's diet, we will also add that anything that can be done by the food companies and media to help will certainly be appreciated. And all Americans will benefit, the childless included, if the local supermarket becomes less of a battlefield.

Upfront 2005

Battle for the bucks:
The Scorecard
Big bucks are on the line next week as the TV networks pitch advertisers and agencies for upfront commitments for next season. More than 8.5 billion is expected to be at stake. This horse race is a little easier to handicap than the Kentucky Derby, since there's no Giancomo waiting to outrun the favorites. CBS is hoping to surpass NBC for the first time in total dollars booked, based on the Eye network's current #1 position overall and strong #2 in the lucrative 18-49 demo. Fox, which is #1 18-49, expects a record take, but has less programming to sell spots on than its three big competitors. ABC is likely to be the most improved over last year, based on its improved ratings. Likewise, NBC is expected to book less upfront money than last year due to its ratings decline. We've put the Nielsen numbers together for you in a Scorecard. Tomorrow: A preview of who's hot and who's not.
| View the Network Primetime numbers |

Conference Calls Q1 2005

Disney beats by a penny
Trading in Disney stock was halted yesterday afternoon when fiscal Q2 results were inadvertently distributed in-house a couple of hours early - - and then a rumor began spreading that the company had beaten expectations by seven cents a share. In fact, the earnings of 33 cents per share beat the Thomson/First Call consensus by a penny. The movie biz was the big driver on the income side, with a couple of hits during the quarter. What about broadcast and cable? Media Networks revenues rose 6% to three billion and operating income was up 3% to 725 million. Cable operating income was actually down 1% to 671 million, as higher revenues at ESPN failed to offset increased costs for the cable operation. Broadcasting operating income nearly doubled to 54 million. Disney officials are standing by their promise that ABC will be profitable for this fiscal year, which is now half over. But the real focus is on future growth, with rising primetime ratings and no longer having to deal with the high cost of "Monday Night Football."

Iger told analysts that moving MNF to ESPN was the right move. For the just completed fiscal Q2 (most companies' Q1), CFO Tom Staggs told analysts that CPMs at the ABC TV network were up in the mid single digits over upfront rates. Revenues for the O&O TV stations were up 4% in Q2, but are pacing slightly lower for the current quarter. In radio, the O&O stations saw revenues grow by low double digits in Q2 and are pacing up modestly for Q3. However, Staggs said sales for the ABC Radio Networks are pacing down.

Adbiz©

GM picks Starcom MediaVest

for 3.2B media account; Donlin speaks
General Motors has awarded Publicis Groupe's Starcom MediaVest Chicago with its 3.2 billion US buying account. The account had been with Interpublic's (Universal McCann's) GM-dedicated agency, GM Mediaworks Detroit for national and LCI New York, for regional buying. The move covers Dealer Association advertising as well (600 million in advertising). The GM buying account is valued at 40-50 million in annual revenue to IPG. The buying functions will move to the Planworks umbrella officially 10/1 (then, all a part of Starcom), with no name change expected. Dennis Donlin at GM Planworks is now in charge and tells RBR/TVBR what's ahead.

TVBR observation: As Donlin said, the moves will be "aggressive." This is Lazar's and LaNeve's plans being put into motion. The goal? As Director of Pontiac Marketing at General Motors Mark-Hans Richer told us in a four-part interview last September, 'When it comes to the modern media environment, for us, it's taking our products and making them not only the center of the story, but the thing that makes the story interesting, worthwhile watching or taking about. Hat's what we mean by, sort of, 'product fusion.' So it's not just product placement. Placement just means just stick a car in a frame and watch it drive by. That's different. We would never, ever spend $10M just to have a car driving down the road in a major motion picture. We would much rather spend that same amount of money producing our own film with top creative talent.' Stay tuned, linked, connected and uploaded, because GM is getting all eight cylinders firing in tandem. LaNeve is not going to hold back when it comes to employing new and revolutionary media and strategy. Donlin and Lazar will be there to make it happen. | More from Donlin |

American Express Picks Saatchi & Saatchi
AMEX has named Saatchi & Saatchi New York as the global AOR for AMEX Financial Advisors in Minneapolis, which it plans to spin off to shareholders later in the year. Billings were estimated at 55 million. The decision came after a review that also included finalists Hill, Holliday, Connors, Cosmopulos Boston; McCann Erickson NY and Ogilvy & Mather Worldwide NY, which continues as the American Express AOR.

Radio & Television Business Report Magazine

June Magazine '05 Clock is Ticking-Heading for Closure

National Sales:
EDI - Electronic Data Interchange, sometimes synonymous with Electronic Invoicing
Kathy Crawford, MindShare President, Local Broadcast, speaks her mind on EDI, specifically stating what solutions she needs from the software and keying entries to get stations faster payment in an exclusive column. States straight up, "Lest you should all think that our work is done in the world of EDI. Think again!" EDI- the focus of the future of national spot dollar. Who is and who isn't involved. From the rep firms to the software companies, we get answers. The Clock is ticking on EDI. Closure in '05?

Reserve your Ad Marketing Space today. Advertising space is limited, contact:
June Barnes [email protected] ----- or ----- Jim Carnegie [email protected]

Media Markets & MoneyTM

Vox Virginia strikes again
There is no company called Vox Virginia, technically, but the Vox family of stations, known in the past for being concentrated in New England, are adding a little more Southern charm. Bruce Danziger's outfit recently filing to buy WZXI-FM Buffalo Gap from Easy Radio Inc. for 900K (5/5/05 RBR #89). Joining that station in the VA portfolio will be WSIG-FM Mount Jackson, which Vox will be acquiring from Force 5 Communications for 2M. Force 5 is headed by Danziger's long-time partner Jeff Shapiro. The stations have nothing whatsoever to do with one another in consolidation terms. We'd say that their biggest relationship is Harrisonburg VA - - Buffalo Gap is 30-some miles south of town, while Mt. Jackson is 20-something miles to the north. Drivers on I-81 can hear both stations, just not the same drivers, at the same time. Richard A. Foreman handled brokerage chores for the seller.

Washington Beat

Eagles take note of notice requirement
The attorneys at Garvey Schubert Barer (GSB) have informed their clients (and us) of an FCC notice of proposed rulemaking (NPRM) that we found interesting and haven't reported on before. It concerns proposals to better notify the public when a station is being sold, and could go much farther than that, to facilities modifications or other transfer application amendments. In a newsletter, GSB says that the whole thing originated in a deal which would have ultimately switched noncommercial WYPR-FM Baltimore from a Religious format to an outlet for NPR. (The new rules, if adopted, would apply to commercial stations as well.) The particular in the Baltimore case was an untimely petition to deny - - the rules would constitute an attempt to head such petitions off at the pass, but GSB says a side-effect would be a new and onerous layer of process for broadcasters. Among the proposals: providing broadcast notice, and detailed notice in a local newspaper; changes to the time frame; use of specific text; use of multiple languages; and require announcement of ownership interests for both buyer and seller.

Transactions

2.1M WNNR-AM & WVOJ-AM Jacksonville FL (Jacksonville, Fernandina Beach FL) from Florida Sports News Network LLC (Larry Calufetti) to Norsan Consulting and Management Inc. (Norberto Sanchez). 100K escrow, balance in cash at closing. Superduopoly with LMA of WEWC-AM Callahan FL (licensed to Hola Communications). LMA until closing @ 12K/month. [File date 4/14/05.]

112.5K WMGR-AM Bainbridge GA. 50% of Decatur Broadcasting Inc. from Charles C. Voyles (100% to 50%) to Dewey Robinson (0% to 50%). Debt assumption. Buyer will also loan company 50K to purchase 5 kw solid state transmitter. [File date 4/12/05.]

Stock Talk

Market up as broadcasters fall
A late rally spurred by falling oil prices gave major Wall Street indices modest gains for the day on Wednesday. The Dow Industrials finished the day with a gain of 19 points to 10,300. That burst of enthusiasm, however, did not extend to broadcast stocks, which were down nearly across the board.

The Radio Index fell 3.460, or 1.7%, to 199.170. Univision dropped 4.5% on news that it was being sued by Televisa. Somehow that disruption in the Hispanic broadcasting business also made investors sell radio rival SBS as well, so it fell 4.6%. Entravision, however, fell only 1.5%.

Radio Stocks

**Here's how stocks fared on Wednesday**
Company	Symbol	Close		Change	Company	Symbol	Close		Change
Arbitron	ARB		39.42	-0.17	Jeff-Pilot	JP		50.14	+0.20
Beasley	BBGI		17.68	+0.16	Journal Comm.	JRN		16.20	-0.17
Citadel	CDL		11.62	-0.36	Radio One, Cl. A	ROIA		13.03	-0.40
Clear Channel	CCU		30.05	-0.35	Radio One, Cl. D	ROIAK		13.07	-0.35
Cox Radio	CXR		15.36	-0.51	Regent	RGCI		5.25	+0.01
Cumulus	CMLS		11.88	-0.37	Saga Commun.	SGA		15.94	-0.24
Disney	DIS		26.67	-0.28	Salem Comm.	SALM		20.99	-0.14
Emmis	EMMS		18.21	-0.23	Sirius Sat. Radio	SIRI		5.75	unch
Entercom	ETM		32.17	-0.35	Spanish Bcg.	SBSA		8.12	-0.39
Entravision	EVC		7.38	-0.11	Univision	UVN		25.32	-1.18
Fisher	FSCI		49.49	+0.66	Viacom, Cl. A	VIA		34.77	-0.38
Gaylord	GET		39.98	-0.19	Viacom, Cl. B	VIAb		34.61	-0.38
Hearst-Argyle	HTV		24.94	-0.32	Westwood One	WON		18.83	-0.31
Interep	IREP		0.45	unch	XM Sat. Radio	XMSR		27.77	-0.03
International Bcg.	IBCS		0.01	unch	-	-	-	-	-

Bounceback

Send Us Your Opinions We want to
hear from you.
This is your column, so send your comments to [email protected]

Upped & Tapped

Ervin gets KMOX
Dave Ervin won't need a moving van as he jumps cross-town from being Market Manager for Radio One's St. Louis stations to his new job as Vice President and General Manager of Infinity's KMOX-AM. He fills the vacancy created when Tom Langmyer went to WGN-AM Chicago (3/9/05 RBR #48).

Carl Miller named Salem's Director of National Program Placement
Miller has been named to the newly-created post, reporting to Ron Walters, vice president of national programming and ministry development. In this role, Miller will work with Salem's Christian Teaching and Talk radio stations in meeting the ongoing demands of national ministries for air time.

Bailey named Senior AE with CC Radio Sales LA
Matthew Bailey has been named Senior Account Executive with Clear Channel Radio Sales, it was announced by Greg Glenday, Regional Vice President, Director of Sales with Clear Channel Radio Sales.

Liberman finds CFO close at hand
After going through two CFOs in less than two years (5/2/05 RBR #86), Lenard Liberman has taken the title back himself at Liberman Broadcasting and its holding company, LBI Media. Still pending is the company's long-awaited IPO.

Stations for Sale

Bankruptcy Sale:
New Mexico Radio Stations
US Bankruptcy Court is selling the assets of a New Mexico radio group - 1 AM and 2 FM's in Silver City and 1 AM and 2 FM's in Alamagordo. Stations generate over $800,000 of revenue, are currently profitable and have good upside potential. No broker fees. John Brooks, Consultant to US Bankruptcy Court(415)383-5967 [email protected]

Nevada "C" Class FM:
Positive C.F., Market Favorite. Upgrade Pending. Asking $1M. Residential Property
Available for $300K.
Brett Miller - MCH Enterprises, Inc.
Full Presentation Available.
[email protected]
805.237.0952

More News Headlines

Omnitronix' PowerBoss One launches

Katz/AWRT detail third annual Women's Career Summit

RBR Radar 2005

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

Emmis bombshell:
TV group for sale, buying stock
After talking for five years about possibly splitting its radio and TV units into separate companies, has instead decided to exit the TV business with their 16 TV stations. One option is a management buyout, headed by TV Pres. Randy Bongarten. Jeff Smulyan said it had become necessary to sell the group to focus on the company's radio business. Bear Stearns analyst Victor Miller asked whether the TV sale might just be phase one, leading to an eventual total sell-off, he didn't get no for an answer. RBR observation: Wall Street's valuation of his company has been a source of constant frustration for Smulyan for many years even before it became an issue for other companies like Viacom and Clear Channel. Being a pure play radio group (with a small magazine subsidiary) may finally win Emmis respect for its cash flow. But maybe not. Then what will Smulyan do? There's a perception that it if you want to run with the big dogs in New York, LA and Chicago, you have to be one of the big dogs - - or risk begin eaten. 05/11/05 RBR #93

What's Emmis got to sell?
Here's your shopping list if you want to get in on the bidding for TV stations at Emmis Communications. RBR observation: We can say with near certainty that the entire Emmis TV group will not end up with a single new owner. That's because of the situation in Honolulu, where it has a temporary waiver to own both the CBS and Fox affiliates. So look for those to end up in separate hands. 05/11/05 RBR #93

NBC stands to lose as much as
550 million in upfront
Or 20% decline from last year as it's take is expected to be between 2.2 billion and 2.3 billion. "It doesn't sit well with us," NBC Universal Television Networks Group President Randy Falco "We're like the New York Yankees, we've been No. 1 for 12 out of the last 18 seasons. Most people go to the Hall of Fame for that record." NBC's decline, highlighted by the loss of "Friends" and bombs like "Father of the Pride," has Fox, ABC and CBS primed for their presentations to advertisers starting Monday in NYC. RBR observation: Did we hear Falco correctly - "It doesn't sit well with us, .. We're like the New York Yankees.." Someone get a grip on reality as TVBR stands by our first of numerous observations on NBC about commitment, passion, and programming content especially with content or the bottom line is Mr. Falco you can't win games like the Yankees with old relief pitchers when you don't even have a strong starting lineup. Mr. Falco NBC has become just a paycheck player because to win games you have to have Passion. We will give you a mulligan on the back nine if you pick up American Dreams and build with youth programming. Or we agree with this part of your statement "...Most people go to the Hall of Fame for that record." Yep, last time we looked there are a number of late ball players in the Hall of Fame and most of them are dead. American Dreams is a good lead into Sunday night football because the programming has passion and youth.
05/11/05 RBR #93

Hicks, Muse exiting
Clear Channel very fast!
We suggested that it might take a while to monetize its entire stake in Channel Communications ). Nope - - it's dumping and running. Not only is the Dallas-based investment firm selling back 5.7 million shares to Clear Channel, it's also selling 16.8 million to Citigroup and then distributing what's left of its 37.5 million-share stake to the investors in the various Hicks, Muse funds to do with them as they wish. It's a good bet that a lot of them will soon be sold.
RBR observation: What's truly amazing is that the Hicks, Muse exit has had very little impact on Clear Channel's stock price. It fell 2.5% on news of the 5.7 million share sale back to the company. The eventual sale by Hicks, Muse had been anticipated for over a year after Tom Hicks retired from the investment firm and then resigned from the Clear Channel board. Beyond that, the stock price had already been beaten down so much that traders must believe it is as low as it can go. If so, it appears Hicks, Muse may be selling at the bottom and taking a loss of about 1.65 billion from what its Clear Channel stake was worth in 2000 when it merged AMFM Inc. into the company - - a 58% drop in value. Ouch! 05/10/05 RBR #92

Broker Opportunity
Established in 1979, conducted over 1 billion in transactions seeking just one exec that desires to learn and become a player in the investment media station brokerage business. First quality in our firm is integrity.

Sales Position
We're expanding our sales force to spread the word about MusicMaster for Windows music scheduling software. Self-starters that can build relationships apply and grow. Must be able to travel but no relocation required.

See Radio Careers

Other Links

State Associations
Contact Us

Publisher question:
Reading RBR from a friend?
Receive your own morning copy at www.rbr.com

Help Desk

Having problems with our epapers?
Please send Questions/Concerns to:
[email protected]

If you wish to remove your name completely from our database use this link __UNSUB__

If you wish to unsubscribe
to RBR only, use this link