Smulyan upbeat, but says Emmis can't buck the economy
Emmis Communications didn't miss its fiscal Q2 guidance target for radio as Wachovia Securities analyst Jim Boyle had warned (9/22/04 RBR Daily Epaper #185) and CEO Jeff Smulyan is confident that the company's radio and TV groups will outperform their markets again in the current quarter. While he admits there are concerns because of the choppy economy and new media competitors, Smulyan said "reports of the demise of over-the-air radio and television are greatly exaggerated."
In his conference call with analysts, Smulyan noted the rash of recent negative reports about broadcast ad trends. "Our September performed very, very nicely, both radio and television. And while October pacing are down, and that's been duly noted, the reality is that pacings were a lot worse in July and August and those months turned out to be. And November pacings are actually looking OK. So I think that all that's been written about the demise of local broadcasting I think is overblown," he said.
While Emmis is projecting growth again in the current quarter, one analyst noted that the gains have been sequentially less each quarter this year, despite easier comps this quarter, so he wanted to know why Smulyan is optimistic about radio's long-term prospects.
"None of us are immune from the economy and I think a lot of the correlation between this medium and the general performance of the economy has sort of been lost. There's no question radio has struggled this year and every CEO and everybody else knows it. I think the real question is - - and we won't really get color for a couple of years - - was did radio really lose a lot or was it just a reflection of a softer economy?" Smulyan replied. He went on to say that industry leaders in radio - - and TV as well - - are addressing the problems that broadcasters face in the current media marketplace. That's not only Clear Channel's "Less is More" initiative, which he praised, but other efforts to advance the perception of broadcast media and technological advancements, such as HD Radio and the Broadcasters' Initiative for DTV that Emmis is spearheading.
"Don't count American radio and TV out. If you don't believe that, ask anyone you know who lives in Florida," Smulyan said, referring to the importance of broadcast stations in delivering emergency information during and after the state's recent rash of hurricanes.
RBR observation:
Times are tough, and as Smulyan noted, his company can't buck the direction of the US economy. But Emmis does have some things going right for it which don't necessarily extend to the entire broadcast industry. In New York, in particular, Emmis Radio is on a roll, with Barry Mayo & Co. cranking up the volume. Saying he didn't want to jinx anything, Smulyan nonetheless couldn't resist mentioning that WRKS-FM "Kiss-FM" is on track to topple Clear Channel's WLTW-FM from its long-held spot and reclaim the #1 12+ title that Kiss once held for many years. Meanwhile, WQHT-FM "Hot 97" is rebuilding its morning show around "Miss Jones" and fighting in court to enforce its non-compete against "Star and Buc Wild," who are now in the Clear Channel stable (and on the air in Hartford and Philly).
Are you reading this from a forwarded email?
