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Welcome to TVBR's Daily Epaper
Volume 22, Issue 142, Jim Carnegie, Editor & Publisher
Thursday Morning July 21st, 2005

TV News®

Ratings task force opposes Burns bill
Sen. Conrad Burns' (R-MT) bill to regulate TV ratings is drawing fire from the Independent Task Force on Television Measurement that was set up to deal with allegations of minority undercounting by Nielsen. Although the Burns bill to make Media Ratings Council accreditation mandatory for TV ratings services was prompted by allegations that Nielsen's Local People Meters undercount minorities, the Task Force says the legislation would hurt minority programmers and ad agencies. The Task Force, which was chaired by former Rep. Cardiss Collins (D-IL), says such regulation would impair Nielsen's ability to introduce new services for stations and networks aimed at minority communities. "For example, the legislation would stop Nielsen from continuing to provide affordable local ratings to Spanish-language stations. That is because existing services like the Nielsen Hispanic Station Index - - whose samples are fairly small and combine data from other samples - - cannot be accredited by the Media Rating Council. If the bills [the Buns bill in the Senate and a House companion by Rep. Vito Fossella (R-NY)] become law, Nielsen would have to shut down these services and eliminate the only available ratings to these clients," the Task Force said in a letter to members of the Senate and House Commerce Committees. Rather than passing the proposed legislation to regulate TV ratings, the Task Force urged the lawmakers "to support a continuing free market process for dealing with ratings issues, and to ensure that communities of color are not negatively impacted."

Roberts lets FCC be the FCC
Supreme Court nominee John Roberts has been at the US Court of Appeals for the District of Columbia Circuit, a venue that is no stranger to communications cases. Two years ago, he upheld the FCC's right to enforce a digital tuner mandate in the face of a challenge by the Consumer Electronics Association (CEA). CEA said that the FCC was overstepping the bounds of its authority. Roberts agreed that the All Channel Receiver Act of 1962 (ACRA) was applicable to the DTV transition. It held that all television sets be able to receive all television signals licensed by the FCC. At the time, then FCC Chairman Michael Powell said, "This will ensure that consumers are able to enjoy high-quality digital broadcast programming without the hassle and expense of hooking up a separate set-top box. We're pleased that the court has upheld a key component of our digital television transition plan." (10/29/03 TVBR #212)

TVBR observation: The District Circuit can be seen as the highest of the high minor leagues - - AAA and then some. Looking ahead to the possibility of Roberts joining the starting judicial nine, it would seem that the key point is his willingness to let the FCC be what it is supposed to be - - an expert agency created to regulate a socially, politically and technically complex set of industries. Hardly a day goes by without a politician somewhere demonstrating a profound lack of understanding of the challenges that go with operating a communications business. With that in mind, it is probably good that Roberts seems to put some stock in that expertise - - although we would caution that it is entirely possible for the FCC to go off track anyway. We would therefore ask Roberts to pay attention and try to find the right answer each time out.


Forrester study sees radio gaining
700M a year from PPM
Here's the short-hand summary of the Portable People Meter economic impact study by Forrester Research that was made public yesterday by the RAB-PPM Task Force: If radio adopts PPM, ad revenues will go up, but if it sticks with diaries, ad revenues will go down. Not all of the 189 advertisers surveyed said they would increase radio ad spending with PPM, but 23% - - about one in four - - said they would. Among the 295 ad agency folks surveyed, 17% said they would increase radio spending with PPM. But if radio sticks with Arbitron's current diary methodology, 8% of both groups said they would reduce radio ad spending in coming years. Thus, 22% of agencies and 24% of advertisers said their radio budgets would be higher with PPM than with diaries - - an average difference of 9% for the agencies and 12% for the advertisers. "We believe that what we've essentially done is now gone and talked to our customers and, in effect, they've given us a ratings roadmap as we enter what we think is a very critical currency crossroad in radio," said David Pearlman of Pearlman Advisors, who has been consulting the RAB-PPM Task Force as he presented the Forrester findings. Based on economic modeling, for which Forrester is a respected authority, the radio industry can expect annual ad revenues to rise 414 million per year if PPM is deployed in all Arbitron markets, vs. a drop of 282 million if diaries continue to be used - - a 696 million swing in revenues. The report also broke out the potential change if only larger markets switch to PPM.
| View the Chart |

TVBR observation: One thing Forrester didn't analyze is whether PPM deployment would justify the 40-65% increase in ratings costs that Arbitron has told radio broadcasters to expect from transitioning from diaries to PPM. 700 million bucks is about 35% of radio current revenues, so if Forrester's projections are accurate, paying Arbitron an additional 110-180 million a year would be a good deal for broadcasters. But while that may be true industry-wide, it's a different calculation in the real world, where stations in smaller markets where ratings are less important than face-to-face selling are less likely to see a cost benefit from PPM. That's also likely to be the case for many niche players in larger markets. If radio embraces PPM, it will be because the big guys - - Clear Channel and Infinity in particular - - see a cost benefit in it.

Where would that PPM gain come from?
If advertisers are going to increase ad spending on radio if PPM is deployed, that additional cash has to come from somewhere. When RBR/TVBR asked about that, Josh Bernoff, Vice President, Principal Analyst, Forrester Research, said the survey didn't specifically ask that question. However, he noted that in incidental comments during the survey, several of the participants indicated that they would move dollars from television, while others said it would just be a result of radio getting a bigger share of growing ad budgets. Notably, there was a lot more dissatisfaction with current radio ratings - - Arbitron's diaries - - than with Nielsen's TV ratings, whether Local People Meters or meter/diary. "When we asked people about credibility of ratings, the television rating system got a much higher rating than the current radio rating system," said Bernoff.

TVBR observation: Being a radio-centric survey, the Forrester study assumed that only radio would switch to PPM in assessing the financial impact. Of course, Arbitron is also seeking to get Nielsen to commit to a joint venture which would make PPM the ratings currency for broadcast TV and cable, as well as radio. We would assume that such a move would reduce any potential shifting of ad budgets from TV to radio. But it would also keep the ratings cost increase for radio closer to the 40% end of Arbitron's range, rather than the 65% jump for a radio-only PPM system. The math on all this is complicated, to be sure.

Senate panel looks at journalist shield
The Senate Committee on the Judiciary held a session yesterday (7/20/05) called "Reporters' Shield Legislation: Issues and Implications." The revelation of the identity of perhaps the most famous confidential source in recent history, Deep Throat, combined with the recent jailing of New York Times reporter Judith Miller, have put a white-hot spotlight on the topic. A trio of elected officials, Senators Richard Lugar (R-IN) and Christopher Dodd (D-CT) and Rep. Mike Pence (R-IN) formed the first panel of witnesses. All claim sponsorship of shield legislation. Time magazine reporter Matt Cooper, who was on the same bubble as NYT's Miller, was a star of the second panel, which also included his Editor-in-Chief Norman Pearlstine, retired NYT stalwart William Safire, attorneys Floyd Abrams and Lee Levine and University of Chicago Law School Professor Geoffrey Stone. Suffice it to say that there is widespread and bipartisan recognition of the need for journalist/source confidentiality if the press is to properly perform its job as watchdog, particularly over the government. Cooper noted the presence of shield laws at the state level, but confided that he was unclear about the true rules of the road, and called for some federal clarification. "As someone who relies on confidential sources all the time, I simply could not do my job reporting stories big and small without being able to speak with officials under varying degrees on anonymity," explained Cooper. "In most organizations only a handful of designated press spokesmen are authorized to speak with the media and, with all due respect, they cannot always be counted on to provide the most fulsome description of what is going on behind the scenes. For that we need anonymous sources."


Conference Calls Q2 2005
Radio outperforms TV at Journal
Revenues and earnings for radio and newspapers were up in Q2 for Journal Communications, overcoming a soft quarter for television. CEO Steve Smith is expecting more of the same in Q3, with radio continuing to grow revenues by focusing on local business, while TV faces tough comps from last year's results, that were inflated by electioneering. Journal Broadcast Group President Doug Kiel also notes the impact of declining network primetime ratings on the group's three NBC affiliates, particularly flagship WTMJ-TV Milwaukee. In Q2, radio revenues rose 4.6% to 21.4 million and earnings rose 9.4% to 5.4 million, while TV revenues declined 1.3% to 21.5 million and earnings plunged 42.8% to 3.5 million. Not counting recently acquired WGBA-TV Green Bay, WI, TV revenues dropped 12.6% and operating earnings were off 45.5%. In all, broadcast revenues rose 1.6% to 42.9 million and earnings decreased 19.4% to 8.9 million. Publishing revenues rose 2.2% to 85.4 million and earnings rose 13.4% to 14.3 million.


Adbiz©

Netflix launches TV effort
Netflix has launched its first ad campaign in two years with five 30-second spots that will air across dayparts on cable and network TV for the next 12 months. The spots each target a particular kind of movie-watcher. In each spot, people come home, open their front door, and are immersed in the movie genre of their choice. In one, a man comes home, opens his fridge and a monster hound growls at him. Another appeals to war-movie lovers, another to romantics, and another to a young girl. Netflix spent 35 million, including 23 million on cable, 11 million for spot TV and the rest on radio and newspapers in 2004, according to Nielsen Monitor-Plus. Goodby, Silverstein & Partners, San Francisco handled creative.

Report: TiVo's "paradigm shift" likely to be unsuccessful
A new report from The Diffusion Group proposes TiVo's new plan to seek "mass deployment" of the TiVo service through cable service providers, while likely to help boost revenue, will do little to generate profit. According to "Can TiVo Survive? A Case Study in the Perils of First-to-Market Innovations," former CEO and co-founder Mike Ramsay warned board members and fellow execs in January that licensing deals with digital TV operators would not be the best way to grow TiVo's business. In fact, said Ramsay, "...the economics are not very attractive." | More... |

TVBR observation: Why would MSOs need TiVo when they have their own technology and DVR offerings? Most new subscribers will opt for the easiest way to DVR - - whatever the cable company offers as part of their package. Why would the subscribers or MSOs need a "DVR middleman"? Brand appeal will only get TiVo so far, and we think we've seen how far already. TiVo's best chance for revenue seems to be its recent interactive additions for advertisers.


Radio & Television Business Report

Radio's Important September Face Off
UpFront 2005 - will radio face the mild reception as Network TV? Look for the major Ad Agency decision makers to speak they mind in our upcoming September magazine. This is last call for networks to get their message across for 2006.
(15,000 mailed and Special distribution at NAB Philly )

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Media Markets & MoneyTM
ErinMedia to
acquire Navigauge
ErinMedia to add radio measurement: Upstart television ratings provider erinMedia, which recently published criticisms of Nielsen's ratings methodology and technology (7/8 TVBR #133), announced it has reached a strategic alliance with in-car media measurement service Navigauge which would enable erinMedia to acquire Navigauge's key assets and intellectual property in Q4, subject to the execution of a definitive agreement. The erinMedia / Navigauge tandem would position erinMedia as the nation's "only ratings company poised to provide cross-media, sector-specific ratings services across the three mass communication mediums of television, radio, and outdoor." "We would be extremely pleased to add the complementary and cutting-edge power of Navigauge to our growing arsenal of technology-driven media measurement systems. Navigauge's passive in-car measurement devices are vastly superior to the diary methodologies still used to monetize over 20 billion annually in U.S. radio advertising," said Frank Maggio, Chairman and CEO of erinMedia. "Much like erinMedia's passive measurements of TV viewing, taken at the point of consumption, the Navigauge methods deliver accurate and relevant results without relying on a listener's memory, sometimes even days later!" Navigauge provides demographic, second-by-second radio ratings products through analysis of data collected using patent-pending passive monitoring devices installed in panel members' vehicles. The Navigauge technology - - which also uses GPS software - - also allows Navigauge to "geo-code" billboard locations, enabling the company to provide timely, current, and board-specific outdoor advertising rating and demographic data.

TVBR observation: We wonder if the Navigauge process of tearing into people's cars to install all of this equipment will really be cost effective - - at least for a real world, nationwide ratings system. Seems that to be cost effective, the Navigauge-system sample size will have to be minimal. For reliable numbers, a large sample size is usually needed. However, Navigauge has delivered some interesting insights about the Atlanta market.


Washington Beat
Reinforcements sign up to keep satellite national
The fact that satellite audio services have the technical ability to jury-rig automated local service for a number of markets doesn't mean they should be allowed to. As most broadcasters know, they are statutorially prohibited from providing service that is not nationally available. That has not stopped them from broadcasting national channels that are keyed to a certain market. It's one thing for them to have automated weather and traffic data keyed to a given city - - it's quite another for them to have boots on the ground during an actual emergency. They don't, and it's not part of the business model. That is the key reason why members of Congress say that truly local broadcasters need to be protected from competition from such pseudo-local services. Bipartisan legislation in the House sponsored by Chip Pickering (R-MS) and Gene Green (D-TX) has actually picked up further support with the addition of Thelma Drake (R-VA), Frank Pallone Jr. (D-NJ) and Chistopher Shays (R-CT) to the co-sponsor list.

TVBR observation: Attached, courtesy of the NAB, is the current list of co-sponsors. Your mission, should your representative not be listed, is to if at all possible rectify that situation. | View the full list of co-sponsors |


Programming
ABC signs for another
round of "Dancing"

Talk about a no-brainer! ABC has wasted no time in nailing down summer hit "Dancing with the Stars" for another go-'round. Look for it to show up at mid-season, rather than waiting until next summer. As a surprise hit, "Dancing" was #1 for the last five weeks of its six-week run and average 16.8 million viewers.

TVBR observation: Our advice to ABC is not to get too cocky. "Dancing" is good summer fun, but don't try something stupid like running it up against Fox's "American Idol." Season #2 should be even bigger than #1 if done correctly. After seeing that the show was a hit this year, some real A-list celebrities may want to show the world that they can cut a rug with the best of 'em. (Can John Travolta really dance, or is it just good editing?) Of course, the field will be expanded next year to make the series run longer. Ten couples sounds about right to us.


Ratings & Research
Over 29M watched Supreme Court announcement
Nielsen Media Research calculates that 29.3 million people 2+ watched Tuesday night as President George W. Bush nominated John Roberts to the US Supreme Court. The speech from the White House was carried live on nine English language commercial networks - - ABC, CBS, Fox, NBC, CNN, Court TV, Fox News Channel, Headline News and MSNBC. But while the audience draw was impressive, it still didn't make the all-time top 20 for presidential addresses on TV. | Here's the list |

Summer numbers look good
for syndication

An analysis of June television ratings by the Syndicated Network Television Association shows that syndicated programs dominate broadcast television with the majority of top 10 rated programs every weekday. "Taking a ratings lead over network prime this June bodes well for syndication's growing momentum this summer," commented Mitch Burg, president, SNTA. "Syndication has three of the top five adult18-49 rated programs every day of the week. This clearly demonstrates syndication's audience leadership in the summer marketplace." | Other findings from the study: |


Stock Talk
An upbeat day
Stocks gains Wednesday as Alan Greenspan delivered an upbeat assessment of the economy - - although he also indicated that the Fed will continue to raise rates - - and several companies delivered strong Q2 results, although General Motors missed its target. The Dow Industrials rose 43 points, or 0.4%, to 10,689.

TV stocks were also higher. The day's strongest performer was Saga, which is mostly a radio company. It gained 3.6%. Scripps gained again on the strong performance of its cable networks - - up 2.9%. Wall Street didn't like the TV softness reported by Journal and it fell 1.3%.


Stocks

Here's how stocks fared on Wednesday

Company Symbol Close Change Company Symbol Close Change

Acme

ACME

4.20

-0.12

Media General

MEG

67.70

+0.29

Belo

BLC

23.74

-0.45

Meredith

MDP

49.96

+0.03

Clear Channel

CCU

31.76

-0.11

News Corp.

NWS

17.53

+0.11

Disney

DIS

25.83

+0.07

Nexstar

NXST

5.60

-0.20

Emmis

EMMS

18.16

-0.10

NY Times

NYT

32.12

+0.58

Entravision

EVC

8.49

+0.15

Paxson

PAX

0.61

unch

Fisher

FSCI

45.05

-0.01

Saga Commun.

SGA

14.80

+0.52

Gannett

GCI

72.70

+0.89

SBS

SBSA

8.64

+0.14

Gen. Electric

GE

35.30

-0.03

Scripps

SSP

50.28

+1.41

Granite

GBTVK

0.20

unch

Sinclair

SBGI

9.02

+0.06

Gray

GTN

13.00

-0.04

Time Warner

TWX

16.65

+0.15

Gray, C1. A

GTNa

11.88

unch

Tribune

TRB

35.90

+0.54

Hearst-Argyle

HTV

23.85

-0.18

Univision

UVN

27.45

+0.25

Jeff-Pilot

JP

50.70

+0.01

Viacom, Cl. A

VIA

32.49

-0.32

Journal Comm.

JRN

16.40

-0.21

Viacom, Cl. B

VIAb

32.47

-0.04

Liberty Corp

LC

38.18

+0.56

Wash. Post

WPO

858.00

+8.00

LIN TV

TVL

14.76

+0.23

Young

YBTVA

3.45

-0.05

McGraw-Hill

MHP

44.80

+0.57

-

-

-

-

-


Bounceback

Send Us Your OpinionsWe want to
hear from you.

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

I was on the NAB board of Directors back when the idea of Satellite Radio first came up. I recall a panel discussion at the national NAB meeting in Vegas where one of the FCC commissioners said, "the technology is there, so we need to let it happen" - - referring to the proposal to allow sat-radio. I got up and took the mike and said..."the technology is there where we could all have an atom bomb in our basements, but that doesn't mean we should do it." That was a poor excuse for letting this rabbit out of the box. Traditional radio needs to be LOCAL, LOCAL, LOCAL, doing lots of local news and information. Frankly, I don't hear much of that...too many "jukeboxes" automated out of the home office.

Curt Brown, Former NAB Board Member, Former AP Broadcast Board Member, Former Country Radio Broadcasters Board Member, and former President of Missouri Broadcasters Assn. Thirty-one year GM of Great Empire's top rated KTTS in Springfield, MO. Now retired in Branson, Missouri.


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TVBR Radar 2005
Television News you won't read any where else. TVBR--First, Accurate, and Independently Owned.

Scripps blows 'em away
TV was soft, but its cable network business was so strong in Q2 that Scripps beat the Thomson/First Call consensus by six cents per share, coming in at 59 cents. For Q3, Scripps is expecting more of the same from its cable nets, with revenues expected to rise 25-30%. But broadcast TV is expected to have another tough quarter - - dropping 8-10%, although the company says that would be a 5-7% increase if you don't count the 10.2 million in political revenues last year. Q3 newspaper revenues are expected to rise 6-8%.
07/20/05 TVBR #141

Gore vows balance for new net
With Current - - the remake of Newsworld International - - set to launch August 1st, co-founder Al Gore, formerly Vice President of the United States, told TV critics this week that the young-skewing news and information channel won't be partisan. Rather, he says, it will focus on programming to draw in 18-34 year olds who don't watch older-skewing news channels. TVBR observation: Wasn't the whole idea of this new network to be a liberal counterweight to Fox News Channel? We would note that Gore grew up in partisan politics and his co-founder, Joel Hyatt, is married to the daughter of a former Democratic Senator. Somehow, we doubt that they're going to let their new cable net promote any conservative Republican causes in an attempt to be fair and balanced. (Oops, that slogan's already taken.)
07/20/05 TVBR #141

ZenithOptimedia downgrades
ad expansion
Advertising prognosticator and scorekeeper has revised downward its most recent prediction for worldwide advertising sales growth. It had been looking for a global increase of 5.4% as of last April, but now expects the year to end only 4.7% to the good. The culprit? US network Television.
TVBR observation: prognosis for 2006, taking it from a 6.5% increase down to 6.1%. The charts take into account most forms of advertising, including television, radio, newspaper, magazine, cinema, outdoor and Internet. View the charts. 07/19/05 TVBR #140

Cable competition bill
back on track in Texas
While it had appeared earlier that legislation to make it easier for phone companies to compete with cable MSOs in video distribution was dead for this year in Texas, a special session of the state legislature has breathed new life into the effort. the Texas House voted 135-6 on Sunday to approve a bill which would let phone companies roll out Internet-based digital TV services without having to win franchises from each local government in the state. 07/19/05 TVBR #140

TiVo launches
interactive ad technology
Its next generation interactive advertising technology solution with campaigns from GM and The WB. The new features include interesting data see 07/19/05 TVBR #140

Prediction: 46.8M
satellite radio subs by 2014
No RBR but Kagan sees satellite radio subscriptions will hit 46.8 million by 2014, generating 7.6 billion in revenues. That's still just a fraction of what terrestrial radio does, but impressive nonetheless if it proves to be true. Basing its latest estimates on recent programming deals announced by the two satellite services, and especially their deals for factory installs by auto makers - - not the least of which is the Hyundai deal to install XM receivers in 100% of its vehicles. Kagan is projecting that XM will turn cash flow positive in Q3 of 2007 and Sirius sometime in 2008. RBR observation: Hey, wait a minute - - hasn't XM been promising shareholders it would be cash flow positive in Q3 2005? That will be its first quarter with more than four million subscribers for the entire three month period - - the supposed magic number. At least Kagan has figured out that that's not going to happen. 07/19/05 RBR #140

Publisher Perspective
Foolish All are with Bill S.1372
Senators involved: Conrad Burns (R-MT) Mel Martinez (R-Fla.), Olympia Snowe (R-Me.) and George Allen (R-Va.). None of which have a clue what they are about to undertake and the potential problems all broadcasters and total media will face if this gains more speed. Why? What happens with bills? How much pork will be added to the belly. Our recommendation is these fabulous four should do a bus trip to Tampa, FL and take a tour of the Nielsen technology plant and talk with the 4,000 plus employees working on the issue at hand to find the pros and cons, especially Martinez. Hey Sen. Mel there are over 4,000 voters there you have done POed.
07/18/05 TVBR #139

Eddie Fritts fires letter to
Congress on WCS-XM deal
Wrote members of Congress 7/14 claiming XM Satellite Radio's deal to buy WCS Wireless and its licenses is "part of a longstanding pattern of deception by the satellite radio industry." satellite companies have "proven once again they simply cannot be trusted." He asks the legislators to support the proposed H.R. 998 bill to solidify a prohibition against local content on satellite. TVBR observation: We applaud Fritts and the NAB's efforts to initiate some way to make XM and Sirius follow the rule of their licenses, even though the entity that issued those licenses-The FCC-isn't. Please send your comments on this issue to [email protected] Your fellow broadcasters thank you.
07/18/05 TVBR #139


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