|iHeart asks “What’s in a name?”
iHeartMedia to sell the names “Clear” and/or “Channel” to its Clear Channel Outdoor subsidiary.
More creative thinking from financially-pressed iHeart – but what does it mean? Even Wells Fargo analyst Marci Ryvicker says “without seeing the details, we honestly have no idea how to interpret this.” But she speculates “It could be another method to move cash from the outdoor subsidiary to the parent.” (That’s happened before, irritating some debt-holders all the way to court.) Marci points out that “the parent is facing an $8.3 billion debt wall in 2019.” But there might be other reasons. The analyst speculates that the intellectual property sale – a “binding option,” at this point – could be “cleanup in preparation for a potential spin, that would allow Clear Channel Outdoor to keep its trademarked name.” (In other words, controlling partners Bain Capital/Thomas H. Lee Partners could spin more of publicly-traded CC Outdoor to keep parent iHeart Media current with its debt. They now own about 90% of “CCO.”) The SEC filing says the option is exercisable by CC Outdoor “at any time between the first and second anniversaries of the payment of the dividend described below.” And here’s that piece of it –
Clear Channel Outdoor declares a big dividend – 90% of which goes to parent iHeart.
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It’s partially linked to the option to buy the “Clear Channel” name (or variations) and has the effect of quickly infusing $254 million into iHeartMedia. That’s 89.9% of the total “special cash dividend” of $282.5 million. (Members of the general public who own “CCO” stock can bank the other 10.1%.) Where does CCO come up with that kind of dough? The outdoor business generally is thriving. CCO will use cash on hand, including last Fall’s proceeds from selling its joint venture interest in Australia, and from selling outdoor assets in Columbus and Indy. And to return to the “binding option” for “Clear Channel” – the exercise price would be set by the “fair market value” of the intellectual property, as determined by an expert outsider. But until that happens – next year or 2019 – Clear Channel Outdoor will be paying iHeartMedia a royalty fee for “Clear Channel.” In September 2014, the familiar parent Clear Channel became “iHeartMedia.
From the Rumor Mill – is iHeart now marketing some stations held by the Aloha Station Trust?
That’s what this NOW Newsletter hears, and it would change the ten-year status quo for the stations that trustee Jeanette Tully’s been holding. You can speculate whether iHeart simply could now use the money from selling these stations. Or whether it’s received signals from the new Ajit Pai FCC that it should be more aggressive about finding permanent owners. The trust could’ve argued through the Great Recession that buyers were scarce. And some stations have been sold off, though the Aloha orphanage continues to keep stations like “Albuquerque’s 80s station” KABQ Bosque Farms/104.7. It shows up in iHeartMedia’s “station search” for Albuquerque alongside officially-owned stations like rock KZRR/94.1 and alternative “104.1 the Edge” KTEG.
The GOP FCC faces new House Subcommittee Chair Blackburn on March 8.
We’ll need new verbs to talk about Congressional relations with the FCC – “Grilling” is out, while “reauthorization” is in. For the first time in years, the FCC and the House are aligned politically, and new Chair Ajit Pai will be telling Telecom Subcommittee Chair Marsha Blackburn things she wants to hear, like they’re working to reverse the “Net Neutrality” policy of his Democratic predecessor, Tom Wheeler. That will please the big ISPs like Verizon and Comcast. They’ve battled the idea that the FCC should use so-called “Title II” powers to regulate them like a public utility. (That idea may’ve come partly from the Obama White House, as a pro-consumer move.) But the first item on Blackburn’s Friday press release is “FCC reauthorization.” She might like the FCC to be doing a whole lot less regulating, period. Blackburn also expects an update from Chairman Pai, fellow Republican Mike O’Rielly and Democrat Mignon Clyburn about the almost-completed spectrum auction –
“Come on, tell us what you got in the spectrum auction,” says Harry Jessell.
The FCC says TV licensees are now free to go public with how much they’d be taking in, and TV NewsCheck’s Harry Jessell jokingly urges more companies to tell us their number. He says “it’s hard to call any of the broadcasters ‘winners,’ since broadcasters are universally disappointed in how much they are getting for their channels. Going into the auction last Summer, expectations were that they would be getting four times as much as they did.” Still, the $350 million announced by Fox will pay the light bill for a while. TV/radio owner Sinclair’s pocketing about $313 million, Tribune $190 million and Grey TV $90.8 million. The money may be even more meaningful for TV/radio pubcaster WITF in Harrisburg - $25 million. Current.org says “the $9.9 million going to Pittsburgh’s WQED for shifting to another frequency could possibly retire the station’s longstanding debt.” There’s also the $18.7 million check going to the TV/radio owner University of South Florida for WUSF-TV and the $14 million that Central Michigan University’s due for WCMZ-TV Flint. Harry Jessell says Michael Dell’s OTA Broadcasting and Fortress Investment Group NRJ Broadcasting wouldn’t talk to him about their “number.”
Scripps gets nothing from the spectrum auction – prices were too cheap for its taste.
The company had put together some tentative “channel share arrangements” in case it wound up turning in TV licenses. But Scripps Senior VP/Broadcast Brian Lawlor says “none of the spectrum we or our [potential channel-share] partners offered was selected during the auction process because the prices available in the auction fell below the value we ascribed to it.” That was permissible, under the rules. So the company says it “will not receive proceeds” from the world’s first-ever turn-back of TV spectrum to be re-purposed for wireless broadband. One of the mystery companies in the auction process is Spanish Broadcasting System. It’s kept radio-silence. SBS told its November 16 quarterly call it had filed to participate in the auction with TV licenses in Miami, Houston and Puerto Rico. The urgency is that SBS has a credit facility maturing in April – just around the corner, in financial terms. CFO Joe Garcia told analysts in November that “we are exploring all possible assets that are nonstrategic…that can be used to help in the refinancing.”
CBS Corp. reports Q4 results and radio plans on Wednesday – and maybe its TV auction “number.”
Les Moonves was required like the other presumed participants in the auction to keep his lips sealed about the spectrum auction for months. But let’s guess that he might’ve kicked in his Long Island-licensed “second” TV license in the New York market, for one. There should be a decent amount of demand for wireless spectrum there. CBS paid $55 million for WLNY-TV (digital channel 47/virtual 55) in 2012 – and maybe it makes a profit selling it. Wednesday morning’s call may yield more about the tax-friendly Reverse Morris Trust merger of CBS Radio into Entercom, which effectively gives CBS shareholders 72% of Entercom. Moonves may supply details about when the filing goes to the FCC and the DOJ/FTC. Don’t be surprised if one of the analysts asks about whether he thinks Entercom’s current FCC difficulty in Sacramento could slow things down. Entercom gave up the legal fight over KDND/107.9, agreeing to surrender its license to short-circuit the FCC hearing about the conduct of the fatal “Hold your wee for a Wii” contest in 2007.
“CBS Sports Radio” stations in Detroit and Baltimore have a year to make changes.
More from the monumental deal where CBS Radio is merged into Entercom – Entercom can “continue to use the ‘CBS Sports Radio Network’ name, but not the CBS ‘Eye’ design,” through December 31, 2020. They can't use “CBS Radio Inc.” Though when the station is an affiliate of CBS Sports Radio Network, they can brand as such. However – there’s a “name change date” 12 months after the deal closing. After that, the stations in Detroit and Baltimore that are branded “CBS Sports Radio” must “remove all references to ‘CBS,’ the CBS brands and all CBS television station brand names from all of their assets.” That includes “any radio station call signs.” That means Baltimore’s “105.7 the Fan” WJZ-FM needs to drop the calls it’s had since November 2008. Ditto with WJZ-AM/1300. Likewise in Detroit, WXYT-FM/97.1 and WXYT/1270. (The two AMs can continue to be “CBS Sports Radio.”) CBS seems especially sensitive about confusion between radio and TV websites and podcasts. Dig further into Entercom’s deal with CBS here. For some of the exact language, check section 7.24.
It was trouble when “a new engineer discovered that the station had been moved to a different site, and the old site had been dismantled.” The Commission really, really hates unauthorized moves. But that’s the frank admission from WLMU Harrogate, Tennessee station owner Lincoln Memorial University. It’s requesting Special Temporary Authority due to “extraordinary circumstances.” The school’s asking the Commission to let it operate from the “interim site” – the one discovered by the new engineer – until it can co-locate student-run variety “91.3 the Gap” WLMU with the school’s AM station. That’s Americana-variety WCXZ Harrogate at 740.
Verizon “finally to offer unlimited wireless data plan after long resisting,” says Aaron Pressman at Fortune.com. Though Verizon once offered unlimited access and then withdrew it. Now it’s back. “Unlimited” starts at $80 a month, and it’s Verizon’s response to the attacks by nimble rivals Spring and T-Mobile. Fortune says “Verizon’s wireless customer growth tailed off at the end of last year.” The new plan offers all-you-can-use talk, text and data for something like 80 bucks a month – slightly higher than its competitors. Usage higher than 22 GB a month – and that’s a whole lot of usage – might be subject to some limitations. But Verizon “would not downgrade the quality of streaming video,” says Fortune.
40th anniversary reunion for UNC-Chapel Hill’s WCAR/WXYC-89.3, the weekend of March 17. The station grew out of carrier-current stations which became WCAR (for “Carolina”), and later class A WXYC. The organizers point to its claim of being “the first radio station to ever broadcast over the Internet.” And its “hundreds of alumni who launched careers in media, entertainment, business and the arts.” Just to list a few of those he helped it get going, there’s Chicago-based broker Bob Heymann, Jim Srebro and an organizer of the 40th event, Jim Bond. He’s got more info at JimBond@gmx.com.
David Rawlinson has experience in both international business and domestic government – and he’s joining the board of Nielsen. Rawlinson was President of Online Businesses for W.W. Grainger, and its European predecessor, Zoro Tools Europe). He worked in both the Bush 43 and Obama administrations, and was a senior advisor for economic policy with the White House National Economic Council during the Great Recession. At Nielsen, he immediately becomes a member of the Audit Committee. David graduated from the Citadel, earned his law degree from the University of South Carolina, and his MBA from Harvard.
Beasley stock sets a ten-year high, and almost an 11-year high. Friday’s close of $9.90 per share was its loftiest since March 2006, before the Great Recession. The volume remains light, only about 27,000 shares (double the average). But it lifts the Beasley market-cap close to $285 million. Friday’s gain was 55 cents, or 6% to $9.90 a share.
New study on podcast advertising finds “Significant positive impact on brand recall, intent to purchase and recall of specific messaging.” Edison Research did the series of studies on five unidentified “major national consumer brands” for Norm Pattiz at PodcastOne. For a financial services product, they say “unaided product awareness increased from the pre-study to the post-study by 47%.” A similar study for an “automobile after-market product” showed a 37% gain. Norm’s investing in research to show the return on investment for his latest business – just as he did decades ago with syndication at Westwood One.
Three more Eastlan Fall-book markets, this time stations in “two-book” markets. So you’re seeing stations across Fall-2015, Spring-2016 and now Fall-2106. Eastlan shares the numbers of all the stations that “make the book,” while Nielsen Audio releases only shares of subscribers. Eastlan’s Fall survey ran September 8-November 16, compared to Nielsen’s September 8-November 30. Eastlan employs a combination of telephone (“random stratified telephone-recall sample”) and “daily e-surveys,” tracking just one person per household. All numbers below are age 12+ AQH total-week shares.
Jackson, Tennessee features just one subscriber in Nielsen (Southern Stone) and five stations. Let’s roll Eastlan’s top ten, shall we? #1 is country “Froggy 104.1” WOGY (10.2-9.3-11.6). This is history-making, says ratings-tracker Chris Huff – “This is WOGY’s first time to lead the market in any survey [Nielsen/Arbitron or Eastlan] since Arbitron’s Spring 1998 book.” Second is Southern Stone’s urban “Kix” WFKX (12.2-9.9-11.0). Forever is third with urban AC WYJJ (7.4-6.1-8.2) and Southern Stone’s fourth with AC “Star 107.7” WHHM (6.7-7.0-7.6). The first talk-based station in the ranking is The Wireless Group’s talk WNWS (5.2-6.1-7.1). Here’s the second five – classic hits “U92” WYNU (Forever, 5.7-8.2-6.9). Rock WZDQ (Southern Stone, 5.5-3.6-5.5). Country WWYN (Southern Stone, 2.4-4.1-3.5). Black gospel WOJG (Shaw Broadcasting, 2.4-4.1-3.5). And Southern Stone’s urban “Hot” WJAK-AM and its translator (2.0-3.6-3.4). Eleventh is Gerald Hunt’s classic hits “Kool” WMXX (3.0-2.2-3.0) and twelfth is classical not-for-profit WKNP (Mid-South Public Communications, 0.9-1.6-2.6). EMF does its not-for-profit contemporary Christian “K-Love” network format on thirteenth-place WZKV (2.2-2.3-2.4). And for something completely different – there’s blues music on a rated Low Power FM. That’s Lane College’s WLCD-LP (0.8-2.1-2.0).
Elkhart, Indiana has an Eastlan population of 166,900, and isn’t rated by Nielsen. Artistic Media’s top 40 “U93” WNDV was #1 in the nearby Eastlan market of South Bend with a 16.1 share – and it’s also #1 in Elkhart (14.5-13.4-17.2). The Dille family’s Federated Media has the #2 and #3 stations, country WBYT (10.8-11.3-12.5) and rock “Bear” WRBR (8.5-7.4-10.0). Fourth is a for-profit contemporary Christian station/Christian teaching station, Progressive Broadcasting’s “Friend of the Family” WFRN (10.9-7.6-8.0). And fifth is Elkhart Community Schools’ news/talk/jazz WVPE (7.9-5.9-6.9). The second five – Federated news/talk WTRC-FM (6.3-5.3-6.2), Mid-West Family’s AC “Sunny” WNSN (6.8-8.3-4.9), Marion Williams’ rhythmic AC WSMK (4.4-2.8-3.7), Federated’s talk WTRC (1.3-2.0-2.6) and Bible Broadcasting Network’s Christian teaching WYBV (1.2-3.1-2.5).
Kalispell hasn’t been surveyed by Nielsen/Arbitron since Fall 2011 (and was called “Kalispell-Flathead Valley”). Here’s the look from Eastlan – country “Bear” KDBR (Bee Broadcasting, 15.2-15.2-13.5). Adult alternative “River” KRVO runs second (Rose Communications, 9.0-9.8-11.0). Two more stations manage double digits - Bee’s classic rock “B98/The Flathead Rocks” KBBZ (8.5-7.4-10.4) and sister news/talk KJJR-AM (11.1-0.0-10.3). Fifth is KOFI Inc.’s oldies/talk KOFI-AM (6.1-8.8-9.8). Note that two the top five stations are AM. Sixth is Rose-owned oldies “Kool 105.1” KWOL (5.1-4.8-6.0). Seven place is shared by University of Montana not-for-profit news/talk KUKL (5.76-6.3-5.4) and Flathead Valley Wireless-owned oldies/full service KGEZ-AM (5.8-5.7-5.4). Ninth is KOFI Inc.’s classic rock “Monster 103.9” KZMN (2.2-5.8-5.0) and tenth is EMF’s contemporary Christian not-for-profit “K-Love” KLKM (6.6-4.6-3.2). K-Love has a regional CCM competitor, Hi Line Radio Fellowship’s KALS (2.6-2.1-2.2), part of the four-state “Your Network of Praise.”
“The FCC should do something to resolve the problem with Channel 6 Low Power TV stations that pose as radio licensees.”
A station owner of many years mounts the NOW Soap Box – “LPTV licenses were granted at a time when the Commission was trying to give minorities an opportunity to get into television ownership. At the time, very few television stations were owned by minorities due to the barrier of entry related to cost. However, let's fast forward to 2017. Many of these LPTV stations that happen to be on analog Channel 6 started to operate as FM radio stations on their audio channel 87.7 FM, and never operated as television stations. They were supposed to serve their local communities as TV operations. In early 2015, the FCC announced that the last day they could operate on their analog channel would be September of that year, but that deadline was later suspended. The FCC should require these stations to convert to a digital frequency and give up their analog license. Obviously, when they do convert, they will no longer be able to operate as FM radio stations. Let's hope new FCC Chairman Ajit Pai will correct this situation.” What’s your opinion? Email “Soap Box” – Tom@RTK-Media.com.
Myrtle Beach has been in suspense about two just-sold FM. Though we do know that buyer Colonial Media Entertainment dropped the previous talk simulcast on both 93.7 and 93.9. WXJY Georgetown, SC – the one at 93.7 is now simulcasting with sister WMIR Atlantic Beach/1200. They’re united in doing gospel as “Rejoice.” As for Colonial’s other new FM, WJXY Conway/93.9 played with locals by running through unlikely formats like polka, love songs and all-Elvis. The closing came after trustee Joule Broadcasting acknowledged gaps in the public files of both Cumulus-owned stations, dating back to before it took them over. It paid a $22,000 fine to the FCC to assure license renewal, so the $220,000 sale could go forward (December 21 NOW).
Entercom debuts a “younger-skewing urban AC” in New Orleans, per Radio Insight. We were waiting for Entercom’s new format on WWWL/1350 – the former sports-and-talk “3WL” – and its translator-friend at 103.7, W279DF. The answer is “Hot 103.7,” and Radio Insight says it “directly attack’s iHeart’s market-leading urban AC WYLD-FM/98.5 and Cumulus’ Old School 106.7 KMEZ with a younger-skewing take” on the format. Playlist for the new “Hot” starts in the 1990s and comes forward from there. The “3WL” hybrid sports-and-talk format exists only on the HD2 signal of WWL-FM, Kenner at 105.3.
Danbury’s news/talk WLAD/800 appears on the FM band, with the sign-on of a move-in translator at 94.1. It’s W231DJ, one of two Milford, Pennsylvania translators acquired by Irv Goldstein-run Berkshire Broadcasting from Bud Williamson (February 3 NOW). Back in Milford, just over the New Jersey border, it had been W290CK and in Western Connecticut it’s paired with WLAD (1,000 watts daytime/286 watts at night).
Dick Taylor finds a lesson in Super Bowl LI – “Ad rates can’t keep going up, ad clutter going up and audience viewership going down, and expect to stay in business.” Since the former commercial radio market manager is now teaching at Western Kentucky U., he’s also passing on a quote from Auburn University’s Herbert Jack Rotfeld – “The increasing advertising to editorial ratio is causing audience inattention and consumer complaints…more effective advertising would mean that there would be less of it.” More about Prof. Taylor’s lessons for radio, “The #1 reach and frequency medium,” here.
The check really was in the mail – Friday’s Joey Reynolds story, about a windfall from a long-forgotten profit-sharing plan, prompts this tale from a NOW Reader – “I once worked for stations in the Midwest that were acquired by an insurance company, and since I was in management, they gave me a retirement plan at no cost. I worked there longer than the ten years the plan took to vest, and when I eventually left, I didn’t give it another thought. In the back of my head, I made a mental note to ‘someday’ check it out. Well, I didn’t have to. Two years ago, I received a call from the insurance company. They no longer own the stations, but they said my plan had matured and they would take care of it. When I asked how they found me, they said it was from my Social Security number. So I waited for my check in the mail – and it turned out be for $20,000.”
Got a Valentine’s Day radio story to share? This time of year, “Love is in the Air.” Share your favorite romantic story about the radio business with NOW readers. Email Tom@RTK-Media.com. Want to reach this readership of people hungry for new ideas, products and solutions? Contact Kristy Scott. She’s at Kristy@RTK-media.com or phone 818-591-6815. See you back first thing tomorrow - Tom