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SparkNet
Thursday, August 14, 2014 Volume 3   |   Issue 159
 
Radio Disney to depend on digital
NAB
Radio DisneyTo focus on satellite and IP delivery, Radio Disney will shed all but one of of its remaining O&Os.

First – this isn’t a surprise. Disney’s been selling stations in smaller markets, and terrestrial radio was always just one spoke in the distribution wheel for Radio Disney. (It just recently signed digital deals with Aha Radio, Slacker and ShowMobile.) These days, fewer than 1 in 5 tweens-and-moms Radio Disney listeners tune in via local AM or FM. (The exact figure is 18%.) 37% listen on SiriusXM, 35% use Internet radio, and 31% use smartphones and tablets. Yesterday’s news in Broadcasting & Cable that Disney’s selling 23 of its 24 Radio Disney-formatted stations was just the next step in a long-planned retreat from terrestrial radio. Lots of implications, including one kind of climate change that everybody can agree on – with this giant dump of stations on the deal market, the weather’s changing for AM stations. 22 of the 23 Disney stations now bearing “For Sale” signs are AMs. That’s a lot of real estate to flood the market with, and it could certainly alter the psychology. One none-too-happy dealmaker tells this NOW Newsletter that there’s not an infinite universe of potential buyers for AMs, and other facilities up for sale will now be competing with Disney. But at the same time – many of these are decent signals in very big markets, like New York City (WQEW/1560). So there are opportunities. How badly does Disney want to sell them?

Will Mickey Mouse take haircuts again?

In its previous wave of sales, outside of the top 40 markets, Disney didn’t mind accepting far less money than it originally paid, a decade or so earlier. The November 21 NOW had two such comparisons – Disney paid $2.6 million for Milwaukee-market expanded-band AM WKSH Sussex (1640). A decade later, it accepted an offer for $725,000. Albany-market WDDY (1460) originally was worth $2 million to Disney, but was sold for $375,000. As one observer says, “this is a top-down decision by Disney corporate,” to sell all the remaining O&Os except L.A.-market KDIS 1110. They’re keeping that as the origination point of Radio Disney programming – and possibly so they can claim the favorable terrestrial-station streaming rate. (Same logic that Pandora’s trying to use in buying an FM in Rapid City, South Dakota). If Disney really does want quick sales, the wholesale marketing of 22 AM stations and one FM could have an effect on station pricing. Still, there’s no need to panic. As somebody says, “Disney had very specific needs, and just because they’re selling these stations aimed at kids and moms,” that doesn’t mean they’re disrespecting radio.

The Radio Disney O&O group covers the breadth of America.

There’s WQEW New York (1560), the former New York Times-owned adult standards station that Disney bought for – get ready for it - $40 million. In Chicago, there’s WRDZ La Grange at 1300. San Francisco is KMKY Oakland at 1310. Dallas is KMKI Plano at 620. Houston is KMIC at 1590. Philly is WWJZ Mt. Holly, NJ at 640. Atlanta is WDWD at 590. Boston is WMKI at 1260. Detroit is WFDF Farmington Hills at 910. Seattle is KKDZ at 1250. Phoenix is KMIK Tempe at 1580. Tampa is WWMI St. Petersburg at 1380. Minneapolis is KDIZ Golden Valley at 1440. Miami is WMYM at 990. Denver is expanded-band KKDZ Arvada at 1690. Pittsburgh is the onetime WTAE at 1250, now called WDDZ. Cleveland is WWMK at 1260. St. Louis is WSDZ Belleville, Illinois at 1260. Sacramento is KIID at 1470. Portland, Oregon is KDZR Lake Oswego at 1640. Charlotte is WGFY at 1480. Then there’s the lone FM signal in the store, Indy-market WRDZ-FM, a Class A at 98.3 licensed to Plainfield. Note that Disney’s even selling the Radio Disney affiliate in Orlando, the home of its multi-billion-dollar operation at Disney World. That’s WDYZ at 990. There’s also the human dimension – people at the station level will be losing their gigs, and there will likely be a re-org at Radio Disney HQ in Los Angeles. Radio Disney GM Phil Guerini says the operations of L.A.’s KDIS “will be picked up by the national team.”

DMR Interactive
Disney’s still involved with over-the-air radio.

It runs the large ESPN partnership, and not only produces the national syndication effort, but still owns a few major-market stations like Chicago’s WMVP (1000). It’s also kept New York’s WEPN (1050), even as it LMA’s WEPN-FM (98.7) from Emmis. There’s also L.A.-market KSPN (710). Last year Disney LMA’d out Dallas-market KESN (103.3) to Cumulus, in a cost-reduction move. Another way it’s involved with radio is ABC News Radio, produced by ABC News for distribution through Cumulus Media Networks through December, and then on its own, starting in 2015. In fact, one NOW Reader who has long familiarity with ABC says “I wonder if internally, they’re putting the sale proceeds from these 23 stations against what they’ll be spending on ABC News Radio, after January 1.” For sure, the Radio Disney strategy going forward is about digital, mobile and various off-air events. Broadcasting & Cable says “the company believes that getting out of the station business will allow it to focus on programming, marketing and creating revenue-producing events such as the Radio Disney Music Awards.” Also its “Next Big Thing,” which has been a more reliable hit-producing machine than recent seasons of TV’s “American Idol.”

UnivisionRe-org at Univision means one GM for radio-plus-TV in 11 markets.

Also one director of sales and one business manager, this NOW Newsletter hears. There could be as many as 28 to 30 people out, and they wouldn’t be entry-level wage-earners, either. Jose Valle remains as President of Univision Radio and will oversee programming and content for the 68 stations. But as you read last Friday, former Univision TV chief Kevin Cuddihy was named “President of Local Media,” and he’ll be overseeing both radio and TV. There will be two Executive VPs of Local Media, with Alberto Mier y Teran and Jaime Jimenez splitting up the country. Onetime CBS Radio exec Lee Davis is now Executive VP of Sales for Local Media. While as you read Friday, Jessica Rodriguez is Chief Marketing Officer. Back to the market level – Luis Patino will be radio/TV GM for Los Angeles, with Bob McCauley in the DOS role. For New York, the GM/DOS team is Ramon Pineda and Karima Khawja. In Miami, it’s Claudia Puig and Loretta Anaya. In Houston, it’s David Loving and Glenn Coleman. In Dallas, it’s Mark Masepohl and Jeff Zimmerman. In the four radio-only markets, Peter M. Moore has San Diego, Larry Lemanski has Albuquerque, Vicky Guerrero has McAllen and Rene Morales manages Las Vegas. It’s unclear what role Evan Harrison will play. He’s the former Digital EVP at Clear Channel who joined Univision Radio in 2012 as EVP of Content & Entertainment. At the top of the Univision pyramid remains onetime NBC executive Randy Falco – running a company that’s supposedly still trying to fit through Wall Street’s IPO window and cash out its investors from the 2006 buyout.

Kelly Music Research
Rumor Check – Recent “takeover” rumors bring the Pandora CFO onto CNBC.

Mike Herring does the smart thing, continually steering his answers back to the company itself and away from speculation. Monday’s vague story from DealReporter about Pandora perhaps attracting buyers like Amazon, Google, Microsoft, SiriusXM and Yahoo did gave the “P” stock its best day since May. Then it dropped. But is there anything really there? There’s been little in the two days since then to provide support for the rumor. But it does bring attention to Pandora, which spurted up 10% yesterday. Guess Herring’s confident appearance did the trick. (A “buy” rating from Stifel Nicolaus didn’t hurt.) Pandora traded at twice the usual volume, finishing ahead $2.65 at $28.35 a share. As for the five-minute CNBC shot - is Mike Herring worried about giant Apple buying new competitor Beats Music? No, Pandora’s been facing plenty of competition for the last 14 years. Is Pandora pushing in-car listening? Yes, because Herring says 47% of all radio listening occurs in-car, and he provides more support for the theory that they’re looking beyond music and comedy to news, talk and perhaps sports, to better compete with broadcast radio. Oddly, for a business channel, none of the three midday CNBC hosts asked about how Pandora can continue to monetize all that listening. And that’s the prize that will ultimately drive the stock.

PrincetonMore aggressive M&A activity ahead – in public radio.

The signs are there. More than 10% of the school-affiliated stations who responded to a survey by the University Station Alliance said they’re considering a radio-radio merger. That’s nearly twice the percentage in last year’s research. 6.9% said they’re considering the outright purchase of a station, up from 4.1% last year. The squeeze of the economy probably influences some of the answers in the survey’s next section, about plans for various kinds of operational consolidation. 8% are considering consolidating financial services and systems, up from 3.5%. 5.3% are thinking about more efficient ways to handle H.R. (human relations), up from 2.8%. The third general area of questioning was about content collaborative partnerships. Last year about 70% said they weren’t thinking about those, but that number is down to about 65%. And there certainly seems to be some cross-platform thinking, because 10.3% mentioned consolidating or cooperating with a local newspaper newsroom. The University Station Alliance has membership from colleges, school systems and state agencies, and 161 of them responded to this year’s survey. The two-page executive summary is here.

An acquisition for the SQAD service that analyzes advertising rates for radio, TV and digital.

It’s buying Workhorse Software. SQAD calls Workhorse “the global leader in advertising planning software,” and says the combined forces can “serve an increasingly fragmented media industry.” CEO Neil Klar says SQAD has over 1,500 clients, while Ken Green of suburban Chicago-based Workhorse Software explains that they already share many clients in common. Green becomes president of the enlarged SQAD and Klar will remain CEO. SQAD will have offices in New York, Chicago, L.A., London and Manila. And they’re hiring – looking for sales executives and software developers. SQAD is backed by New York-based Clarion Capital Partners. In this purchase, SQAD was repped by Cooley LLP, and Workhorse by its financial advisor, Metronome Partners and its counsel, Reed Smith LLP.

RAIN
KSCOFree speech ruling from the FCC backs license renewal of KSCO Santa Cruz.

It also didn’t hurt that unhappy listener Thomas Irion couldn’t provide any transcripts or tapes of what he alleged – #1, that hosts “openly advocate criminal behavior, specifically, the use and abuse of illegal drugs.” One example cited by the listener was the on-air description of “the recipe for preparation of a substitute form of Meth.” Objection #2 was that station owner Michael Zwerling “engages in anti-social behavior on the air,” bullying callers and even his own mom. The listener happened to catch Zwerling allegedly bullying a representative of the high-IQ group MENSA. First, the FCC says Irion filed his objection too late, but it decided to deal with it anyhow, as a petition for consideration. That gives us a glimpse into the stance of the FCC (and this one went up to the 8th Floor for approval by the five Commissioners). The agency decides that KSCO did serve (in the famous phrase) the public interest, convenience and necessity and that there have been no serious violations of the law. It also says, strongly, that the First Amendment and the Communications Act “do not give the Commission the ‘power of censorship’ over the content broadcast on radio stations.” Also that the FCC may not “interfere with the right of free speech of radio broadcasters.” If the listener had enough evidence to prove otherwise – he didn’t submit it. Read the FCC letter here, And read attorney David Oxenford’s latest column, “FCC decisions, including Fox TV renewals, focus on FCC limits in assessing programming claims,” here.

WKRC Cincinnati weekend host arrested after his wife is shot in their driveway.

The police believe it happened as she met him outside their house with his clothes, “essentially throwing him out,” says the Cincinnati Enquirer. Blake Seylhouwer presents the 1-2pm “Small Business Sunday” show on Clear Channel’s talk WKRC (550), and as of last night that program was still listed on the schedule. Blake called 911 himself, says the Enquirer, saying the operator that she’d been accidentally shot by his .30-06 rifle. But the Madeira, Ohio police chief says “his story and her story are night-and-day different.” Police believe that’d taken the rifle out of his vehicle as the couple argued outside their house. The gun shot went into the driveway, and pieces of the concrete struck her in the leg, side and head. Seylhouwer’s bond was set at $250,000 and he’s been ordered to stay away from his wife and their two children. On her Facebook page, she says she’s an executive producer at WKRC. Her husband’s main business is running the local franchise of the Jani-Clean franchise, which he owns. His attorney says “there was no intent to do any damage to anyone [and] we respectfully disagree with the police version of the facts.”

Tom Kent Radio Network
Doing Business

Triton Digital unfurls a next-generation “Tap” – Triton Advertising Platform for online ads. It comes in two styles, with Tap Live crafted for over-the-air broadcasters and Tap OnDemand for Internet pure-play publishers. They’ve been developing it with CBS and Cumulus (including Cumulus-connected Rdio), and Triton’s Senior VP/GM of Advertising Benjamin Masse tells this NOW Newsletter that “there’s a lot of difference between Tap” and the current Campaign Manager product. He says “we see that we need to play a central role, enabling every piece of the equation, so that audio is properly valued.” They conferred with agencies, and Benjamin says that with Tap, agencies “will be able to execute buys the way they want.” And always in the online world, they talk about the advantages of “more transparency and targeting.” The suite carries the process from “creative manager” module through “audio trafficker” and “forecast and affidavit engine.”

BMW i3Some electric cars have interference problems with AM reception, and the NAB formally asks BMW to “reconsider the choice to exclude AM radio” from its new all-electric i3 model. The all-electric niche is tiny at the moment (mostly defined by Tesla), but the NAB doesn’t like the precedent being set. In a letter to BMW of North America’s Ludwig Willisch, it reminds him that some other electric car-makers have solved the problem. It also reminds him that news, talk, sports and ethnic programming remain popular on the AM band – as you’ll see in the letter here. Of course, you could wonder about the NAB’s stance on FM chip in cellphones. The same argument applies, though there are different challenges with antennas, etc. in a phone.

NAB Spring Show adds more streaming video focus, welcoming the formerly-separate New Media Expo under the giant roof of the Las Vegas Convention Center. The two parties started dating this year, with a “New Media Lounge,” and now the entire NMX will co-locate with the NAB Show. As they jointly say, that will “introduce thousands of new media content creators and disruptive businesses to the NAB Show.” NMX CEO/co-founder Rick Calvert says “we believed this was inevitable for years now, so we are beyond excited to be side-by-side” with the event that attracts close to 95,000 people. It’s all about traffic, and the right kind of visitors. NAB Executive VP Chris Brown says NMX serves the “new video ecosystem that has emerged on the web.”

Coleman
Formats & Branding

Oasis 95.1The new Phoenix-area soft oldies “Oasis” pledges “55 minutes of music every hour.” That’s one way to stand out on the dial, especially for a Sun City-licensed Class C that’s located northwest of Phoenix. Riviera Broadcasting just debuted “95.1 the Oasis” to replace Spanish AC on KVIB. Earlier this year it adjusted the approach from Spanish hot AC to Spanish-language adult contemporary as “Exitos Solamente” (January 24 NOW Newsletter). Now KVIB is playing “Lite and refreshing” music from the likes of Billy Joel, Madonna, Lionel Richie, Adele, Michael Buble and Kelly Clarkson. Check out the Oasis website and listen here.

Omaha’s new “Keg” serves classic rock to one and all, replacing the previous variety hits format named “Big O 101.9.” NRG Media’s KOOO is a Class C0 (C-zero) licensed to La Vista, located between Omaha and Lincoln. In the Spring Nielsens, “Big O” tied for 11th place with age 6+ share, up to a recent high of a 2.5. Tap the Keg here.

On The Block

A hard-luck classic country station finds an in-market buyer, northwest of Pensacola. You could easily wring a couple of verses of a country song out of the travails of WBZR-FM, Atmore, Alabama (105.9) – it lost its tower site to a hurricane in 2004 and finally completed construction of a new one in 2008. In September 2010 the transmitter was struck by lightning and they switched to a lower-powered backup. (It’s a Class A licensed for 5,500 watts at 328 feet.) Money woes pushed it into Chapter 11 bankruptcy (reorganization), during which period it failed to pay its FCC regulatory fees and found its “license to cover” at a new transmitter site dismissed under the FCC’s “red light rule.” (If you owe fines, you won’t get the approvals you want.) Lee Hagan’s Gulf Coast Broadcasting wound up with WBZR-FM, and now it’s selling it to Larry White and Earnest White of Tri-County Broadcasting for $130,000 cash. Tri-County owns Pensacola-area classic country WPFL at 105.1, licensed to Century, Florida.

In Northwestern Oklahoma, news/talk/classical non-com KZCU Woodward (95.9) is being sold to the University of Central Oklahoma – and will probably be dropping at least some of the news/talk lineup. The University of Central Oklahoma in Edmond will use the Woodward FM as a satellite operation of its own classical KUCO at 90.1. Seller is Cameron University, which has five other FMs, including news/talk/classical KCCU in Lawton at 89.3. What is class A KZCU selling for? $50,000 cash.

RTK Media, Inc.
Worth Reading

Interested in Vietnam-era Armed Forces Radio, like the station where the fictional Robin Williams played the role of real-life Adrian Cronauer? There’s a nice website with a history here. Consultant Jaye Albright tells NOW that “during that same period, there were a bunch of us in in Thailand, though at the time we could only say ‘a base in southwest Asia,’ since we weren’t publicly there.’ She says there’s a good history of the American Forces Thailand Network here.

Darren DavisRAIN Summit keynoter Darren Davis previews his September 9 remarks and tells RAIN in a pre-Summit conversation how they did the recent re-org – “I went to Bob Pittman and [then-CCM+E CEO] John Hogan last Fall and said, I’d like to put Premiere back together. Premiere had a circuitous reporting structure…Bob said that was a good idea, but here’s a bigger idea: Our opportunity is to put all the networks together, and find those synergies. We’re six months into that, and it’s going really well.” More of the conversation – where we learn that “we have concerts happening here in the iHeartRadio office” - here.

“A Summer of decline for broadcast” – TV, that is. We’ve spent time debating the recent direction of talk radio, but Media Life points to another change in media consumption – “New [TV] shows have struggled and returning shows have seen their ratings slide, this Summer…that’s led to a 10% decline among the top seven broadcast networks,” with adults 18-49. Only the CW is up from the previous Summer, and the Big Four of ABC, NBC, CBS and Fox are down an average 13%. Even the Spanish Univision and Telemundo are off, against a pattern where they’ve recently posted gains. Media Life says “a big part of the declines is the lack of standout new shows” – so it may just come down to content. “America’s Got Talent” with judge Howard Stern has risen to become the #1 broadcast show, but it’s down to “series lows.”

Cigar Dave
You Can't Make This Up

Psychic hotline to the news room? A keep-me-anonymous NOW Reader says "Back when I worked for a certain radio news service, I was away at a journalism conference when a noted former politician in our state died. I called our headquarters, offering to return for the story. They said it wasn't necessary, and my colleague covering for me did a fine job. Upon my return, the same corporate/management type who approved my time off and said I didn't need to come back called to yell at me. Why? For not being there when the politician departed this life. He bellowed, and I quote, 'You should have known when he was going to die.'" Does a similar non sequitur live deep in your brain, the punchline to a favorite story? Share it with the industry. Email “You Can’t Make This Up” – Tom@RTK-Media.com.

Reelworld

Spanish Broadcasting System finally reports its Q2 today, and you’ll have coverage in tomorrow’s Tom Taylor NOW Newsletter. Thanks for your time reading it every day, and see you first thing tomorrow - Tom


Radio Show Planner 2014

BROKERS
Kozacko Media Services: George W. Kimble, Cell: 520-465-4302, Email: georgewkimble@aol.com; Dick Kozacko, Cell: 607-738-1219, Email: dick@kozacko.com; Indianapolis Marriott Downtown; Office: 607-733-7138; www.radio4sale.com


Patrick Communications: Larry Patrick, Susan Patrick, Greg Guy, Jason James. Contact info: Westin Indianapolis; Office: 410-799-1740; jaime@patcomm.com; www.patcomm.com

 
 
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