Cumulus starts an LMA with Merlin – for as long as four years.
First, this isn’t a sale, at least not yet. Cumulus says it’s “taken over operations of two Chicago stations through an LMA with option to buy WLUP (97.9 the Loop) and WIQI (101.1), as well as the alternative rock format currently on WKQX-LP (87.7).” So let’s unpack the various stories nested inside the bare facts – because there’s enough drama to keep a “Downton Abbey” fan occupied, including a disappointed suitor. The Chicago Tribune says this is a “four-year local marketing agreement, with a firm option to buy the stations.” Cumulus could exercise its option as soon as next year, and CEO Lew Dickey tells Crain’s Chicago Business that “We’re not in the business of renting things.” Though the LMA is a prudent strategy for now. Cumulus can conserve cash by paying just a monthly fee, which might be credited against the eventual purchase price. In return, it gets the revenue it generates from classic rock “Loop” WLUP and from restoring the alternative rock format to 101.1. (Though Cumulus supposedly won’t be calling it “Q101.” That intellectual property was sold to Broadcast Barter Networks in 2011.) What about 87.7, the audio service of a low power TV station owned by Venture Technologies? Under FCC rules, the exemption that lets LPTVs stay analog ends next year, so it’s going away as “radio station,” anyhow. Crain’s says Cumulus will simulcast it with 101.1 for 45 days – then Venture will do a different format.
Rumor mill says Chicago’s Loop and 101.1 had been offered at $75 million.
Nobody’s talking numbers, for either the eventual sale price to Cumulus or the monthly LMA fees. This NOW Newsletter hears that Chicago-based GTCR, the backer of WLUP/WIQI licensee Merlin Media, was looking to make a deal, after three very bumpy years in the radio business. One dealmaker not involved in the Cumulus bid says “GTCR’s willingness to accept a very long LMA term lets it get its price, and lets Cumulus defer paying that price until it’s got the financing together.” Lew Dickey’s problem in Chicago is that his clusters are undersized compared to Clear Channel, CBS and Hubbard. That makes selling ads tougher, and the operating costs higher. Cumulus can use Donna Baker, current Chicago manager of its talk WLS (890) and classic hits WLS-FM (94.7), to also supervise the Loop and 101.1. How different the world looks, here at the dawn of 2014, from 2010, when former Tribune Co. CEO Randy Michaels persuaded GTCR that he could do big things if they bought stations in Chicago, New York and eventually Philadelphia. (Randy personally had less than 1% of Merlin.) The Chicago and NYC purchases from Emmis were a package worth about $198 million. Emmis kept a minority stake in Merlin and has since LMA’d out New York-market 98.7.
No, Merlin chief Randy Michaels isn’t out of radio.
He’s taken his hits, after failed attempts at doing news/talk in Chicago (on 101.1, now hot AC WIQI), New York and Philadelphia (106.9, now sold to K-Love network parent EMF). But Merlin’s still functioning into next year, overseeing its Chicago LMA with Cumulus. And lest we forget, Randy’s got his own radio group, assembled from purchases at past FCC auctions, called Radioactive, LLC. It’s the holder of 16 licenses and construction permits, and just last week you read here about Michaels getting an FM license back in the Burlington-Plattsburgh market, from a previous buyer. Even without Merlin and Radioactive, it’s hard to imagine Randy just flying his plane around the country and enjoying the good life – he’s too much a radio guy. As CEO of Tribune, he got experience overseeing newspapers, digital assets and TV stations. But this NOW Newsletter has picked up glimpses of him over the last year, perhaps trying to raise backing for yet another new group, or perhaps trying to save part of the Merlin deal. Why did Merlin fail? Converting stations in Chicago and New York to all-news, a format that famously requires great patience and deep resources, just isn’t something out of the Randy Michaels playbook. He traditionally favors reactive and fast-growing formats like CHR, rock and the hot-button talk that let him re-make Cincinnati’s WLW (700). Going all-news is like renting the slowest car at the Hertz counter – and that’s not like Randy Michaels. One former associate shakes his head and says “It’s a mystery.” But don’t write Randy off. (Though Windy City media chronicler Robert Feder isn’t unhappy to see him go for now, marshalling past quotes about what Merlin would accomplish.) By the way – guess who has the WKQX call letters? Answer – two parties. They’re attached to the low power TV alt-rocker at 87.7. Also to a downstate Illinois full-power FM in Watseka, Illinois – licensed to Randy Michaels’ Radioactive LLC.
The Merlin sale leaves somebody in Chicago disappointed (and CBS pleased).
One rumor was that Cumulus would do the deal with Merlin and take WIQI/101.1 country, as “Nash.” But that’s not happening, and that’s a nice break for CBS Radio. It owns highly-rated country incumbent “US 99.5” WUSN, and it won’t face a “Nash” competitor. Somebody else might do country against US 99.5 and no doubt Cumulus would love to introduce the format there. But not any time soon. (Lew Dickey tells the Tribune that “over the long term, we would love to expand our footprint in Chicago.”) Meanwhile, there have long been talks about somehow putting 97.9 and 101.1 together with Tribune’s talk WGN (720). Those talks trace back to the days when Emmis owned the FMs. Jimmy de Castro’s now running WGN and he once managed The Loop (97.9). But the Cumulus LMA-with purchase option means the Merlin stations are out of circulation. Knowing de Castro – there’s a Plan B. And a Plan C.
Liberty Media offers to buy out the remaining shareholders in SiriusXM.
Liberty’s John Malone and Greg Maffei toiled diligently, expanding their original 2009 rescue of SiriusXM into majority ownership, and now Liberty has about 53% of New York-based satcaster SiriusXM. Their next move, announced Friday – offering $3.68 a share to current holders of the “SIRI” stock, in return for shares in a new Class C series of stock in Liberty itself. That would give SiriusXM owners 39% of Liberty Media, and SiriusXM would become a wholly-owned subsidiary of Liberty. The deal values SiriusXM at well over $20 billion. But this story’s not over, not by a long shot –
Wall Street expects Liberty to sweeten its offer for the rest of SiriusXM.
After all – “SIRI” was trading at over $4 a share as recently as late October. Liberty’s now offering $3.64, a relatively small premium over the closing prices last Thursday ($3.50) and Friday ($3.57). The deal was announced late Friday, and the after-market traffic was above Liberty’s announced bid of $3.64. Anytime a majority owner like Liberty reveals a potential tender offer, there’s going to be close scrutiny of the price. Expect that to happen this time. Why would Liberty want to go to 100% ownership of SiriusXM? Bloomberg speculates that it’s because it has bigger game in its sights – chasing Time Warner Cable. Bloomberg’s reporting that Charter Communications, “backed by Malone, is preparing a takeover offer of about $135 a share for Time Warner Cable.” And Greg Maffei says any pursuit of the big cable operator “would require incremental capital.” When it reports its full-year results, SiriusXM earnings could top $3.7 billion – and Liberty could use some of that as dry powder. Read Friday’s press release from Liberty here. By the way – this purchase would halt years' worth of day-trading fun for investors, including some in radio. One PD told NOW “once, when I was between jobs, I made as much money day-trading SiriusXM stock as I’d made from my previous salary. My radio background afforded me some advantages, and I only did it the first couple of hours every morning.” Trading should be brisk this week – and so should the activity at the law firms that “investigate” potential problems with takeout bids.
Radio Disney faces some green-activism in Ohio.
As of last night, there were 15,722 signatures on a petition addressed to Disney CEO Bob Iger, beseeching him to “halt your road show promoting oil and gas extraction and pipelines to kids, and sever your partnership with Ohio Oil & Gas Association.” That apparently involved an hour-long live presentation drilling and resource extraction that included folks from Radio Disney's Cleveland O&O, WWMK (1260). The petition is here and it’s the subject of a Daily Caller story titled “Environmentalists target Radio Disney in anti-drilling campaign.” The point is larger than this particular flashpoint. Advertisers (and in this case owner Disney) can be whiplashed by social media campaigns much faster than in the “write a letter” days. This kind of activism has been felt for years now, most notably from the February 2012 comments by Rush Limbaugh about Sandra Fluke. The stop-advertising campaign has helped changed the makeup of Rush’s client base, toward direct-response advertisers who know he can deliver measurable results. It also added some friction to the relationship between Limbaugh and Cumulus – though the two sides are mostly still doing business, because it’s profitable for both of them. Back to the Ohio petition, for a sample of the language – “Radio Disney should not, under the guise of teaching kids ‘science,’ promote dirty energy that gives kids asthma, pollutes our air and water, and fuels climate change.” Regardless of how you feel about that claim, recognize that some radio programs (also TV and other media) these days get a lot more attention from the outside.
Sprint-owned Boost Mobile to offer FM radio on its new Moto G smartphone.
The affordable phone comes with the NextRadio app ready to go, visible on the Moto G’s very large 4-1/2 in screen. PCMag.com says it’s “the first Motorola handset offered by Boost since 2011,” at a price point of $129.99 – and no contract required. Sprint’s going to package it with a $55 monthly unlimited-use plan, with the chance to reduce that in $5 steps to 40 bucks a month, if the customer keeps making payments on time. It was a year ago, at the 2013 CES in Las Vegas, that Sprint began demoing the Emmis-developed NextRadio interactive software. You can expect more tech news about radio at the 2014 CES that opens tomorrow.
Questions for 2014 – NOW readers add their own.
Continuing the theme we started last week – what are the important questions for radio to deal with?
• “Where’s the personality?” says Scott Krusinski. He says “attention spans have been truncated, but most people still yearn to be amused, educated, even titillated. Continuously, throughout the day, and for longer than 15 seconds. So as not to rush to judgment, I polled the inhabitants of my house – females 48 and 16, males 14 and 11. I said ‘For an all-expense-paid trip to Starbucks, name one person you listen to on the radio.’ No names were offered.”
• “Don’t forget the impact of digital marketing,” says Ellyn Ambrose. The Marketing Group CEO says “Radio was the original ‘engaging’ media – we were about the listeners. They called to chat, we talked to them about things they cared about (and not ourselves), and had entertaining jocks. Now, when engagement is essential to our survival, radio thinks the solution is running a contest on their Facebook page. (There are a few stations doing a great job.) Engagement isn’t hard, but it requires someone managing the process.”
• “How will radio grow marketing share versus new audio options?” asks Jack Walker at KRZK and other stations in Branson, Missouri and Harrison, Arkansas. He fires off two more questions – “Will radio get aggressive on the digital front, like newspaper and TV have? How will we monetize social media?”
• “Will the industry stop focusing on tune-out and put its energies into building brands?” Jon Coleman of Coleman Insights coincidentally offers a new blog-post titled “Misreading PPM and what drives ratings,” where he says “I think that PPM may have caused programmers to become slaves to ‘in the moment,’ and lose track of what really builds ratings.” Got your questions for radio, here on the cusp of the New Year? Email Tom@RTK-Media.com.
Latest Fall-book Nielsen Audio results from diary markets.
Albany, NY – Country WGNA was #1 for all four of last year’s quarterly books. Even more impressive, it’s been #1 in 46 of the last 50 books, going back over 12 years. The station now owned by Townsquare did a 10.0-share with age 12+ AQH share in the Spring book, a 10.6 in the Summer, and now a 9.2. After that, we see Pamal’s top 40 “Fly 92.3” WFLY, 5.9-6.6-6.8 and its admirably consistent sister, AC “B95” WYJB, 5.6-5.5-5.7. And that’s where things get crowded, in the 5-shares. Clear Channel’s classic rock WPYX runs 5.8-4.8-5.6, closely trailed by siblings WGY-AM/FM (doing talk, 6.7-6.2-5.4) and “Oldies 98.3” WTRY (4.3-5.2-5.4). Note that Nielsen’s “subscriber only” procedure means we see only the topline shares of stations that subscribe. The Fall survey period ran September 12 through December 4.
Syracuse – Here’s a streak for you – Clear Channel’s country “B104.7” WBBS has been tops for 57 books, or more than 14 years. In recent history, it’s gone 11.0-11.8-9.2. That’s the second-longest longest active streak in the continuous measurement markets that get four diary-rated books a year. However, that 9.2 share is B104.7’s smallest topline since Winter 2010. Just around the corner is Cumulus CHR “93Q” WNTQ, 8.2-6.8-8.4. Two Clear Channel stations are virtually tied around third place – talk WSYR-AM/FM (7.3-7.3-6.6) and CHR “Hot 107.9” WWHT (7.8-7.8-6.5). Only three operators subscribe in Syracuse – Clear Channel, Cumulus and the local Wolf Radio.
Fredericksburg, VA – Four #1s in a row for country WFLS. With no sweat, the Free Lance-Star station keeps its double digits in this two-book-a-year market, 11.6 (Fall 2012) to 10.8 (Spring of 2013) to 11.9 (Fall 2013). Centennial’s hot AC “B101.5” WBQB stays in its range, 9.7-10.8-9.7. Then comes Telemedia’s classic hits WGRQ, 3.9-3.0-4.7. Bear in mind that we’re not seeing stations that spill-in from D.C. to the north or Richmond to the south.
Asheville – Clear Channel’s the only subscriber here, so with no stations from other groups shown, we quickly go from #1 at a 19.9 share to #3 at a 4.6 share. (Saga’s active in this market, but doesn’t subscribe.) Top station is country WKSF, 18.9 to 17.5 to 19.9. That’s its twenty-third #1 finish and its largest 12+ share since back in Spring 1997. Then we can see top 40 “Star 104.3” WQNQ, 4.8-5.0-5.3, and classic rocker WQNS, 2.4-3.6-4.6. Note that Clear Channel’s hoping to improve things for WQNS, with this coming Thursday’s frequency/city of license change from 104.9/Waynesville to 105.1/Woodfin. That brings the Class A station east, toward Asheville. Talk WWNC could use some kind of assistance, falling 5.4-6.0-3.0, to the lowest level ever recorded by the station (which used to be a double-digit country format) in Nielsen/Arbitron.
Tuscaloosa, Alabama – Two stations on top, from the two owners who subscribe here. Those are Apex-owned urban “105.1 Jamz” WALJ (5.7-6.7-6.3) and Clear Channel’s country WTXT (6.1-6.2-6.3). CC’s “Talk Radio 105.9” WRTR is up 3.3-2.6-3.7.
Olean, New York – “Sizzlin’ Country 95.7 the Pig” has a somewhat softer book – 23.0-19.7-16.9. It’s the Community Broadcasters-owned WPIG, and yes, those are its real call letters. Colonial’s “Hometown country/Bob 103.9 FM” WXMT shows as second, 3.3-3.4-3.0 – implying that we’re not getting to see some local stations.
New York City’s WWRL (1600) goes regional Mexican as “La Invasora.” We knew Access.1 was abandoning its talk format to go Spanish (December 17 NOW), and here’s the new branding – “La Invasora.” The talent includes “La Invasion Mananera con El Gordo y Mamizuki,” Iliana “La Nena” Sanchez, and Alex “El Genio” Lucas (from Entravision and Stardome Radio Networks). As you’d expect, WWRL manager Adriane Gaines cites the changing demographics - “New York City is the 15th largest economy in the world and almost one in four residents is Hispanic.” SupeRadio Latino Network Executive VP Jesse Rios says “La Invasora will serve as the flagship station” of the syndication. Access.1 owns SupeRadio, which offers content such as an immigration show hosted by attorney J.A. Garcia and “The Intimidades Show con Betty” – both of which will clear in New York on 1600. The station should be up and streaming soon at LaInvasora1600 here.
No more split-personality for the Dove on Florida’s West coast, says Radio Insight – Clear Channel uncomplicates things for listeners by re-branding soft oldies “Dove Radio” WSDV Sarasota (1450) and simulcast WDDV Venice (1320) as “Sunny.” There’s been some confusion up and down the coast, since Clear Channel sold Tampa-market “Dove” WDUV New Port Richey (105.5) to Cox in 1999 – but kept operating as The Dove further south, in Sarasota. The original Dove there was at 92.1, and then the format was moved to the two AMs – which are now operating as “Sunny 1450/1320” with website here.
Atlanta’s “Rock 100.5” WNNX pulls the currents and is apparently chasing the classic rock and classic hits fans currently at Cox-owned classic hits “River” WSRV. That’s Rodney Ho’s analysis of the Cumulus thinking about Rock 100.5, which is “dropping all new songs and almost everything else from the past 15 years.” One factor is that WNNX won’t be running Braves baseball this year, as the games shift to sister news/talk WYAY (106.7). Rodney suddenly finds more Black Sabbath, Whitesnake, ZZ Top, Who and Foo Fighters on Rock 100.5, as you can see from his song list here,
Albuquerque’s super-long “Santa” stunt at 100.9 ends with Clear Channel finally showing its hand as rhythmic oldies “Hot 100.9.” Clear Channel kept the HD multicast-fed translator going with holiday tunes for over four months (September 6 NOW), and the end-product is “Old School Hot 100.9.” The sign-on bit is “10,000 old school jams in a row,” and the “HotABQ” site is here. Recently-upgraded translator K265CA Albuquerque is supplied by an HD multicast signal from alt-rock sister “104.1 the Edge” KTEG Santa Fe.
In Las Cruces, New Mexico, Veronica Test is the GM for new KSNM (570) owner Adams Radio, and she tells the Sun-News “there’s already two talk stations in town, so it just made sense” to re-format to classic country – especially since it complements Adams’ country KGRT (103.9). The only show retained from the previous format is “Let’s Talk Las Cruces,” moved from mornings to noon-1pm. Veronica says “we just felt it was good information for the community.”
South Jersey Latinos have a second chance to hear “Envivo Latino,” thanks to a new simulcast. Last year, owner Rick Brancadora switched formats on WIBG Ocean City (1020) from conservative talk to the bilingual Spanish-English format, and now the Press of Atlantic City says sister WIBG-FM Avalon (94.3) has dropped oldies to form a simulcast. General manager Jerry Beebe saw the results from the AM switch and suggested putting the format on FM, too. Check Beebe’s comment about the format – “It’s a mix. Young Latinos growing up are of two cultures. They don’t want one or the other – they want both.”
“The Outlaw – Southern rock, real country” existed online-only until it spread to Myrtle Beach-market WJXY Conway, SC last January. At the time, the former Cumulus station was held by the Volt Trust, and then it went into the Joule Trust run by Eddie Esserman. WJXY (93.9) is now doing talk, but the “Outlaw” folks say they’re ready to discuss putting a customized version of the rock/country hybrid on other terrestrial stations, with “music, voicing, imaging, requests, promotion, contests, production and local events run on the station’s own automation system.” The terms are barter, in exchange for two minutes an hour. This is the latest attempt to fuse what seem like two natural fountains of programming – country and southern rock. For previous entrepreneurs, the quest has been elusive.
In upscale Colorado communities like Aspen and Vail, a $2.65 million sale cashes out NRC Broadcasting, after more than 11 years in radio ownership. Tim Brown founded what was originally called “Newspaper Radio Corporation” in 2002, with backing from his father-in-law, the billionaire Phil Anschutz and the Anschutz Company. The original focus was toward Denver, but that shifted to the upscale ski country real estate like Steamboat Springs. Today NRC Broadcasting is comprised of 12 full-power stations plus some boosters. The stations include adult alternative KSPN-FM Aspen (103.1) and talk/sports KNFO Basalt (106.1). The buyer is AlwaysMountainTime LLC, whose principals are Pete Benedetti and Patricia MacDonald-Garber. Pete’s recently been gripping the ski poles as an executive with NRC, and before that he was an executive at New Northwest Broadcasters. He has attributable interests in four Billings-market stations including country “98.5 the Wolf” KEWF. Pete holds a one-third interest in AlwaysMountainTime. His partner is born-into-the-business broadcaster Patricia MacDonald-Garber, who has interests in eight stations in Traverse City-Petoskey, Michigan, including soft AC “Lite 96” WLXT Petoskey. Together as AlwaysMountainTime, they’ve also filed to buy Colorado stations KQSE Gypsum/102.5 and KTUN New Castle/94.5. In their $2,650,000 agreement to buy the NRC stations, they’ll pay $900,000 cash and then $1,750,000 in a 36-month seller note. Pete and Patricia like the Colorado ski country. Their company motto – “Life’s just better up here.”
Ginny Hubbard Morris is profiled by her hometown Minneapolis Star-Tribune, one of the very few times you’ll see the chairwoman of Hubbard Radio talked about in the non-radio trade press. She prefers to steer clear of the limelight, as you can see in this quote about her management style from Hubbard VP Dan Seeman – “She leaves you alone, but she’s there when you need her.” Read more about recent NAB National Radio Award winner Ginny Morris – one of the paper’s “Ten newsmakers we watched in 2013” - here.
“Listen to Pandora, and it listens back,” says Natasha Singer at the New York Times. She says Pandora “has started data-mining users’ musical tastes for clues about the kinds of ads most likely to engage them.” They’re adding “a music layer” to the behavioral targeting that’s common at some other Internet companies like Amazon and Netflix. More about Pandora’s deepening strategy for ad sales – like predicting which political ads to serve to somebody, based on their music choices - here.
The stakes are high – survival, for some Internet audio services – as a new panel of judges preps to start considering webcasting rates for 2016 through 2020. Communications attorney David Oxenford’s worked in this space for years, on behalf of webcasters, and he says the just-issued Federal Register notice is tantalizing, on a couple of counts. “First, the judges ask if the Copyright Royalty Board would be justified in adopting a percentage-of-revenue royalty, rather than the per-person, per-listener royalty metric” used in the past three proceedings. The judges note that that they’re bound by precedent – but they want to be educated about the environment. Second, Oxenford says the CRB’s asking “if there should be different rates for different types of webcasters.” If you want to participate in the proceeding, you must file by early February, and there’s more to learn from Oxenford at BroadcastLawBlog here.
Keith Hotchkiss is leaving Cleveland for Charlotte, perhaps trading in his Browns and Cavs stuff for Panthers and Bobcats shirts. But maybe not – Keith started as an intern at Cleveland rocker WMMS (100.7) back in 1996, and that’s a long time to form attachments. He’s currently the general sales manager for the Cleveland Indians radio sales operation and four stations, including 'MMS. His new Charlotte job as the Director of Sales gives him all five Clear Channel stations, such as country "96.9 the KAT" WKKT. Charlie Wilkinson’s the Charlotte-based regional manager for Clear Channel.
Doug Ingold joins Compass Media Networks starting January 20 as Senior Director of Affiliate Sales, giving a push to its affiliate work and also adding presence on the West Coast. L.A.-based Ingold was a senior director of national affiliate sales for Dial Global and Westwood One, and before that doing he did record promotion for Roadrunner Records, V2, Volcano, Zoo Entertainment and Relativity Records. Before that, he did radio programming and/or airwork at stations in Santa Barbara, San Diego and L.A. At Compass, Doug will be working with the portfolio of long-form music and entertainment shows like Free Beer & Hot Wings, Rick Dees, Off the Record – launching today for Compass – the Big D & Bubba country morning show.
Surprise, surprise - A NOW reader says "I had worked with my female co-host for over two years and thought I knew her pretty well. Until one morning, right before our show began, she turned to me and said 'By the way, I'm gay.' She had never previously talked much about her personal life, though she probably knew plenty about mine - married to the same woman for quite a while, with a couple of kids. I was flabbergasted and didn't have the chance to talk to her before we began our airshift. Later, I told her I was totally fine with what she said, and because of other circumstances, we no longer work together. But I'll never forget that day." Got your own true radio story for “You Can’t Make This Up”? Email Tom@RTK-Media.com.
Take 2 – #1, Many Yankees and Mets fans (not much overlap there) emailed about Friday’s story, where I said that CBS was unlikely to fracture the simulcast of New York’s WFAN-AM/FM (660/101.9) because of its new baseball partner. The new partner is of course the Yankees. The Mets have departed the Fan for Clear Channel’s WOR/710). #2, In discussing the Fall Nielsen Audio results for Monmouth-Ocean, I got the owner wrong for “New Jersey 101.5” WKXW – it’s Townsquare Media.
The news about radio in one place, first thing every morning - you want the news, but also context background, maybe something to make you smile. Thanks for spending some of your valuable time with this daily Tom Taylor NOW Newsletter. Got a product or service to promote here in 2014? Kristy Scott can come up with solutions. She's at Kristy@RTK-media.com or phone 818-591-6815. See you back tomorrow morning - Tom