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WJAS is getting a new owner. Will it change or not?

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WJAS, 1302 AM, one of the oldest stations in Pittsburgh, is getting new ownership. From a web article on Triblive, here's a "fair use" sized quick summary excerpt.

Pending approval of the Federal Communications Commission, Renda Broadcasting sold WJAS-1320 for $1 million to Frank Iorio Jr., who is doing business as Pittsburgh Radio Partners Inc.

This year, the FCC approved Iorio's sale of WBVP-1230 and WMBA-1460 in Beaver County to Mark and Cynthia Peterson, with a condition he not compete within 25 miles of those stations. However, that condition allows for a station “within the city of Pittsburgh.”

Iorio owns an FM station in Cambria County and several stations in the Warren area in the state's Northern Tier.

Iorio is no stranger to oldies radio formats. He might update WJAS from it's current "older than the oldies" format, or he might be content to stick with the level of success WJAS currently enjoys. There is some speculation that this could be the end of the on-air careers of Bill Cardille, who is now 85, and Jack Bogut, whose exact age is difficult to quickly find.
 
Iorio and Radio Partners Inc. also own WNAE 1310 AM (Warren), a talk format, WKNB 104.3 (Clarendon), country music and WLKE 93.5 FM (Gallitzin) religious progamming so Iorio is not a stranger to quite a few formats. It is possible he could continue with the current incarnation of WJAS, though if that were the case one has to wonder why Renda would part with it if it were successful. Of course Renda also sold off all of their Oklahoma stations (as well as donating 1360 WMNY in Pittsburgh), so maybe they are just cash strapped. Given Radio Partners are also leasing the existing tower site from Renda (Springhill Group is their property management arm) it looks like they are making a play in the Pittsburgh market rather than trying to relocate the existing signal, though they do have a construction permit for Sheffield PA and their other AM runs on a translator as well (96.7) so right now just about anything is possible.
 
Anything is possible, but some things are more probable that others.

The best chance of any high level of success with an AM station in a declining and aging market like Pittsburgh would probably be to cater to an underserved market niche. That's currently what WJAS is doing. WJAS has no other competition in town for the "senior-citizens-who-want-to-hear-nice-old-songs" niche. If anyone were to attempt to capture listeners on an AM station in Pittsburgh with any other format, they'd have to be good enough, and aggressively marketed enough, to take listeners away from an existing station. That strikes me as a silly thing to attempt if they've already sewed up 100% of an uncontested market niche.

However, I could see WJAS making some minor gains with better drive-time news reports. Since Chris Shovlin is also the Director of Marketing & Promotion at all the remaining Renda stations, my guess (and it's purely a guess) is that he's more likely to keep his Marketing & Promotion job than he is to keep his DJ job. I could be totally wrong, but I think they'll replace Shovlin. Who knows? This could be Jim Quinn's new landing zone, as he once again re-invents himself as an elder statesman/DJ. It wouldn't be a bigger change in career direction than changing from half of a wacky morning team to a conservative talk host. I don't know that such a thing is probable, but it's certainly possible.

I do not know if Cardille and Bogut are making the kind of big bucks "legends" like them would be expected to make, or if they're working on-air as a retirement hobby, mostly for fun and to keep busy. If they're very expensive, I'd expect to see them replaced with someone (or something) more economical.
 
I agree, I think that Renda will retain Chris Shovlin. He runs the promotions department and was doing the news on WSHH mornings last I had heard (though it has been a while since I listened). The sales staff at Renda focuses almost exclusively on the FM, any business generated by the AMs (or their former AMs) was usually driven by the talent moreso than the sales staff. If there is a client specific to WJAS, chances are they are there because of an existing relationship with Bogut or Cardille. Any other spots are usually just throw in as a package with the FM station. If Renda doesn't find it economically feasible to stay the course, I am not sure Iorio will have much better luck with the same. I don't know how much of the market WJAS grabs these days (Renda no longer is an Arbitron subscriber), though they used to be the #2 AM in the market (behind KDKA).
 
fromtheinsideout said:
If there is a client specific to WJAS, chances are they are there because of an existing relationship with Bogut or Cardille. Any other spots are usually just throw in as a package with the FM station. If Renda doesn't find it economically feasible to stay the course, I am not sure Iorio will have much better luck with the same. I don't know how much of the market WJAS grabs these days (Renda no longer is an Arbitron subscriber), though they used to be the #2 AM in the market (behind KDKA).
Click to expand...

Since WJAS is going after market niche that advertisers who simply read the ratings ignore, paying for ratings is a waste of money. You suggested that Renda needed to raise cash, and I think you're correct. But, they wouldn't have gotten any cash for WJAS if it wasn't generating some revenue. Therefore, I think it safe to guess that WJAS is doing a good job of selling ads the old fashioned way, by persuading the actual business owners to use their own judgement rather than listening to some bean counters.

As I said earlier, I believe WJAS has 100% of the market niche that wants to hear mellow music from yesteryear. Over on the Voy nostalgia forum, they had a picture of the old weekly hit list from one of the AM stations from 1969. Even that late, there was still a lot of "leftover" music that sounded more appropriate for the 40's than the verge of the 70s. The few times I had to sit through listening to WJAS (which I made a point to avoid), it was like listening to my parents' music collection. And I'm 62 years old! Don't get me wrong, I appreciate Sinatra, Tony Bennett, Harry Connick, Jr. & Michael Bublé (who are contemporary, but sound like they're from the 50's), or women like Julie London, Vickie Carr, or Peggy Lee. I just don't want to listen to them on AM. But, there are people who do, and for them, WJAS is the only game in town. With a good sales staff that actually calls on decision makers and not just clerks, I can see where WJAS could be very profitable. And, with a little push, I think it could remain so for a long time.

When Free Form FM first came along, not only did rock acts get more exposure. The mellow singer-songwriters like James Taylor, Jackson Browne and others were right there alongside the Doors and Led Zeppelin, just like Sammy Davis, Jr. was alongside the Grass Roots over on AM. I suspect that as the audience ages, WJAS could pick up those Baby Boomers who are nostalgic for the softer, more mellow music of the late 60's and 70's, and maintain their success for another decade. I won't be among their audience, but I'm sure many of my wife's girlfriends will be.
 
The sale price was $1 million. Typically that breaks down to about 6 times cash flow. Do the math, and that'll tell you how much money they bring in a year. Then figure out salaries, rent, insurance, utilities, and other expenses. Since he owns several AMs, he can share some costs, like legal and finances. Maybe share sales staffs.
 
fromtheinsideout said:
Here is a little something that will tell you absolutely nothing

http://www.post-gazette.com/ae/tv-r...rmat-still-up-in-the-air/stories/201406050178
Click to expand...

Well, supposedly Iorio is some sort of experienced broadcasting professional. Yet his main quote is, "The biggest challenge ahead is getting people to listen."

Wow! What incredible insight! Who could have possibly thought that would be the biggest challenge?

Let's hope he was just in "cliche-speak" mode when talking to the PG reporter. Or, maybe he said a lot of interesting and insightful things, but Maria Sciullo was in just-run-the-cliches mode herself.
 
I didn't realize this... but if it's in the PG it has to be correct... right?

"Mr. Iorio used to have The Force, which later became WXDX 105.9 and then WAMO 106.7."

I've always thought that Mr. Iorio never had 106.7 but was only offered the AM, WBVP when he bought it from what became Clear Channel. Clear Channel then made a deal with Sheridan to swap 106.7 with 105.9.
 
I think Iorio owned the station during its WBVP/WKKS FM days, though I am not 100% certain on that. I am pretty sure you are correct that it was a Clear Channel property when it was "The Force", then Sheridan sold 105.9 FM to Clear Channel for 106.7 FM, 107.1 FM and $10 million if my memory isn't failing me. "The Force" then relocated to 105.9 and became what we now refer to as "The X", while WAMO FM simulcast their programming on both of the new FM signals, though neither one got the coverage in the city that WAMO previously had at 105.9.
 
"Typically" often doesn't mean anything. Some stations trade on what's called "stick value", i.e. the presumed "worth" of the stick (the transmitter and plant.) So it would include the legal costs for applying for a license, getting a station running with zero cash coming in for some months while paying salaries, real estate, and the very real problem of NIMBY troubles getting a transmitting tower placed.

This deal may, indeed, be "six times cash flow" or it may be nothing close to that. It's possible that there is no "cash flow" and that's why it's being sold. Some of the bigger named announcers may have "participation" in the advertising on their shows (Bogut did while at KDKA), or they may be strictly jocks-for-hire, I wouldn't know. Nor do I have the slightest idea of how WJAS is doing these days, but around the country these "older than oldies" stations don't do particularly well, at least by corporate standards. Still, they can probably produce a decent living for a few, like owning a neighborhood hardware store might, even in the face of a Home Depot in the big city 10 miles over.
 
In the past WJAS has been one of the highest-rated Adult Standards stations in the country. Now that Nielsen no longer lists non-subscribers, that's hard to determine.

The station appears to be profitable and I am pretty sure that Messrs. Bogut and Cardille sell time on their own programs, but I don't know the exact level of "participation."

There are things that could be done to make WJAS a better radio station, but until the day Bogut and Cardille retire I think Mr. Iorio would do well not to lose a good thing.

C.
 
Being the highest rated adult standards station is liking being Pittsburgh's tallest midget. The ratings were lukewarm at best when they were still subscribing and I can't see any reason why they would have improved. If, as reported, Iorio is going to pay $4,500 a month to rent tower space, he's going to have a hard time making money. He also has to hire salespeople since the Renda staff won't be selling and he'll probably have to rent space for operations and hire at least token support staff. I predict before the end of the year, this station will have a format that comes completely via satellite.
 
I am not sure how much WJAS is making or billing at this point. One would think if it was still doing okay there would be little reason for Renda to part with it unless they are cash strapped, which would explain their selling off of the Oklahoma stations in the past. I do know that they just settled a lawsuit with Nielsen (Arbitron) in late May in Florida for using the Nielsen numbers without being a subscriber, though terms of that settlement were not released. $1 million (plus rent for the existing tower site) would seem to be a pretty decent amount for an AM signal these days, but I have no idea how much Renda dumped into building the new site.
 
Radio Richie said:
Being the highest rated adult standards station is liking being Pittsburgh's tallest midget. The ratings were lukewarm at best when they were still subscribing and I can't see any reason why they would have improved. If, as reported, Iorio is going to pay $4,500 a month to rent tower space, he's going to have a hard time making money. He also has to hire salespeople since the Renda staff won't be selling and he'll probably have to rent space for operations and hire at least token support staff. I predict before the end of the year, this station will have a format that comes completely via satellite.
Click to expand...

Back when we could see their ratings, WJAS was in the three-share range. For an AM station, those are excellent numbers. If they can't monetize it, that's a sales problem. Nothing wrong with the ratings.

I'll be happy to hear any programming ideas that would get WJAS more than a three share.

As to why many of his stations are being sold, I believe Mr. Renda is doing estate planning.

C.
 
They were below three and ALL of it was 55+ which is a very tough sell. Sales aren't going to increase, so decrease the overhead. Easiest way to do that is to flip the switch and take programming off a satellite. Personally I believe it's a lost cause no matter what they do and have no idea why Iorio sunk money into this.
 
I have a difficult time understanding why anyone would buy a radio station with the idea of doing nothing but tapping into a satellite feed. Is the return on investment for such an enterprise that much better than opening a coin-op laundromat, or a corner bar, or a convenience store, or a fast food franchise? Is running an AM radio station with nothing but satellite feed the most profitable thing a businessman can do with a certain amount of investment money? Isn't running a radio station more of something someone does because they really want to be engaged in broadcasting, and who actually cares to some degree about what goes out their stick?

Running a radio station as nothing more than a satellite programming repeater sounds more like what someone would do if they inherited a radio station or otherwise would themselves owning one without having planned to be in the broadcasting business. It doesn't sound like something anyone would deliberately decide to do. It's like buying a newspaper just because you want to own a printing company. It would be cheaper to just buy some printing presses.
 
I agree and I would argue that is part that sales is a big part of WJAS's problem. Renda has one sales staff for its two Pittsburgh properties so sales tends to focus their energies on the FM side, where as a salesperson, you will make more money. The AM stations are left to fend for themselves, so business is drawn in large part by the talent that is on the air. It was one of the reasons 1360 came apart piecemeal (Lynn Cullen's show remained profitable while Doug Hoerth's didn't) rather than as a wholesale format change until Ron Morris started buying roughly 18 hours of airtime a week, and why Sunday night oldies shows were also brokered programming (first Johnny Angel then Terry Lee, who both had to get their own advertising). Once Cardille and/or Bogut leave, a large chunk of their business will leave with them and there is no talent ready to step in and fill that void, nor are there clients lined up for programming beyond that which Cardille and/or Bogut supply.
 
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