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107.7 The Lake

SirRoxalot said:
You can't sell a 3 share that was mostly men when you have no other stations in the group to package them with. Especially when you're selling against a group of stations with good numbers for men (Cumulus) or good numbers across the board (WYRK). And fans of the old Lake weren't a primary audience for NTR from events.
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When you talk about packaging and multiple stations, you are generally talking about agency buys. Local direct does not buy that way... of course Buddy is the expert here... they buy with a very different set of criteria.

Agency is maybe 20% of the total market ad revenue. Think local sales.
 
SirRoxalot said:
You can't sell a 3 share that was mostly men when you have no other stations in the group to package them with. Especially when you're selling against a group of stations with good numbers for men (Cumulus) or good numbers across the board (WYRK). And fans of the old Lake weren't a primary audience for NTR from events.
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You can absolutely sell with a 3 share. It’s gonna be 80 percent direct, but a 3 share is the magic number for agencies.
 
SirRoxalot said:
The best thing Entercom could do with 107.7 is simulcast WGR. Their nighttime signal is a big figure 8 north and south. The signal is horrible east and west. 107.7 would fill in the eastern part of their audience nicely. In fact, the Pegula Sports Entertainment should insist on it, more for the Sabres who play a lot more night games than the Bills. Of course, the point becomes moot if the dashboard ends up in the hands of Radio.com and other streamers.

Realistically, 107.7 is paid for. It just needs to pay its electric bill at this point. So far, Big City talent has had a negative impact on already weak ratings. I think that they're just a placeholder until the Covid emergency eases and the station can once again be used to promote live events. Whether it remains alternative or not will be decided then.
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SirRoxalot said:
The best thing Entercom could do with 107.7 is simulcast WGR. Their nighttime signal is a big figure 8 north and south. The signal is horrible east and west. 107.7 would fill in the eastern part of their audience nicely. In fact, the Pegula Sports Entertainment should insist on it, more for the Sabres who play a lot more night games than the Bills. Of course, the point becomes moot if the dashboard ends up in the hands of Radio.com and other streamers.

Realistically, 107.7 is paid for. It just needs to pay its electric bill at this point. So far, Big City talent has had a negative impact on already weak ratings. I think that they're just a placeholder until the Covid emergency eases and the station can once again be used to promote live events. Whether it remains alternative or not will be decided then.
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107.7 is paid for? Perhaps with stockholder money but it is truly not paid for. It’s financed by many groups that contribute to the whole of ETM. 1077 was losing money before the pandemic. This now has got to be a total bloodbath for them. I gonna get this station one day.
 
What's wrong with the idea of 107.7 being a deliberate tax write off for Entercom?
There's some logic there.
As long as other Entercom stations are making money, it serves two purposes.
1) the frequency was bought to prevent someone else from competing with WKSE.
2) It can do what a tax write off naturally does for a radio business.
 
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The IRS does not allow tax write-offs for multiple years. I think you have to show at least breakeven about once in 3 years. Maybe that does not apply for corporations. Why would anybody in the current state of radio want to lose more money?
 
b-turner said:
The IRS does not allow tax write-offs for multiple years. I think you have to show at least breakeven about once in 3 years. Maybe that does not apply for corporations. Why would anybody in the current state of radio want to lose more money?
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I was not aware of that. If this is true, maybe there is a loophole of some sort allowing a tax write off to continue.
 
b-turner said:
The IRS does not allow tax write-offs for multiple years. I think you have to show at least breakeven about once in 3 years. Maybe that does not apply for corporations. Why would anybody in the current state of radio want to lose more money?
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There are plenty of start-ups that lose money for years and years, and that is perfectly legal.
 
Yeziknoradio said:
What's wrong with the idea of 107.7 being a deliberate tax write off for Entercom?
There's some logic there.
As long as other Entercom stations are making money, it serves two purposes.
1) the frequency was bought to prevent someone else from competing with WKSE.
2) It can do what a tax write off naturally does for a radio business.
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All business expenses are "write offs". A business pays income tax on the difference between gross income and expenses. called net income or "profit".

If you station bills $1 million in a year, and the costs of running it are a total of $750 thousand, you pay taxes on just the $250 thousand. If you lost money in prior years, you can use the carry-forward against this year's profit before paying taxes.
 
Yeziknoradio said:
What's wrong with the idea of 107.7 being a deliberate tax write off for Entercom?
Click to expand...

Maybe not a write off in the traditional sense. But the ownership rules prevent one company from owning too much of the advertising market. So Entercom owns two of the most profitable stations in town. And they also have two stations that are at the bottom. I don't know if they're losing money, or if they qualify as tax write offs. But they certainly balance BEN and GR, so the company can't be seen as a monopoly in Buffalo.

You can spend a lot of time talking about tax law. Part of it has to do with how the stations are grouped. iHeart has grouped their stations in multiple sub-companies. My sense is that's for tax purposes. I don't know if Entercom adjusted its business structure when they bought CBS. I imagine they had to under the terms of the reverse morris trust. Structurally you organize your assets in groups in order to manage tax liability. That may be what's at play here. But I'm not an accountant.
 
b-turner said:
The IRS does not allow tax write-offs for multiple years. I think you have to show at least breakeven about once in 3 years. Maybe that does not apply for corporations.
Click to expand...

I will disclaim this by saying I'm not an accountant. I have a business minor but left college for the last time about 20 years ago. So, my memory might be a tad fuzzy.

What I remember, however, is that corporations can carry a loss forward for three years. That might be what you’re thinking. If a corporation doesn’t show profit after three years, the money lost in its first year is gone forever and can’t be recaptured.
 
Kent said:
What I remember, however, is that corporations can carry a loss forward for three years. That might be what you’re thinking. If a corporation doesn’t show profit after three years, the money lost in its first year is gone forever and can’t be recaptured.
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Net operating losses, losses incurred in business pursuits, can be carried forward indefinitely, as a result of the Tax Cuts and Jobs Act; however, they are limited to 80% of the taxable income in the year the carryforward is used.

www.investopedia.com

What Are Tax Loss Carryforwards?

A tax loss carryforward is an opportunity for a taxpayer to move a tax loss to a future time to offset a profit.
www.investopedia.com www.investopedia.com

This applies to the various forms of incorporated businesses and to individuals.

Example: I know a person who sold all their investments very near the bottom of the 2007-08 Great Recession and used the funds to buy comparable investments with other funds or company shares. They took a loss that they applied up to the ceiling against their income for about five years until it was fully exhausted.
 
Kent said:
What I remember, however, is that corporations can carry a loss forward for three years. That might be what you’re thinking. If a corporation doesn’t show profit after three years, the money lost in its first year is gone forever and can’t be recaptured.
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A sidebar to this subject is the occasional purchase of a company that has closed operations after a long period of loss and using it to absorb a profitable operation so that the accumulated tax losses can be used against future profits.

One of the larger privately owned radio companies began in the 60's using the shell of a closed (but not dissolved) theater company to buy radio stations. The loss carry forwards allowed the company to minimize tax payments and to more rapidly expand by buying additional stations.
 
DavidEduardo said:
One of the larger privately owned radio companies began in the 60's using the shell of a closed (but not dissolved) theater company to buy radio stations. The loss carry forwards allowed the company to minimize tax payments and to more rapidly expand by buying additional stations.
Click to expand...

Ha! Sounds like RKO.
 
TheBigA said:
Maybe not a write off in the traditional sense. But the ownership rules prevent one company from owning too much of the advertising market. So Entercom owns two of the most profitable stations in town. And they also have two stations that are at the bottom. I don't know if they're losing money, or if they qualify as tax write offs. But they certainly balance BEN and GR, so the company can't be seen as a monopoly in Buffalo.

You can spend a lot of time talking about tax law. Part of it has to do with how the stations are grouped. iHeart has grouped their stations in multiple sub-companies. My sense is that's for tax purposes. I don't know if Entercom adjusted its business structure when they bought CBS. I imagine they had to under the terms of the reverse morris trust. Structurally you organize your assets in groups in order to manage tax liability. That may be what's at play here. But I'm not an accountant.
Click to expand...
They do not own two of the most profitable stations in town. WBEN and WYRK are the most profitable.

ENTERCOM is up to their eyeballs in debt. This will come to fruition this year.
 
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