92.3 Now's fall

[davideduardo]

I read a post from DavidEduardo recently that said Now was billing alright

I wouldn't necessarily believe everything people post, especially about billing and demo ranking - I've seen people just flat out lie about facts they know most people don't have access to

Now's billing was flat from 2011 to 2012. While not stellar, it is in the third tier of stations that bill between $14 and $18 million that includes Power, PLJ, WABC, WEPN (AM)*, WPAT, WWFS and WOR as well.

The second tier is those billing $22 to $32 million, or about 6 stations. Then there are 5 stations billing $41 to $48 million.

* Remember, this was for 2012.

 

[atlantaboy]

I read a post from DavidEduardo recently that said Now was billing alright

I wouldn't necessarily believe everything people post, especially about billing and demo ranking - I've seen people just flat out lie about facts they know most people don't have access to

Now's billing was flat from 2011 to 2012. While not stellar, it is in the third tier of stations that bill between $14 and $18 million that includes Power, PLJ, WABC, WEPN (AM)*, WPAT, WWFS and WOR as well.

The second tier is those billing $22 to $32 million, or about 6 stations. Then there are 5 stations billing $41 to $48 million.

* Remember, this was for 2012.

How does that compare to RXP's billing numbers for 2012?

Seems like any station targeting a market as large as NYC is going to have those billing numbers, even if they come in dead last - isn't it a question more of whether a format change would increase billing?

 

[dcowboy7]

I read a post from DavidEduardo recently that said Now was billing alright

I wouldn't necessarily believe everything people post, especially about billing and demo ranking - I've seen people just flat out lie about facts they know most people don't have access to

Now's billing was flat from 2011 to 2012. While not stellar, it is in the third tier of stations that bill between $14 and $18 million that includes Power, PLJ, WABC, WEPN (AM)*, WPAT, WWFS and WOR as well.

The second tier is those billing $22 to $32 million, or about 6 stations. Then there are 5 stations billing $41 to $48 million.

* Remember, this was for 2012.

How come they say plj doesnt mind their lower ratings so much because they have good demos so they bill well ?

14-18 doesnt seem so well when z100 is doing 48.2.

 

[davideduardo]

Seems like any station targeting a market as large as NYC is going to have those billing numbers, even if they come in dead last - isn't it a question more of whether a format change would increase billing?

By that theory, there are about 12 stations that ought to consider changing format.

 

[atlantaboy]

Seems like any station targeting a market as large as NYC is going to have those billing numbers, even if they come in dead last - isn't it a question more of whether a format change would increase billing?

By that theory, there are about 12 stations that ought to consider changing format.

Alright, let's ask this another way...

How many NYC stations are billing LESS than Now 92.3?

 

[davideduardo]

Alright, let's ask this another way...

How many NYC stations are billing LESS than Now 92.3?

There are 80 commercial stations licensed in the New York City MSA.

Now is 19th in billings.

Now is also in a group of stations with very comparable billings, so in a way you could say they were tied for 12th... or averaged 16th.

The key is the cost of operation. They may, in fact, cash flow more than some other higher billing stations that have significantly greater expenses.

Even if we conclude that the format is not doing as well as they might like, the cost of a format change is very high. Unless you just tweak the format, you generally loose almost all the billings. And it can take you, even with the immediacy of PPM, 6 to 9 months to get back into significant billing... in the meantime you have lost, in Now's case, as much as $10 million in revenue.

It would take a major win to make that back, and it would still take several years to amortize the cost of the change. Add in the costs of changing staff (severance, promotion, legal, etc), possible loss of business compensation for sellers, etc., and you have a costly proposition.

 

[atlantaboy]

Now is 19th in billings.

Now is also in a group of stations with very comparable billings, so in a way you could say they were tied for 12th... or averaged 16th.

The key is the cost of operation. They may, in fact, cash flow more than some other higher billing stations that have significantly greater expenses.

Even if we conclude that the format is not doing as well as they might like, the cost of a format change is very high. Unless you just tweak the format, you generally loose almost all the billings. And it can take you, even with the immediacy of PPM, 6 to 9 months to get back into significant billing... in the meantime you have lost, in Now's case, as much as $10 million in revenue.

It would take a major win to make that back, and it would still take several years to amortize the cost of the change. Add in the costs of changing staff (severance, promotion, legal, etc), possible loss of business compensation for sellers, etc., and you have a costly proposition.

I don't see how this is any different than the situation WRXP was in - 19th in billings is pretty bad

The difference IMO is that CBS still wants to continue its prospects of potentially flipping more stations to Rhythmic-leaning CHR - I think it's keeping Now for the same reason it's keeping The Game in ATL

 

[davideduardo]

I don't see how this is any different than the situation WRXP was in - 19th in billings is pretty bad

A major difference is that Emmis had debt service and CBS doesn't.

Emmis could not get major traction with WRXP, and it was not a tight fit with the urban and hip hop stations for sales.

CBS could be cash flowing $6 to $8 million on Now. Emmis had a debt crunch, shareholder discontent and other issues.

The situations are about as different as you can get.

And... if WNOW were in Atlanta, it would be 5th in billings. If it were in Phoenix, it would be #1 in revenue. WNOW is in the top 100 billing commercial stations out of 11,100 in the whole US.

Hardly "pretty bad".

Considering it is likely cash flowing, that it would cost millions in lost revenue and millions more in start-up costs, there is not a powerful reason to make a flip, unless it were to "save" the much larger revenue of one of the news stations... unlikely at the moment.

 

[Barry]

Given that it is costly to change formats, and that none of the major stations in New York appear to be doing really poorly, perhaps it is unlikely any will flip to something else anytime soon.

 

[davideduardo]

Given that it is costly to change formats, and that none of the major stations in New York appear to be doing really poorly, perhaps it is unlikely any will flip to something else anytime soon.

Precisely.

After all the talk on this forum about WPAT-FM changing format, they, after some delay, made some format adjustments to better mirror the PPM panel, and have increased by more than double in the core demos. From a 1.0 in 18-49 late last year, they are tracking in the end of March at over a 2.5. No major expense, just some research, adjustments and fine tuning.

A full format change would have flushed $15 to $16 million in billings, and lost them nearly as much during the turn around period.

WPAT adjusted the format, but did not change it, and now they look quite smart.

 

[atlantaboy]

And... if WNOW were in Atlanta, it would be 5th in billings. If it were in Phoenix, it would be #1 in revenue.

I think we all know that that makes no sense, since the potential number of CHR listeners in Phoenix is much lower than the potential number of CHR listeners in NYC

But I understand what you're saying about RXP being in debt, if that is in fact true

 

[Morpheux]

Given that it is costly to change formats, and that none of the major stations in New York appear to be doing really poorly, perhaps it is unlikely any will flip to something else anytime soon.

Precisely.

After all the talk on this forum about WPAT-FM changing format, they, after some delay, made some format adjustments to better mirror the PPM panel, and have increased by more than double in the core demos. From a 1.0 in 18-49 late last year, they are tracking in the end of March at over a 2.5. No major expense, just some research, adjustments and fine tuning.

A full format change would have flushed $15 to $16 million in billings, and lost them nearly as much during the turn around period.

WPAT adjusted the format, but did not change it, and now they look quite smart.

I must say that was a learning experience. That's why I'm being more cautious trumpeting format changes for NOW or any other station.

 

[JayD]

DavidEduardo always has the most intelligent, knowledgable posts on this board... Thanks David!

 

[davideduardo]

And... if WNOW were in Atlanta, it would be 5th in billings. If it were in Phoenix, it would be #1 in revenue.

I think we all know that that makes no sense, since the potential number of CHR listeners in Phoenix is much lower than the potential number of CHR listeners in NYC

You are not getting the point. Now may be in the lower range of billings for "major" New York signals, but their billings are definitely very high when compared with to the industry as a whole.

In other words, at $14 to $15 million, the station is making money. My guess is that they have significant cash flow, and with no debt service they look pretty good. There are eleven thousand stations in the US billing less than they do.

But I understand what you're saying about RXP being in debt, if that is in fact true

Now you are becoming a source of amusement for me. "If that is in fact true". Funny.

The ongoing Emmis story, including the need to sell assets in New York, Chicago and LA, it's shareholder lawsuits and such have been major headlines over the last several years. Just go to any of the financial sites and key in EMMS and see what you get.

Or... look at the reasonably accurate http://en.wikipedia.org/wiki/Emmis_Communications and pay considerable attention to the part that says, "In their January, 2011 filing with the Securities and Exchange Commission, the company reported that it had the necessary cash to survive through February, 2011. "Absent asset sales, which the company is actively pursuing," Emmis attorneys stated in the regulatory filing, "the company believes it is unlikely it will be able to maintain compliance with the financial covenants after Sept. 1, 2011."

If you are going to comment on whether a station "needs" to change format, you should first understand the underlying business model of a radio station and the particular conditions bearing on the specific station and owner in question.

 

[atlantaboy]

And... if WNOW were in Atlanta, it would be 5th in billings. If it were in Phoenix, it would be #1 in revenue.

I think we all know that that makes no sense, since the potential number of CHR listeners in Phoenix is much lower than the potential number of CHR listeners in NYC

You are not getting the point. Now may be in the lower range of billings for "major" New York signals, but their billings are definitely very high when compared with to the industry as a whole.

That statement would be true for any station in New York City, even one that comes in 20th, 25th, or 30th - and I'm sure you know that as well as I do

 

[atlantaboy]

The ongoing Emmis story, including the need to sell assets in New York, Chicago and LA, it's shareholder lawsuits and such have been major headlines over the last several years. Just go to any of the financial sites and key in EMMS and see what you get.

If you are going to comment on whether a station "needs" to change format, you should first understand the underlying business model of a radio station and the particular conditions bearing on the specific station and owner in question.

What you're implying is that the only reason a New York radio station should legitimately change formats is if the whole corporation is having financial issues

This is an excerpt from one of the many articles from a couple years back discussing the need for Emmis to sell WRXP:

WRXP used to be known as CD 101.9 with a smooth jazz format. Emmis changed that format to the current triple A and call letters to WRXP on February 5, 2008. Since that change, the station has been struggling in the ratings. In the fall, 2007 book as WQCD, the station pulled a 2.7. In their first book as WRXP, the winter, 2008 book, they pulled a 1.6. Since that time, the station has managed to move up in the ratings, but not much. The best the station has done since the change is a 2.5 in the December, 2009 book. The most recent book, September, 2010 saw WRXP at a 2.0 in 22nd place, the absolute lowest rated commercial FM in the market.

Notice, the entire rationale is based on ratings and rank - yet somehow we're supposed to believe that coming in dead last is extremely profitable for Now 92.3, but caused bankruptcy for WRXP?

 

[davideduardo]

That statement would be true for any station in New York City, even one that comes in 20th, 25th, or 30th - and I'm sure you know that as well as I do

And it is just as likely that the stations that appear to be marginal based on ratings rank or billings rank are actually making good amounts of money.

In many cases, a station that occupies a secure niche and is making money consistently will not consider potentially more profitable positions because of the cost of the change and the risk involved.

 

[davideduardo]

What you're implying is that the only reason a New York radio station should legitimately change formats is if the whole corporation is having financial issues

What I am saying is that appearances can be deceiving. A company with fully paid assets and good cash flows is not going to be as likely to have their finger on the trigger as one that is in dire financial straits.

Each situation is different. The revenue base of a market, buyer preferences for formats, the competitive array, the owner's corporate culture and many other factors come into play in making format decisions or holding off on them.

This is an excerpt from one of the many articles from a couple years back discussing the need for Emmis to sell WRXP:

WRXP used to be known as CD 101.9 with a smooth jazz format. Emmis changed that format to the current triple A and call letters to WRXP on February 5, 2008. Since that change, the station has been struggling in the ratings. In the fall, 2007 book as WQCD, the station pulled a 2.7. In their first book as WRXP, the winter, 2008 book, they pulled a 1.6. Since that time, the station has managed to move up in the ratings, but not much. The best the station has done since the change is a 2.5 in the December, 2009 book. The most recent book, September, 2010 saw WRXP at a 2.0 in 22nd place, the absolute lowest rated commercial FM in the market.

Notice, the entire rationale is based on ratings and rank - yet somehow we're supposed to believe that coming in dead last is extremely profitable for Now 92.3, but caused bankruptcy for WRXP?

Problems with that statement:

WQCD was in "Titanic Mode" following the introduction of the PPM in New York. The effects of the PPM had severely dinged the rhythmic and urban stations in the cluster, and WQCD (like nearly every smooth jazz station in a PPM market) dropped almost all the salable 25-54 numbers.

WQCD made some adjustments to the format (The Chill episode being the most notable) and only got worse in 25-54. The flip to rock came from having an impaired cluster and nowhere to go with smooth jazz. Note that at the same time, nearly every PPM market smooth jazz station changed format. In other words, the 6+ or 12+ numbers don't show the story here.

The rock format was a "best option" given the fact that from the last diary book to the first PPM book smooth jazz died. That methodology change is a once in a lifetime type thing for most owners (a few also went through the change from Pulse/Hooper to Arbitron with similar adjustments) and will never be repeated; this was a "now you are doing fine, now you are dead" type of situation from one diary book to the first PPM book.

WRXP was not bankrupt. Stations that are part of a group do not separately and individually go bankrupt. It's totally out of place to use that word here, since neither Emmis nor any subsidiary declared bankruptcy.

What did happen is that Emmis became a smaller company. In addition to selling the TV division to pay down debt, they sold or the underperforming radio properties as they produced the least cash flow and the value could best be used to pay down debt. WRXP was sold to help pay down debt. It was a valuable property, and it did not contribute sales synergy to the two remaining stations in the NY cluster.

Under other circumstances, Emmis might have tried to keep the NY cluster intact. But they had a debt situation that made a downsizing the correct option. Debt free, they could have slowly built WRXP and had a nice, profitable station. But that was not the case.

 

[atlantaboy]

What I am saying is that appearances can be deceiving. A company with fully paid assets and good cash flows is not going to be as likely to have their finger on the trigger as one that is in dire financial straits.

I agree with most of what you're posting, except that Clear Channel and Cumulus are both quick to flip formats, at least in Atlanta, and neither corporation is even close to being "in dire financial straits" - if either one had ownership of Now 92.3, I am convinced they would have flipped it by now to a more profitable format

What you're basically saying, I think, is that New York City has such a large population that CBS should be content with the billing that they have, since coming in 20th in New York is more profitable than, say, coming in 1st in Providence, for example - so then, according to what you're saying, extremely large cities should have very few format flips, relative to medium-sized cities - I'm not sure if that's true on not...it's just the first time I've heard that in the couple years I've been on this board

 

[whatsnew3000]

Guys!

The reason for doing this post was to assess ways WNOW can be helped

I posted what I wrote because its sentiments that the actual program director must have seen and just ignore like he's on top of the world and can't respecting the viewpoint of the station he negatives programs.

The changes I mentioned are doable and can work. People want professionalism above all. How many stations are actually professional? The great ones: Z100, WCBS AM AND FM, KTU, POWER, LITE FM and the like. They have approachable and likable.

Write comments that can invoke change!