Clear Channel Selloff Continues

[Cornflake the Destroyer]

This Just In...The Clear Channel selloff continues...11 markets in TX, OK and LA


PRESS RELEASE

APRIL 4, 2007

This is to announce that a contract has been signed and an application is being filed with the FCC for the transfer of radio stations KEAN-FM, KEYJ-FM, KFGL-FM, KSLI-AM, KULL-FM, KYYW, ABILENE; KATP-FM, KIXZ-AM, KMML-FM, KMXJ-FM, KPRF-FM, AMARILLO; KFMX-FM, KFYO-AM, KKAM-AM, KKCL-FM, KQBR-FM, KZII-FM, LUBBOCK; KAFX-FM, KSFA-AM, KTBQ-FM, KYKS-FM, LUFKIN; KCHX-FM, KCRS-AM, KCRS-FM, KFZX-FM, KMRK-FM, MIDLAND/ODESSA; KKYR-FM, KMJI-FM, KOSY-AM, KPWW-FM, KYGL-FM, TEXARKANA; KBGE-AM. KISX-FM, KKTX-FM, KNUE-FM, KTYL-FM, TYLER; KIXS-FM, KLUB-FM, KQVT-FM, VICTORIA; KBZS-FM, KNIN-FM, KWFS-AM, KWFS-FM, WICHITA FALLS, ALL IN TEXAS; KLAW-FM, KVRW-FM, KZCD-FM, LAWTON, OKLAHOMA; AND KEEL-AM, KRUF-FM, KTUX-FM, KVKI-FM, KWKH-AM, KXKS-FM, SHREVEPORT, LOUISIANA from Clear Channel Communications to Gap Broadcasting LLC.

The buyer, Gap Broadcasting, LLC, is a Dallas-based company headed by George Laughlin.

Kalil & Co., Inc. is the exclusive broker for the transaction.

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[Cornflake the Destroyer]

CC Adds 12 More to the Sell Off in Three Markets

Don't forget about the latest

CC Sells Off 12 More in Three Markets

PRESS RELEASE

This is to announce that a contract has been signed an application is being filed with the FCC for the transfer of radio stations; KXLP-FM, KYSM-AM, KYSM-FM, MANKATO MINNESOTA; KCHA-AM, KCHA-FM, KCZE-FM, KGLO-AM, KIAI-FM, KLKK-FM, KBMA-FM, MASON CITY; and KKEZ-FM, KWMT-AM, Ft. Dodge, all in Iowa, from Clear Channel Communications to Three Eagles Communications.

The buyer, Three Eagles Communications, is a Lincoln-based company headed by Rolland Johnson. Three Eagles Communications also owns stations in Iowa, Minnesota, Nebraska and South Dakota.

KAHLIL & CO., INC. is the exclusive broker for this transaction.


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[radionut925]

Re: CC Adds 12 More to the Sell Off in Three Markets

Don't forget about the latest

CC Sells Off 12 More in Three Markets

PRESS RELEASE

This is to announce that a contract has been signed an application is being filed with the FCC for the transfer of radio stations; KXLP-FM, KYSM-AM, KYSM-FM, MANKATO MINNESOTA; KCHA-AM, KCHA-FM, KCZE-FM, KGLO-AM, KIAI-FM, KLKK-FM, KBMA-FM, MASON CITY; and KKEZ-FM, KWMT-AM, Ft. Dodge, all in Iowa, from Clear Channel Communications to Three Eagles Communications.

The buyer, Three Eagles Communications, is a Lincoln-based company headed by Rolland Johnson. Three Eagles Communications also owns stations in Iowa, Minnesota, Nebraska and South Dakota.

KAHLIL & CO., INC. is the exclusive broker for this transaction.


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Seems like CC can't put itself out of its own misery fast enough. It's too bad that can't or won't give up more of its small-market stations in the Southeast, especially in Georgia.

 

[ngriffin]

There will likely be some spin-off sales as a result of these purchases since Three Eagles already owns stations in these markets.

 

[davideduardo]

Re: CC Adds 12 More to the Sell Off in Three Markets

Seems like CC can't put itself out of its own misery fast enough. It's too bad that can't or won't give up more of its small-market stations in the Southeast, especially in Georgia.

Clear announced last year the sale of 488 smaller market stations, which are nearly all of the stations in markets outside the top 100.

Those stations produced, apparently, less than 10% of revenues and about 5% of cash flow, meaning that they had a downward influence on operting margins and brought in very little profit.

This is not a case of "misery" but making the company more focused on the markets where most of the earnings are produced and eliminating the distractions of smaller markets.

There are still bout 450 stations to go in the sell-off list, for which bids were accepted several months ago.

 

[inradio]

I think that money figure is true to a point. I also look at what other factors CC had on those smaller markets. Premiere was able to add a truck load of affliates for various programming, so really good, some really bad. So you have to look at revenues that were brought in because of this. You make a lot more money selling advertising when you have 488 affliates as opposed to 100. Just take a look at all of the AMs that switched from their news provider to Fox News. That was a huge coup.

 

[davideduardo]

I think that money figure is true to a point. I also look at what other factors CC had on those smaller markets. Premiere was able to add a truck load of affliates for various programming, so really good, some really bad. So you have to look at revenues that were brought in because of this. You make a lot more money selling advertising when you have 488 affliates as opposed to 100. Just take a look at all of the AMs that switched from their news provider to Fox News. That was a huge coup.

Networks sell based on the population coverage and aggregate ratings, not number of stations. Not all markets and stations are created equally.

The top 100 markets, where Clear is not selling, represent 60% of the entire US population. The next 200 markets are not even 15%... with the rest being rural and smaller unrated markets.

Premiere is still going to get its significant shows cleared... nobody is cancelling Rush, obviously, unless there is a total format change. The loss of all the smaller markets will not significantly affect revenues, and they are not going to lose most of them. Just NY, Chicago and LA have more population than the sum of markets 101 to 200, and markets 201 to 399 have about the same population as just NY alone.

 

[SirRoxalot]

Multiple Choice?

So, what you're saying is:

A) CC made a foolish decision in purchasing these small-market stations in the first place?

B) They failed to manage them efficiently?

C) All of the above?

 

[davideduardo]

Re: Multiple Choice?

So, what you're saying is:

A) CC made a foolish decision in purchasing these small-market stations in the first place?

Many of these come from the JAcor / Randy Michaels concept of building statewide clusters (Ohio, for example) or regional clusters (Colorado / Wyoming / Montana / Idaho) and then getting Arbitron to create a software option to make great big markets out of multiple small ones. It apparently did not work as well as expected, which may be as much to do with the fact that the concept creator was gone as any failing in the idea itself. In any case, they did not get the expected synergy from buying so deep in the market ranks.

B) They failed to manage them efficiently?

Smaller markets absorb a lot of management time, so probably the economics of low revenues (proportional to market size) and the distraction these markets were to the company business model made the operation inefficient, not the management.

 

[pbf1]

WRONG.

Premiere is still going to get its significant shows cleared... nobody is cancelling Rush, obviously, unless there is a total format change.

Wanna bet? Check KFGO Fargo. Still N/T, but no more Rush. He even put a special Fargo stream on rushlimbaugh.com (not sure whether it's still there - I'm guessing not, as they've redone their website).

 

[davideduardo]

Re: WRONG.

Premiere is still going to get its significant shows cleared... nobody is cancelling Rush, obviously, unless there is a total format change.

Wanna bet? Check KFGO Fargo. Still N/T, but no more Rush. He even put a special Fargo stream on rushlimbaugh.com (not sure whether it's still there - I'm guessing not, as they've redone their website).

Oh, golly. They lost fargo.... that will probably cost them several dollars a year in revenue It's market 223, and the total revenue of all the stations is less than that of the #20 rated station in New York... or the #30 station in LA. The Fargo station averages less than 4,000 AQH persons. Rush in LA averages 96,000 in LA.

I guess I should have said, "they will have cnages in station affiliations, but will probably stay on in nearlyt every market they are in now." They will definitely not lose anything of significance in either listenership or revenue

And somebody will pick Rush up... supposedly WDAY... it's not like the show had no ratings (it may be that Premiere already had a deal in line). Again, the network sales are mostly based on the top 100 markets. Did you know that 30% of all radio revenue is generated just in the first 10 markets?

 

[pbf1]

Yes, David. Save your elitism.

By the way, the show was ripped from WDAY, and they've made it clear that they're not the least bit interested in taking it back.

 

[davideduardo]

Re: Yes, David. Save your elitism.

By the way, the show was ripped from WDAY, and they've made it clear that they're not the least bit interested in taking it back.

Check back in a year...

And there is noting elitist about reality: one Fargo more or one Fargo less is not going to change the profitability of Premiere... any more than Dothan or traverse City or the Victor Valley will. Radio revenue is concentrated in the very top markets, and that is just the way it is.

 

[pbf1]

Elitism

There IS something about saying "no one will drop Rush," then having an instance pointed out, only to have you say, "oh well, that's just (insert small market here)." If you meant, "no BIG market will drop Rush," then SAY it.

 

[davideduardo]

Re: Elitism

There IS something about saying "no one will drop Rush," then having an instance pointed out, only to have you say, "oh well, that's just (insert small market here)." If you meant, "no BIG market will drop Rush," then SAY it.

Please note that I retracted and clarified... I do not think Rush will be off any market, other than for a format change or a switch to another station, for long.

You do raise one point which reveals the ugly truth about small "mom and pop" operators is that they run the stations on occasion more for their own satisfaction than for that of the listener... it's the old request line call fromt he manager's wife asking for a song you don't play.

 

[SirRoxalot]

Re: Elitism

You do raise one point which reveals the ugly truth about small "mom and pop" operators is that they run the stations on occasion more for their own satisfaction than for that of the listener... it's the old request line call fromt he manager's wife asking for a song you don't play.

Yes, I'm sure that Clear Channel and other major groups invested tons of money into music research in the small markets that they serviced. They wouldn't just use the research from a nearby big city station, would they? And, we all know that small market listeners would switch in an instant to a big city station if they had the chance, right?

Sounds to me like somebody around here really doesn't really have an understanding of small market radio.

 

[davideduardo]

Re: Elitism

Yes, I'm sure that Clear Channel and other major groups invested tons of money into music research in the small markets that they serviced. They wouldn't just use the research from a nearby big city station, would they? And, we all know that small market listeners would switch in an instant to a big city station if they had the chance, right?

Sounds to me like somebody around here really doesn't really have an understanding of small market radio.

I have managed stations in Tallahassee and Lake City, FL... and the difference is economics.

A music test costs about $30,000. Some markets and some stations in the lowest tiers do not have that kind of money... one thing I did in FL (WTNT, the #1 station at the time) was to share testing... our consultant helped us share country tests with several other markets, and we rotated, doing one in each of four markets twice a year... total cost, $15,000 a year for two tests for markets within a hundred or so miles of us. We found so little difference between markets that this made a lot of sense.

Call out costs over $2500 per cycle, with about 18 to 20 a year being the minimum for it to work... small markets can't do that, but they can do good imitations by polling at statin events and such. Any listener input is better than none if you know what to do with it.

As to Clear, they OWN two research companies, and definitely did tests that took into account regionality if they could not justify 100% local testing.