Cramer: It's Over for Radio Stocks

[amfmxm]

Basnya has a point. Radio STOCKS are over.

I work for a privately held group of radio stations, we've been private since before Marconi first transmittted a signal.

We're expanding into new markets, signing on new stations and our owners have never been happier.

Radio is as reasonably healthy as it's ever been. Publicly trading radio stocks is/was fundamentally flawed to begin with. Our business models are based on LOCAL conditions. Good riddance to wall street.

Can we get back to serving our local communities NOW...instead of Wall St. ?

It's been a long dozen years. And though the instigators of this misadventure in oligopoly--Clear Channel--are the first to bail, the rest of us will be saddled with CC operating strategies championed by the short-sighted and mimicked by all of these mini-Clear Channels we now work for.

Think of Cramer's derisive slam of radio's obsession with cash flow the next time your CEO calls to complain that your 50 percent cash flow isn't good enough.

 

[RichWood]

The service is free, the devices are cheap and eminately portable.

<snip>

Honestly, you iboc haters will grasp at anything

It appears the IBUZ cheerleaders haven't noticed the lack of "eminately portable" (sic) receivers. Also, compared to analog receivers, the devices aren't cheap. There seems to be a little grasping of your own. I guess one out of three isn't bad. It is free until conditional access is activated.

Rich

 

[LinoNYC]

The service is free, the devices are cheap and eminately portable.

<snip>

Honestly, you iboc haters will grasp at anything

It appears the IBUZ cheerleaders haven't noticed the lack of "eminately portable" (sic) receivers. Also, compared to analog receivers, the devices aren't cheap. There seems to be a little grasping of your own. I guess one out of three isn't bad. It is free until conditional access is activated.

Rich

I guess I should know better than to engage with an adult using "Ibuz" ...but this one is just too easy to pass up.

My original post:

A product with an installed base of 600-800 million receivers.

A product that is available free to over 90% of the 300 million people of the United States.

A mainstay for rapid, authoritative information.

The service is free, the devices are cheap and eminately portable.

If Mr Cramer is so unsure of radio's permanence he'd better hurry-up and bank all those checks he gets for his appearances on this obsolete medium.

Honestly, you iboc haters will grasp at anything.

Note the first two sentences....do you really think that I (or the article) were talking about IBOC?

Ladies and gentlemen for the record I believe that radio will be a predominately analog medium for atleast the next ten years, which coincidentally is the same amount of time it will take for the last of WOR's listeners to die-off or move to Florida (same thing really).

Lino

 

[skippertthomas]

Sgerik... Very well said, in a few thoughtful words!! Agree, I do, with you.... 8)

 

[raydofan]

Sure. Everyone in America is going to pay $10 a month, $15 a month or whatever they want to charge for satellite radio. Especially with the economy going into the tank.

When Wimax comes along (internet radio in cars) that will put an end to whatever success satellite radio will see.

WiMax will not be free. They tried a NOMINAL price rate in Philadelphia, and the system was made to crap the bed. Unreliable at the moment. If the big .commers who purchased the 700mHz band are going to provide it, it won't be wideband if it's free. That is the only way to get anything in the car other than TR and SR. SR has a decent delivery system which will improve with the merger.

 

[JohnnyElectron]

I've heard a $40-$60 montly fee for mobile WiMax (in the one area that they're currently testing with employees) - and in that case $12.95 a month for satellite is cheap.

 

[clouseau]

AMEN, skippertthomas. So refreshing to see someone who obviously breathes oxygen instead of nitrous, when it comes to HD.

Bob, I really like the rest of your post, but I do need to point out that you are HD obsessed. NOWHERE do I see HD mentioned in skipperthomas's post.

Congsec1, the only model which will ever work for satradio is if they eventually start selling spots, or channel access to terrestrial broadcasters. Broadcasters, want digital distribution? Forget IBOC and use the existing infrastructure with plenty of receivers already in circulation. Meet satradio and internet radio. Think broadcast TV and its alternate distribution pipelines of cable, satellite and the internet. THAT's the digital model.

Interesting idea, Savage. How about spotbeams for XM as well? I believe Sirius can't do that because they are Geosyncronous and not geostationary. (I think that's the terminology). You could have maybe 50 channels of national music and entertainment and then 30-50 REGIONAL channels. Unlike it's current configuration, Terrestrial might have to compete with that.

(Oh, radio people, and while you're at it, you might think about actually adding content in on your music channels, so listeners can hear the difference your programming provides vs. XM & Sirius. Lose the "14 in a row" plus angry-voiced liner guy plus a gob of spots paradigm.)

I've heard that a long time ago. I think they called it radio. By the way , you're right on with that IMHO.

Like it or not, IBOC boosters, that's where it's going.

Should we assume you have now changed topics from the content to the delivery method? I guess so...

It would be that way even if your pet system worked acceptably. Or was affordable. It doesn't and it ain't.

I agree - HD delivery method is irrelevant to this conversation. Hannity had some interesting commnets on the death of Music radio. He's a little ahead of himself, though.

Clouseau

 

[Savage]

Thanks, Inspector. But at the risk of being branded "HD obsessed" (apparently because I brought it up on the HD discussion board) I think if you re-read both skippertthomas' post and its context in the posts immediately before and after, that IBOC was part of that discussion. Skipper specifically references the nighttime HD interference problem and its degradation of local AM service, precisely the situation which is affecting our station.

Was I addressing delivery method, satradio, economics or programming? Actually all of the above. I think a global discussion was underway addressing the problems facing our industry today. I was offering satradio delivery as a new economic model for satcasters and a simultaneous solution to the problem of terrestrial broadcasters' attempts to provide digital service, using XM/Sirius as an alternative to IBOC, and one which might rack up more listeners faster than trying to force the HD issue. Sorry if this wasn't clear.

 

[JohnnyElectron]

IF ClearChannel wasn't in the financial crapper, they would have been smart to sell-off half of their stations and BUY up Sirius -or- XM SatRad and flood it with simulcasts of their many stations that they'd keep! They could even offer a half-dozen stations for FREE, and charge for the rest. Just a thought, but I don't think that they could finance it anymore.

 

[R.F. Burns]

IF ClearChannel wasn't in the financial crapper, they would have been smart to sell-off half of their stations and BUY up Sirius -or- XM SatRad and flood it with simulcasts of their many stations that they'd keep! They could even offer a half-dozen stations for FREE, and charge for the rest. Just a thought, but I don't think that they could finance it anymore.

WHy would they want to invest in a losing corporation. There's no promise that combined XM & Sirrius is going to make it. Maybe they'll have less loss but they will probabaly still have loss. If you are a satellite fan I'd say good luck but I wouldn't bet on anything when it comes to those two. Unless the economy improves soon, I'd say the puddle of red ink will soon be an ocean.

 

[skippertthomas]

Great Topic and Comments from all angles.... The 'panic button' on the economy is having a negative impact on the above comments.. "Sky is falling!".. If you're in housing, real estate (as many companies consider staton ownership, as such), and related fields, yes... It's in the 'crapper'... But many areas of tech, research, healthcare corporations, etc. are ahead of last year (12 month cycle)... It's how you play your stocks... The 'tanking' of the housing and building industry has pulled the overall numbers down, but the overall numbers are 12,000 in the NYSE and over 2,000 on the NASDAQ.. Far ahead of 9/11 and post 9/11 numbers... Election year! Those wanting POWER will tell you "BAD, BAD, BAD", when in reality, we have 'cracks' and areas of major concern (to the average Joe, ie....Credit Debt).....But in the tangled web of the world market, It could be much worse... Oh, that's right! Mom and Dad and the Grandparents are older or gone... Our generation knew nothing about happiness within "The Depression Years".... Just a side note on this great thread....

 

[Gatekeeper007]

Another problem that Iboc will create is over kill on the different kinds of music one market can handle. Oh sure now we can have programming for every little nitch group, yah right. Do you really think thats going to happen or are we going to have 4 to 8 feeds of programming from each station that walks on or copies the 4 to 8 feeds of the next station on the dial. And what do you think that will do to the indepent and mom and pop stations that are still left in the market what few there are left. The only real advantage other than more programming of the same thing we already have is the digital quality sound that will come from the change over.

 

[davideduardo]

IF ClearChannel wasn't in the financial crapper, they would have been smart to sell-off half of their stations and BUY up Sirius -or- XM SatRad and flood it with simulcasts of their many stations that they'd keep! They could even offer a half-dozen stations for FREE, and charge for the rest. Just a thought, but I don't think that they could finance it anymore.

A company with EBITDA of $1.6 billion last year is hardly "in the crapper." That's what Clear achieved.

The two satellite companies lost $1.7 billion last year.

The satellite companies only wish Clear would buy them... giving them lots more successful content.

 

[JohnnyElectron]

DavidE wrote: "...The satellite companies only wish Clear would buy them... giving them lots more successful content..."

You mean ClearChannel would have more successful content - as I think the satrads have better content and sometimes delivery, but without spots, they can't make the money to pay for the delivery system.

 

[hipporadio]

The “TRUTH” is simply – broadcast stocks are “following the marketplace”... DOWN. DOWN, DOWN... NOT due to technical issues... Analog FM in 2008 SOUNDS GREAT... and youth demos seem complacent about LOW-QUALITY “pod-cast” downloads. I LOVE “great audio” on AM and FM – but I wonder – does it matter in this age? - I hope so! I NEVER ran an AM or FM station without attention to good audio... It was a natural for my operation, BUT - NO ONE ever signed an advertising contract because they "liked my station's sound"!

Hence the HD paradigm... “Audio” is a side-embellishment. It is NOT the “where-with-all”... PROGRAMMING is key – and corporate radio has forgotten - NO, neglected that! WHY WHY WHY would a "typical-Joe" pay $200 for a format-specific “HD Radio” to sample the current under-performing offering from these stem-clippers?

THIS IS elementary in “marketing” – SORRY to give the corporate broadcast biz that “buzz”, but it’s apparent that they missed-it somewhere along the way!

 

[davideduardo]

DavidE wrote: "...The satellite companies only wish Clear would buy them... giving them lots more successful content..."

You mean ClearChannel would have more successful content - as I think the satrads have better content and sometimes delivery, but without spots, they can't make the money to pay for the delivery system.

Nope. I mean Clear has far more entertainment content... all the morning shows, the programs from Premiere, etc., etc. Most Satellite channels are pure music plays of content provided by outsiders. Having access to all the talent on the Clear stations woul make a big difference.

 

[SUPERCASTER]

As the wise "hippo" said:

WHY WHY WHY would a "typical-Joe" pay $200 for a format-specific “HD Radio” to sample the current under-performing offering from these stem-clippers?

And, the answer is: (opening the latest HD cartel answer envelope) "conditional access and iPod tune tagging".