Does any radio company have a sustainable competitive advantage?

[MickJ]

Radio stocks are at such historic lows, I'm tempted to dive back into the water and buy some of it. But it's hard to rationalize any upside. Every company seems to claim to outperform its peers. But really?

I'm not picking on Entercom, it's just that their earnings call was yesterday and I heard the same old, same old about Entercom's superior execution with no apparent reason to think they have any talent advantage over other companies.

John Blackledge - JP Morgan

… And then I just wonder about national pacing in the first quarter if it's kind of inline pacing downwards local or if it's weaker? And then also if you can just touch on pricing environment -- is it kind of what it was in the fourth quarter, and then what it is and what's the pacing in the first quarter? Thanks.

David Field

Let's see those reverse orders as far as pricing is concerned, it's tough out there right now, and again it's a choppy market place plus the normal issues of first quarter, particularly the beginning of first quarter, and so it's not the best environment. But then again it's we're executing, I think, regionally well under the circumstances.

and also this

Bishop Cheen – Wachovia

David the way you've changed the sales culture, and the positive impact it's having on Entercom can you give us more on that?

David Field

Sure. I think we did actually give more color than usual on that in the Scion example. But we're very much evolving our company into a marketing solution organization that is able to harness the extraordinary and unprecedented within the industry at least unprecedented power of the integrated marketing platform that we've at our disposal. And our core currency is ideas and we're bringing in as many smart marketers that have good ideation powers and setting them to work and it's making an impact.

I wish it was making a faster impact, but it's making real impact -- fuel money, and candidly you could be a fly on the wall listening to the conversations we're having with advertisers. I think you would conclude that there is a very hopeful future for radio, as we begin to harness that opportunity in a broader way going forward, and that's not unique to Entercom, of course -- that's really an industry wide opportunity.

Bishop Cheen - Wachovia

Do you sense the industry itself is changing its culture, or do you think you're out there in The End Zone all alone?

David Field

I think it absolutely is changing. Obviously each company is doing what they think is best. But I think both on a collective basis as we look at what the national reps are doing, and there was an interesting announcement out of Atlanta the RAB in terms of what the rep firms are going to be having an unprecedented degree of collective efforts to make radio more -- to drive radio development efforts at major corporations across United States, So, I think it's happening on a collective basis and I think it's happening to vary degrees within individual companies.

He didn't really say anything that couldn't have been said after any quarter in any year. Lots of MBA-speak i.e. "integrated marketing platform" (We sell Internet ads too.) "ideation". (We have ideas.)

Warren Buffet quoted someone once, I don't remember who, who said: If you want a reputation for being a good business person, get into a good business. I'm wondering if this business is fixable. Thoughts?


Source: Page 8 of yesterday's earnings call transcript. Link here: http://tiny.cc/2v9bB

 

[deff junction]

Its fixable if radio became informative and entertaining as it used to be.
I recently had 2 people complain about todays radio. one was a 20ish receptionist at my doctors office and another was a 60ish cab driver. Both said radio was boring and very repetitious. We don't need cookie cutter Mcradio. I also check out the stock prices of different broadcasting companies and I am shocked at how those prices have fallen.What are they teaching in business schools these days? Who are the "geniuses" responsible for the current state of affairs? Are any of these companies doing anything to reclaim some value? I keep hear about how radio is dead. Maybe someone can explain why new stations are going on the air,new licenses are being applied for and I can tell you about some low powered AM stations,including soem daytimers that are doing very well because they are live and local. Why can't the big operators see that?

 

[MickJ]

I also check out the stock prices of different broadcasting companies and I am shocked at how those prices have fallen.What are they teaching in business schools these days? Who are the "geniuses" responsible for the current state of affairs?

The big radio companies seem stuck in a continuing cycle of cost cutting thinking that the top line will grow "next year." The next year comes and it's still flat. More cost cutting. Think about the fact that revenue has been flat, or nearly so, for years. Not at every station or cluster but overall. Radio's share of advertising has declined significantly and Internet advertising caught up and is even with radio if not ahead. Google is only ten years old!

Maybe someone can explain why new stations are going on the air,new licenses are being applied for and I can tell you about some low powered AM stations,including soem daytimers that are doing very well because they are live and local. Why can't the big operators see that?

I tip my hat to these local AM station operators. In most cases, a lower cost basis helps. Clear Channel et al overpaid. I'm not criticizing them, anyone can see that in hindsight. Also, the local AM stations are not dependent on Arbitron ratings. It's a better business model. These local stations have small budgets so it's not like they are spending a lot of money either, but they stay close to their customers and listeners.