"Dump AM IBOC, Move the AM Band"

[700WLW]

"Dump AM IBOC, Move the AM Band"

http://rwonline.com/pages/s.0044/t.417.html

 

[OldGringo]

"Dump AM IBOC, Move the AM Band"

http://rwonline.com/pages/s.0044/t.417.html

Dumb idea, as the lower V's spectrum is going for other communications services and will be auctioned off to provide government with needed billions. It is already decided.

 

[dbdigital]

"Dump AM IBOC, Move the AM Band"

http://rwonline.com/pages/s.0044/t.417.html

As provocative as Fred Lundgren's article was, I found Skip Pizzi's conclusion about internet radio even more interesting.

Notice his final comments:

"Perhaps even more appealing to broadcasters is that both high quality and unlimited quantity of new service are possible online, and there's no tradeoff between them, as there is with IBOC. Want more bits in the payload? Just sign up and pay the bill to your hosting service.

Of course, the one big downside with Internet radio is its lack of portability. Today. If Internet radio does indeed become widely and cheaply available on mobile and portable platforms, however, as many observers forecast, it would appear to be the winner of the sustainability sweepstakes. So could the real future of digital radio be online? Clearly the radio industry has a lot riding on the promise of the wireless Internet."

Is Skip possibly getting religion here?

Here's his entire article:

http://www.rwonline.com/pages/s.0054/t.419.html

db

 

[700WLW]

"Dump AM IBOC, Move the AM Band"

http://rwonline.com/pages/s.0044/t.417.html

Dumb idea, as the lower V's spectrum is going for other communications services and will be auctioned off to provide government with needed billions. It is already decided.

Prove it.

 

[w9wi]

Dumb idea, as the lower V's spectrum is going for other communications services and will be auctioned off to provide government with needed billions. It is already decided.

I think you're working from an old DTV plan. That was the idea at one time but was changed years ago. The FCC has certainly tried to accomodate stations that wanted to leave low-band but they're doing nothing to *force* the issue.

As Mr. Lundgren says, there are DTV stations authorized in these channels, and a few dozen stations have chosen to keep their permanent DTV operations in channels 2-6. We're also in the process of sorting out DTV assignments for low-power and translator stations, some of which are also ending up on low-band VHF.

IMHO it's too late to clear DTV assignments out of 2-6. Even if it was possible to find new channels in 7-51 for these stations (and I'm not at all convinced it is possible) there would be a major ripple effect on other stations. It would take at least a year if not more to sort everything out - and the closedown of analog would be delayed at least that long. Congress would never stand for it.

If we were to move the AM band elsewhere, I would suggest somewhere in the 30-50MHz spectrum would be the right place. 30-50 2-way communications are vanishing quickly; the antennas are unwieldly and the sporadic-E interference and impulse noise a concern. Of course the interference would also affect any use of the band for broadcasting - but it would be a LOT less than the interference currently caused by skywave propagation in analog, let alone in IBOC. If digital transmission modes were used, (maybe even including full-digital IBOC) I would think a small slice of this spectrum would have little trouble accomodating existing AM operations.

 

[OldGringo]

Dumb idea, as the lower V's spectrum is going for other communications services and will be auctioned off to provide government with needed billions. It is already decided.

I think you're working from an old DTV plan. That was the idea at one time but was changed years ago. The FCC has certainly tried to accomodate stations that wanted to leave low-band but they're doing nothing to *force* the issue.

As Mr. Lundgren says, there are DTV stations authorized in these channels, and a few dozen stations have chosen to keep their permanent DTV operations in channels 2-6. We're also in the process of sorting out DTV assignments for low-power and translator stations, some of which are also ending up on low-band VHF.

IMHO it's too late to clear DTV assignments out of 2-6. Even if it was possible to find new channels in 7-51 for these stations (and I'm not at all convinced it is possible) there would be a major ripple effect on other stations. It would take at least a year if not more to sort everything out - and the closedown of analog would be delayed at least that long. Congress would never stand for it.

If we were to move the AM band elsewhere, I would suggest somewhere in the 30-50MHz spectrum would be the right place. 30-50 2-way communications are vanishing quickly; the antennas are unwieldly and the sporadic-E interference and impulse noise a concern. Of course the interference would also affect any use of the band for broadcasting - but it would be a LOT less than the interference currently caused by skywave propagation in analog, let alone in IBOC. If digital transmission modes were used, (maybe even including full-digital IBOC) I would think a small slice of this spectrum would have little trouble accomodating existing AM operations.

My understanding is that segments of the lower VHF spectrum will be used for two way and others under auction, protecting the remaining V's there. Is this not correct?

FM originally was centered on 46 mHz until the reallocation in, I believe 1946. Those are freaky frequencies, full of shortwave-like skip and odd interference.

The real issue is that no manufacturer would produce radios with a new band that promised existing AMs an outlet. Many manufacturers today want to drop Am to chepen the receivers because they know very few are listening in the ages that buy radios (AM has a 10% share of listening in under 45-year-olds) so a complete move would be a disaster. Most stations would not survive.

 

[I.B. Iquity]

My understanding is that segments of the lower VHF spectrum will be used for two way and others under auction, protecting the remaining V's there. Is this not correct?

FM originally was centered on 46 mHz until the reallocation in, I believe 1946. Those are freaky frequencies, full of shortwave-like skip and odd interference.

The real issue is that no manufacturer would produce radios with a new band that promised existing AMs an outlet. Many manufacturers today want to drop Am to chepen the receivers because they know very few are listening in the ages that buy radios (AM has a 10% share of listening in under 45-year-olds) so a complete move would be a disaster. Most stations would not survive. "


The skip issue was oriigionally brought up by Sarnof and crew which they used as their excuse to move FM from the old 40 Mhz band to the current spectrum. Meanwhile they had no problem using that spectrum for television, Sure there is the ocassional band opening on that sprectrum but with capture effect it can't be any worse than what you have above 1200 Khz now. As for stations going dark I don't think that would be the case. there would be a transition period (One which would be enforced) and after a short period of time the current AM transmitters could be turned off. There is very little activity now in the old Armstring band and due to technological advances mobile operartions have migrated to higher frequencies, using more sophistcated radios. I beleive that a new band can be divided into both a digital and analogue portion, although creating a new analgue spectum in today's world probably wouldn't be a great idea. My only issue with IBOC is the licensing. I realize that legitimate FM radiios at one time had to have a Armstrong tag indicating that they had paid for a FM license. I don't have a problem with IBOC having such a license for a limited time to recoup their developement costs but there is no way I would agree to perpetual license fees and different fees for HD 1, 2 and 3 etc use. That is a subject i think many of us both pro and con can agree on.

 

[700WLW]

"Dump AM IBOC, Move the AM Band"

http://rwonline.com/pages/s.0044/t.417.html

Dumb idea, as the lower V's spectrum is going for other communications services and will be auctioned off to provide government with needed billions. It is already decided.

"AM Will Compete in an HD-R World"

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

http://rwonline.com/reference-room/iboc/2006.08.02-05_rw_hd_am.shtml

 

[rbrucecarter5]

I would suggest a mass shuffling of AM stations to make intelligent use of the spectrum, and its characteristics. Here is a plan:

All frequencies from 540 to 1000 kHz - clear channel, high power, spacing at least 1000 miles, absolutely NO IBOC, but Kahn and C-Quam allowed. Primarily serves sparsely settled Western 2/3 of the country with skywave. Daytime power unlimited to get some semblance of skywave ranges.

1010, 1020 - unused

1030 to 1470 - local use only - high power allowed - IBOC stations spaced at least 30 kHz (1030, 1060, 1090, etc). No skywave guarantee, no guarantee of reception at all outside the metro area, maybe less than 100 mile spacing, high enough power to cover metro area with 2 mV contour needed for IBOC.

1480, 1490 - unused

1500 to 1700 - regional, small rural towns. Frequent re-use of channels, some skywave possible, but NO IBOC. Replaces current graveyard channels like 1230, 1240, etc - and lets hundreds, maybe thousands of new stations on the band. More diversity.

A computer program could be employed to find the optimum location of the cutoff frequencies -

IBOC would become a band within the AM band, large cities that can benefit from digital could use it at whatever power it took for complete metro coverage, with no adjacent channel concerns, no skywave concerns.

Music formats not on the IBOC band could still use Kahn, C-Quam, or whatever they wanted. For this to work, the FCC would have to mandate both IBOC and stereo capability in all radios over $50.

Skywave would be preserved as a resource for isolate rural communities with no fear of eventual interference from IBOC. DX'ers would be happy to get back a band to DX.

Everybody gets what they want - the only inconvenience is a one time frequency shuffle which to the consumer would be no more upsetting than a format change on all the AM stations in their community. In days, it would be done, the band preserved, and everybody happily broadcasting in the format they feel they need to reach their intended audience.

Coordinate this with Canada, Mexico, Cuba - and nobody would have unwanted interference.

 

[zumahans]

The entire California Highway Patrol radio system is still down around 42-44 mHz. Where would they go?

 

[OldGringo]

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

No, AM is not successful. It is on a severe decline to the extent that in ages 12-45 the share of radio listening held by AM is under 10%.

The only two mass appeal AM formats, news/talk and sports, are moving to FM.

Most markets have only 1 or 2 successful AM stations, but the formats that made them successful are becoming FM formats. Example: WTOP in DC moved to FM, putting a niche format on the old AM channel.

Without a major technical upgrade, AM will be gone in a few years.

 

[vsa]

OLDGRINGO/DAVID WROTE: "Without a major technical upgrade, AM will be gone in a few years."

Hey David. I agree with you!

But it could be gone anyway, even with a dramatic technical upgrade - if people don't decide they want to buy new radios in droves.

 

[SUPERCASTER]

OLDGRINGO/DAVID WROTE: "Without a major technical upgrade, AM will be gone in a few years."

Hey David. I agree with you!

But it could be gone anyway, even with a dramatic technical upgrade - if people don't decide they want to buy new radios in droves.

AM stations have to come out of the closet, and back into the studio (if it still exists).
The loud HD radio IBOC buzz and adjacent channel interference can only hasten AM's demise and help drive the coffin nails in AM broadcasting.
An answer might be truly local programming from the AM station's own studios and local news, etc. that is not available on other stations. Of course that requires a sizeable investment in talent, and facilities, which I do not think the big broadcast conglomerates are willing to make.

 

[700WLW]

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

No, AM is not successful. It is on a severe decline to the extent that in ages 12-45 the share of radio listening held by AM is under 10%.

The only two mass appeal AM formats, news/talk and sports, are moving to FM.

Most markets have only 1 or 2 successful AM stations, but the formats that made them successful are becoming FM formats. Example: WTOP in DC moved to FM, putting a niche format on the old AM channel.

Without a major technical upgrade, AM will be gone in a few years.

"AM Will Compete in an HD-R World"

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

http://rwonline.com/reference-room/iboc/2006.08.02-05_rw_hd_am.shtml

It appears that you and this author are in complete disagreement, but we know who has the agenda.

 

[dbdigital]

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

No, AM is not successful. It is on a severe decline to the extent that in ages 12-45 the share of radio listening held by AM is under 10%.

The only two mass appeal AM formats, news/talk and sports, are moving to FM.

Most markets have only 1 or 2 successful AM stations, but the formats that made them successful are becoming FM formats. Example: WTOP in DC moved to FM, putting a niche format on the old AM channel.

Without a major technical upgrade, AM will be gone in a few years.

"AM Will Compete in an HD-R World"

"Let's get a couple of things straight up front about AM radio. It is a viable, successful and very capable medium right now. Think about what AM has done in the last 10 years. With very little help of music, it has created its own programming and its own niche and in most markets has been insanely successful with it."

http://rwonline.com/reference-room/iboc/2006.08.02-05_rw_hd_am.shtml

It appears that you and this author are in complete disagreement, but we know who has the agenda.

Absolutely. The media conglomorates recite this mantra that 'AM is dead' and turn it into a self-fulling prophecy because they refuse to program quality. "AM is dead so lets just program infomercials or some other crap hardly anyone will want to hear because no one over 15 is listening anyway."

But there is plenty of anecdotal evidence, some from posters on this site, that AM does make money and is alive and well, particularly in the smaller markets. Granted maybe these stations aren't making the $100 million a year these conglomorates are used to but they're healthy financially nonetheless.

I do believe some fresh thinking is needed as to where AM should be heading for the future and it would be great if the FCC would begin a hearing on the issue. A start would be to get AM stations out of the hands of the conglomorates who own FM stations (let them put their AM programming on their HD2 or 3 channels if they think it's so great) and put the AM stations back into the hands of the community. Perhaps an AM 'enterprise zone' could be created that would allow for a return of the mom and pop owner, treating the service as local only.


But I firmly believe that if AM is dying, it is because the media conglomorates are strangling it with their negative mindset.

db

 

[Chuck]

But I firmly believe that if AM is dying, it is because the media conglomorates are strangling it with their negative mindset.

db

Over the last 15 years or so, the big money in broadcasting has had little to do with actually "broadcasting" anything. The real profits have s been in buying, selling, and moving stations. Actually operating them has been on the back burner. Dealing with a business that grosses maybe $1-2 million per year is chicken feed when compared with the $100-300 million that can be made by buying, selling and otherwise manipulating the airwaves. That's why you have crap on the air. Why put money into something that has little cash return, when you can make a lot more money by firing everyone and delivering pabulum to your audience? After all, you are not in it for the long haul. Flame on if you like, but I think the truth is very simple.

The buying and selling frenzy is based on "The Greater Fool" theory. No matter how much you pay for a facility, there has always been somebody who is foolish enough to pay more. Like most pyramids, there is a point of diminishing returns. I think we are close to that point. The guys who brought this to you are telling their investors that their digital magic wand, HD radio, will fix everything. It won't.

At its core, broadcasting is a fairly simple business. It has been a victim of the moneychangers. I think some of them are likely to loose some major cash in the not too distant future.

 

[dbdigital]

But I firmly believe that if AM is dying, it is because the media conglomorates are strangling it with their negative mindset.

db

Over the last 15 years or so, the big money in broadcasting has had little to do with actually "broadcasting" anything. The real profits have s been in buying, selling, and moving stations. Actually operating them has been on the back burner. Dealing with a business that grosses maybe $1-2 million per year is chicken feed when compared with the $100-300 million that can be made by buying, selling and otherwise manipulating the airwaves. That's why you have crap on the air. Why put money into something that has little cash return, when you can make a lot more money by firing everyone and delivering pabulum to your audience? After all, you are not in it for the long haul. Flame on if you like, but I think the truth is very simple.

The buying and selling frenzy is based on "The Greater Fool" theory. No matter how much you pay for a facility, there has always been somebody who is foolish enough to pay more. Like most pyramids, there is a point of diminishing returns. I think we are close to that point. The guys who brought this to you are telling their investors that their digital magic wand, HD radio, will fix everything. It won't.

At its core, broadcasting is a fairly simple business. It has been a victim of the moneychangers. I think some of them are likely to loose some major cash in the not too distant future.

Undoubtedly there is some truth to what you say. How else would you explain a $25 million price tag for a station that has so few listeners it isn't even listed in the Arbitron book. Such is the case with Los Angeles AM station KMPC.

No doubt there will be a day of reckoning. We're already seeing some of that as many stations that are up for sale are sitting on the market for months or years and CP's offered for sale by speculators remain unsold.

db

 

[OldGringo]

Over the last 15 years or so, the big money in broadcasting has had little to do with actually "broadcasting" anything. The real profits have s been in buying, selling, and moving stations. Actually operating them has been on the back burner. Dealing with a business that grosses maybe $1-2 million per year is chicken feed when compared with the $100-300 million that can be made by buying, selling and otherwise manipulating the airwaves. That's why you have crap on the air. Why put money into something that has little cash return, when you can make a lot more money by firing everyone and delivering pabulum to your audience? After all, you are not in it for the long haul. Flame on if you like, but I think the truth is very simple.

The buying and selling frenzy was concentrated in the few years after consolidation was permitted, from 1996 through about 2000. The issues with the economy following the dot com bust, the early 2001 market "adjustment" and 9/11 made IPOs less desirable, thus reducing the ability to use equity financing. Prices are below the peaks, but definitely healthy as the $135 million Wickes deal this week and the Entercom purchases from CBS have shown.

A station in LA, at $250 to $300 million, will, f well managed, be much more than a $1 million to $2 million cash flow (EBITDA). In fact, a station at #10 in LA will have BCF of around $15 to $20 million. The business of operating stations is sound, but the prices paid in 1996 to 2000 were a bit high. The top 20 LA stations average grosses of over $25 million each, with one at $60 million!

To find top stations billing $1 to $2 million you have to get outside the top 100 to 150 markets. For example, Fresno, market 66, has 10 stations billing over $2 million and another 7 billing over $1 million but less than $2 million. And a Fresno FM among this group might have an average value of around $18 to $25 million.

In fact, market 123, Pensacola, has 7 staitons billing over $1 million! There are stations in markets 200 to 250 billing well over $1 million.

FMs in major markers can have 40% to 60% margins, and if you look at the billings you can guess the kind of cash flow. A Houston FM is billing nearly $30 million by being #2 or #3 and can BCF more than half of that, for example.

In general, FMs are going in the 24 to 18 times BCF price range, while AMs that are cash flowing are around 12 x. This is a better use of capital than putting the money in bonds or mortgages, which is why a number of companies are going private. It's a good investment based solely on operations, but not on purchase price alone. Prices are based on actual revenue and BCF, or the a bility of a statin to generate same.

 

[OldGringo]

Undoubtedly there is some truth to what you say. How else would you explain a $25 million price tag for a station that has so few listeners it isn't even listed in the Arbitron book. Such is the case with Los Angeles AM station KMPC.

That LA station could be used for an Asian format, and produce $2 to $4 million in BCF with no trouble, and with no ratings. Many stations with no ratings are very profitable... ask Art Lieu, a master at making loads of money with less than competitive stations and signals.

 

[awj223]

That LA station could be used for an Asian format, and produce $2 to $4 million in BCF with no trouble, and with no ratings. Many stations with no ratings are very profitable... ask Art Lieu, a master at making loads of money with less than competitive stations and signals.

...in other words, content is what matters. That's what people have been saying all along. If stations provide content that people want, they will get listeners. HD Radio is not the savior of AM radio. It's what is being broadcast that's important, not how it is being broadcast. That said, I do believe AM should go digital, but it should not be Ibiquity's inferior, destructive system that ends up being used.