ESPN FM?

[TheBigA]

Although 98.7 was purchased before the '96 law, there were plans in place and adjustments were made in advance to the inevitable. It is how so many purchases took place at the same time. Most of the leg work was done by then.

Doesn't matter. The purchase was made 18 years ago. The purchase of 98.7 is not the reason why Emmis is in trouble. Lots of other companies bought stations at the same time, and aren't doing what Emmis did.

 

[badjef]

Although 98.7 was purchased before the '96 law, there were plans in place and adjustments were made in advance to the inevitable. It is how so many purchases took place at the same time. Most of the leg work was done by then.

Doesn't matter. The purchase was made 18 years ago. The purchase of 98.7 is not the reason why Emmis is in trouble. Lots of other companies bought stations at the same time, and aren't doing what Emmis did.

Not yet...

Jeff in Sa-ra-so-ta!

 

[davideduardo]

Emmis isn't Clear Channel. It bought WRKS in 1994 before deregulation. Emmis paid a lot for its stations, but it was pre-deregulation money.

Indeed. Emmis paid $68 million for the station in 1994, and it is worth at least that today based on the recent sales of 101.9 and 96.3. In the meantime, that station was spinning off as much as $20 million a year in cash flow. They paid for the station many times over in profits (in 2005 they billed nearly $40 million, for example). The recession and the PPM and new media have changed things... but the 1994 purchase was sound and smart.

 

[badjef]

Emmis isn't Clear Channel. It bought WRKS in 1994 before deregulation. Emmis paid a lot for its stations, but it was pre-deregulation money.

Indeed. Emmis paid $68 million for the station in 1994, and it is worth at least that today based on the recent sales of 101.9 and 96.3. In the meantime, that station was spinning off as much as $20 million a year in cash flow. They paid for the station many times over in profits (in 2005 they billed nearly $40 million, for example). The recession and the PPM and new media have changed things... but the 1994 purchase was sound and smart.

What have they billed recently?

Jeff in Sa-ra-so-ta!

 

[davideduardo]

What have they billed recently?

Jeff in Sa-ra-so-ta!

In a market that is off about 30% since 2006, they are off about 55%.

 

[CTListener]

Is the thinking in the business that advertisers will eventually come back to radio in pre-2008 numbers, or is it more like the newspaper business where they see a drop of "only" 5 percent as good news?

The Internet: The Great American Job Killer.

 

[TheBigA]

Is the thinking in the business that advertisers will eventually come back to radio in pre-2008 numbers,

Depends on who you ask, but I'm not counting on it. That's why so many radio companies are diversifying, including Emmis.

The advertising situation is improving, but at lower rates, and the same budget is now being spread among more people.

 

[badjef]

Is the thinking in the business that advertisers will eventually come back to radio in pre-2008 numbers,

Depends on who you ask, but I'm not counting on it. That's why so many radio companies are diversifying, including Emmis.

The advertising situation is improving, but at lower rates, and the same budget is now being spread among more people.

That will only help to benefit Emmis. more. The more Disney sees the advertising, the more inclined they will be to stay with the agreement.

If this works, and I have little reason to believe it won't, the FM dial will not look anything like it looks now, in New York, or any place else.

This has the potential to be a seismic in the business model.

Jeff in Sa-ra-so-ta!

 

[davideduardo]

Is the thinking in the business that advertisers will eventually come back to radio in pre-2008 numbers, or is it more like the newspaper business where they see a drop of "only" 5 percent as good news?

In the PPM markets... which represent over half of all radio revenue... the problem is that the PPM shows about 30% lower ratings for each stations. With transactional buys being made on a Cost Per Point basis, if the delivery is lower then the amount a station can charge on agency buys is lower. And, further, we have erosion from lessened use of radio in some demos, further reducing the amount advertisers will pay.

Essentially, the station that was getting a 0.8 rating in the diary is getting around a 0.5 rating in the PPM. And we have individual radio listening, which held around 20 hours weekly going back to surveys in the early 50's, at about 12 hours a week in PPM markets.