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Foreclosure in Elmira

Apparently the never-ending antics at Route 81 or Waller or whatever they want to call themselves today continue. It seems that the LMA operator at their station in Hazleton found his doors all padlocked yesterday since Route 81 owes the building owner many months of back rent. The new owner has been told that A) the landlord wants his back rent yesterday and B) They are to get out of his building immediately and C) nobody gets in or out of the station until the back rent is paid. If that wasn't enough, it seems that those who are left working for Route 81 found that they no longer had any health insurance because the health insurance was run through Avalon Equity, and when Waller foreclosed on Avalon, they cancelled the health insurance..but none of the employees were informed of this by the management. So when one of the employees went to have some medical issue taken care of, they got a heck of a surprise. Maybe they should change their name again to 3 Stooges Broadcasting! At least the Stooges were entertaining.
 
Here is what I think could happen regarding the former Route 81 cluster in E/C.

I could see Robert Pfuntner, and Backyard Broadcasting (the two major players in the market), acquiring as many of these stations as possible. Of course, due to ownership caps, neither company could add more than one or two stations to their portfolio. That would leave two stations left to sell. That being the case, I'm afraid Mark's prediction of a new religious entity comming into the market just might come true. EMF Broadcasting, (the K-Love and Air 1 folks), has been rapidly extending the reach of both networks, especially in upstate NY. Currently, EMF does not own any property in the E/C market. My guess is, they would sure like to.

Like many on this board, I would like to see these stations return to local ownership. Having grown up not far from Corning (in Bath), I have fond memories of all of these stations from back in the day.

I think I would go a step further than most posters here. I would like to see these stations super serve their respective cities of license. In other words, Corning stations originate their programming from somewhere in the crystal city, (1450 could return to their roots as WCLI), and stations like WENY AM/FM can go back to their roots as true Elmira/Chemung county radio stations.

Personally, I thought it was a very sad day when WENY TV and Radio were split up. I sometimes wonder what the market would look like/sound like today, if Lilly Broadcasting had chosen to hang on to WENY Radio, instead of selling it to Eolin Broadcasting. I guess we'll never know, will we?
 
A few things become very clear while reading this thread: Posters here have a lot of interest in these stations and great love for the Elmira-Corning area. There's also been a lot of down-home wisdom and market knowledge poured forth. A potential buyer would be wise to read this thread and sort through some of the suggestions and observations. I certainly would pay heed to the advice, if I had the cash. Heh... "if" being the key word.

While Pfuntner appears to have serious personnel issues, the E-C market has two bonafide players with Harris and Backyard. Given the backgrounds of their CEO's and ownership, Harris has the programming advantage while Backyard has the sales advantage. No disrespect in my assessment of either company. If those two qualities could be combined in one group, the new ownership of these stations would have a a good chance of being successful.

Everyone posting here knows the E-C market economics are tight and access to start-up money is equally tight. Due to our (my) backgrounds, we (I) tend to view broadcasting from a programming-promotion-production perspective. The reality is, the battle is won and lost on the street: A good sales department is the foundation of success, especially in small markets like E-C. When sales and programming combine to create solid relationships with clients and the community, the stations have greater potential to generate long-term revenue and good will, which bring respect and success.

Owning a cluster in E-C requires daily diligence... and a willingness to eat peanut butter and jelly sandwiches for a few years. One more thing. This thread has had an amazing number of "views" and posts. Good to see some life in the Bingo Board.
 
JPB...great insight here. No matter what people like or dislike, the truth is..Revenue Rules! Because without money to pay for good equipment or talent, or even basic office supplies, nothing happens. Good programming can equal better sales, they need to work hand in hand, and more often than not, they act as enemies. But without cash, things don't happen. With the economy in a downturn, coming up with enough money that could be borrowed at a reasonable rate isn't easy. Of course it's easy enough to find money from the "venture..or is it vulture" capital lenders, but you will be paying credit card interest rates for your loan. That sort of loan makes it pretty hard to make any money, much less afford a decent staff. I once worked for a station that had no real ratings, but they had a sales staff of misfits who sold "a sandwich in a bag" better than any group of sales people I ever saw. Because these sales people were so good, the rest of the staff was well paid, and things were good. So often people and companies are buying properties whatever the price might be, and then don't have enough money for even the basics. Citadel is a perfect example of this. They got stars in their eyes looking at ABC, so they went out and borrowed far more money than they could afford, and bought them. Then after it was over, they finally got the message that 1 piece of cake tastes pretty good, but eating the whole cake will make you sick. In 1999 Citadel stock was, for a time, priced at almost $70. Right now there are days that it's barely worth 70 cents! It puts the entire company and it's employees at risk. So hopefully someone will come along who would buy the Route 81 properties who would be a good operator, offering a good product with a real interest in their staff and with the community.
 
I plan to be in Corning on Thursday to visit family and I just might find the time to stop by the E/C studios on Market Street. Hopefully I can get some insight as to what is happening to the stations.

As I understand from my Aunt, the guy who used to do mornings is long gone and someone else is there now doing a call-in show. She also tells me the place is full of people, which was the complete opposite when I was down there just a few years ago. Then the stations had just two people when I stopped by; the former morning guy talking to some lady with her dog (don't ask) and some young guy watching the automation equipment.

When I return this coming Sunday I'll fill you folks in if I hear anything new. Meanwhile I'm still sticking to my prediction that some religious outfit will come to E/C and buy the stations.

Personally I would really be upset to see one of the mini-me players in the Southern Tier take over the E/C stations. I'm not naming names, but you know who I'm talking about.
 
I wonder if anyone involved in the old Eolin Broadcasting (the former owners of the cluster prior to Route 81), would be interested in buying back the stations.

It's happened before. When Clear Channel sold its Utica cluster, some of the stations went back to the former owner. So it's not totally out of the question.
 
I wonder why it is you all think that E/C will be sold. Could this property be the viable one in the group?! E/C could possibly be holding its own while the PA stations were the economically unstable in the cluster. Not unheard of I'm sure.
 
You don't cancel peoples' health insurance if you plan to keep the stations.

Rt. 81 defaulted to the equivalent of corporate loan sharks. They are NOT operators, and aren't interested in waiting to see if money will dribble in from E/C. They want their capital back ASAP so they can find other suckers -er borrowers with risky ventures that may pay off big. That's the nature of "venture capital".
 
A few weeks ago I went to my employer with the idea of buying some radio and TV spots in the Southern Tier. So I did some homework and discovered a few interesting things.
Corning and Elmira's population has declined in recent years. The biggest employers, Corning Inc, has all but eliminated manufacturing jobs , and A&P in Elmira left that area years ago. There are a number of car dealers in both communities, and some big-box stores. Car dealers will spend money on local advertising, while many of the box stores won't.
So after completing my research I sat down with my boss and discussed the idea of buying air time in the E/C market. We both ended up agreeing that while the cost per spot would be cheaper than buying in a larger market, he decided it wouldn't make any sense to pour dollars into a declining market.
The reason I bring this up is because anyone seriously thinking about buying the E/C stations had better take that into consideration before signing their name(s) on the dotted line.
While down in the Southern Tier, I was impressed by the rural setting and thought that downtown Corning was very nice; especially when you take into account what Market Street looked like before the 1972 flood. However, as Brig mentioned, a diet of Peanut Butter and Jelly sandwiches would be the food of choice unless a buyer already had big enough pockets to keep the stations afloat. How many millionaires do you know with any broadcasting experience? Say even if one person with money came in and bought these stations, that person is going to want to see a profit eventually. I think we've all ran across these types of owners before. Many of them are not willing to wait a few years before stations generate revenue. They want results yesterday.
The E/C market would be an excellent place for people starting out in broadcasting to get their experience before moving on to larger markets. Unfortunately the larger markets are controlled by big media companies, and those companies are not hiring, but instead laying off people in order to make the bottom line look better.
In conclusion I would have to say that while it would be a nice idea of own stations in the E/C market, one must look to the future in order to determine if such a venture is worth it. With a declining population, and few businesses to support it, I just don't see where spending $1.7 million or even 700k would be worth it to buy these properties unless an owner is willing to take some losses for a few years. The ideal situation would be for someone with money to purchase E/C and hire professionals to run the place. But that's like asking a fortune teller to give you the six winning lottery number.
 
SirRoxalot said:
Rt. 81 defaulted to the equivalent of corporate loan sharks. They are NOT operators, and aren't interested in waiting to see if money will dribble in from E/C. They want their capital back ASAP so they can find other suckers -er borrowers with risky ventures that may pay off big. That's the nature of "venture capital".
Click to expand...

Rox is 100% correct. After I read about how the Route 81 group got to this point, liquidation is EXACTLY what the financial guys want to do. They aren't broadcasters.
 
SirRoxalot said:
You don't cancel peoples' health insurance if you plan to keep the stations.

Rt. 81 defaulted to the equivalent of corporate loan sharks. They are NOT operators, and aren't interested in waiting to see if money will dribble in from E/C. They want their capital back ASAP so they can find other suckers -er borrowers with risky ventures that may pay off big. That's the nature of "venture capital".
Click to expand...
While it is true that E-C did make some money as far as the Route 81 group went, they were making money based on the fact that they had 6 stations under one roof with a minimal staff. As I posted awhile ago, when the founder of Route 81, Lloyd Roach got in a fight with the vulture capital lenders, and they voted him off the island, that was the end of Route 81 being a broadcasting company. The investor groups..Avalon Equity & Waller-Sutton hired well known radio gun-slinger Ira Rosenblatt as their CEO. Ira was hired to shave every area of expense and cut costs to the bone, and then suck out the marrow. It was the intent of Avalon & Waller when they hired Rosenblatt back in 2005 to liquidate right then and there, except for a small problem that became a major headache for them. It was around that particular time that all the Route 81 licenses came up for renewal, and there was a formal license challenge filed by former CEO Lloyd Roach. The challenge apparently had enough merits that it required a full hearing by the FCC, which did not get settled until January of 2008! Of course whenever there is a valid license challenge in front of the FCC, the license holder cannot sell any properties until that challenge has been heard and settled by the FCC. So it held up their property sales for over 2 years. By the time this was all over, the investors had, had enough, and the fire sale began. As Mr. Rox said..these people are not broadcasters. And despite his flowery speeches, Ira Rosenblatt isn't either. He has made his reputation as a cost cutter and deal maker. If he arrives at some station's front door, you know it's time to start looking for another job. The man is pretty good at what he does, but he is ruthless, and cuts and fires with virtually no compassion. Someone down on the PA board likened him to a cobra. Rox is 100% correct, these people want out, and they want out yesterday, and they will do whatever they need to do, to bury Route 81, or whatever they want to call it now. While the lenders who own Route 81 are not named Vinny The Chin or Sammy The Bull or Fat Tony, doing business with them is little different than taking a loan from the Malevolent Brotherhood of Thick-Necked Sicilians. This time they got stuck and there's nobody's leg to break. So they want to get out, and take their losses and it makes not one dime's worth of difference who they cheat or put out of a job or step on to do it. In many ways, the sooner it gets out of their hands..the better.
 
It was the intent of Avalon & Waller when they hired Rosenblatt back in 2005 to liquidate right then and there, except for a small problem that became a major headache for them. It was around that particular time that all the Route 81 licenses came up for renewal, and there was a formal license challenge filed by former CEO Lloyd Roach. The challenge apparently had enough merits that it required a full hearing by the FCC, which did not get settled until January of 2008! Of course whenever there is a valid license challenge in front of the FCC, the license holder cannot sell any properties until that challenge has been heard and settled by the FCC. So it held up their property sales for over 2 years. By the time this was all over, the investors had, had enough, and the fire sale began.
Click to expand...

Thanks for the superb history lesson, Brig. Seems in some small way, Roach exacted some revenge. Small consolation.
 
During my vacation to Corning I managed to stop by the E/C operations. There have been some personnel changes there and the people I spoke with didn't really have anything new to offer.

Many of them are concerned about their futures, which is natural considering the situation.

Some employees are hoping that either a local group of business people will buy the cluster of stations and let local management run it. The big concern is that either some current broadcasting entity will come in and cut even more jobs, or that some religious group will buy the stations.

That's all I can offer to this discussion at this time.
 
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