iHeartSiriusXM?

[Theater of My Mind]

That's a funny comment. You're saying there will come a day when we will all throw away our PCs, tablets, and cell phones and rush to eBay to buy transistor radios, and the world will be great again. Streaming & podcasts aren't just the future. They're the present.

Well podcasters can't play popular music on their shows which rules out a huge segment of audio entertainment. No hosted music shows, countdowns, concerts, artist interview features including full songs, etc. At least not until the music industry agrees on a way to allow it.

That means most, if not all podcasts, are talk shows. And most of those are longform talk shows requiring a time commitment by listeners. Not everyone is into that. Personally, for most of that kind of subject matter, I prefer to read. The main type of talk I really like to listen to is live news and I don't want to hear that in a prerecorded podcast.

In my view, there's a lot that the radio business can and should do, but the whole industry now operates purely in terms of money manipulation instead of creative programming innovation.

 

[TheBigA]

Well podcasters can't play popular music on their shows

Actually they can, but they have to pay a higher music royalty than broadcasters.

Podcast Music License Cost and What Podcasters Actually Pay

Plan podcast music license cost with dollar ranges and a podcast-safe license so you budget confidently and avoid copyright surprises.

audiodrome.net

In my view, there's a lot that the radio business can and should do, but the whole industry now operates purely in terms of money manipulation instead of creative programming innovation.

It depends on who you talk to. There are a lot of people who work in broadcasting who are specifically involved in creative programming innovation.

 

[XCountry285]

The only major U.S. cities I know of where IHeart doesn't own any radio stations are Buffalo and Kansas City (where the company never got a foot in the door) and Chattanooga and Richmond (where they traded stations with Audacy). I should also note the states that currently hav no IHeart outlets: Maine, South Dakota, Vermont, Montana, Idaho, and Wyoming. With its 2007 sale of radio stations to Townsquare, IHeart did get out of a lot of smaller markets, but with the exceptions I noted above, it is still in the nation's largest markets. Furthermore, from a business standpoint, this makes sense as the larger the population any given station or station cluster serves, the greater its chances of negotiating deals in its favor from advertising agencies.

They got the only stations in the Sussex County NJ market.

 

[Theater of My Mind]

They got the only stations in the Sussex County NJ market.

I forgot about that. Market #228. Is that iHeart's smallest market?

 

[CTListener]

They got the only stations in the Sussex County NJ market.

Are you basing that on the published Nielsen ratings? There seem to be only three actual Sussex County stations listed. The others are all in New York City. Might there be stations owned by small-time operators in the county that don't subscribe to Nielsen?

 

[Theater of My Mind]

Well podcasters can't play popular music on their show

Actually they can, but they have to pay a higher music royalty than broadcasters.

The link you posted reinforces my point perfectly, explaining in very simple terms why they can't.

Using a popular commercial song involves two main rights, called sync and master. You need to clear both with songwriters or publishers on one side and record labels on the other. This process involves negotiation, time, and often high fees, so most podcasters choose royalty-free tracks instead of chart hits.

The process is prohibitively complex and costly because the music industry has not offered podcasters a standard method of clearing popular songs on their shows. If and when they finally do, it will inevitably be crafted as a windfall for the labels and publishers, and a bad deal for podcasters. As a result, podcasts are predominantly on-demand talk shows and can't offer the kinds of music programming I described above.

 

[TheBigA]

The link you posted reinforces my point perfectly, explaining in very simple terms why they can't.
The process is prohibitively complex and costly because the music industry has not offered podcasters a standard method of clearing popular songs on their shows. If and when they finally do, it will inevitably be crafted as a windfall for the labels and publishers, and a bad deal for podcasters. As a result, podcasts are predominantly on-demand talk shows and can't offer the kinds of music programming I described above.

What they describe is exactly the process TV shows and movies must follow to use popular songs. It's not "prohibitively expensive" because the usage of the content will last in perpetuity. The podcast can be heard forever. So the musicians want a piece of that money.

 

[Mediafrog+]

It's not "prohibitively expensive" because the usage of the content will last in perpetuity. The podcast can be heard forever.

We should point out that “perpetuity” and “forever” are eventually eclipsed when works fall into the Public Domain. Of course those creators are all dead by that point.

 

[seattlesarchiebunker]

What I think could be interesting (and probably a lot of business-types who love this word) is the “synergy” between the two companies. Despite the outward appearance, I can see why folks would want this to happen. This sounds goofy, but allow me to explain:

Assuming SiriusXM is the dominant company of the merger: Well, they have an Alternative Rock channel already…AltNation. iHM has dozens of alternative stations around the country. Most of them run part (or even all) of their broadcast schedule via “Premium Choice” or whatever they call their in-house program logs and format-specific national voice tracking these days. It wouldn’t take much for those companies to merge, cut back large amounts of programming/on-air talent, and have everyone (Satellite, streaming, OTA) playing roughly the same music, same jocks, and same branding nationwide. They could easily do that with almost all of iHM formats and create a leaner merged company with far better ability to repay billions in debt.

What SXM realistically gets out of the deal is the streaming platform (even though I like SXM’s recent app), free publicity of their offerings via national broadcast radio, and boots on the ground. Several local salesforces to capture local ad dollars and the ability to provide regional, national, and potentially international ad sales in multiple advertising categories.

From a radio geek perspective, an iHM/SXM merger is disaterous. Homogeneous stations and music from sea to shining sea. People gripe about K-Love assimilating stations like the Borg in Star Trek…this will be far worse. Lots of folks will lose their jobs. I’d argue it will begin the next major change in radio…major job losses, a shift from local to regional radio cluster headquarters and regional/national simulcasting to stem lower ad sales. If SXM decides to unload 800+ stations, it’ll dilute the market to such a point many of us could afford our very own radio station, but would be foolish. As much as iHM tries to sell themselves as a content platform, they are at their heart a radio company.

From a business perspective, it’s unusual, but I can absolutely see the appeal in this merger. And the larger company can be more lean and profitable…along with potentially being revolutionary to the industry. That’s a big deal if the core industry itself (radio broadcasting) is in a downward trend.

 

[secondchoice]

That's a funny comment. You're saying there will come a day when we will all throw away our PCs, tablets, and cell phones and rush to eBay to buy transistor radios, and the world will be great again. Streaming & podcasts aren't just the future. They're the present.

It's what critics about NBC and CBS when they invested in TV, to the detriment of their radio businesses in the 1940s. Ultimately they each got out of the radio business. Perhaps that's what this merger is about. Someone has to own these stations, or they simply become abandoned and left to decay by the side of the road. It takes a special kind of owner to get into the museum or restoration business. That's what some want to see with radio.

A lot of companies have split and the spin-offs survive even when parents are gone. Sears started and spun off Allstate and Discover Card, also Sears at one time "under the ta owned 40% of Advanced Auto.

Circuit City spun off CarMax.

IMHO Unless something thing is done about iHeart's debt anyone who wants any kind of return on their investment will not buy iHeart. Also I doubt anyone would finance it at a reasonable interest rate.

 

[TheBigA]

A lot of companies have split and the spin-offs survive even when parents are gone.

That's what iHeart has been doing. They're shifting resources away from broadcasting to everything else. As you say, they don't want to be radio operators. So they're slowly winding down that business and converting to one that has less expense.

IMHO Unless something thing is done about iHeart's debt anyone who wants any kind of return on their investment will not buy iHeart. Also I doubt anyone would finance it at a reasonable interest rate.

They can add even more debt by doing this merger and then go bankrupt again. That's practically the only option they have. As I said, people aren't going back to broadcast radio. That's not a way to pay off the debt.

 

[secondchoice]

They can add even more debt by doing this merger and then go bankrupt again.

That might be fraud with jail time for someone.

IMHO Even after the haircuts they took, the debtholders are going to have to wait a long time to get back part of their original loan amount. Their Internet business most likely is not collateral for a huge loan for them to walk away.

If you took the debt out of the picture, the radio part of the business isn't horrible. The "content creation" cost for radio shouldn't be that much higher than on line. One can only guess iHeart will try to somehow split the company and walk away from the radio part. I am sure the iHeart bondholders' lawyers won't let that happen.

 

[TheBigA]

That might be fraud with jail time for someone.

Do you remember who is president?

IMHO Even after the haircuts they took, the debtholders are going to have to wait a long time to get back part of their original loan amount.

Don't you understand that it's the debtholders who are running this company??? They're the ones pushing this.

 

[XCountry285]

Are you basing that on the published Nielsen ratings? There seem to be only three actual Sussex County stations listed. The others are all in New York City. Might there be stations owned by small-time operators in the county that don't subscribe to Nielsen?

No they literally own the only 3 stations in the market. If you are in the eastern part of the county you can get NYC stations but further west you can only get Lehigh valley stations or Hudson valley stations.

 

[CTListener]

No they literally own the only 3 stations in the market. If you are in the eastern part of the county you can get NYC stations but further west you can only get Lehigh valley stations or Hudson valley stations.

Why don't the NYC stations of groups other than iHeart show up in the ratings? Is iHeart the only NYC station operator that subscribes to Nielsen's Sussex book?

 

[XCountry285]

Why don't the NYC stations of groups other than iHeart show up in the ratings? Is iHeart the only NYC station operator that subscribes to Nielsen's Sussex book?

They do

 

[ted chittenden]

They got the only stations in the Sussex County NJ market.

What I think you mean to say is that IHeart has the only radio stations that serve the entire market. I do see two NPR affiliates (WNJP and WNJY) in the area as well as a spanish christian non-commercial outlet in the area. Also, it looks like both the commercial AM and the non-commercial simulcaster of Philadelphia's WXPN-FM from Hackettstown reaches part of that market as well.

As to Sussex's being the smallest market that IHeart is involved in, I suspect that honor goes to either Opelika, Alabama (northwest of Columbus, GA) or Fairbanks, AK. And, if memory serves, IHeart is involved in a very small market south of Columbus, OH, as well.

 

[XCountry285]

What I think you mean to say is that IHeart has the only radio stations that serve the entire market. I do see two NPR affiliates (WNJP and WNJY) in the area as well as a spanish christian non-commercial outlet in the area. Also, it looks like both the commercial AM and the non-commercial simulcaster of Philadelphia's WXPN-FM from Hackettstown reaches part of that market as well.

As to Sussex's being the smallest market that IHeart is involved in, I suspect that honor goes to either Opelika, Alabama (northwest of Columbus, GA) or Fairbanks, AK. And, if memory serves, IHeart is involved in a very small market south of Columbus, OH, as well.

Yes I am sorry

 

[secondchoice]

Do you remember who is president?



Don't you understand that it's the debtholders who are running this company??? They're the ones pushing this.

The Supreme Court ruled a President is above the law unless impeached. However unless you can get a pardon, it can still can get ugly.

The debtholders / owners of iHeart really want this (or any) deal but I personally feel the debt holders / owners of iHeart only hope of a short term way out is for a "bigger fool" to come along.

SXM has Pandora. IMHO They could economically expand Pandora rather than dealing with iHeart's debt.

Disclosure: I inherited some Pandora stock. I learned a valuable lesson. The stock price will eventually reflect the positive or negative cash flow not the EBDITA of the company no matter how bright the "future" is.

Also I shorted Citadel stock with "puts".

Free advice, if SXM acquires iHeart, take your "fun money" and buy some "put options" on the new company. My best guess: it will about 2 to 3 years for the new company's stock price to head south.

The Supreme Court ruled the President is above the law unless impeached. But unless a person can get a pardon it can get still can get ugly.

 

[atthestars]

What I think you mean to say is that IHeart has the only radio stations that serve the entire market. I do see two NPR affiliates (WNJP and WNJY) in the area as well as a spanish christian non-commercial outlet in the area. Also, it looks like both the commercial AM and the non-commercial simulcaster of Philadelphia's WXPN-FM from Hackettstown reaches part of that market as well.

As to Sussex's being the smallest market that IHeart is involved in, I suspect that honor goes to either Opelika, Alabama (northwest of Columbus, GA) or Fairbanks, AK. And, if memory serves, IHeart is involved in a very small market south of Columbus, OH, as well.

Some other really tiny markets iHeart still has stations in:

Somerset, KY
Dickinson, ND
Minot, ND
Ogallala, NE
Farmington, NM
Gallup, NM
Chillicothe, OH (i think that's one you were referring to)
Williamsport, PA
Huntington, WV
Wheeling, WV
Parkersburg, WV
Cheyenne, WY

Most of them are usually Premium Choice programming, with an occasional local person here and there.