Is CBS Radio interested in buying out Cumulus and divesting the small stations nationwide and keeping all the former crown jewels of the Disney/ABC Radio Group? Would that not be a brilliant move in the top twenty markets? In San Francisco they could move KCBS to the 810 or the 680 signal and get rid of all the small stations. The two group owners getting together for this new sports network may just be the first move to further consolidation. Yikes! Is this possible?
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Is it possible there's another shoe to drop?
- Thread starter RadioStarOne
- Start date
The rumor that Trickey Dickey might buy CBS Radio has been circulating for a couple of weeks. Some ownership limits might present problems but those things have a way of working themselves out.
Would be terrible for all CBS employees.
It also may have been an erroneous rumor as people saw things that actually were part of the Sports network deal being done
Would be terrible for all CBS employees.
It also may have been an erroneous rumor as people saw things that actually were part of the Sports network deal being done
Most of CBS' clusters are very healthy and would be quite expensive. If....IF...Cumulus is in acquisition mode in big markets, look for them to pick up smaller players. As I suggested in another thread, Bonneville would be a very good fit in terms of size (7 stations) and putting Cumulus in markets where they aren't (except for L.A., where they'd gain a second FM). Emmis, Hubbard and Merlin would be other possibles.
I wonder, Michael, if broadcasters have a data base of recommendations, bad reviews to turn to, as consumers have in Yelp online?
I KNOW how one bad review can adversely affect an online business. If that were true for radio stations, wouldn't it have a big impact, individually, on each price tag?
skyrocker said:
But are we forgetting who the customer is? For instance, I'm looking into buying radio advertising right now. I'm looking for age 50+ individuals and small business owners. Even though I know the nuts and bolts of what's going on with Cumulus, CC, CBS, Entercom, etc., my main focus as an advertiser has to be on whether I can get the demographics I need for a price I can afford to pay.
Sure, there are Yelp reviews about KGO's dumping the old staff, for instance. But as a potential advertiser, none of that is important to me. What's important to me will be what X station can deliver now, today, and whether I can get them for a reasonable CPM.
This is an interesting thread, and clearly this new deal opens the door to more collaborations between Cumulus and CBS. But what it shows is you can gain access to your competition's customers without BUYING the radio station. This is exactly what companies were trying to do before the 96 Act. Now that everyone has maxed out their ownership and debt limits, it's time to find other ways to grow the customer base and provide more advertiser value without spending money. That's the story behind the CBS-Cumulus deal. I don't expect CBS to spend any more money on radio aquisitions, and I don't expect Cumulus to dig the debt hole much deeper. Why should they? The fact that Cumulus can share in the revenues from CBS-owned stations, and vice versa, is enough of a victory for the two companies. However, I have to wonder why Entercom or anyone else would want to share their audience with these two competitors.
skyrocker said:
It would, Bobby. But we both know that radio station operators believe that they carry the magic bullet in their brains...that as soon as the license has their name on it, that they can turn crap to gold.
I'd sure dock a seller of a restaurant or car dealership I was considering buying for bad Yelp reviews just because I'd know I'd have to spend more money to erase their bad PR. But station transactions will continue to be based on multiples of (ever-declining) cash flow.
TheBigA said:
I think that's mostly right. However, there are economies of scale that make it very difficult for one or two station clusters to compete when the other guys have six, seven or eight. They'll naturally look to get out of those markets or the business altogether, and if a competitor in a similar position can go from having two stations in the market to four because of it, if the price is right, they will.
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