Mariners Radio Network - P-I Radio Beat 3-30

[NwzAir]

http://seattlepi.nwsource.com/baseball/264865_msradio29.html

http://seattlepi.nwsource.com/tv/264774_radiobeat30.html

 

[jdweaver]

Re: Fisher buying radio

> http://seattlepi.nwsource.com/baseball/264865_msradio29.html
>
>
> http://seattlepi.nwsource.com/tv/264774_radiobeat30.html
>

The issue for radio operators like Fisher is when is the slide going to stop. When the economy grows 3-4% and radio revenue is flat or down 2-4% over a couple of years that adds up pretty rapidly. Suddenly you're looking at a revenue pie that is really 12-15% less than just a few years ago.

So when do smart operators jump into the shrinking pool? Spanish operators have proven this is a great time - which is a change in the paradym over the past when a station's value was largely irrespective of it's format. When operators can pay 5-8X TRAILING cash flow then folks like Fisher will likely be back in the hunt.

I'd argue that then the stations will be really sucked dry. Radio will repeat what happened in the steel business a few years ago. The steel operators simply ran them for the cash flow in the mills and figured their investment was sunk cost. There really isn't going to be much appreciation in the value of stations - they will probably be worth less.