WBZ Network News Shuffle/Adjustment Has Begun?

[davideduardo]

And the stockholders of CBS STILL own the newly merged company called "Entercom." Joe Fields gave up his voting stock and control of Entercom. Moonves, in theory, could put David and Joe out on the street if he decides to. Why in the world would Fields do a deal where he loses control of the company?

The shareholders of CBS held a high percentage of the Entercom shares at the deal's closing, not CBS corporate. And some of those shareholders have sold since then.

Les Moonves is losing his entercom board seat as of the date of the Entercom annual meeting.

 

[wavo]

The shareholders of CBS held a high percentage of the Entercom shares at the deal's closing, not CBS corporate. And some of those shareholders have sold since then.

Les Moonves is losing his entercom board seat as of the date of the Entercom annual meeting.

From what I quickly gathered there are no superclass or "voting" shares of Entercom. But the question still lingers...did Joe Fields want this deal so bad he gave up voting control of his own company?
It is notable that Joe Fields has been buying shares like crazy at near 52 week low prices.

 

[TheBigA]

I was wondering why Entercom didn't keep the entire CBS Radio cluster and dump their own cluster.

To paraphrase one Entercom exec, you don't sell something you know. They know their stations and their people, so there's a bias towards them. We saw that most notably in Seattle, where they flipped the high-rated and better-billing country station KMPS to AC, and kept the weaker KKWF as the market's country station. Since the flip, Hubbard flipped their rock station to country, and the Entercom station hasn't gained any audience. On the surface, not a smart move. Their exec defended it by saying they knew their station and their people. Easier to get rid of people they don't know. That's basically what they did with WBZ.

 

[nowradioguy]

To paraphrase one Entercom exec, you don't sell something you know. They know their stations and their people, so there's a bias towards them. We saw that most notably in Seattle, where they flipped the high-rated and better-billing country station KMPS to AC, and kept the weaker KKWF as the market's country station. Since the flip, Hubbard flipped their rock station to country, and the Entercom station hasn't gained any audience. On the surface, not a smart move. Their exec defended it by saying they knew their station and their people. Easier to get rid of people they don't know. That's basically what they did with WBZ.

Then why did Entercom so gladly take on AMP 103.3, Mix 104.1, and Magic 106.7? These weren't stations they "knew"; these were stations they salivated over.

I guess WRKO, WBZ-AM, and WKAF (a station they did "know", BTW) weren't "in the direction they wanted to go".

And from some other threads I'm getting the bad vibes that WBZ NewsRadio 1030 is not "in the direction" iHeart knows how to go, either. So what if WBZ-AM were offered to them? They could've said No! Dammit, there are more than a few of us who wish they had said No.

 

[TheBigA]

I guess WRKO, WBZ-AM, and WKAF (a station they did "know", BTW) weren't "in the direction they wanted to go".

Three AM stations at a time when AM is a declining platform. Given the choice of what to sell, sell something with the shortest potential shelf life. Look at KYW in Philadelphia. This is a heritage news station, just like WBZ. The exact same heritage. For years, it was #1 or #2. Now it's dropping. Why? Because fewer and fewer people are listening to AM radio. So might as well get rid of as many AMs as you can when you can.

And from some other threads I'm getting the bad vibes that WBZ NewsRadio 1030 is not "in the direction" iHeart knows how to go, either. So what if WBZ-AM were offered to them? They could've said No! Dammit, there are more than a few of us who wish they had said No.

I think you're reading too much into that line. It's similar to being told by your girlfriend, "we should see other people." Viewed one way, that's a very liberating statement. Viewed another, it's a nice way of saying she doesn't want to see YOU anymore. I think it's the latter interpretation that was meant. Because as the article points out, WBZ is hiring staff. They just didn't want to renew the contract of one particular guy. It's not a statement on the station, but the contract. That's MY interpretation.

 

[nowradioguy]

Three AM stations at a time when AM is a declining platform. Given the choice of what to sell, sell something with the shortest potential shelf life. Look at KYW in Philadelphia. This is a heritage news station, just like WBZ. The exact same heritage. For years, it was #1 or #2. Now it's dropping. Why? Because fewer and fewer people are listening to AM radio. So might as well get rid of as many AMs as you can when you can.



I think you're reading too much into that line. It's similar to being told by your girlfriend, "we should see other people." Viewed one way, that's a very liberating statement. Viewed another, it's a nice way of saying she doesn't want to see YOU anymore. I think it's the latter interpretation that was meant. Because as the article points out, WBZ is hiring staff. They just didn't want to renew the contract of one particular guy. It's not a statement on the station, but the contract. That's MY interpretation.

Alright; one of the possibilities mentioned when CBS announced it wanted out of the Radio business was to spin off CBS Radio as a stand-alone unit (with an IPO). Now I'm not business-savvy to know whether this was unsustainable in the long run, or whether it was even possible for this option to get off the ground, or whether Entercom's appearing on the scene short-circuited the stand-alone option (this would be my guess). A newly-created CBS Radio Group, completely separate from CBS Corp, would've kept the whole cluster of stations together. The (new) CBS Radio Group could sold off any poorer performers which might've indeed been dragging down earnings. Just my $0.02-worth.

 

[TheBigA]

A newly-created CBS Radio Group, completely separate from CBS Corp, would've kept the whole cluster of stations together. The (new) CBS Radio Group could sold off any poorer performers which might've indeed been dragging down earnings. Just my $0.02-worth.

Interesting theory. I never read anything from anyone in the company talking about potential station sales before the Entercom deal. That would have been bad for morale if they had. So we don't know. The reality is that they would have had to find a way to economize, and most likely they would still have had to leave the TV building. The CBS Radio Group would not have been able to operate as they had under CBS Corporation.

 

[nowradioguy]

Interesting theory. I never read anything from anyone in the company talking about potential station sales before the Entercom deal. That would have been bad for morale if they had. So we don't know. The reality is that they would have had to find a way to economize, and most likely they would still have had to leave the TV building. The CBS Radio Group would not have been able to operate as they had under CBS Corporation.

I don't recall where I'd read of a possible IPO; talkers.com, perhaps?

To clarify: when I said "kept the cluster of stations together", I meant of the Radio stations only, not the CBS Radio and TV stations.

Any stations that the new CBS Radio Group wanted spun off could have been done post-spinoff.

As you said, "Interesting theory". However, an IPO would not have been a tax-free transaction for CBS Corp, and that might've been why this "interesting theory" never was realized.

 

[TheBigA]

However, an IPO would not have been a tax-free transaction for CBS Corp, and that might've been why this "interesting theory" never was realized.

I think the way they proposed it, which was similar to the reverse Morris Trust, it would have been tax free. But selling it to Entercom produced more "shareholder value," which is what Moonves wanted. They got money plus equity. Money up front, plus money afterwards.

 

[nowradioguy]

I think the way they proposed it, which was similar to the reverse Morris Trust, it would have been tax free. But selling it to Entercom produced more "shareholder value," which is what Moonves wanted. They got money plus equity. Money up front, plus money afterwards.

"(W)hat Moonves wanted: ... money plus equity. Money up front, plus money afterwards."

That says it all. Nicely expressed.

Sad, though, since some legacy or heritage stations are not going to fare well as a result.

 

[CTListener]

OP cited WRKO, WBZ(AM) and WKAF, and BigA responded:

Three AM stations at a time when AM is a declining platform.

WKAF is an FM with an urban AC format, not an AM.

 

[raccoonradio]

Iheart's other AM is the conserv talk on 1200, WXKS, which they already owned.They got RKO and BZ via swap.

 

[spt87]

Now that CBS is being heavily meddled with by parent National Amusements and probably being forced to merge with sister company Viacom, it is almost nice that the radio division is out of that mess.