With NASH as a national brand is WNSH a money maker regardless of ratings?

[Jeffrey]

As I continue to sample WNSH from time to time I've noticed that there are now some commercials, primarily national ads, ie. Suburu, Chase and the like. I did hear a few local for New Jersey businesses.

As NASH is a national brand and apparently all Cumulus country stations will have the NASH moniker, would it make sense that even with a 1.5 WNSH would make money for Cumulus seeing as they're able to claim they have X number of stations in market no. 1 and with various formats thus reaching all demographics.....?

Might this be the future of radio? Cheaper, easier to sell adds and ratings less of an issue.....

Some have touched upon this subject in previous posts but I'm very interested to see how this will play out. I also question how much local programming WNSH will eventually have. Radio on the cheap!

 

[DToTheJ]

...As NASH is a national brand and apparently all Cumulus country stations will have the NASH moniker, would it make sense that even with a 1.5 WNSH would make money for Cumulus seeing as they're able to claim they have X number of stations in market no. 1 and with various formats thus reaching all demographics.....?

And if it's true that 103.9 is going to be part of Cumulus' new rock format initiative, just think, we'll have twice this "cheap" model on our local dial...

 

[Steve Green NEPA]

If I'm remembering right, the first 'full' book for Nash 94.7 (and the rest of the New York City stations) won't be released until nearly the first day of Spring. That's five weeks off.

Naturally, the subscribing stations already will have had the initial bumf and will go about whatever tweaking they see fit. If they're seeing the numbers at or near a comfort point for their purposes, it's unlikely they'll go nuts in an effort to 'improve' them.
Of course, they'd like to see some revenue coming in to pay off that $30,000,000 + dinner tab. But it'll be a while before any excuse like, 'Ooops. I seem to've left my credit cards and wallet in the other sports coat in Atlanta' won't work. The ink still hasn't dried on the deed. There's time.

(Little of that laissez-faire contentment and elbow room is apt to do Cumulus as much good if they put rock on 103.9, though. The company is apt to face a tougher task. Nash was all set to plug in. One slipup with Rock, though, and the purists here and elsewhere will rip them to shreds).

 

[OC3]

Ya think???

​

 

[TimeIsTight]

If Cumulus is selling advertisers national spots that will run on all Nash affiliates across the country, then it needs to offer them a respectable signal in Market-One, and 94.7 is that one big last necessary piece of the national puzzle.

In the big corporate picture, it's not necessarily how well it does as a free standing individual station, but its greatest value may be in how its existence is needed for the national brand to be heard in Market-One, also home to Madison Avenue.

Only the accountants will really know for sure, but what matters most to Cumulus is its total corporate earnings per share at the end of each quarter and fiscal year, and where that takes the stock price and shareholder value. So, ratings, and even local billings wise, WNSH could look like a loser, but if its existence helps sell high dollar national spots that run on dozens of other stations too, then it is still helping the ultimate corporate cause, and possibly more than a better rated stand alone format New York station that is marginally more profitable.

Another way to look at it is: WNSH may be more valuable to Cumulus as a national brand team player, than just another NYC ratings star.

 

[TheBigA]

Another way to look at it is: WNSH may be more valuable to Cumulus as a national brand team player, than just another NYC ratings star.

There are a lot of stations in NYC that serve that purpose, promoting the brand, rather than simply serving a market. Radio Disney, ESPN, Salem, even WOR and WABC.

However, While Cumulus is a public company, and they do have shareholders, the shares are mainly for internal use. The people Cumulus must please are the investment bankers who hold the billions in loan guarantees.

 

[TimeIsTight]

While Cumulus is a public company, and they do have shareholders, the shares are mainly for internal use. The people Cumulus must please are the investment bankers who hold the billions in loan guarantees.

Actually, only 9-percent of Cumulus shares are held by corporate insiders or 5-percent stakeholders, and the other 91-percent of the shares are owned by financial institutions and mutual funds.

Interestingly, for radio ownership watchers, among the financial institutions holding stakes in Cumulus are Oaktree Capital, and Bain Capital. Oaktree also, essentially, owns radio station group Townsquare Media (NJ-101.5 et al) and we all know about Bain Capital and Clear Channel.

While Cumulus should also try to please the investment bankers who hold its debt, most of the bankers funds have already been committed long-term, while the stockholders can get out on any market trading day. Continued interest in the shares by big institutions likely allows the bankers to sleep more comfortably at night, knowing the stock market indicates the collateral they hold isn't losing value, and the debtors appear to have enough cash flow to continue to pay the "vigorish."

 

[TheBigA]

Actually, only 9-percent of Cumulus shares are held by corporate insiders or 5-percent stakeholders, and the other 91-percent of the shares are owned by financial institutions and mutual funds.

Yes I know. The "financial institutions" are the investment companies that you listed. Also Crestview Partners, who hold the bulk of the debt and stock. They actually EMPLOY the Dickeys, so they're the ones the Dickeys have to please. And yes, they are in it for the long term. That's why the short term quarterly profits you mentioned in your previous post aren't as important. They're more important in terms of operating expenses, and will dictate how much money the station management has to hire staff.

Looking back at the last 12 months, the stock has been relatively stable, with the exception of the drop as a result of the purchase of WFME in October. That caused a bit of a sell-off. But not to the extent that it would have had the stockholders been typical short term investors.

 

[TimeIsTight]

That's why the short term quarterly profits you mentioned in your previous post aren't as important.

My point was that if quarterly profits, and, particularly earning per share, don't meet analyst, or investor, expectations the company's stock price will suffer.

Crestview does own a 37% stake in Cumulus, and if the price of Cumulus shares go down $1 each, the value of Crestview's stake goes down by $59-million on paper. And while, Crestview's view may be longer term than typical investors, they, and all the other institutional investors, do not want to see the value of their investment shrink like that.

However, if, as you say, Crestview holds mucho Cumulus debt, along with a 37-percent equity stake, and does actually "employ" the Dickeys then we know who ultimately calls the shots and issues the marching orders. And the Dickeys probably salute smartly.

 

[TheBigA]

And the Dickeys probably salute smartly.

Exactly. To get back to Jeffrey's OP, I agree that they will use this station as a centerpiece for a lot of things, both in terms of sales as well as programming, both locally and nationally. Hiring a veteran local sales manager shows they will be attracting some local advertising, but as you said, it's not all hinged on being a Top 10 radio station.

 

[Jeffrey]

And the Dickeys probably salute smartly.

Exactly. To get back to Jeffrey's OP, I agree that they will use this station as a centerpiece for a lot of things, both in terms of sales as well as programming, both locally and nationally. Hiring a veteran local sales manager shows they will be attracting some local advertising, but as you said, it's not all hinged on being a Top 10 radio station.

It'll be interesting to see this thing play out. My understanding as well was that they would use WNSH as a sort of centerpiece regardless of actual success in terms of ratings. It's obviously of utmost importance to have the brand in market no. 1. I do however wonder though that if it turns out to be a ratings disaster how much sense it could make. National brand or not, if no one is listening can it still help their bottom line? Surely advertisers, national and local will know whether the station pulls in numbers. If it doesn't it's presence in the market would be less relevant.
Perhaps I'm way off but that is my logic anyway.

One thing is for sure, this was the only way to get country back on NYC radio. No one was surely going to take the gamble of putting what is a niche format in NYC on as a stand alone station.

 

[TheBigA]

National brand or not, if no one is listening can it still help their bottom line?

I'm sure they've done the math. They're good at math. A 1 share should still add enough cume to the national number to be worthwhile.

 

[Barry]

Let's not forget that sister station WPLJ does not have great ratings in New York, but has terrific billing.
It is very popular among women in NJ that advertisers are apparently eager to reach. And Cumulus seems to know how to sell it to sponsors.
They could sell WNSH to many of the same advertisers, as it could do well among a similar audience in suburbs in NJ and elsewhere. In addition there should be plenty of additional business from Nashville record labels, country concert promoters, country music venues, and firms wishing to tap into the country lifestyle.
And Cumulus CEO Lew Dickey has said he expects WNSH to eventually be among the top 10 in ratings, so clearly he is viewing this very differently than the writer of the original post.

 

[TimeIsTight]

And Cumulus CEO Lew Dickey has said he expects WNSH to eventually be among the top 10 in ratings, so clearly he is viewing this very differently than the writer of the original post.

As corporate CEO, Lew Dickey had to say that he expects WNSH to be in the top-ten stations, if he didn't "expect" at least that much he might get too many questions from investors. CEOs always have to have high "expectations" otherwise they may not be CEO very long, and WNSH was a $40-million investment for a company that the stock market values at $174-million.

Still, I am sure he expects the station to stand on its own financially, thanks to its local audience and local sales, but if it only provides the needed NYC affiliate for a national sales effort that brings all 83 of the other Cumulus country stations to the party, it still will be serving its purpose.

 

[TheBigA]

Still, I am sure he expects the station to stand on its own financially, thanks to its local audience and local sales, but if it only provides the needed NYC affiliate for a national sales effort that brings all 83 of the other Cumulus country stations to the party, it still will be serving its purpose.

Regardless, half of the programming is likely to come from Nashville, and not NYC.

 

[TimeIsTight]

WNSH was a $40-million investment for a company that the stock market values at $174-million.

Just to correct my own post, because I was in a big hurry and forgot to do some math. I forgot to multiply the number of Cumulus shares outstanding by Friday's closing price for Cumulus stock.

The correct figure for Cumulus's current Market Capitalization is about $575-million.

Regardless, half of the programming is likely to come from Nashville, and not NYC.

No doubt, the decisions as to what music is played will be made in Atlanta, and half the programming, like nights and weekends, will be network feeds from Nashville, and there will be a few local "personalities" in NYC, to do drivetime while bantering with local traffic and weather reporters (who already work for Cumulus), and to appear in public to put a local face on the station image. Station offices and management will be shared with cluster siblings WPLJ, and WABC. So, it may be a new commercial radio station, but only a handful of new jobs were created, probably not much new office space was needed, in NYC. As part of a national network, and an existing cluster, along with low operating costs, (don't forget they don't even have ESB rent to pay) it may be an easy station to run profitably even if it doesn't meet expectations in the ratings race.

 

[Barry]

On the site MediaBistro there is an interesting interview from last month with Kim Bryant, the recently appointed New York Market Manager for Cumulus. She asserted that Nash's programming will "All be out of New York. We have a studio here. We’re going to be a New York radio station.”
Kim stated that Nash will not be part of a national network. She said, “Every market is unique. Every market is going to have its own needs.” This may indicate that at least in large markets, there will not be major changes to the programming of Cumulus country stations, such as Kicks 105.5 in the Danbury area.
The interview also states that Cumulus made a decision to play a broad mix of country music right from the start, rather than just focusing on the major stars in an effort to reintroduce New York to country music.

Discussion With Cumulus' New York Manager Kim Bryant: http://www.mediabistro.com/fishbowl...onalities-likely-in-next-several-weeks_b74846

 

[TheBigA]

She asserted that Nash's programming will "All be out of New York. We have a studio here."

That's OK. They have studios in Atlanta and Dallas too, and they go syndicated starting at 7 PM in both of those markets, and those two shows come from Nashville. So I expect NYC will not be any different.

As for originating a national network, I agree. They won't be replacing hosts in Atlanta or Dallas with people from NYC. I think there was a lot of misunderstanding when this was announced. Some thought they'd be originating a 24/7 service from NYC. They already have a 24/7 syndication service that they got from ABC Radio, and none of their stations run it. The network is just a brand, not syndicated talent.

 

[TheBigA]

Just got this from RadioInk:

New York City's only Country station has its first two live DJs. This afternoon Cumulus will announce that Kelly Ford (10 a.m.-3 p.m.) and Jesse Addy (3-7 p.m.) will start their live shifts Monday.

 

[TonySantiago]

As NASH is a national brand and apparently all Cumulus country stations will have the NASH moniker, would it make sense that even with a 1.5 WNSH would make money for Cumulus seeing as they're able to claim they have X number of stations in market no. 1 and with various formats thus reaching all demographics.....?

Might this be the future of radio? Cheaper, easier to sell adds and ratings less of an issue.....

It's not the future of radio. It's here now. :-[

If the Southern outlets of this network do well, then it doesn't matter how good or bad New York does with WNSH so as long as the money comes in and profits happen. And yeah, I can easily see the rock network on 103.9.

You want the future? Here's my prognostication.... :-\

I could eventually see CC get into that fold of an over-the-air network and brand Z-100 as their "East Coast Flagship"
and KIIS in LA as the "West Coast Flagship" and perhaps sign exclusives with artists to only have their music run on their radio stations. Kinda reverse "payola" in that way. Rihanna could be a CC "property", Pitbull could be a CBS Radio "property". Same can happen with all formats down the road; secure artists and their fans would only follow the stations their music is heard on because it couldn't be played anywhere else.