Changing the subject line here so we're no longer beating up on poor KXEL, which has had enough grief anyway...
Mike McKenna wrote: > Scott, As a consultant and former owner -- I understand all of the > rules. But -- the value of a station is no longer based soley on > it's intake of cash. I never said "solely." There are plenty of factors that go into valuing a station. It's no different from buying any other business, really: if your goal is to buy an ongoing business, you care deeply about sales and cash flow. If you're really just after the real estate where the business is sitting, then the existing business operating from that real estate may just look like a nuisance that has to be dealt with. You're coming at things from the cynical assumption that nobody's buying radio stations as ongoing businesses any longer. I don't believe that's the case. > The FCC allows 'tolling" so that some "silent > stations" have remained "off the air" or even unbuilt for over ten > years. KNGS FM, KAAX FM, KZPE FM are just a few. The sales of > these stations is still pending review and even if not built, on the > air or making money or serving the public in any way -- will bring > about 5 million dollars. Apples and oranges. One of the stations you cite is an unbuilt noncommercial FM construction permit. One is an unbuilt commercial FM, and the other is a commercial FM that (as best I can piece it together from FCC filings) was on the air, then its owner died. These are the radio equivalents of buying or selling empty, undeveloped lots - highly speculative, with values driven as much by emotion as anything else. In the case of one of the stations you cite, there appears to be a trail of legal actions stretching back quite a few years, which makes it more or less the equivalent of that abandoned building on the corner - "distressed property." They're not representative of most of the tens of thousands of radio stations that are on the air, functioning as going businesses, and yes, serving the public. > The rewards of being good local > broadcasters -- no longer exist. The FCC does not give gold stars > nor is the stations value in a local market based soley on being a > "good sport" and member of the local Eagles Lodge. Stations are sold > to big companies based not on sales -- but need to control the > market. Being a good broadcaster does NOT make any radio station > worth more money. Doing more does not bring in more cash. Your > idea of what radio is all about -- is dead. It does NOT matter if > you are good or bad. You just have to have enough cash to buy the > license. And the value of a station is not based on sales or public > service. Again, if what you say were true, those two identical class B signals for sale in the medium-sized market I mentioned would be offered at the same price. They're not. One will bring twice as much as the other when their sales close, and why is that? They are - to beat my metaphor to a bloody pulp - identical "properties," if you will, on opposite corners of the same street. Station A is worth twice as much as station B precisely because it DOES "do more" - it sells itself more effectively, it connects to its community in a way that draws listeners, which gives it better ratings, which in turn brings in not just local sales but also national agency buys. If your theory that "doing more does not bring in more cash" had any validity at all, perhaps you can explain why anyone would bother programming a radio station at all. You seem to be arguing that a radio station is worth just as much if it programs dead air as it would be if it does the things that we identify "good broadcasters" as doing. So why would KIRO, or WGN, or WBZ bother to maintain a news department in that case? Why would Z100 or KIIS-FM stage a huge annual concert for its listeners? Why does one of my local stations' websites have big promotions on the front page for three charity events it's sponsoring? Just throw on a 1 kHz tone and walk away...that won't change the value of the radio station, right? > Most ads are not local buys any more. Locals don't have > the cash to buy spots in all but the smaller makets. Just listen to > any station in Seattle, LA or even Klamath Falls, Oregon. How many > owners are there in Klamath Falls ??? Not one does local spots. If you're determined to find vinegar in every bottle of wine you open, I guess that's what you'll find. I don't pretend to know what sort of bad experiences you've had as a "consultant and former owner," but your sour, cynical take on the broadcast business today certainly doesn't reflect what I see in my travels. I've never been to Klamath Falls, but on the way to and from the IRCA convention last fall, I spent time in Eugene, Corvallis and Portland, not to mention most of the markets in Washington State. The commercial stations I visited in those markets certainly had plenty of local spots in addition to national buys, and that was true in both tiny markets and big ones. The sales manager in Olympia who gave me a tour of his station said business was good. There were a lot of people sitting in cubicles marked "SALES" at the cluster I visited in Eugene, and they certainly seemed to be hard at work. And I just looked up Klamath Falls both today and in my 1967 Broadcasting Yearbook - the answer seems to be two clusters of commercial stations, plus one standalone commercial FM, against three individually-owned AM stations in the market 40 years ago. They're all listed as having sales managers. I can't imagine those people would have jobs if they're not selling any local spots. My goodness, if what you say were true, there are SIX people at the New Northwest Broadcasters cluster twiddling their thumbs doing nothing all day: http://www.kladfm.com/articles/radio_advertising.shtml (In fact, that particular Klamath Falls station's homepage even has what looks very much like a local advertiser right there on the bottom - or does "Eagle Hardwoods" not count somehow?) Yes, times are changing. No radio station can do business in 2007 the same way it did in 1967. But that's true of ANY business today, not just radio. Everything has become more consolidated. Nothing's as local as it was back then. It's still a long way from that to your poisoned conclusion that radio as we knew it is dead. I'm glad most of the broadcasters I know don't feel that way, and I'm glad most of them are still out there being involved in their communities and building the value of their stations, not just sitting in front of a keyboard bitching and moaning about how "radio is dead." End of sermon... s _______________________________________________ IRCA mailing list [email protected] http://montreal.kotalampi.com/mailman/listinfo/irca Opinions expressed in messages on this mailing list are those of the original contributors and do not necessarily reflect the opinion of the IRCA, its editors, publishing staff, or officers For more information: http://www.ircaonline.org To Post a message: [email protected]
