Bye Bye Boston's Progressive Talk?

[Dan Strassberg]

Rumor has it that WESX and WJDA are sold out. Otto Miller (if I've got the
name right--the guy who bought WESX and WJDA) is reportedly looking for
additional properties in the Boston market. I can imagine 1430 beng in his
price range but WKOX probably not. The grapevine says that Radio One's
asking price for WILD (rumored to be at least $7 million) did not stop
Miller from negotiating--but I have no clue about whether negotiations are
still going on. The parties may have been too far apart and saw no point in
continuing.

With 1090, 1200, 1430, and 1510 all on the market, one would think
Boston-market AM prices would be coming down a bit. I could see 1200 going
to some major Hispanic broadcaster for big $$$. But we all know about the
last major Hispanic broadcaster with properties in Boston and environs. So
the question is who has the resources to buy or LMA a station for which Bain
Capital will probably ask something close to $20 million? Beasley? Aren't
Beasley's foreign-language stations mostly brokered? I know that WRCA is.
Same for Arthur Liu. Liu has deep pockets, but I don't think Multicultural
is into producing the programs that air on its stations.

Still, I imagine that both Beasley and Liu understand the brokered-time
business really well and know how to make it pay, whereas brokered time was
a very small part of CCU's business and CCU may have decided that the return
just didn't justify the headaches. Unless CCU's new owners feel that leasing
out facilities is a good way to make money, I can imagine a lot of CCU's
non-core assets being sold to companies for which leasing out facilities is
a core strategy. OTOH, if Bain Capital becomes persuaded that leasing out
facilities is the thing to do, look for them to hire people who know how to
do it and for many CCU AM properties to become major players in the
leased-time business. As a rule, brokered stations have relatively low
revenue but bring a very high percentage of revenue to the bottom line.

Since Paul Allen is a multi-billionaire, he seems willing to wait for
someone to meet his price for WWZN. In this case, I would say that that
strategy has not paid off and appears unlikely to do so. Anyone considering
buying WWZN can now probably also consider WKOX. Once WKOX upgrades, the
signals will be comparable--although 1510's night coverage will be
superior--believe it or not. The asking price for WKOX may be significantly
greater but, because of the onerous lease for 1510's transmitter site, the
break-even for WKOX will almost surely be lower.
--

Dan Strassberg
dan.strassberg@att.net
Fax: 1-707-215-6367

----- Original Message -----
From: "Sean Smyth" <sean.smyth@yahoo.com>
To: "David Tomm" <nostaticatall@charter.net>
Cc: <boston-radio-interest@bostonradio.org>
Sent: Thursday, November 30, 2006 9:50 AM
Subject: Re: Bye Bye Boston's Progressive Talk?


> David Tomm <nostaticatall@charter.net> wrote:
> > The changes with Clear Channel is what's driving this move.  My guess
> >
> > is they are prepping the AM's to be sold.   They're not going to make
> >
> > any real revenue being the fourth conservatalker in town or doing
> > brokered ethnic.
>
> I'll disagree. Why else did Clear Channel keep brokered programming on
> WKOX for the first few years they owned it? Why else would Arthur Liu's
> firm have paid to buy 1470, then pay for the move-in to the Lexington
> site? They'll make more money selling airtime than, as you said, being
> No. 4 talker or sports station in town. To boost revenues short-term,
> and make the balance sheet look nice, it's a smart move. Long-term,
> there always will be a market for underserved markets, especially since
> there is no major Spanish signal in the market.
>
>
>
>
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