September 6, 2017

    Connoisseur Media CEO Jeff Warshaw likes to speak his mind, and that’s exactly what he did Wednesday. During the Broadcast Finance panel, Warshaw continued his push to see more deregulation of the number of radio stations a company can own. He says without it, radio will be very challenged in 10 years. “We are fighting for survival. We absolutely need more deregulation.”
    He also believes radio may be making too much of an effort to save the AM band, and that could come at the expense of the entire industry. “We should not sacrifice the future of this business for a declining band.” That is certainly not going to go over very well with the many AM broadcasters who are looking to the FCC to fix that band so they can survive. It’s an issue FCC Chairman Ajit Pai has championed and its doubtful he’s going to back off on that any time soon.

    Warshaw, and many others, say the only way radio can compete for ad dollars with digital companies like Google and Facebook, who are unregulated by the government, the FCC must allow broadcasters to own more stations. “Getting relief on the number of stations we can own is the single most important thing that can happen in our industry.”

    Of course, not everyone agrees with Warshaw. Many have also made the case that too much deregulation put the industry in a position where a few companies have so much debt that you often hear radio now has a “cloud hanging over its head.” You also consistently hear that companies with so many stations in a market will drop their rates on the lowest performing station or stations to get more share of the dollars being spent in that market. That last scenario, if done over many markets, for months and years is clearly one of the reasons radio has not grown its share of the overall revenue pie.

    Warshaw also wants radio to step up the level that “we attack ourselves.” He says radio needs to have a serious discussion about why advertisers undervalue radio and all the things we are doing wrong.

    Hebert: 2018 Will Be Tough For iHeart, Cumulus

    September 6, 2017


    Wells Fargo Director Davis Hebert, speaking at the Radio Show in Austin, Wednesday, said the market is concerned about the sustainability of iHeartMedia and Cumulus over the next two years. “It may be tough for both companies to get through 2018 without some sort of restructuring. There’s not as much sand in the hourglass and there will be no significant deal volume in the near-term until iHeart and Cumulus get fixed.”

    Hebert had high praise for Beasley Media’s performance, especially how the company has been paying down debt. He said Entercom’s stock has been down 30% since the announcement of the merger with CBS Radio but blamed that on the weak performance of the CBS stations. He called CBS Radio a chronic underperformer for two years. He said it’ll be up to David Field to prove the market wrong.

    Hebert said investors want to see positive ad sales, conservative balance sheets, more consolidation, and multi-platform extensions. He said investors are worried about the weak advertising environment, audience fragmentation, and radio’s place in the dash.

    Hebert predicted that radio will see revenue decline 2% in 2017 and be either flat or up 1% in 2018. He said radio’s ability to expand its audience could be the catalyst for radio over the long run and gave the example of smart speakers as one of the area’s radio should be leaning.