INSIDE STORY: BROADCASTERS SEEK THE POWER OF APP ENGAGEMENT.

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Monday, May 16, 2016

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Inside Story: Broadcasters Seek the Power of App Engagement.

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The quick way to a consumer’s heart, more and more these days, is through their smartphone. The best route to get there is, unquestionably, through apps: Consumers spend up to 80% of their mobile usage time in apps, according to eMarketer. That’s why radio stations need to give users/listeners compelling reasons to download and visit again and again.

The mobile app category is shifting and growing fast, with radio broadcasters working overtime to attract users and serve up enticing features, from original video to dynamic advertising options. Since the bulk of that 80% of time is spent in only a handful of apps, standing out becomes paramount.

“Mobile provides so many engagement opportunities, and as radio moves into podcasting, video and social media, a full-featured app can really pull that all together,” says consultant Paul Jacobs, VP/GM for Jacobs Media. Many radio station apps are bursting with features, including streaming audio, local news and information, contests, podcasts, music information and content from popular DJs, such as blogs and video clips. But that’s where the industry consensus on apps ends. Just how radio station apps are designed—and even how they are organized—varies by groups.

At the top of the ecosystem is iHeartRadio, iHeartMedia’s massive radio aggregator app featuring live streams of its stations and other broadcasters, as well as original content, videos, podcasts and custom channels.

On a smaller scale, some radio groups have created their own aggregator apps, seeking to maximize their audience, cross-promote brands and give users and clients access to multiple properties. Aggregator apps work best for large and medium-sized groups with enough stations to populate a portal and give advertisers scale, Jacobs says. Those group-wide apps, which include Beasley Broadcasting’s iRadioNow, Scripps’ Radio League, Townsquare Media’s Radio Pup and SBS’ La Musica, are a gateway to dozens of local stations and original mobile content. The architecture of these apps is as varied as their music formats. On Radio League, users see all the group’s individual stations and can tag favorites. On Townsquare’s Radio Pup, consumers find stations by searching by market or format, and users can personalize news and weather. SBS is targeting a very specific demographic group with its LaMusica app, which launched last December. Aimed at Millennial Latinos, LaMusica allows users to access 23 million songs, build custom stations with English and Spanish songs, watch music videos and also stream local stations. The apps figure big into each company’s strategy—which will undoubtedly shift as the times and listening preferences evolve.

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On Eve Of Trial, iHeart and Creditors Exchange Proposals.

Updated

As mediation continues between iHeartMedia and a group of its creditors and a trial gets underway to resolve their dispute, iHeart says that the two sides have exchanged proposals to amend the terms of the company’s credit agreement and, through a series of exchange offers, its priority guarantee notes.

In an 8-K filing with the Securities and Exchange Committee, iHeart says that, as part of the mediation talks, some of the debt holders submitted a proposal to the company on May 13. That was followed on May 15 by a counterproposal from the company.

While the mediation continues, a trial begins today in State District Court in Bexar County, Texas to determine the legality of a contested stock transfer iHeart made from one subsidiary to another last December. “The outcome of the litigation may have a substantial bearing on the outcome of these negotiations, which may be discontinued at any time by any party,” the company said in Monday’s 8-K filing. It notes that “there can be no assurance that any agreement will be reached” by iHeart and the creditors or any other of the company’s debt holders over “any or all of the issues” contained in the proposals. What’s more, the filing notes, the transactions outlined in the proposals would require an amendment to the company’s credit agreement and, through a series of exchange offers, the priority guarantee notes. The proposed transactions would also require the approval of additional debt holders who aren’t part of the negotiations, the company said.

In a statement released Monday morning, iHeart reiterated its position that the contested stock transfer “complied with our financing agreements” and that it looks forward “to the expedited trial on the merits of our case” and a ruling “that affirms our position.” The company said that the proposals from both sides “address a broader solution than what is at issue in the trial and that it has had “productive conversations over time with many of our lenders as we continue to focus on executing on our strategic plan and realize the financial benefit for all our stakeholders.”

Meanwhile, according to Reuters, iHeart has brought in Millstein & Co as an additional restructuring advisory firm, to help it evaluate options for its debt, including buying some of it back.

Story

Man Dies at Sacramento Station Concert.

Updated

A man died Sunday night after he was allegedly assaulted at CBS Radio rhythmic CHR KSFM Sacramento’s sold out “102.5 Live” concert at the city’s Discovery Park. According to KXTV-TV, the deadly assault was separate from an earlier incident in which half a dozen people were injured following a deep fryer fire at one of the concert's food vendors.

The assault took place around 5:45 pm when two men got into an altercation in front of a food vendor, as thousands of people were leaving the event, Sacramento police said. The 31-year-old victim was taken to UC Davis Medical Center, where he died from his injuries, according to KXTV. Police are still looking for the person responsible for the attack.

The deep fryer fire occurred around 2:30, igniting some propane tanks and causing what the Sacramento Fire Department called a relatively small fire. A crowd of people scattered when the fire broke out, causing trample injuries, according to the fire department.

The concert featured E-40, Fat Joe + Remy Ma, Tyga, and Ty Dolla $ign, among others.

Story

How One App for a Station, Show or Format Can Reach Many.

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For hundreds of radio stations around the country, an individual app is the preferred mobile strategy. Branded with their logo and slogan, individual apps, says station consultant Paul Jacobs, VP/GM for Jacobs Media, can work well for stations with strong individual assets such as well-known hosts, local brand recognition and original content.

They’re also ideal for helping smaller broadcasters play in the same big pool. Cox Media Group, Cumulus Media, Hubbard Radio and Entercom are among major radio companies that have opted for individual apps that emphasize singular local outlets. “Listeners don’t know who Hubbard is. They don’t need to. They know the brands and that’s what’s important,” says Jeremy Sinon, Hubbard Radio’s director of Digital Strategy.

One challenge with aggregated apps from larger broadcasters is helping users find them. In many cases, a search for a station’s call letters in the App Store or Google Play store comes up blank. If stations promote their apps on-air, it helps users make that connection if it isn’t obvious. To assist its audience in finding aggregator app LaMusica, SBS heavily promotes the new app on-air, online and at its events. “This is going to be the biggest company priority, promoted in all events and platforms,” SBS digital media executive Jesus Lara said when the app launched. ”We can give this product sustained marketing support for a long period of time.”

In some cases, broadcasters are putting forward both an individual app and a group portal, as Scripps does with its powerhouse news station WTMJ Milwaukee (620). The most popular mobile solutions vendors, including Jacobs Media’s Jacapps division, Futuri Media and Clip Interactive, work with radio stations on both flavors of apps. Jacapps built Scripps’ Radio League app, while Clip Interactive architected Beasley’s latest version of iRadioNow, and will soon launch a new portal app for Entravision called Sonoditos, which will include the company’s 60 stations, popular personalities and affiliates, according to Clip Interactive executive VP/chief revenue officer, Bill Freund.

With mobile apps such an evolving space, broadcasters are experimenting with other models as well. Entravision is also creating apps for its most popular shows, including a recently launched app for the “El Show de Erazno y la Chokolata,” which garnered 100,000 downloads in its first two months. Mobile is one of Entravision’s top priorities, COO Jeff Liberman said recently, and, later this year, the company will launch mobile apps for “El Show de Piolín” and “El Show de Alex ‘El Genio’ Lucas.” “The Latino marketplace has skipped desktop in most cases, and they use tablets or mobile phones as a way of connecting,” Liberman said. “We have taken a mobile-first vision.”

In still another twist on apps, Emmis Communications created a lifestyle app, “Where Hip-Hop Lives,” featuring its talent, music and content from rhythmic CHR powerhouses “Hot 97” WQHT New York and “Power 106” KPWR Los Angeles. The app offers original video, blogs and a subscription tier with exclusive content and ad-free audio streams. The “Where Hip-Hop Lives” app could serve as a model for launching more apps, says Emmis’ national director of Digital Content, Jeffrey Thacker. “It is creating a good blueprint on how to do this with other genres as well,” Thacker said recently. “I don’t think this is unique by any capacity.”

Story

Advertisers Now Reach Deeper Through Radio Apps.

Updated

Move over banner ads. Next-generation radio station apps are offering advertisers more dynamic capabilities, such as ad targeting, data mining and even cobranded content. Broadcasters have invested heavily in their mobile apps, in response to user demand, and they’re now eager to monetize the endeavors. And the timing couldn’t possibly be better.

Mobile advertising is exploding, with mobile ad spending up 50% this year, according to Carat estimates. This year, eMarketer says mobile will account for nearly two-thirds of the of the $68.8 billion digital ad market. Until recently, mobile advertising on many radio station sites has simply been a small banner ad across the top or bottom of the screen, and spots in an audio stream simulcast. Now, industry execs are forecasting major changes on the horizon. One growing category is location-based advertising, where an app can deliver an ad based on a user’s geographic location or deliver ads to all users within an area. Entravision’s new apps for popular shows such as “El Show de Erazno y la Chokolata,” will have these features, as do Federated Media’s revamped apps. Advertising software provider Marketron provides location-based ads for station apps for groups including Cumulus Media, Delmarva Broadcasting, Radio One and Saga Communications.

Going forward, broadcasters will also be able to better monetize their audio streams with digital audio ratings from Nielsen’s SDK, which could answer a need for streaming metrics to sell to advertisers.

Advertisers are enticed by mobile apps’ ability to engage users and draw them in, hopefully deepening their response to messaging.

With an app’s ability to encourage the collection of data, stations and clients can better engage users, and target ads with greater accuracy. Most radio station apps allow users to enter anonymously, but in order to access more advanced features, they need to register.

As mobile apps continue to improve, radio broadcasters are offering more interactive ads and native advertising. Federated Media’s new apps feature subchannels for different music formats and those sections are ripe for branded content, the way a beach music section on country WBYT South Bend’s “My B100” app features Corona beer. The product placement is subtle, with small images of Corona beer bottles flanking the “Beach Music” tab, but to a user who recognizes the label, it is a radio ad win-win.

Clip Interactive, which creates apps for a dozen broadcasters, features a news feed, much like Facebook’s, in its apps that scrolls through station content and ads, mirroring the on-air broadcast. On the app, the ads are interactive and users can click through to get more information, share their details and redeem offers. That capability gives advertisers an extra level of engagement and data, says Clip Interactive CEO Bill Freund. “An advertiser can now get direct attribution from spots and get real leads,” he says.

The next frontier for mobile apps is likely video ads, particularly as marketers aggressively increase digital media budgets. “Video is the next big opportunity,” says consultant Paul Jacobs, VP/GM of Jacobs Media. “Mobile is a big white piece of paper. If an advertiser wants a section to feature video of products or pre-roll ads or geo-locate with beacons, radio can embrace it all.”

Story

ABC Looks To Radio For Strahan’s Replacement.

Updated

ABC’s search for a replacement for Michael Strahan as Kelly Ripa’s “Live” co-host has led to the door of a trio of well-known syndicated radio hosts. Both Ryan Seacrest and Mario Lopez have been mentioned as possible Strahan successors in the press. And last week Bobby Bones said on his radio show that he was considered for the job.

While all three have TV experience, co-hosting a daily talk show requires strong improvisational skills and the ability to think quick on your feet – proficiencies that are core to live radio and that many in TV lack.

Seacrest recently re-upped as host of ABC's “New Year's Rockin' Eve” for four more years and has more time on his schedule now that “American Idol” has concluded after 15 seasons. But a move to New York, where “Live” is based, would disrupt Seacrest's syndicated daily radio show which is fueled in large part by the access to stars Seacrest has from his Los Angeles base. And despite his many TV ventures, Seacrest has long kept radio a top priority.

According to a source, Bones spoke with ABC about the show a few weeks ago but the talks haven’t progressed beyond that. No stranger to TV, Bones was one of the radio personalities who guest-hosted with Ripa in January 2011 when then co-host Regis Philbin took a week off. Bones has said he’s working on a TV show. But like Seacrest, a move to New York wouldn’t mesh with his Nashville-based syndicated show.

Lopez, who launched his TV career in 1989 with the sitcom “Saved By The Bell,” did little to deflate the rumors when asked about it on the “Ellen DeGeneres Show,” saying that he finds talk of him potentially replacing Strahan "very flattering,” according to The Hollywood Reporter. "I love Kelly. I’ve guest-hosted with her a few times; she’s awesome," Lopez said. "I actually did a movie with her husband Mark, who’s a real good guy. I’m looking forward to going back and guest-hosting again."

All three are syndicated by Premiere Networks.

Others said to be in consideration are Andy Cohen and Anderson Cooper with the latter said to be Ripa’s No. 1 choice. ABC will be auditioning potential replacements in the next few weeks, according to the Reporter, with a rotating group of guest hosts joining Ripa until a permanent co-host is named.

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No Matter How You Slice It, Sports Radio Is Growing.

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Just as April showers bring May flowers, the return of Major League Baseball brings a seasonal spike to sports radio ratings. This year is no exception. Sports’ 6+ ratings across Nielsen’s 48 PPM markets grew from a 4.2 share in March to a 4.5 share in April, according to a new report from Nielsen. The gains spanned across demos – 18-34 climbed 3.1-3.2 while adults 25-54 moved up two-tenths to hit a 5.0 share in April.

Local market reports issued last week provide numerous examples of sports stations gaining market share. Tigers baseball on “97.1 the Ticket” WXYT-FM Detroit pushed the CBS Radio station from seventh place in March back to first place among listeners 6+ in April. Longtime Cardinals flagship “News Talk 1120” KMOX St. Louis climbed from fifth place in March to second in April. And the flagship for the Baltimore Orioles, CBS Radio’s “105.7 The Fan” WJZ-FM, advanced 3.9-5.3 for its highest market since last June.

Yet sports soared higher this year than in any previous April survey in the past three years, according to Nielsen. From 2013-2016, sports has trended 4.1-4.2.4.4-4.5 in April among listeners aged 6+ and 4.6-4.8-4.8.-5.0 among 25-54 year-olds. One reason for the year-over year growth is the number of sports stations has grown. According to Inside Radio/Precision Track data, the number of commercial sports stations in the U.S. increased from 730 in April 2013 to 778 in 2014 to 799 in 2015, before dropping back to 782 in April 2016.

Story

Ratings Scorecard: Regional Mexican Bounces Back.

Updated

April was definitely spring ahead time for radio’s most popular Spanish-language format. Regional Mexican radio bounced back in Nielsen’s PPM markets, after two years of across-the-board ratings declines. Among listeners aged 6+, the format rose from a 3.2 share in April 2015 to a 3.7 this April.

That puts it back on track with the 3.7 share it had in April 2014 but just shy of the 3.9 it notched in April 2013. Regional Mexican’s year-over-year gains were slightly larger in 18-34, where it rose 4.5-5.1 since April 2015 but fell short of its marks in April 2014 (5.2) and April 2013 (5.6). Likewise, 25-54 bounced back 4.0-4.6 from April 2015, putting regional Mexican ahead of April 2014 (4.5) but still short off the 4.7 it hit three years ago.

Meanwhile, Spanish contemporary set a new April ratings record in the 25-54 demo with a 2.9 share, up from a 2.7 share last April. That marks a second consecutive year of growth in the Money Demo. Among listeners aged 6+, Spanish Contemporary’s 2.6 share is just one-tenth of a point off its all-time high of a 2.7and up for a second year in a row. The format performs best among 18-34 year-olds, where it jumped 2.7-3.1 from April 2015 to tie the April number set in 2013.

Story

Radio In The Mix For New Allstate Campaign.

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A new multi-media campaign from Allstate aims to position the insurance company as a “modern, innovative brand for the future.” The "It's good to be IN good hands” campaign will run across a range of advertising and marketing mediums, including radio, television, digital and mobile, online video, social media and print.

"We're redefining what it really means to be in good hands,” Sanjay Gupta, Allstate executive VP of Marketing, Innovation and Corporate Relations said in a release. “We're taking all the best attributes of our iconic brand and completely modernizing it with a fresh and dramatic new look and feel, provocative and fun celebrity talent, and a clear and contemporary message."

The campaign was designed by Leo Burnett Chicago, the same agency that created Allstate’s award-winning “Mayhem’s All-Time Greatest Hits Countdown” radio campaign which took over all the advertising during rush hour on multiple stations in the same city in markets across the country. That campaign discarded traditional spot lengths in favor of a top 10 countdown of Mayhem’s top hits, complete with hokey jingles and jock set-ups, customized for each market.

Humor is also part of the recipe of the new ads, which star Adam DeVine, Tim Gunn and Leslie Jones in comical situations as metaphors to convey what it really means “to be in good hands.”

Allstate was among radio’s top 100 advertisers in 2015, airing 201,579 spots on stations tracked by Media Monitors. While the company has scaled back its commercials in 2015, running 24,209 radio spots from Jan. 1 – May 12, 2016, it has also favored a more non-traditional approach such as the “countdown” concept which isn’t tracked as traditional spots.

Story

SiriusXM Bids To Take SiriusXM Canada Private.

Updated

SiriusXM Canada is going private, via a deal with U.S.-based SiriusXM Holdings Inc.—its biggest shareholder—and two of its top Canadian shareholders. The deal values Sirius XM Canada at about $367 million, according to Reuters.

Sirius XM Canada's shareholders will receive C$4.50 per share in cash or SiriusXM Holdings stock for each share they own, representing a premium of 6.4% to the stock's closing price on Thursday.

SiriusXM Holdings said it expects to pay about $275 million for the transaction, which will increase its stake in Sirius XM Canada to 70% from 37%, and give it ownership of 30% of its voting shares. Sirius XM Canada said the rest of its equity and voting stakes will be held by Canadian radio broadcaster Slaight Communications Inc. and Toronto-based private equity firm Obelysk Media.

The Canadian Broadcasting Corp, the national public radio and television broadcaster, will no longer be a shareholder in Sirius XM Canada, said Jim Meyer, CEO of SiriusXM Holdings. The CBC was Sirius XM Canada's second-biggest shareholder with a 12.5% stake of as of Dec. 9, according to Thomson Reuters data. It will continue to support the company as a programming provider.

"This proposed transaction shows SiriusXM's and Sirius XM Canada's commitment to serving the Canadian market with our leading bundle of premium content, much of which will continue to be created in Canada,” said Meyer. “The existing Canada-led governance structure will be preserved while vastly improving cooperation between the two companies on next generation products and services that will ensure a healthy future for satellite radio in Canada.”

Story

SiriusXM Bids To Take SiriusXM Canada Private.

Updated

SiriusXM Canada is going private, via a deal with U.S.-based SiriusXM Holdings Inc.—its biggest shareholder—and two of its top Canadian shareholders. The deal values Sirius XM Canada at about $367 million, according to Reuters.

Sirius XM Canada's shareholders will receive C$4.50 per share in cash or SiriusXM Holdings stock for each share they own, representing a premium of 6.4% to the stock's closing price on Thursday.

SiriusXM Holdings said it expects to pay about $275 million for the transaction, which will increase its stake in Sirius XM Canada to 70% from 37%, and give it ownership of 30% of its voting shares. Sirius XM Canada said the rest of its equity and voting stakes will be held by Canadian radio broadcaster Slaight Communications Inc. and Toronto-based private equity firm Obelysk Media.

The Canadian Broadcasting Corp, the national public radio and television broadcaster, will no longer be a shareholder in Sirius XM Canada, said Jim Meyer, CEO of SiriusXM Holdings. The CBC was Sirius XM Canada's second-biggest shareholder with a 12.5% stake of as of Dec. 9, according to Thomson Reuters data. It will continue to support the company as a programming provider.

"This proposed transaction shows SiriusXM's and Sirius XM Canada's commitment to serving the Canadian market with our leading bundle of premium content, much of which will continue to be created in Canada,” said Meyer. “The existing Canada-led governance structure will be preserved while vastly improving cooperation between the two companies on next generation products and services that will ensure a healthy future for satellite radio in Canada.”

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Insider Interviews

Q&A: David Oxenford, Partner, Wilkinson Barker Knauer LLP

Updated

In addition to representing station groups, he has worked with broadcast associations, media brokers, program & service providers, banks, webcasters and other digital media companies. Oxenford regularly shares his smarts at conferences, and has served as an expert witness on broadcasting and music licensing issues.

As author of the Broadcast Law Blog, he regularly breaks down the complex regulatory labyrinth for broadcasters. In his May 9 post, Oxenford explored the timely topic of equal time for political candidates. Now, with Inside Radio, he digs in a little deeper on that top-of-mind issue for all broadcasters in this election year, among other issues related to campaigns, ads and radio. An edited transcript follows.

In layman’s terms, what is the essence of the “Equal Opportunity Rule”—or equal time—for political candidates on the air?

A station is required to provide a candidate equal opportunities to gain access to the airwaves, so if it sells advertising time to one candidate for office, it must offer equal time to an opposing candidate if they ask to buy time. And for free time outside of exempt programming—essentially news and news interview-type programs—they have to provide free time to opponents if they ask for it within seven days.

What does the FCC consider to be a news or news interview program?

The FCC has been very good about helping broadcasters understand these terms. Any program is exempt from the equal opportunity rule if it regularly covers issues-oriented topics and regularly has guests that discuss those topics. It must also be regularly scheduled and somewhat reliant on journalistic discretion—not a purely political program, with just Republicans, for instance.

This can be a morning show on a music station if, let’s say, you’re bringing in the police chief to talk about crime, or the school board head to talk about education. The FCC has gone so far as to declare Howard Stern an exempt program when he was on terrestrial radio, because he regularly had newsmakers and politicians on the air.

Donald Trump has proven the value of free media. With candidates in local elections attempting to emulate that approach—calling in to stations to discuss issues and promote themselves—what should broadcasters know?

If a station is letting any candidate call in within the context of a news or news issues program, there’s no problem, as long as you’re not providing a soapbox for just one candidate and refusing other points of view to be expressed on the air.

It’s like any news program; you don’t have to have exact equivalency in the amount of time you devote to all candidates in your coverage. Some are just more newsworthy or are doing more to seek the limelight. So as long as a station is making time available to other candidates, inviting them to participate…if they choose not to take advantage of that—like so many of the candidates in the race with Mr. Trump—the station can’t mandate it. It’s all about offering the opportunity.

And on the advertising front, what can stations do to avoid a position where they can’t meet last-minute obligations for political advertising because they accepted a full slate of advertising from an opponent?

If you booked a big, big schedule of time for one candidate right before the election, you’ve got to be careful; if the other candidate comes in, you’re going to have to give them an equal schedule, if they request [the buy]. So it’s best to only book a certain amount initially and tell the first candidate that they can approach the station again just before the schedule is set to run—and find out if there is availability for more time.

Is a station required to dedicate all inventory to political ads, if there are enough buyers?

You have no obligation to sell a candidate all the available advertising time they want, even federal candidates. If you sell them a couple spots per daypart per day, that’s probably ‘reasonable access.’ You don’t have to become a wall-to-wall political advertising radio station. The only candidates that you are required to give access to are federal candidates—and again, only reasonable access. That doesn’t mean selling them everything they want; it means access to all classes and dayparts on the station.

How can a station safely establish a political rate?

The government has mandated what the fair rate is 45 days before a primary or 60 days before a general election—the lowest rate you’ve charged any advertiser for the same class of time within that period. That said, you are not obligated to sell advertising to state and local candidates, although once you make the decision to sell to them, you must offer equal opportunities and lowest unit rates to all candidates. And this includes the benefit of all volume discounts without a candidate having to buy in volume—so the unit rate you sell to McDonald’s for a thousand spots is what a candidate pays to buy one spot.

If the advertising buy comes [before the 45/60 deadlines], you can charge the same rates as a commercial advertiser; you don’t have to give them the absolute lowest rate.

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