Radio+Television Business Report

So much for that COVID-19 subscriber bump.

Full market estimates from Kagan, the S&P Global Market Intelligence media research group, are out. And … they’re not pretty.

Millions of subscriptions by multichannel video services were shed in 2020. As such, the cord-cutting story is real.

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WASHINGTON, D.C. — The U.S. Senate late Friday (3/5) approved a budget reconciliation bill that doesn’t raise the minimum wage to a statutory $15 per hour and will put an extra $1,400 in the hands of many Americans.

The legislation also will direct hundreds of millions of dollars in COVID-19 related emergency assistance to public radio and television stations.

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BMI (Broadcast Music, Inc.) has a new Vice President of Creative for its Latin arm.

Jesus Gonzalez will join the company as will oversee BMI’s Latin Creative team helping to sign and develop new talent, assist BMI’s family of songwriters and publishers and serve as a liaison between the Latin music community and the industry at large.

Based out of BMI’s Los Angeles office, Gonzalez reports to BMI SVP/Creative Alex Flores.

“Throughout his career, Jesus has forged strong relationships within the Latin music community as a songwriter and a music executive,”  Flores said. “His background gives him a deep understanding for both the artistic and business side of what we do, which is invaluable to our music creators, and his ability to forecast industry trends within the ever-growing Latin music space is second to none. I look forward to working with Jesus on developing new talent and supporting our incredible roster of Latin songwriters, producers, composers and music publishers.”

Prior to joining BMI, Gonzalez spent nearly seven years at Universal Music Group, where he was most recently SVP/Brands & Partnerships.

In that role, he spearheaded major collaborations between top Latin artists and global Fortune 500 companies, developed marketing plans around releases to amplify those partnerships and forecasted industry trends. During his tenure at Universal, he helped secure deals for internationally acclaimed performing songwriters, including J Balvin, Juanes and Luis Fonsi, with top brands such as Anheuser-Busch, Pepsi and Mastercard, to name a few.

Other roles include a stint as Vice President of Music Partnerships working with Rogers & Cowan, FRUKT and Octagon under the Interpublic umbrella, and he was the Principal partner at Maleco Music, a music and brand consulting agency.

As a songwriter, he is a voting member of the Recording Academy for the GRAMMY and Latin GRAMMY Awards, and was a mentor for the 2020 Adweek Executive Mentor Program. Gonzalez received a Bachelor of Arts in Political Science from the University of California, Riverside.

“Spurious Emissions.”

It’s something the FCC takes seriously, and will issue a Notice Of Violation for any offense. This week, two notices in one day were issued, and as Wilkinson Barker Knauer attorney David Oxenford notes, both involve low-power radio stations.

It shows that even micro FMs are subject to policing.

Specifically, Oxenford says an FCC Field Office cited Low Power FM operators for using transmission systems that, in addition to transmitting signals on their authorized channels, were also emitting signals on other channels that posed the potential for interference with other users on those other frequencies – sometimes not even broadcast frequencies.

In one case, the FCC noted that it was the FAA that reported the interference.

“All broadcast transmissions have the potential for these spurious emissions on channels other than the ones for which a station is authorized, especially if a station is near other stations as frequencies can interact to produce these unintended emissions,” Oxenford says. “When constructing and operating any broadcast station, care should be given to ensure that these off-channel emissions are not of a signal strength beyond that permitted by the FCC rules as interference can occur and the FCC can potentially impose fines.”

Neither of these NOVs proposes a fine.

Rather, each asks for a response from the operator of the LPFM station and reserves the right to impose a fine depending on the response and any corrective action that is taken, Oxenford says.

It should be noted that the Commission rarely publishes these “routine” NOVs in its Daily Digest. But, it did so with these two notices.

“This publication may be meant as a warning to all stations to ensure that their transmissions are within the permitted limits to avoid any enforcement action, so consider yourself warned!” Oxenford concludes.

A digital low-power TV station serving Florida’s state capital and a sibling LPTV facility located in Auburn, Ala., are being spun.

It’s a Game Day decision. Really. That’s the name of the seller in this transaction.

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RBR+TVBR OBSERVATION

You never know where one can find the freshest ideas that can truly spark a radio station, making it vitally important — and fun — for its listeners.

One successful FM serving Canada’s biggest market has one that every AC, Classic Hits or Rhythmic “Old School” station should consider. Now.

Why? It demands appointment listening, audience engagement and involves something simply gratifying. When’s the last time one of your stations did that?

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In July 2015, a collection of 9 AMs, an FM and an FM translator were sold by what was left of the former Davidson Media Group. The buyer? A licensee controlled by Mark Janbakhsh.

He’s now in divestment mode, and has signed off on the sale of one of those AMs acquired nearly six years ago.

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As RBR+TVBR first reported on February 18, Spanish Broadcasting System (SBS) not only completed its recapitalization effort and closed its previously announced offering of notes due 2026, but settled a court battle regarding its Series B Preferred Stock.

Further details regarding the company’s agreements with Series B shareholders are now known.

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The long-awaited spin of Nielsen Holdings plc‘s sale of what was recently rebranded as NielsenIQ is complete.

The multinational company that is the dominant ratings data and consumer research provider to U.S. TV and radio broadcasting and cable companies has completed its sale of Nielsen IQ — formerly branded as Nielsen’s Global Connect business — to affiliates of Advent International, in partnership with James “Jim” Peck.

In making the announcement, Nielsen CEO David Kenny thanked the NielsenIQ team “for their invaluable commitment and contributions over the years,” while acknowledging that, even after the spin-off, a “strong working relationship” is anticipated.

Speaking of the post-spin Nielsen, Kenny continued, “This is a transformative time for Nielsen. We have redesigned our products, our business platform, and our operating model, positioning Nielsen to better deliver the solutions our clients need in the rapidly changing global media ecosystem. We are now fully aligned around three essential solutions —Audience Measurement, Audience Outcomes and Gracenote Content Services — that are designed to drive growth by leveraging a single media platform across a global digital-first footprint.”

Nielsen Holdings on November 1 announced that it had signed a definitive agreement under which affiliates of Advent International, one of the largest global private equity investors, in partnership with former TransUnion CEO Peck, will acquire the Nielsen Global Connect business for $2.7 billion.

The agreed-to price is subject to working capital, cash, debt-like items and other customary adjustments.

Nielsen also received warrants in the new company exercisable in certain circumstances.

David Rawlinson will remain CEO of NielsenIQ.

The deal’s closing comes just days after Nielsen and Roku announced a new strategic alliance that the companies believe will help shape the future of media and TV measurement.

Advisors
J.P. Morgan Securities LLC and Guggenheim Securities, LLC are acting as financial advisors to Nielsen, and Wachtell, Lipton, Rosen & Katz, Clifford Chance LLP, DLA Piper, and Baker McKenzie are serving as legal advisors to Nielsen. Ropes & Gray LLP and Weil, Gotshal & Manges LLP are serving as legal counsel to Advent and BofA Securities is serving as lead financial advisor, with Deutsche Bank Securities Inc., RBC Capital Markets and UBS Investment Bank also advising. Financing for the transaction is being arranged and provided by Bank of America, UBS Investment Bank, Barclays, Deutsche Bank AG New York, HSBC, RBC Capital Markets, MUFG and Wells Fargo.

Tech stocks paced a wave of declines on Wall Street Wednesday, as the Chair of the Federal Reserve declined to say whether or not the Central Bank will work to put a kibosh on inflationary pressure.

Media stocks were caught up in the dips.

Among the bigger decliners is Salem Media Group, down 34 cents to $2.47 after the company posted lower Q4 2020 adjusted EBITDA.

Also off sharply: Beasley Broadcast Group and iHeartMedia.

Cavell, Mertz & Associates President Garrison Cavell and Garvey Schubert Barer attorney Erwin Krasnow have made suggestions on assessing station potential from the technical side and deciphering station coverage maps, and have then explored treasures that might be found in cyberspace and by poking through the stacks of station paperwork in various Media Information Bureau columns appearing at RBR+TVBR. Today, they take a look at tire kicking.Please Login to view this premium content. (Not a member? Join Today!)

WASHINGTON, D.C. — The FCC’s Media Bureau is reminding all low power television and TV translator stations that the digital transition date — when stations must terminate all analog television operations — is fast approaching.

BE SURE TO FOLLOW RBR+TVBR ON TWITTER!

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Updated at 3:10pm Eastern

For 15 years, she was the go-to person for all of the corporate-level communication from Univision Communications, the multimedia giant focused on Spanish-speaking U.S. Hispanics that is now under majority ownership of ForgeLight LLC and Searchlight Capital Partners.

With that shift in control, several changes transpired. Wade Davis replaced Vince Sadusky as CEO. Steve Mandala was fired, with Donna Speciale brought in to the C-Suite.

Now, big changes have come to the corporate communications team.

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The E.W. Scripps Company has agreed to broadcast a commercial-free special across its local stations next week in a move it hopes will “spark a national dialogue around implicit bias while advancing conversations at the local level in the 41 markets where it operates.”

“Each of us have experiences and backgrounds that shape how we think and how we interact with the world around us,” explains Scripps Local Media President Brian Lawlor. “As a steward of the public airwaves with a station footprint that reaches into nearly a quarter of U.S. TV households, Scripps has a powerful platform from which we can help facilitate critical conversations about the implicit biases we all carry and what they mean for how we connect with one another.

With that, every market where Scripps has a station will air the 60-minute special, “Hidden Bias of Good People,” hosted by Dr. Bryant T. Marks, Ph.D.

“We’re proud to bring this special with Dr. Marks to our viewers in every market in order to provide a safe space for these discussions – neighbor to neighbor – about identity and bias,” Lawlor said.

Dr. Marks is the founder and chief equity officer of the National Training Institute on Race and Equity.

Scripps notes that the TV special is “interactive and conversational, with a goal of helping viewers understand the unconscious biases we all carry based on our upbringings and environments. Implicit, or unconscious, bias refers to attitudes and beliefs that occur outside of our conscious awareness and control.”

Marks has provided training to police departments and to executives and professionals in educational institutions, nonprofit organizations and local and federal government agencies, among others.

In addition to airing the special, Scripps’ local TV stations are producing multiplatform content to aid viewers in engaging with the topic of implicit bias. Planned content includes an in-depth series on race relations and stories examining the importance of equity, diversity and inclusion to employers and job seekers.

Scripps TV stations also will host Facebook Live discussions and Zoom Q&As with local experts.

The RBR+TVBR InFOCUS Podcast on Tuesday celebrated its 100th episode, as Editor-in-Chief Adam R Jacobson conducted an exclusive interview with Colorado Broadcasters Association President/CEO Justin Sasso to learn more about the key topics the CBA is addressing in Washington, D.C. for radio and TV station owners in the Mile High State.

Among them: ATSC 3.0 transition in a state with weather and terrain challenges, and the ongoing fight for radio with respect to royalty fees. The discussion came just 24 hours after GMR sent a take it-or-leave it letter to radio stations regarding a new nine-month interim license, effective April 1, that includes a 20% rate hike.

Didn’t hear the podcast? Easily do so from our new embedded player at RBR.com!

Coming March 9: Jay Prasad, Chief Strategy Officer at LiveRamp TV, discusses his expectations for TV advertising ahead of the 2021-2022 Upfronts.

And, to access the other 99 episodes of the InFOCUS Podcast, presented by DOT.FM, just click here!

LOS ANGELES — Salem Media Group, the Camarillo, Calif.-based company known for conservative Talk radio stations branded as “The Answer” and a host of sibling radio properties devoted to Christian music and teaching, has successfully turned its financial fortunes from severely shaking to solid and growth-filled.

How did Salem accomplish this in the fourth quarter? Its just-released earnings report shows it comes down to two non-broadcast segments.

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LOS ANGELES — It is owned in part by NBCUniversal, Charter Communications and ViacomCBS and is known for its privacy-focused audience connectivity, collaboration, and authentication platform.

Now, it is leveraging TransUnion’s portfolio of identity and data-driven audience products, focused on privacy-focused identity, data modeling, audience creation and activation.

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As of 11:37am Eastern, Sinclair Broadcast Group shares were trading at $35.98, up 23 cents from Wednesday. Consider it icing on the cake for a company that has seen significant share growth since late October.

Still, Sinclair’s fiscal health is far from perfect. That could explain why the Baltimore-based company is engaging in a reduction in force impacting 5% of its employee roster — including those at its headquarters.

According to the Baltimore Sun, nearly 600 jobs will be culled across the U.S. by Sinclair; the company has not issued any formal statement on the reduction in force effort.

Why? “The impact of the COVID-19 pandemic continues to be felt across all sectors of the economy, something that can have a profound impact on a company as diversified as ours,” the company said in a statement to the daily newspaper.

While its unusual for a media company squarely focused on visual media and not audio media, which has seen big staff furloughs and layoffs due to the novel coronavirus, to blame COVID-19 for layoffs, Sinclair is unique among its peers: it invested heavily in the ex-FOX regional sports networks. With no live sports across much of 2020, viewership — and advertising support — plummeted.

That, it appears, has contributed to the fiscal challenges fueling the layoffs about to transpire.

“In response to this, we are currently undergoing enterprise-wide reductions across our workforce, including corporate headquarters, to ensure we are well-positioned for future success,” the statement to the Sun said.

Sinclair’s full-time roster of employees numbers 9,211. Additionally, the company has 2,219 part-timers who are on contract and not considered employees.

Sinclair’s Q4 2020 performance was good: Earnings per share exceeded Wall Street analyst estimates, while revenue came in line with forecasts. However, the RSN arm of Sinclair, battered by COVID-19, is its most underperforming segment. Distribution revenue for Local Sports dipped to $513 million from $724 million, as advertising slid to $14 million from $60 million.

Knowledge of trade secrets, and their possible use for technology at another company, is a serious matter. It extends across multiple industries, including Radio.

Just ask Cumulus Media‘s national radio arm Westwood One. On Tuesday, it filed a lawsuit against an operation that provides 24/7 music radio programming with national talent and custom content.

Patent infringement is the crux of the matter.

As first shared by RBR+TVBR via Twitter late Wednesday, Westwood One filed a complaint for patent infringement against Local Radio Networks (LRN).

The filing was made March 2 in the U.S. District Court for the Northern District of Indiana. Specifically, Westwood One claims LRN infringed on patent numbers 7,860,448 (Methods and Computer Programs for Localizing Broadcast Content) and 7,412,203 (Systems, Methods and Apparatus for Operating a Broadcast Network).

In the complaint, WWO accuses LRN of infringing on the “Methods and Computer Programs” patent “by making, using, selling, offering for sale, and/or importing its Radio Velocity Control computer hardware and software technology.”

Westwood One explains that the LRN Program “is a system that comprises several components: a Voice Tracker tool, an LRN Portal, a server, and a cloud storage site, each with its own code.”

Thus, in the view of the Cumulus-owned WWO, Radio Velocity Control is comprised of much of what Westwood One holds a patent for.

How could LRN gain explicit knowledge of the elements of the “Methods and Computer Programs for Localizing Broadcast Content” patent?

Former Westwood One employees went to work for LRN and shared the information with their new employer, it seems.

The complaint fingers LRN VP/Programming Operations Chris Reeves, who was VP/Operations at Westwood One from July 2009 until joining LRN in July 2017; Jonathon Steele, Director of Programming Operations at LRN from July 2017 who was previously a Westwood One Operations Manager; LRN Director of Creative Services/Voice Talent Chris Hatton; LRN VP of Regional Affiliate Sales Matt Caldaronello, who joined in January 2019 after serving for nearly 13 years as WWO’s VP of Affiliate Management; and EVP/Operations Patrick Crocker, who came on board at LRN in June 2019 after 23 years and 4 months at WWO, exiting as SVP/Affiliate Management.

In a statement released March 3 to the media, LRN said the claims “are legally and factually baseless” and that it “intends to vigorously defend against those claims.”

LRN was launched by Steve Swick in 2015 and, it claims, developed and uses its own technology.

“Six years after LRN’s successful launch in 2015, Westwood One is apparently giving up on trying to fairly compete and instead is trying to now use the courts to do what its programmers, engineers and affiliate sales people could not do,” the LRN statement reads, concluding that LRN “will not be bullied by a corporate radio Wall Street giant.”

In the complaint, Westwood asserts LRN knew about the alleged infringement since May  2020, when LRN was sent a cease and desist letter from WWO.

Similar claims are being made by WWO regarding the “Systems, Methods and Apparatus for Operating a Broadcast Network” patent. That’s because LRN has a software program that informs customers it delivers maximum custom localization and station owner control — an alleged infringement of WWO’s proprietary technology.

Skyview Networks, which distributes LRN’s music formats, is not involved in the lawsuit.

— Additional reporting by Ed Ryan and Rob Dumke

When it comes to its tactics for bringing those responsible for some of the music heard across the radio dial, there’s perhaps no rights organization more brash than the Irving Azoff-founded Global Music Rights (GMR).

GMR has been a thorn in the side of the Radio industry for years, with ongoing litigation with the Radio Music Licensing Committee (RMLC) a top story in 2019 and 2020.

Now, the powerful artists and publishers’ rights organization that’s tangled with the RMLC for five years is taking a page straight out of the Mafia film Goodfellas by handing Radio a “pay up, or else” approach to its new licensing agreements set to commence April 1.

As first reported by Streamline Publishing’s Radio Ink, GMR — which represents a wide swath of writers and publishers ranging from Billy Joel and Bob Seger to current pop stars Ava Max and Drake — has issued communication to radio stations that air music in its library that their current licensing agreements expire on March 31.

The new deal is straight out of Mission: Impossible, if not reminiscent of the Goodfellas character Henry Hill’s description of how his mafiosos go about collecting payments from those who owe money. On April 1, a nine-month interim licensing agreement would start. But, a 20% royalty increase comes with the signing of a new deal.

The timing couldn’t be worse for the Radio industry, which has seen sequential improvements in its quarterly earnings since the depths of the COVID-19 pandemic some 11 months ago. Still, most publicly traded radio broadcasting companies have carefully balanced cash on hand and their debt leverage by moving forward with a reduction in force. At iHeartMedia, the industry’s largest audio media company, job losses came after an infamous January 2021 employee reduction effort — one that was never reported by iHeartMedia-owned trade publication Inside Radio.

The hardball tactics GMR is taking came without any input or negotiation from the RMLC, Radio Ink reports.

And, GMR’s unilateral royalty rise comes as its court battle with RMLC has been delayed due to the pandemic, creating a legal back log. The discovery process in the groups’ case is not set to conclude until the end of 2021.

A PRE-COVID GUNSLINGER

On February 17, 2020, one month before the novel coronavirus sent most of the U.S. into a pandemic-fueled lockdown, GMR and RMLC engaged in a war of words over who was in the wrong with respect to the litigation and where the court was heading.

In GMR’s view, Judge Terry Hatter Jr. of the Central District of California “dealt a significant defeat” to the alliance of radio broadcasting companies known as the RMLC, “denying its attempts” to dismiss the lawsuit.

However, what GMR’s public relations veteran Larry Solters didn’t mention is that, should RMLC be able to prove the facts it is alleging, then GMR is the entity that is “an illegal cartel,” RMLC said at the time.

Meanwhile, the fight between GMR and the RMLC won the support of the Trump-era Justice Department. In late December 2019, DOJ urged a federal court to reject attempts by the Nashville-based RMLC “to misconstrue the laws that prohibit its illegal, price-fixing, cartel behavior.”

That statement came after GMR in October 2019 sued Entravision Communications for non-payment of royalties for music played — according to GMR — on English-language Rocker KFRQ-FM in Harlingen, Tex.; Classic Rocker KOFX-FM in El Paso; Hot AC KVLY-FM “107.9 MIX FM” in McAllen-Brownsville; and Los Angeles stations KDLD-FM “Súper Estrella Clásica” and simulcast KLYY-FM/KSSE-FM “José” from January 2017.

The GMR letter to Radio became known on the same day SoundCloud introduced what it is calling “fan-powered royalties — a fairer and more transparent way for artists to earn money on SoundCloud.”

It is designed to assist independent artists whose livelihoods were greatly crippled by COVID-19, with a lack of live performances eating into earnings in a major way.

“With fan-powered royalties, money made from listeners goes directly to the artists they listen to,” SoundCloud explained. “This equitable payout model is what independent artists across the industry have been asking for, and as an artist-first platform, we’re excited to be the first music company to roll it out.”

The fan-powered royalties go into effect April 1 for “Pro Unlimited” subscribers in the Premier monetization program and Repost by SoundCloud artists, including those in Repost Select.

How does it work? “The more fans listen on SoundCloud, and listen to your music, the more you get paid,” it explains.

Under the old model, money from dedicated fans went into a giant pool paid out to artists based on their share of total streams — a model, SoundCloud says, “mostly benefits mega stars.”