Inside Radio Weekly July 16-20, 2018 Radio Ready To Wager On Legalized Sports Betting. The odds appear to be in radio’s favor Mississippi expected to soon follow. No ‘A Revenue Trifecta’ for capturing a generous piece of the fewer than 13 states have bills pending Veteran radio executive David Pearlman advertising pie for the nascent sports that would permit sports betting. But it who, as president of Pearlman Advisors, betting industry. But unlike fantasy has taken decades for states to legalize consults radio broadcasters and pro football, where DraftKings and FanDuel lotteries – 44 states now have some form teams on sports rights deals, agrees the spent millions of dollars on radio of lottery. In a similar fashion, legal sports radio prognosis is good. “If I were a betting nationally, sports betting will be a local betting is expected to gain traction slowly. man, I would wager that radio could hit a play, confined to the small number of “It’s going to be left up to the states and revenue trifecta with bigger bucks, larger states that legalize it. it’s going to be spotty,” Borrell says. pools of listeners and expanded bottom lines from the benefit of legalized betting,” How big a pie is up for grabs? Using While a handful of states are ready to roll, he says. gambling and casino advertising as a experts predict sharp resistance in other forerunner of what’s to come, Borrell states. Three major forces are at play. But broadcasters should proceed with Associates CEO Gordon Borrell First, many states want to protect the caution, according to attorney David forecasts about $300 million in new billions of dollars in revenue they already Oxenford. “While in the long run there ad revenue for radio, following the collect from state lotteries. Last year may be immediate benefits to stations Supreme Court’s landmark May 14 Americans plunked down $73.5 billion on in certain states, there are numerous decision to strike down the Professional traditional lottery tickets, according to the caveats for broadcasters to consider and Amateur Sports Protection Act North American Association of State and before they recognize an advertising (PASPA). “If you look at gambling and Provincial Lotteries. The second point of boom from sports betting companies,” he casinos overall, which spent $4 billion resistance comes from the major sports wrote in a May blog post. For example, on advertising last year, how that’s split leagues, which see legalized betting as there will be questions of whether radio is a harbinger for what would happen an affront to their integrity and influence. and TV stations, located in states where with sports betting,” Borrell says. Of that The NHL, NFL, NBA and MLB have fought betting is banned, can take ads for amount, $292.6 million went to radio, or legislation to legalize sports gambling. legalized gambling in adjacent states 7.3%. But a more telling number is the The MLB is taking an especially tough where they have significant audiences. $2 billion spent locally on gambling and stance, saying its rights holders who casinos. Radio captured nearly twice as accept advertising from sports betting Another wildcard is the sports leagues, much of that kitty, a 14% share or $286 companies would violate MLB policy. who can wield significant power over million. Finally, moralists in conservative states their media rights holders. But while the are likely to vote against legalized betting. major leagues have historically shunned any connection to the betting world, their In states that take the plunge, the attitudes may be evolving. “The attitude gambling ad category is custom-made about proximity to betting is evolving and not just for sports radio, but any station will move to another level with all these with a strong male 25-54 audience cohort. states getting into the betting game.” “In addition to sports radio it’s a natural for rock radio, classic rock or any male genre,” Mason says. And radio is better “This not a national play yet; it’s more suited than TV to capitalize on of a local and state play,” says former this new ad category, thanks CBS Radio CEO Dan Mason, who to its promotional power and has doubled down on sports betting as the ability of local personalities an investor and advisor to Las Vegas to host live remotes from startup VSiN (Vegas Stats & Information local gambling parlors. “The Network). Supreme Court decision has unleashed a freight train, a Along with Nevada—where wagering great opportunity for radio to on sports has been legal for years— grow another ad category that New Jersey and Delaware moved is unprecedented, that we quickly after the Supreme Court haven’t seen in a long time,” decision to sanction sports gambling, Mason says. with Pennsylvania, West Virginia and Page 1 Inside Radio Weekly July 16-20, 2018

PE Firm Makes $500M Investment Offer In iHeart. Private equity firm Silver Lake has contacted iHeartMedia and its largest creditor group with a $500 million offer to in- vest in the radio group, according to a story in the Wall Street Journal. However the creditor group, led by Franklin Mutual Advisers and Pacific Investment Management, reportedly hasn’t accepted the offer. Silver Lake’s interest in iHeart was first reported two weeks ago by the New York Post but the PE firm had yet to make an offer. The Post speculated that the firm may want to form a partnership between the radio and streaming giant and arena venue manager Oak View Group, which Silver Lake bought a $100 million stake in earlier this year. Silver Lake views iHeart as “as an attractive growth investment opportunity,” the Journal reported Wednesday, citing two people familiar Entercom, Beasley Beef Up Philly Clusters. with the offer. Its proposed investment would be made in the Philadelphia country bastion WXTU is coming home to Beasley. form of convertible preferred shares, a hybrid debt and equity And Entercom has just bagged the market’s top billing radio instrument that typically pays interest and gets paid before station, one that many others before it tried to reel in. With two common equity. Convertible preferred shares also come with deals involving three companies, the Philly radio landscape is an option to convert to common equity at a specified share being reshaped in a way that will strengthen two of its biggest price. Silver Lake’s interest comes after iHeart’s creditors on players. The return of WXTU not only gives Besaley a fifth FM June 15 rejected a $1.16 billion offer from John Malone’s Lib- in one of its biggest markets, it also helps demographically erty Media because the bid was too low. The Journal report balance the portfolio. With rock WMMR classic rock WMGK and suggests the goal for both bidders is to hammer out a deal sports “The Fanatic” WPEN, Beasley is male heavy. “It gives before iHeart emerges from voluntary chapter 11 bankruptcy us more diversification in the marketplace by allowing more protection, which would bring in more money to distribute to access to females so we’re not so creditors. An iHeart spokeswoman declined to comment. See male-focused within the cluster,” CEO more HERE Caroline Beasley told Inside Radio. WXTU was one of the first major market FMs acquired by Beasley Ratings For Classic Hits And Classic Rock Are Heating Up. True to form, ratings for classic hits and classic rock are heating founder George Beasley in 1983. The up with the summer weather. But as the two genres duke it out station, has long held a special place in for the coveted “Format of the Summer” distinction this year, the family’s heart and was bittersweet classic hits has notched its highest 6+ audience share in PPM to part with in 2014 as part of a multi- markets since Nielsen began tracking national format ratings. market swap with CBS Radio. For Entercom, the purchase of Classic hits’ share of audience among persons 6+ was 5.9% the city’s top-rated and highest billing station strengthens an in June, the highest mark for classic already formidable cluster. After it deals WXTU to Beasley, hits Nielsen has ever recorded. And Entercom will still have four of the market’s top 10 stations in listenership for both it and classic the June survey. And that may be the reason why David Field rock is pacing ahead of the average rang up Caroline Beasley a while back. Entercom could have of the first five months of this year. hung onto WXTU and still remained within the FCC’s current The ratings ascent of both formats local ownership caps. But with revenue giants like sports WIP- has historical precedent. The two FM, news KYW and WOGL in its hometown cluster, keeping radio staples have each won Format all five FMs could have put it over the Department Of Justice’s of the Summer honors twice in the past four years. Nielsen 40% revenue threshold. See more HERE awards the honor to the format that exhibits the most uplift in audience share during June, July and August compared with O’Rielly Tells Pirates: ‘We’re Coming For You.’ the first five months of the year. See moreHERE Summertime in notoriously active for pirate radio, but the FCC is also planning to turn up the heat itself. “I see great Brent Musburger To Take Over Raiders Play-By-Play. enforcement action coming. If there are pirates out there— Iconic sportscaster Brent Musburger will begin calling radio we’re coming for you,” commissioner Michael O’Rielly told play-by-play for the NFL Raiders starting this season, accord- an MMTC conference in Washington on Thursday. O’Rielly ing to the Las Vegas Review-Journal. The former anchor of suggested “additional activity” around fighting unlicensed “NFL Today” on CBS and ex-halftime host of “Monday Night operations is in the works. Even with the FCC’s stepped up Football” has reportedly agreed to a three-year deal for the enforcement during the past year and a half, the number of Raiders, who will relocate from Oakland to Las Vegas in 2020, places where a pirate can be found continues to grow. “It’s no the final year of Musburger’s deal. Greg Papa has called longer just the original three or four markets that people think Raiders games on the radio since 1993. Musburger, 79, has about in pirate radio, it’s expanding to other places that we hardly rested on his laurels since retiring from a 27-year career never thought about,” O’Rielly said. O’Rielly told the MMTC’s with ABC Sports and ESPN in January 2017. Along with his “Disruption & Opportunity” conference in Washington that brother Todd Musburger and nephew Brian Musburger, he minority broadcasters have made a compelling case to him helped launch VSiN (Vegas Stats and Information Network). about how pirate radio disproportionately impacts them, since Musburger also writes a weekly sports betting column for the unlicensed stations frequently air urban and Spanish-language Review-Journal. See more HERE formats. See more HERE

Page 2 Want a more engaged audience?

Here are the facts: Our audience listens longer. They spend 59 minutes per day with us compared to the industry standard of 37 minutes.*

To pick up the show, call Hank at 615.260.4624 or visit RamseyMedia.com.

*Sources: 2016 Dave Ramsey Show Listener Survey, 2017 Nielsen.

Page 3 Below-Market Prices For Sinclair Spin-Offs Raise Flags. Inside Radio Weekly In a unanimous decision the FCC has voted to send Sinclair July 16-20, 2018 Broadcast Group’s proposed $3.9 billion buyout of Tribune Media to the review of an administrative law judge. The The Mainstreaming Of Smart Speakers. 17-page order says the proposed deal raised “significant Smart speakers are reaching a demographically wider audience questions” about whether the proposed spin-offs of stations as usage shifts from early adopters to those that purchased in Chicago, Dallas and Houston were one of the devices more recently. So says The Smart Audio “sham” transactions that included Report from NPR and Edison Research, based on an online sweetheart prices and strong ties to survey of 909 adults 18+ who report owning a smart speaker. Sinclair. In addition, the FCC says The study honed in on the different behaviors and demograph- “substantial and material questions of ics of Americans who have owned a smart speaker for a year fact” have been raised about whether or more (early adopters) and those that have had one for less Sinclair was the real buyer of the three than a year. These so-called early mainstream smart speaker stations. There are also questions owners comprise a much larger group, accounting for 74% of about whether the company “engaged in misrepresentation the smart speaker audience. As they find their way into more and/or lack of candor” in its applications with the Commission. But Sinclair has insisted that it has been “transparent” with homes, smart speakers are starting to become the primary way the agency in the months since the deal was announced in that some people listen to audio. Among early adopters, one May 2017. But in order to get the deal approved, Sinclair and in four (25%) say it’s their No. 1 source for listening to audio. Tribune have amended their proposed deal. Sinclair said it And for early mainstreamers it’s a close second (22%), trailing now plans to keep WGN-TV Chicago and put KDAF-TV Dallas only their smartphone or tablet (26%). In another major finding and KIAH-TV into a divestiture trust while it searches for new from the study, the ability to access news throughout the house buyers. See more HERE has emerged as a primary growth driver .Asked why they want to buy another smart speaker, six in ten (60%) said to listen to Radio Ads Sell The Goods During Amazon Prime Day. news in more rooms in their house . In fact, news and current Amazon Prime Day was another example of the power and affairs is the No. 1 spoken word topic smart speaker owners reach of radio. Westwood One found that radio ads touting are interested in listening to on their device. Roughly seven in the sale reached across demos and matched the age groups ten smart speaker owners say they ever listen to news on their who made the most purchases during the 36-hour event. Meanwhile, TV ads skewed older and, while raising awareness, smart speaker and 37% listen to 2+ hours of news on their smart didn’t equal to purchases. Westwood One commissioned speaker each week. See more HERE IPSOS to examine purchasing during the fourth annual sales event that ran from July 16 at 3pm through July 17. Overall, Radio In The Mix For Nearly Half Of Local Advertisers. 18% of Americans reported making a purchase during the Nearly half of local advertisers (44%) say they are including promotion. IPSOS found that, compared to Americans 18+, radio in their marketing mix this year, according to a new awareness of Prime Day skewed older while purchases survey of more than 2,000 small and medium sized businesses leaned younger. 79% of Americans were aware of the event. conducted by Borrell Associates. Radio ranked sixth among More 55+ consumers (82%) were aware than 18-34s (74%). the 12 most popular ad channels, ahead of such shiny digital However, when it came to purchases, one out of four 18-34 objects as search engine marketing (40%) and banner ads Americans made a purchase versus only 10% of persons (37%). In fact, old forms of advertising 55+.These numbers match up with the audience reached via populate the list of what’s most TV ads vs. radio ads. The study found that the TV campaign popular with SMBs. Newspaper ads over-delivered older consumers who did not make a purchase. are more popular than any other form Almost half reached by the TV campaign were over the age of of digital marketing except for social 55. Those who recalled having seen online and heard radio media, which tops the list with 78% advertising for Amazon Prime Day were equally distributed of advertisers surveyed using the among 18-34 Millennials, 35-54 Gen X, and 55+ Boomers. ubiquitous ad channel. “It points to the 81% of consumers that made a purchase on Amazon Prime importance of having a good media mix in marketing,” Borrell Day fell within the 18-54 age range. “E-commerce marketers says in the latest installment of its Chart of the Week series. would be wise to use a greater allocation of AM/FM radio at “Traditional forms of marketing such as newspapers, direct the expense of television, which over-delivers older, non- mail, radio, local magazines, and yellow pages remain quite purchasers,” Westwood One/Cumulus chief insights officer popular among local advertisers.” See more HERE Pierre Bouvard wrote. See more HERE Baseball Is The Most Listened To Sport On Radio. Premiere Inks Clay Travis To New Multiyear Deal. While the lyrics to the song are “Take me out to the ballgame,” Clay Travis will remain in the starting lineup on Fox Sports listening to America’s Pastime, whether at home, work or in Radio under a new three-year deal between the host and the car, is nearly as popular as sitting in the stands. A new Premiere Networks. (FSR is a division of Premiere.) Under report from Nielsen shows that Major League Baseball is the the expanded deal, Travis will continue most listened to sport on radio. Nearly 12% of all adults have to anchor “Outkick The Coverage with listened to a game broadcast on radio Clay Travis” in morning drive. As part in the last year, according to Nielsen of the new deal, Travis gains an equity Scarborough. Radio trails in park stake in the program, the host said in a watching of baseball (13.9%) and blog post. The Nashville-based sports TV viewing (41.7%). Overall, 28.7% talker’s career has grown from local of U.S. adults say they are “very to regional to national in recent years, starting on Cumulus interested” or “somewhat interested” sports “104.5 The Zone” WGFX in Music City. Premiere signed in Major League Baseball, according Travis to FSR’s weekday lineup in September 2016. He came to Nielsen Scarborough USA+ 2017 Release 2 (June 2016 - from the on-demand side of the business with his successful November 2017). Furthermore, Nielsen reports the share for podcast of the same name, which has since been adjusted to sports radio peaks in the fall, coinciding with the World Series “Outkick The Show.” See more HERE and the beginning of the NFL season. See more HERE

Page 4 SALES – STATIONS

San Francisco – Salem Media Group files to spin-off talk “860 AM The Answer” KTRB to New Inspiration Broadcasting North Carolina – James and Maxzine Utley’s CLI Radio Company in a transfer valued at $5.125 million. New files a $127,500 deal to buy “Gospel Joy 1490 AM” WWIL, Inspiration Broadcasting Company is a related company Wilmington, NC from Carolina Christian Radio. The deal also controlled by Salem CEO Ed Atsinger and chairman Stuart includes the Wilmington, NC-licensed translator W285FQ at Epperson. No programming changes are planned for KTRB. 104.9 FM. CLI Radio already owns talk/R&B oldies WLTT Once the sale is finalized Salem will still own religious KFAX (1180) and the Wilmington-licensed translator W296DP at (1100) in the San Francisco market and business news 107.1 FM in the area. Once the deal closes Carolina Christian KDOW (1220) in the nearby San Jose market. Radio will still own four stations in the region.

Puerto Rico – Caguas Educational TV files a $1 million deal Little Rock – Jose Carlos Moron and Albino Gutierrez’s Radio to buy Spanish contemporary Christian “Sacra FM” affiliate La Patrona files a $100,000 deal to buy gospel KTML (760) WBYM, Bayamon, PR (1560) from Aurio Matos. Caguas from the estate of George Domerese. The deal includes the Educational TV already owns Spanish Christian “Pura Sherwood, AR-licensed translator K249FE at 97.7 FM which Palabra Radio” WQML, Ceiba, PR (101.5) and religious gives the 10,000-watt daytime-only AM. WUJA-TV, Caguas, PR (channel 48) on the eastern end of the island. A second deal between the two companies will Puerto Rico – Juan Hidalgo Cruz and Nelson Estevez’s give Caguas Educational TV its first station in the Ponce HMS Distributors files a deal valued at $34,876 to buy the region. It will pay $100,000 currently-silent WYQE, Naguabo, PR (92.9) from the Munoz to buy WMLG, Guayanilla, PR family’s Fajardo Broadcasting Company. The purchase (89.9) from Matos. The Class represents the debts Fajardo Broadcasting currently owes to A FM also airs its “Sacra FM” the FCC and its broadcast attorneys in Washington. Spanish Contemporary Christian format. Once both sales close Charleston, WV – St. Paul Radio Company files to donate Matos will still own four other the currently-silent WMUX (1110) to Baker Family Stations. Colastations Wars in Puerto Hit Full Rico Force including The deal includes the Charleston, WV-licensed translator W257EK at 99.3 FM. Positive Alternative Radio will operate With“Sacra Pepsi, FM” Coke affiliates Vying On WLUZ, WMUX as a noncommercial station. Once the donation Radio.Levittown (88.5) and WZCA, Quebradillas (91.7) as well as romantica “Cima 103” WCMA, Bayamon and the currently- closes, St. Paul Radio Co. will still own religious WLUX (1450) silent WDNO, Quebradillas (960). in the Charleston market.

Memphis – Tom and Allison Freeman’s North Mississippi SALES – TRANSLATORS Radio Group files a $900,000 deal to buy country “95.3 The Rebel” WEBL from Ron Unkefer’s Memphis First Ventures. Cedar Rapids, IA – Calvary Chapel Iowa files a $50,000 The deal includes a $600,000 promissory note. Tom deal to buy the Iowa City, IA-licensed translator K286BY at Freeman has been general manager of the station since 105.1 FM from Edgewater Broadcasting. Calvary Chapel 2009. He earlier was an ops manager for Cumulus Media in Iowa will use the signal to simulcast its Cedar Rapids market Topeka, KS and an ops manager for iHeartMedia in Tupelo, low-power religious station “Enduring World Radio” KEWR- MS. Memphis First Ventures currently has a pending deals to LP (97.5). sell its two other Memphis stations. Butron Media is paying $799,000 deal to buy classic hits “Guess FM” WGUE (1180) in York, PA – William Shipley and Eric Menzer’s High Five a deal that also includes the Memphis, TN-licensed translator Baseball adds an FM translator to its previously-filed deal W257CY at 99.3 FM and the Memphis-licensed K268DA at to take majority control of “Sports Radio 1350” WOYK in a 101.5 FM. And Global Ministries Foundation has a pending deal valued at $1,905,344. They file to add the York, PA- $703,823 deal to buy “Guess FM” outlet WUMY (830) and the licensed translator W255DJ at 98.9 FM to the acquisition. As Memphis-licensed translator W288BJ at 105.5 FM. previously filed, under the terms of the deal High Five will make a series of $97,209 payments over a 30-year period. Oklahoma – South Central Oklahoma Christian Broadcasting files a $250,000 deal to buy contemporary Christian KCBK, CLOSINGS: Frederick, OK (91.5) from First Dallas Media. South Central Oklahoma Christian Broadcasting currently owns four other Puerto Rico – Educational Media Foundation closes a stations but none are in the area. Once the sale closes, First $2.9 million deal to buy WCAD, San Juan (105.7) from Dallas Media will still own five Texas radio stations in the Broadcasting & Programming System of Puerto Rico. The Dallas and San Angelo markets. Broker: Bill Whitley, Media deal also includes FM boosters in Fajardo and Juana Diaz. Services Group EMF plans to convert WCAD to a noncommercial operation and carry its contemporary Christian “K-Love” format on the Lubbock, TX – Flores Communications files a $140,000 deal signal. The deal gives EMF its first station in Puerto Rico. to buy country “Red Dirt Rebel 105.3” KJDL-FM and contem- Broker: Beth Griffin porary Christian KJDL (1420) from Walker Broadcasting & Communications. The deal also includes the Lubbock-licensed North Carolina – Godwin Communications closes a $9,370 translator K254CI at 98.7 FM. The sale replaces a deal filed deal to buy gospel “Power 1220 AM” WENC, Whiteville, NC last year but never consummated that would have seen Vic- from Larry Ansell’s DHA Communications. Jesse and Ethel tor Flores pay $275,000 for just the AM and the FM translator. Godwin had been operating WENC under a time brokerage Flores doesn’t own any other stations. Once the sale closes agreement since Feb. 2016. Dave Walker will still own classic hits “105.7 King FM” KRBL in the mark. More closings HERE

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