Posted by The Ghost of RYO on July 23, 2020, 11:56 am
I was talking to someone at Entercom. They said more layoffs are coming. But the big ones are US99 will be flipping. B96 will not be changing but they will skew the format to limit competition. They will sell off WBBM AM780 to raise cash for debt and the new owner will have to sign a non compete for the news format.
I'm skeptical of this statement. If this is true (which I don't think it is), out of the cluster, why would you sell your cash cow first? Does Entercom not see the economy rebounding for a long long time?
Entercom is in SERIOUS debt. Bad. They have some notes coming up and they can't make payment. As Sal indicated in another thread, US99 has been w/o a PD and morning show for how long now? No action to replace them either. Just sit still and die in ratings and revenue mentality.
It actually makes a lot of sense. The AM is an afterthought now. 105.9FM is the cash cow, not the AM.
If you assume the above is credible, moving The Score to 104.3 and selling off 670 AM would make sense too, rid themselves of the bloat it takes to run an AM.
But I doubt they can get more than 7 million for 780 AM especially since it is now diplexed. 670 AM can probably get 8 or a bit more. AM signals are dogs these days. The daytimers are going dark and the 50KWs are not what they once were. WABC in NYC, the #1 market which bills much more than Market #3 sold for 12.5 Million. Before anyone says I am wrong and they can fetch more, no they can't. Because it would be assumed the format goes with the current owner and a non compete is signed as the OP listed!
If 670 and 780 are sold and go to FM permanently what format would even be put on these stations? Second/third tier conservative talk, second tier sports, brokered, older skewing music format? It would be a shame to see potentially 2 50kw AMs reduced to basically nothing.
You will see all the formats you mentioned minus music. You will see religious or possibly ethnic. Used to clear certain programming like Rush or the new African American news network.
The AM band will eventually fall wayside. As the older demos pass on, there will be less listener ship. Technology has changed listener consumption, offered on demand and high fidelity, which AM can't offer.
Sadly, the US govt pissed a lot of time away and helped kill the band. If they had adopted AM Stereo earlier and stuck to one type of encoding along with DAC used in Europe, it would be a different ballgame.
First off, I don't really believe any of the claims in the original post, especially about selling WBBM-AM.
Who's going to pay for an AM station now? And pay enough to make a substantial dent in Entercom's debt?
If anyone was in the market for a Chicago AM, you'd think they could have or would have already bought WLS-AM (Cumulus has been clear about wanting to exit the largest markets especially where it has a small station portfolio) or WGN-AM, which is Nextstar's one and only radio station and which they seem to be ambivalent about owning.
Cumulus is generally shedding stations, not buying. So that leaves iHeart, Hubbard, or smaller groups and the brokered / ethnic / religious operators. None of those seem plausible to me and I don't see a John Catsimatidis waiting in the wing to snap up 780 ala WABC, either. Besides the fact that neither Cumulus or Nextstar have managed to unload 720 or 890, just look back to Merlin's sale of WLUP and WKQX -- either of which are arguably more valuable signals now than an AM station, even a 50kw one. EMF bought one, and WKQX went to Cumulus by default. Sold for $21M and $17M. I think your guess of $7M for WBBM-AM is close if not high.
As for US99: why would Entercom flip it? US99 still leads Big country and there have been plenty of rumors of iHeart pulling the plug on Big, so Entercom can just wait out iHeart and possibly get format exclusivity back. Plus, as others have noted, it currently costs near nothing to run.
And what would Entercom flip 99.5 to? They already had classic hits on 104.3 and gave up. I don't see them trying alternative, which could hurt XRT. I'd think the same would apply to classic rock, but maybe the Drive's fat ratings look tempting. I guess I could see a simulcast of the Score on FM, but I'm still skeptical Entercom would give up on US99 for sports at a time when we don't know if there will be sports next week and the Score and ESPN1000's ratings are already dropping.
Lastly, sorry to be a contrarian, but I don't think the failure of AM stereo did that much to kill the AM band. Maybe that was one of the factors back in the 90s that helped push things on their way, but before the more recent decline, AM has had a pretty good second life as a home for primarily spoken word (news, talk, sports) programming.
The larger factors in the current decline of AM seem to me to include the rise of streaming, the constantly rising noise floor thanks to RF polluters like cheapo Chinese LED bulbs that can make listening to AM tedious, declining support for AM radio in receivers (AM band absent entirely or tuner is so poor it might as well be), and the consolidation and decline of the radio industry in general (less content / poorer content leads to less listeners which leads to less revenue which leads to less content / poorer content…).
There are also the just fundamental technical disadvantages that AM has vs FM and streaming in terms of signal bandwidth / fidelity / susceptibility to lightning interference, etc. AM stereo doesn't fix any of those (except maybe fidelity, but … the other issues overwhelm that one).
Yes, it's great that you can kinda hear 670/720/780 across the Midwest, and I say that as someone who loves to catch DX, but to me, AM radio is like not far from the telegraph and dial-up modems. It’s a product of another age that has almost outlived its usefulness.
First off, I don't really believe any of the claims in the original post, especially about selling WBBM-AM.
I do not hold much on message forum scoops either. But in their dire financial status and that they diplexed the signal, selling the old TX site, it is possible they would want to unload it. It is already on FM and the AM is redundant. And pay enough to make a substantial dent in Entercom's debt?
When you are starving, 1/4 loaf of stale bread will taste good. Substantial is not the keyword, minimum note payment is.
So that leaves iHeart, Hubbard, or smaller groups and the brokered / ethnic / religious operators.
iHeart would buy it in a snap to clear their syndicated programs which are aging out of the demo but still making money (ie: Rush). Also marginalized groups where their potential audience can't afford streaming fees.
None of those seem plausible to me and I don't see a John Catsimatidis waiting in the wing to snap up 780 ala WABC, either.
No one expected Catsimatidis to buy WABC but he did. He also has made it known he wants to network nationwide. He has Liberal and Conservative ties, being Conservative as of recent, that he would like to push.
I think your guess of $7M for WBBM-AM is close if not high.
I agree. Follow my link at the end of the post to see how these AM's are valued these days. *Assuming* 780 AM Chicago sold AND there was a contract in place for no compete on the News format, not sure if this formula fits. The last revenue was listed in 2016 @ $45 million. The market overall is depressed since then. If they are billing $30 million and their operating is 75% (not uncommon for a news/talk outlet) they had a "Broadcast Cash Flow" of $7.5 million. But, a majority of that is on the FM side, so it is possible that the AM only shares $ 1 million of that. That is where I came up with the figure. Again all speculation as we do not know their exact revenue numbers.
Speaking to someone in the industry, WMBI-AM is valued at 1 million and only way it can sell at that is if there is an FM translator for the new owners. After Covid, I believe it is worth < 250k being a daytimer only. And what would Entercom flip 99.5 to? They already had classic hits on 104.3 and gave up.
US99 and 104.3 are billing, not much, but billing! 104.3 is more at risk going WSCR. If the cost to run 670AM is less than giving up an FM to move an AM there and losing the AM, 670AM is going nowhere.
Lastly, sorry to be a contrarian, but I don't think the failure of AM stereo did that much to kill the AM band. Maybe that was one of the factors back in the 90s that helped push things on their way, but before the more recent decline, AM has had a pretty good second life as a home for primarily spoken word (news, talk, sports) programming.
The bad choices of AM Stereo and HD Radio in the US killed the AM band much quicker than it should have. Proof positive in Europe and Asia where it survived for more years stronger than the US in many areas airing content besides spoken word.
The larger factors in the current decline of AM seem to me to include the rise of streaming, the constantly rising noise floor thanks to RF polluters like cheapo Chinese LED bulbs that can make listening to AM tedious, declining support for AM radio in receivers (AM band absent entirely or tuner is so poor it might as well be), and the consolidation and decline of the radio industry in general (less content / poorer content leads to less listeners which leads to less revenue which leads to less content / poorer content…).
Totally agreed. The broadband, LEDs, MESH, Smart power meters and the like have decimated the band. Sounds like you might be a HAM or DX'er. Then you will understand when I say, have you heard the noise on 20m and 900Mhz? Even the noise floor on 2 meters is insane some days.
There are also the just fundamental technical disadvantages that AM has vs FM and streaming in terms of signal bandwidth / fidelity / susceptibility to lightning interference, etc. AM stereo doesn't fix any of those (except maybe fidelity, but … the other issues overwhelm that one).
Agreed, but you have to admit, AM Stereo sounds better even with the noise. Side note, India using the AM broadcast band and DRM are on fire. The receivers are cheap and it sounds great, even on the AM band eliminating fading and most noise. For those reading this, look it up. They use DRM in the present AM band, FM band and 174 - 260 Mhz.
Yes, it's great that you can kinda hear 670/720/780 across the Midwest, and I say that as someone who loves to catch DX, but to me, AM radio is like not far from the telegraph and dial-up modems. It’s a product of another age that has almost outlived its usefulness.
Again, I agree with you totally. The technology is 100 years old. The AM receivers produced today have more technology like PLL, bass/treble or equalizers etc... but the filters used for frequency response are terrible hence AM sounding "muddy". But, using DRM or other technology it can be revitalized. Like you, I love to DX, but the day will come when the US is attacked, or the IP/Wireless grid will be pulverized. Lack of AM might possibly mean we lose that battle on our ground. AM radio is the only long distance communication that can be guaranteed, unlike IP based technology.
US99 won’t flip. Lots of rumors as of yesterday. I’m told that they want an all female morning show at 99. The problems that USN has is they have been in a 4 year free fall, bad shows after bad show have killed them. They gave up all their heritage when they started to go young. Made them no different than Big. I highly doubt they will flip but....look for more changes. Sad cuz it was once a power house.
The day will come when they have to reckon, the past is the past and the brand has been crapped on beyond throwing it on a plate with garnish and prop it up.
If BIG leaves and they are the only outlet to remain they can run it lean and make money. As long as BIG is there, they will have to deal with reduced numbers and revenue which will lead to more cost cutting and mediocre content.
Same thing with B96. You can't have a heritage CHR running 2.0 6+ and in the shitter for their demos. Besides reduced advertising revenue it just looks bad. Especially in a period when Classic Rock and older demos are ruling the roost.
Mitch has wanted the score on a FM for years. The rumor always was 105.9, as far as Jamz who knows but...the guy running all these stations in the ground is Todd. He has over seen jamz, B and 99. His time is up. 99 wont flip, but they don’t have money to hire any talent and right now with Chicago burning down they need someone who can have a backbone and say what needs to be said. Playing music won’t cut it. Too many mistakes at USN has cost them. I think Z out it very well. It’s just a crap show and will continue. The only thing Big has over 99 is Lisa in middays.
