Interpreting the Signals
The last major shakeup in Denver's commercial radio market took place in the wake of the 1999 merger of two Texas mega-corporations: Clear Channel, the nation's largest owner of radio stations, and a previous rival, AMFM. Before it would approve the deal, the Federal Communications Commission demanded that Clear Channel divest over a hundred of its newly acquired outlets, including six here. As a result, New York's Infinity Broadcasting and Indianapolis's Emmis Communications, two of radio's heavy hitters, entered the local market for the first time, and Colorado Public Radio, through its acquisition of KVOD-AM, was able to launch a two-channel network that has radically altered the face of public radio in the state ("Going Public," February 21).
Afterward, there was a modicum of quiet on the local radio front. But things started getting noisy again in late December -- and since then, five high-profile frequencies have switched teams. In a complicated arrangement intended to keep its accountants happy, Chicago's Tribune Co. entered into a local marketing agreement with Pennsylvania's Entercom Communications Corporation for KOSI, a purveyor of adult contemporary sounds; the Hawk, a classic-rock staple; and KEZW, a musical-nostalgia broadcaster on the AM band. The price of the package was reportedly $180 million in cash. Additionally, Emmis bailed on Denver after less than two years, selling Alice, which features the contemporary-hit-radio format, to Entercom for $88 million. And Emmis collected another $47.5 million for the Peak, most recently touted with the slogan "The '80s and Beyond," from Entravision Communications Corporation, a Spanish-language specialist that owns four other Denver media properties: radio's KJMN-FM and KMXA-AM, plus television's KCEC/Channel 50 (Univision) and KTFD/Channel 43 (TeleFutura), which debuted in January.
This shift seems seismic on the surface, and on a purely financial level, it is: Entercom alone is on the hook for over a quarter of a billion simoleons. But at least in the near term, listeners aren't likely to hear much difference. Thus far, only one format flip has been announced: The Peak will be switched to Radio Tri Color, a style described by Rob Quinn, the general manager of Entravision Radio Colorado, as "the regional Mexican format, which is basically Mexican country music." But this same approach has been heard on KMXA for years, and that will continue to be the case; Quinn says a handful of "talk and issues-oriented" programs may occasionally turn up during weekends, but the station will mostly just simulcast Radio Tri Color. "KMXA has a 50,000-watt signal that serves listeners from Wyoming to New Mexico and goes into Kansas and Nebraska as well," he notes. "It's a phenomenal signal, and very viable." Indeed, KMXA's listenership among those ages twelve and older came close to tripling between the previous Arbitron ratings period and the most recent one.
Still, putting Radio Tri Color on higher-fidelity FM makes perfect sense, particularly in light of the 2000 census. "The figures show that the Hispanic population in Denver has increased 73 percent since 1990," Quinn says. "Denver now is the twelfth-ranked Spanish market in the U.S. This is most definitely a market of consequence -- which is why we just invested over $47 million in it."
Not that the shows on Entravision's newest bauble will be unique to the area, since Radio Tri Color and Radio Romantica, on KJMN, are satellite services beamed to Colorado from San Jose, California. Quinn emphasizes that some modifications can be made on the programming: "If we're getting a foot of snow here and I-25 is a mess, the DJ will cut to a Denver feed and say, 'Friends of Denver, I-25 is closed. If you're heading south, take a different route.'" On top of that, Entravision employs two local personalities, Beto Gaytan and Ulises Almanza, to helm remotes or make local appearances, and California jocks are occasionally flown in for big events, like the Mexican rodeo at the recent National Western Stock Show. But such cosmetic gestures can't disguise the fact that most Entravision employees in Denver work in a sales capacity -- and business is good. "Six years ago, I couldn't pick up the phone without hearing jokes from our good friends at Clear Channel and Jefferson Pilot," Quinn says. "They'd offer to find us real jobs, and we'd tell them, 'Thank you. We're fine. Our day's coming.' And now it's here."
So is Entercom's -- and Jane Bartsch, the onetime vice president and general manager of Tribune's Denver stations, who's currently fulfilling the same function for Entercom, promises that the outfit will make "a big splash." But neither Bartsch nor John Donlevie, Entercom's executive vice president, will discuss the prospect of changes at its quartet of acquisitions. Meanwhile, insiders speculate that, because of the weak economy, everything will remain as it is in the near term, and perhaps longer. In other words, those of you dreaming of some new and exciting programming to shake local radio out of its lethargy need to snap out of it.
Of course, nothing's set in granite, particularly in the radio industry. Since the passage of the Telecommunications Act of 1996, which greatly liberalized rules concerning how many stations companies could own, signals have been passed around like bottles at a beer bust -- so much so that Donlevie can't say for certain whether his company is the third-, fourth- or fifth-largest in its field. "It depends on what data you use," he explains. At present, though, Entercom holds the title to 101 radio stations in nineteen localities, including Boston, Seattle, Kansas City and New Orleans, and its executives wanted a presence in Denver for the simplest of reasons: "It's a good market, and we haven't been there before."
As such, the firm was willing to tailor its agreement to buy KOSI, the Hawk and KEZW to Tribune's specifications. Tribune was hoping to essentially trade the signals for a TV station, but since Entercom doesn't own any, that was impossible. So Tribune was allowed to structure the deal as a management option of up to three years in order to defer the purchase date. Then, when Tribune finds a TV station it wants, it will be able to buy it using money from the Denver sales in a transaction technically known as a like-kind exchange, thereby saving a pile in taxes.
Technically, then, Tribune remains the licensee of the three broadcasters -- but for all practical purposes, Entercom has been in charge since February 1. General manager Bartsch confirms rumors that the company is conducting research about the outlets, but she characterizes the process as routine: "Stations do that on an ongoing basis, so we're continuing to do it." Moreover, she's wholly complimentary about KOSI, Denver's fourth-most-popular frequency, which experienced the biggest overall ratings gain of any station in the most recent Arbitrons, and she thinks coordinating its sound with Alice's could pay even greater dividends. Bartsch sends bouquets to KEZW as well: "It does phenomenally well and has a very loyal audience and a very loyal advertiser base."
That leaves the Hawk, which lost a full ratings point in the last survey, shrinking its audience to just over a third the size of the crowd that favors the Fox, Clear Channel's classic-rock powerhouse. But Bartsch stops well short of committing to dump it -- "We have to keep our eye on the Hawk for opportunities and challenges, and we'll see what happens" -- and even suggests that the impending disappearance of the Peak could give the station a boost.
Mike O'Connor, director of FM programming for Clear Channel Denver, doesn't expect the Hawk to immediately take wing. "It would be party time for us if it did," he says, "but I think they're making money over there, and I know from my own experience that in this economic climate, it's hard to blow something up that's making money, even if it's not very much." Likewise, he doesn't expect the Peak's death sentence to make a sizable difference in Clear Channel's bottom line, especially since the station's numbers have fallen so precipitously over the past year. But he can't help crowing a bit about its demise. "Going Spanish is a smart move," he says, "and it should have happened a long time ago."
It almost did. At the time of Clear Channel's divestiture, the Peak was purchased by the Hispanic Broadcasting Corporation, which intended to begin programming in Spanish -- but because Clear Channel owned a significant stake in the enterprise, the FCC nixed the sale. That opened the door to Emmis, which repositioned the station as an '80s rocker complete with Nina Blackwood, one of MTV's original VJs, as its poster child. Clear Channel's KTCL responded with a series of attack promos starring "Nina Fatwood" -- but since the retro-Peak didn't catch on, further assaults were unnecessary. To O'Connor, the signal's Spanish future only makes its failure juicier.
"In my opinion, Emmis arrogantly decided to buy the station high and then screwed it up with a bad product decision," O'Connor asserts. "So I'm not sorry to say, 'Goodbye, Emmis.'"
Predictably, Joe Schwartz, general manager for Emmis's Denver possessions, doesn't put things quite that way. "In December, Emmis very aggressively went after the Tribune stations," he says. "We didn't get them; Entercom did. Then, shortly thereafter, every major radio owner in Denver, including the new ones, contacted us and inquired about buying our stations. And when we looked at the amount we could get for them, Emmis decided that instead of being a buyer, we would be a seller."
Spin definitely seems to be at work here. Emmis got about $11.5 million more for the Peak than it paid, but sold Alice for about $10 million less than its original outlay, making its Denver excursion little better than a break-even situation. Besides, Emmis, like oodles of media companies, has had a tough time of things since September 11. Last fall, the vast majority of Emmis employees received company stock that amounted to 10 percent of their annual salary to compensate them for a 10 percent pay cut -- a move intended to stave off company-wide layoffs. On top of that, cost-chopping had become a way of life at Alice and the Peak, which last year replaced its low-rated morning show with a caller-driven program called "My Peak in the Morning" -- a clear move to save bucks. The life was squeezed out of the advertising budget as well.
"We haven't marketed the Peak in almost a year," Schwartz says. "When we first came out of the box and did heavy advertising in TV and outdoors, the ratings were great. But when we pulled the plug on ads due to the economy, they went down." He admits that Alice's ratings have fluctuated for the same reason, but even so, it retains plenty of fans. The station's recent fundraiser for Children's Hospital was so relentless that it had half the citizenry in tears.
Schwartz, however, retains a sense of humor, even about the Peak's demise. When asked about the station's journey from Spanish to English to Spanish again, he jokes, "Like Yogi Berra said, it's déjà vu all over again."
And so, despite the ownership swaps, is Denver's radio dial.
Prize patrol: They may not have the same thrill factor for the general public as the Oscars (no starlets wearing outfits incapable of covering their assets, for example), but the Colorado AP Editors and Reporters, or CAPER, awards and the Colorado Press Association prizes mean plenty to the folks at the Rocky Mountain News and the Denver Post. That's especially true this year, since the CAPERs and the CPA awards, announced on February 22 and 23, respectively, represent the first outside analysis of the papers' quality since the joint operating agreement took effect just over a year ago.
By these measures, the Rocky was the champ by a landslide. In the CAPERs, it earned the "Best of Show" plaudit plus 21 awards, including thirteen first places, as compared to the Post's ten awards and five first places; at the CPA soiree, the News received the "general excellence" bauble and fourteen first-place honors, with the Post netting six first places. (The Colorado Springs Gazette was the only other publication to face off against the Post and the News in the large-paper category. Westword is not affiliated with the Associated Press and stopped entering the CPA contest after it was prevented from competing against the Denver dailies.)
For newshounds, the results weren't terribly surprising: Although the JOA labeled it a "failing" newspaper, the News has consistently bested the Post in statewide journalism challenges. But News employees were still overjoyed by the results; a source who attended the CPA ceremony confirms that News representatives were in high spirits, while Post types did more grumbling than cheering. The differences in the ways in which the papers reported the final tallies were telling as well. The News ran separate pieces about the CAPERs and the CPAs -- the former on Saturday, the latter on Monday -- and included details about other newspapers' awards. In contrast, the Post published a single article on Sunday that noted its own triumphs but left out everyone else's -- no doubt because printing them would have made it a helluva lot harder to act happy about the outcome.
Equally amusing were the full-page, self-congratulatory ads the papers ran, which used essentially the same template, but very different content. The February 23 Rocky notice was filled with just its CAPER accomplishments. The next day, the Post's ad spotlighted its top finishers in both contests -- otherwise, the type would have needed to be mammoth to fill the page -- and even claimed victory in the CPA's best-series category. In fact, the Rocky won that award as well, and that line was removed when the Post reran its ad on Monday.
On the surface, the lack of enthusiasm that the judges showed for the Post would seem to repudiate the daily's international bent in the wake of the September 11 attacks, but that's not the case: Articles had to be published no later than August 31 for contest consideration. The Post is obviously laying the groundwork for upcoming battles, though: On February 24, the same day it tried to make lemonade out of its CAPER and CPA lemons, the paper published a special terrorism section obviously intended to garner future hosannas. But despite its air of importance, the package was curiously scattershot -- a potpourri of articles that never truly cohered.
In other words, the Post still finds itself on a Rocky road.
Erratum: In last week's column about the foibles of Post columnist Woody Paige, I wrote that a piece the Woodman had written about the Salt Lake City Olympics -- one that oodles of Mormon readers found exceedingly offensive -- had not been placed on the Nexis data service that's used by most media outlets. However, Post editor Glenn Guzzo, who never returned a call seeking comment about Paige, e-mailed after the fact to say that the article in question was indeed on Nexis; as it turns out, it was loaded onto the system two days late, after I'd checked for it. "Another error, Michael," Guzzo wrote. "You've had quite a run of them."
Maybe -- but it sure as hell wasn't as big a gaffe as the Post's printing Paige's column in the first place. Ten thousand angry Mormons can't be wrong.
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