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Entercom Names Which of Possible Stations It Will Divest in L.A.

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pjc1961

As part of the merger with CBS Radio, it was speculated when the deal was announced that Entercom will have to part with one FM station in L.A.

As part of the formation of the station trust "TDC Communications", 14 stations (all FM) in total nationwide will be placed in the trust for sale or swaps.
The specific number of FMs per market was released today with the expected one station to be divested in L.A.

What was somewhat surprising was that unlike the other markets, it was announced that in L.A. it will be
*either* KSWD-FM-100.3 ("The Sound") *or* KCBS-FM-93.1 ("Jack FM") that will be divested.

Arguments for either:

Entercom's opening foray into L.A. was with the swap that landed them The Sound.
They have invested in the station by adding L.A. Rams game broadcasts and
have just signed midday host Uncle Joe Benson to a long term contract.

The 93.1 signal is the stronger of the two and (I believe) the better revenue producer of the two stations.
Likely more profitable as well with the relatively small staff required to run the current format.

Another consideration is the 40% revenue cap for a group owner in the market.

Let's discuss....

Story link: http://www.insideradio.com/entercom...cle_28ff2eee-0e4b-11e7-9ecc-ef888eef1bd3.html
 
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Since the company will continue to be named Entercom. They can move the Rams to 93.1. Right? Poor 100.3 has been tossed around like crazy over the years.
 
I should have noted that the L.A. Rams broadcasts are a production of ESPN L.A. (710 KSPN) and are just simulcast on 100.3.
Thus, as ThePowerCow said, the simulcast will be easily movable to one of the remaining stations post-merger, if necessary.
 
pjc1961 said:
I should have noted that the L.A. Rams broadcasts are a production of ESPN L.A. (710 KSPN) and are just simulcast on 100.3.
Thus, as ThePowerCow said, the simulcast will be easily movable to one of the remaining stations post-merger, if necessary.
Click to expand...

I am wondering what would happen were ESPN to buy an FM in the market.

Could ESPN buy one of the spin-off stations?

Or could ESPN buy another FM. For example, Grupo Radio Centro's 2016 filing with the securities authority in México shows KXOS as losing, Ps. 118 million, which at the current exchange rate, is about $5.6 million in 2016. It further states that they can not predict profitability in the future. Translation: they might look at a good offer.
 
pjc1961 said:
I should have noted that the L.A. Rams broadcasts are a production of ESPN L.A. (710 KSPN) and are just simulcast on 100.3.
Thus, as ThePowerCow said, the simulcast will be easily movable to one of the remaining stations post-merger, if necessary.
Click to expand...

I am amazed that there even is a discussion. KCBS-FM has the superior signal with the more profitable and highly rated format. Plus their format (JACK) has no direct competitors. KSWD is locked in a permanent stalemate of a fight with KLOS until one of them drops the classic rock format entirely. And as already noted, they can probably keep the Rams simulcast and just move it down the dial. I am sure the Rams won't mind being on the stronger signal with an everyday format that is targeted to a younger demo.
 
DavidEduardo said:


I am wondering what would happen were ESPN to buy an FM in the market.

Could ESPN buy one of the spin-off stations?

Or could ESPN buy another FM. For example, Grupo Radio Centro's 2016 filing with the securities authority in México shows KXOS as losing, Ps. 118 million, which at the current exchange rate, is about $5.6 million in 2016. It further states that they can not predict profitability in the future. Translation: they might look at a good offer.
Click to expand...

Not from the area, is KXOS one of the better FM signals there?
 
ThePowerCow said:
Not from the area, is KXOS one of the better FM signals there?
Click to expand...

Yes. It's a full Class B grandfathered at 18.5 kw on Mt Wilson. More powerful than KOST, KIIS, KSWD and KSCA that are also on the same location.
 
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DavidEduardo said:


I am wondering what would happen were ESPN to buy an FM in the market.

Could ESPN buy one of the spin-off stations?

Or could ESPN buy another FM. For example, Grupo Radio Centro's 2016 filing with the securities authority in México shows KXOS as losing, Ps. 118 million, which at the current exchange rate, is about $5.6 million in 2016. It further states that they can not predict profitability in the future. Translation: they might look at a good offer.
Click to expand...

Not sure if Disney (owner of ESPN) wants to own more than the two they have in el Lay. ESPN has not been the cash cow for Disney as it once was. Entercom prefers tax-free exchanges, so if it was a cash deal for KSWD, it would probably be an inflated price. And what price for KXOS?

HOWEVER, the thought of ESPN (or someone else) owning one Sports FM, one Sports AM and one Deportes FM in the #2 market is intriguing!
 
DavidEduardo said:
I am wondering what would happen were ESPN to buy an FM in the market.
Click to expand...

WEPN-FM in NY hasn't been a big success. And that's just an LMA. They're renters not owners.

If I'm sitting in a conference room, discussing various cutbacks at the channel, and someone brings up spending millions on a FM signal, I'm not predisposed to say yes. I'd be more excited about reviving the ESPN restaurants. Or perhaps sports retail.
 
TheBigA said:
WEPN-FM in NY hasn't been a big success. And that's just an LMA. They're renters not owners.

If I'm sitting in a conference room, discussing various cutbacks at the channel, and someone brings up spending millions on a FM signal, I'm not predisposed to say yes. I'd be more excited about reviving the ESPN restaurants. Or perhaps sports retail.
Click to expand...

However, if it can be seen that buying an FM can be easily monetized, the decision is made in a silo situation, isolated from any problems ESPN has with cord cutters and video/TV distribution.

As to WEPN, in NYC it competes with an AM/FM simulcast with 30 years of heritage in the format. Yet in the last book in 25-54 men, WFAN AM & FM was 8th and WEPN was 12th... not bad for a challenger and definitely a sales win.

Since LA does not have a "dominant" sports station, this might be seen as a potentially very profitable incremental improvement for the audio side of ESPN.
 
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DrAkbar said:
Not sure if Disney (owner of ESPN) wants to own more than the two they have in el Lay. ESPN has not been the cash cow for Disney as it once was. Entercom prefers tax-free exchanges, so if it was a cash deal for KSWD, it would probably be an inflated price. And what price for KXOS?

HOWEVER, the thought of ESPN (or someone else) owning one Sports FM, one Sports AM and one Deportes FM in the #2 market is intriguing!
Click to expand...

What "Deportes" FM do they have in LA? If ESPN Deportes has a "Flagship Station" it is KWKW in LA. Along with KTNQ, which converted last week to Univision Deportes, there are two Spanish language sports stations in the market now.

As to a purchase, I was thinking more of ESPN acquiring an FM outside the CBS deal, and moving their simulcast of the AM to their own FM.
 
DavidEduardo said:
Since LA does not have a "dominant" sports station, this might be seen as a potentially very profitable incremental improvement for the audio side of ESPN.
Click to expand...

The reason LA doesn't have a "dominant" sports station is because it's not a big sports town, as evidenced from weak attendance by many teams. The new station wouldn't have much local play by play. It would be mainly a clear for the syndication, which is what they do with WEPN. If they're going to do this, they'd want someone else to own, and they'd supply the content, as they do in NYC. There's no upside to owning.
 
TheBigA said:
The reason LA doesn't have a "dominant" sports station is because it's not a big sports town, as evidenced from weak attendance by many teams. The new station wouldn't have much local play by play. It would be mainly a clear for the syndication, which is what they do with WEPN. If they're going to do this, they'd want someone else to own, and they'd supply the content, as they do in NYC. There's no upside to owning.
Click to expand...

I think some of the decision will come from what Michael Eisner hears when he punches up ESPN on his drive to or from Burbank. There has always been a focus on local media ownership in a company home town going back to the early NBC days in the late 20's. Part of a decision may be based on optics. And the price of an LA FM today is about one day's box office for Beauty and the Beast.
 
TheBigA said:
I wasn't aware that Eisner still calls the shots at Disney.
Click to expand...

Sorry... brain fart. Should have said "Iger" and not Eisner.

I used to see Eisner with some frequency as he arrived at the Disney complex when I was doing my morning jog in the neighborhood... so I tend to think of him first, even a decade plus after he was "departed".
 
DavidEduardo said:


What "Deportes" FM do they have in LA? If ESPN Deportes has a "Flagship Station" it is KWKW in LA. Along with KTNQ, which converted last week to Univision Deportes, there are two Spanish language sports stations in the market now.

As to a purchase, I was thinking more of ESPN acquiring an FM outside the CBS deal, and moving their simulcast of the AM to their own FM.
Click to expand...

What I was thinking was ESPN (or someone else) picking up KSWD and KXOS. Sports in English on 100~Three and in Spanish on 93~Nine. Money, Lotus, etc. Details, Details. But it would be darned close to interesting!
 
I could see Cumulus swapping one of their stations in a market where Entercom desires a larger footprint, for the Sound. They could then stick the Nash format on 100.3. Wouldn't cost them much. They would eliminate their direct competitor and take share away from KKGO at the same time. Saul Levine is notorious for switching formats and may not be willing to go up against a national format with solid ties to the country music establishment.
 
robnokshus06 said:
I could see Cumulus swapping one of their stations in a market where Entercom desires a larger footprint, for the Sound.
Click to expand...

This was mentioned in another thread, and the obvious market is Houston, where Cumulus has only one station. Whether they use that station as an outlet for country is another discussion, since the potential in LA isn't very good (as demonstrated by KKGO). The only advantage is it gives their national programming an outlet in market #2, which is why they did it in NYC. But the question is will that revenue replace what they'd be losing in Houston?
 
robnokshus06 said:
I could see Cumulus swapping one of their stations in a market where Entercom desires a larger footprint, for the Sound. They could then stick the Nash format on 100.3. Wouldn't cost them much. They would eliminate their direct competitor and take share away from KKGO at the same time. Saul Levine is notorious for switching formats and may not be willing to go up against a national format with solid ties to the country music establishment.
Click to expand...

Keep in mind that the new administration at Cumulus is reversing the "national format" focus and giving much more autonomy to the local stations to establish their brand and identity.
 
DavidEduardo said:


Keep in mind that the new administration at Cumulus is reversing the "national format" focus and giving much more autonomy to the local stations to establish their brand and identity.
Click to expand...

True. But they have doubled down on Nash and are obviously committed. The company is also committed to the success of KLOS and were they able to eliminate their direct competitor and own the rock audience outright, the attendant revenue increase would justify installing the Nash brand on 100.3. The benefit to KLOS would be in keeping with their focus on local market autonomy. The move could only help KLOS.
 
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