26 April 2005

Note to Lew: Buy a radio station

A small bit of news that flew under the radar last weekend was the announcement that Susquehanna, the parent company of KNBR (680 and 1050 AM), is putting their radio business up for sale. In the salad days of the late 90's KNBR and KTCT (1050, which later became co-branded as KNBR) were cash cows for Susquehanna. Lately they've become more of a liability to the parent company, as the 49ers' and Raiders' fortunes suffered, pulling away listeners and ratings. Susquehanna, based in York, PA, also owns the venerable KFOG and KSAN-The Bone rock stations in the Bay Area, and 20 more stations in 7 other markets.

It is unclear whether the stations will be sold as a group or as individual entities. Some, like KNBR-680, are the crown jewels and will fetch a pretty high price. 680 is one a handful of clear channel (not the company) stations throughout the country whose signal can be heard at night for hundreds of miles, in states as far as Utah and up and down the Pacific Coast. KNBR has had difficulty finding a good programming mix over the last few years for its lesser property (1050), sometimes going with edgier personalities such as Jim Rome and "J.T. The Brick." On the other hand, it would also simulcast some of its other shows, such as "The Razor and Mr. T." The morning drive-time slot has also been somewhat tricky, especially when KNBR brought a decidedly "morning-show" vibe to 680 in the "Not Just Sports Show," which was killed only last fall. The Raiders had been on 1050 for several years, but were not renewed last season and subsequently moved to KSFO-560. Most recently, KNBR announced a four-year deal with the San Francisco 49ers, who had seemingly been on KGO-810 forever, but were let go after KGO saw a ratings slide.

If 680 and 1050 were sold together, the buyer would be given a virtual monopoly on sportstalk radio in the Bay Area, but would also be saddled with having to program for two 50,000-watt stations, which can be expensive. Signing the 49ers when they did probably helped boost the asking price of KNBR, but it remains unclear how the sale would be handled. KNBR already has Giants baseball exclusively on 680 and Warriors basketball (which switches between the two stations). It's not unprecedented for a single station to carry three different teams, but that means that schedule conflicts could become a common occurrence.

This gives Lewis Wolff a potentially huge opportunity. As mentioned previously, the A's will be off KFRC-610 at the end of the 2005 season and their next radio home has not yet been determined. If Wolff were to buy KTCT-1050, he'd have a built-in sportstalk audience on a 50,000-watt station, along with immediate programming in the A's, who currently are relegated to vagabond replacement player status in local radio. Not only would the A's get more immediate exposure; they would also be able to do many of the same revenue-hiding tricks that only the big boys are able to get away with.

That's not to say that acquiring a station will be easy. Once any station goes on sale, literally hundreds of suitors line up for a shot. Existing behemoths such as Clear Channel (yes the company) and CBS/Infinity/Viacom have tons of cash to throw at any acquisitions. An open auction process could drive the price up for either or both stations. KNBR also has a 2% minority stake in the Giants, which further complicates things. Breaking the two stations apart and allowing them to compete would be good for the listening public and potentially reduce any conflict-of-interest issues. Buying KTCT would cost the Wolff/Fisher group millions of dollars, but it would guarantee the A's a stable home on local radio for years, if not decades to come. That can't help but raise the value of the franchise.


Genaro said...

The question is whether KTCT is sold seperately; as you pointed out, having two teams that would conflict from September to April would make KTCT being sold somewhat prohibited.

Marine Layer said...

Not sure what you're referring to there. The Giants and KNBR are locked in together for virtual infinity. That leaves KTCT, which currently has no team agreements other than Sabercats football and the occasional Warriors game when a conflict with the Giants arises.

A situation that could work might look like this:

1. KNBR and KTCT split, with Wolff/Fisher buying some percentage of KTCT. The Giants either buy back the 2% share KNBR owns or allows the new operator to keep the share.
2. KNBR keeps broadcasts of Giants, Warriors, and now, the 49ers. Conflicts could arise in March-June if the Warriors make the playoffs, and less frequently in October-January, when the 49ers and Warriors might conflict.
3. KTCT would partner with the A's, and to round out programming, the new KTCT might pursue other teams such as the Raiders or Sharks. The immediate benefit to the A's would be the possibility of 2+ hours of pregame and 4+ hours of postgame coverage.
4. The Sabercats would go to the highest bidder.

Peanut Gallery said...

Agree on all counts. We definitely need some competition in sports radio and I'd love to see the A's on 1050. Question: does 1050 still have that problem where they have to turn down their signal after a certain hour (8, I think) because it interferes with another station that if I recall correctly is in Mexico?

Genaro said...

What I mean is that when the Raiders were with KNBR they were played on the 1050 side. So if KTCT were to split, they would have to play 3 teams on one station which could come to be problematic durring, at the minimum, September to April.

Marine Layer said...

According to FCC documents, KTCT is still 50,000 daytime and 10,000 nighttime. I remember about a year after The Ticket started broadcasting, that the station said they no longer had the low-power problem. I think they simply changed antenna directions at night instead of boosting the signal.

About the programming conflicts - I doubt it conflicts would occur more than 6-8 times a year. Arrangements could be made with FM stations to carry the backload. It also helps that scheduled are published six months in advance, making it easier to mitigate any conflicts.