Monday, May 18, 2009

Radio: Broom and gloom in Pittsburgh

Did you hear that David “Fumbles” Rehr is still coming to work every morning at the National Association of Broadcasters (NAB)?

Here’s the clown that carpet-bombed the radio and television industry out of any hopes to achieve parity with new media in the twenty-first century – and he’s still allowed in the building?

Come on, Fumbles. This is broadcasting. Capishe?

There are no fare-thee-wells. When you’re out, you’re out.

Just ask the thirty-five former employees of Sheridan Broadcasting’s three radio stations in Pittsburgh.

Unlike Fumbles, who botched nearly every NAB assignment on Capitol Hill and knew his days were numbered, the employees of WAMO AM and FM and WPGR -AM had no such advance warning that last Friday would be their last day.

They were called into a mandatory meeting late that afternoon.

WAMO-FM’s Hip Hop/R&B format was consistently Abritron-rated top ten – and placed eighth in 12+ total audience ratings in the Winter ’09 Arbitron with a 4.5 share – up from a 4.0 in the Fall ’08 survey.

Both WAMO-AM’s Urban AC and WPGR’s gospel formats were syndicated and had ratings lower than whale excrement. WAMO-AM, 1,000 watt day/830 watt night and licensed to Millvale, PA, placed eighteenth with a 1.2 12+ total audience share while WPGR, 5,000 watt day/1 watt night, and licensed to Monroeville, didn’t even show.

The WAMO call letters, which have been in continual use in Pittsburgh for sixty-plus years, signify the city’s three rivers– the Allegheny, Monongahela and Ohio.

At the meeting, employees were told the stations were sold to an unidentified company.

Those that qualified received a severance package.

Employees were asked to clean out their lockers, turn in their keys and ID and were wished well on their future endeavors.

Following the meeting, Sheridan contacted local news media and released information that the station’s new owner, St. Joseph Missions, would change the three stations’ formats, leaving market number twenty-four without a formats serving the Pittsburgh African-American community. Arbitron estimates Pittsburgh's African-American population at 8.2 percent.

No information was provided nor could be found on-line regarding the identity or background of St. Joseph’s Missions, which purchased the three stations for the such-a-deal fire sale price of $8.9 million.

Rather than answer questions about the sale, Sheridan hired a spokesperson, Russell Bynum of the Pittsburgh-based Bynum Marketing and Communications, who referred to St. Joseph Missions as "religious-oriented.”

"This was a difficult decision for the owners, but it was a necessary situation for them," he added. "When we look at Sheridan, we are looking at a strong organization that has had to make these changes to adapt to the movement and the changes in the marketplace."

Translation: It takes money to make money but Sheridan was obviously not making enough of it.
Sherdian Broadcasting, which is headquartered in Pittsburgh, is the principal owner of the American Urban Radio Networks group, the only African-American network group in the U.S. American Urban runs three networks, which they claim reach an estimated 20 million African-American radio listeners. The company still owns radio stations in Atlanta, Birmingham, and Buffalo – at least for the moment.

Sheridan Broadcasting owner Ron Davenport Sr. bought WAMO-FM and AM in 1973, His son, Ron Davenport Jr., is the general manager. The company purchased WPGR-AM in 2001.

"This is a business decision," he said. "That's the reality of the marketplace. The marketplace determines how businesses go, and industries have to change with the times."

Fear of the future – specifically, the insurmountable obstacles following NAB’s botched negotiation with the RIAA’s SoundExchange on streaming audio royalties and the forthcoming almost-certain-to-happen performance royalty fee were the unofficial reasons for Sheridan’s decision to pull out of station ownership. Arbitron’s people meter ratings and their effect on urban formats was also rumored to be a deciding factor.

Regarding its decision to abandon the African-American radio audience in a market it’s headquartered in, Bynum claimed that Sheridan tried to find minority buyers for the Pittsburgh stations but – no surprise here - none were able to secure financing.

He added, "I believe someone will fill the void."

That’s more than one can say about Fumbles, whose continued relationship with the NAB should just be voided.


Anonymous said...

It was a shocker. Nobody saw it coming. It still hasn't sunk in. Thanks.

Anonymous said...

i wonder how hard davenport really tried to get a minority company to buy the stations. he has to know that no bank or lending institution in america is going to loan money to buy radio stations. i think davenport was approached by these religious guys & bit the hook pure and simple. i'm sure he was not looking forward to ppms & all those nab screw up royalty fees but i don't think that figured into his final decision.

Anonymous said...

Davenport is no dummy. You are right. He knows no institution is going to loan money for radio. It is too risky. However, religion is flush with cash and those Catholics must have had that money burning a hole through their poor box. I think Davenport made out well with $9 mil. I would not call it a fire sale. Had Davenport not done the deal his values would have dropped far lower. His AMs are nothing and even the FM is Beaver Falls license. Davenport did just fine. Three months from now he would have been lucky to get $7 million.

Anonymous said...

Davenport - take the money and run. You have buyers lined up for the other markets? If you don't hurry up before the bottom falls out.

Anonymous said...

It was also said at the severance meeting that a huge increase from Arbitron contributed to the financial stress. National sales had plummeted, too. The signal was not strong enough and the African-American population large enough to overcome these additional hurdles. I'm also not so certain the St. Joe's folks are Catholics. Mormon's maybe?

Anonymous said...

I remember a swap between Clear Channel and Sheridan for the frequency which left the latter with an inferior signal for a while until they were able to get an upgrade. I don't think WAMO ever did as well again even after the upgrade. I am surprised Sheridan did not have more clout with Arbitron. The NAB ignores minority owned stations and that had to rile Davenport too when David Rehr negotiated that disgusting deal with the RIAA and destroyed any hope of compromise on the performance royalty issue. Davenport is wise to get out.

Anonymous said...

Davenport is the smart one. The dumb ones are those who will buy his properties and they will. Maybe the religious groups can make a go of it with their tax status but commercial companies can forget it. Radio is dead and about to be put in the ground. Advances in on line are happening so fast that in five years radio will be like vinyl. Remember when.

Anonymous said...

I think Sheridan knew that the NAB is powerless against the NAB lobby and that Arbitron may bend for Clear Channel but won't for smaller minority owned broadcasters. Sheridan got out while he could and made more money than the company would have had it stayed in another few months.

This was in Radio Business Report this morning:

Watchdogs who tried to convince House Judiciary Committee Chairman John Conyers (D-MI) that his Performance Rights Act would be devastating to minority broadcasters failed. So they are now moving up the leadership ladder, pressing their case with Speaker Nancy Pelosi (D-CA).

They see this as a civil rights issue. “As civil rights activists,” they wrote, “we know that minority owned radio stations speak directly to our communities and are a cherished resource that must be nurtured and protected. However, H.R. 848 would lead to severe reductions in sustaining and public service programming. Based on its knowledge of minority broadcasters’ finances, the Minority Media and Telecommunications Counsel predicts that H.R. 848 would lead to the bankruptcies of at least a third of minority radio stations.”

MMTC’s David Honig is one of the signers of the letter, along with Barbara R. Arnwine of the Lawyers’ Committee for Civil Rights Under Law and Francisco R Montero of the Spanish Broadcasters Association.
They are incensed that Conyers ignored their request to specifically look into the implications of the bill on minority broadcasters and, more broadly, its effect on the ability of minorities to fully participate in the US democracy.

It also says Conyers rushed the bill through without examining some other critical facts.

“For example,” they argue, “H.R. 848 would require all radio broadcasters to pay a performance tax, but there is no corresponding examination of whether these stations should be compensated for the value of airplay and promotion they provide to the record labels and artists.” It also did not examine the impact the bill would have on a station’s ability to serve its local community; no corresponding look into reviving the minority tax certificate; in fact, no corresponding look at a number of minority broadcast issues.

RBR/TVBR observation: Pelosi sets the agenda, so whichever side manages to win her support will have a huge advantage going forward. Surely she doesn’t want to hit broadcasters up for cash and simply bundle up about half of it and ship it oversees to international recording conglomerates.

Anonymous said...

Sheridan will get another FM in the city to carry its syndicated Hip Hop format and make out just fine. Don't feel bad for Sheridan and Davenport. It is the employees that got it. Always the case.

Anonymous said...

The only radio sales that will get done are those where the buyer puts up his own money. That's how Larry Wilson got those stations for $14 million in Portland. You did hit the nail right on the head when you wrote a few months back that former broadcasters will be back in the fold. In Sheridan's case they got lucky with a religious group flush with cash. Take my world that lenders are not going to participate in any deal involving radio stations unless the buyer puts up his own dollars too and lots of them. I also agree with you that the fire sale prices will drop even more. Wilson just happened to get a good deal upfront. Sheridan, too. There will not be many of those until values drop further and they will.

Anonymous said...

WAMO had the longest-running market identity in the city, having served the black community with those call letters since 1958, long before Sheridan got in the game. A shame.

Anonymous said...

Those call letters are among the best known in America. Porky Chedwick started there and John you may disagree with me but I believe he predated both Alan Freed and Bill Hawkins in exposing rhythm and blues music on a commercial radio station up North.

I was out of town when WAMO moved the R&B format to FM and put gospel on the AM.

The FM had an identity crisis for a few years. I remember it being AOR for a time, Disco, and finally Urban contemporary.

I hope that the new owners either retain the call letters or allow someone who picks up the format to have the call letters (and maybe their jocks too) on that station.

A sad day for Pittsburgh radio fans and there have been a lot of them since Clear Channel and CBS came into this market.

Anonymous said...

GIVE ME A BREAK PLEASE! DAVID *FUMBLES* REHR IS STILL COMING TO WORK EVERY DAY AT THE NAB? ARE THEY F---KING CRAZY? This is the man that did more damage to radio in his short tenure at the NAB than anyone else could ever do. AND HE STILL HAS A JOB? COME ON, NAB W A K E U P & SMELL THE ARBITRON.

Anonymous said...

Why did Davenport hire a spokesperson instead of putting his own ass on the line? His company is the voice of African-American radio in Pittsburgh so he hires some mouthpiece to read his excuses? That is just plain chickenshit politics coming from a company that should know better. Practice what you preach on your gospel network, Ron. You fired your loyal employees and you crapped on the market that made you successful. Damn you, Ron. Damn you.

Anonymous said...

To the previous poster: I have to agree with you. I feel the same way. The least Ron Davenport or his son could have done was to speak to the press themselves about the station sale. Not doing so and hiring a pr guy or whatever he does is as about bush league as you can get. Can't the Davenports look us in the eye and say we're sorry? Maybe Ron and Ron have to rush to the bank to cash the St. Joe's check and just didn't have the time to talk. COWARDS!

Anonymous said...

John, this was a bulletin just e-mail blasted from Radio-info. Too bad this didn't happen before Sheriden decided to sell
FCC to launch inquiry into Arbitron PPM

Complaints from minority broadcasters and others - like the New Jersey Broadcasters Association - find a receptive ear in Acting FCC Chairman Michael Copps. He launches a Notice of Inquiry about whether Arbitron's People Meter undercounts minorities and disproportionately harms black and Spanish broadcasters. Arbitron challenges the assertions of the "PPM Coalition" and says the Commission has no authority to investigate a third-party rating system. More about today's surprising news at

Anonymous said...

Another explanation about PPM, is that it is rumored that WGN turned off IBOC because it was interfering with PPM. I find it very interesting that with the power increase looming for FM-HD, that this is happening, now. iBiquity has boughtout everyone.

Anonymous said...

WAMO, Bam-o, Thank you, Ma'am-O....Now get outta here.

How insincere could a company be?

I guess Clear Channel, CBS, Citadel and Cumulus aren't the only ones.

Anonymous said...

David Rehr is coming in every day? He's a dead ringer for entertainer Buster Poindexter (David Johanson), maybe the NAB.. in their infinite wisdom, hired Buster Poindexter as the new president and never told us. Hey he'd do as good a job as Rehr. Maybe better!

Anonymous said...

Look, we all agree Rehr was, at best, ineffective. But where is the evidence that the Performance Rights Bill had anything to do with this decision? Today's Pittsburgh Business Times mentions NOTHING about that but does mention PPM costs which makes sense.

Read it here yourself:

In other words blame Rehr for things he should be blamed on but blaming him for this makes no sense at all. This blog sounds overly vindictive and blaming Rehr for things he had nothing to do with. What next? Rehr's the reason Swine Flu was overblown? Why Dick Cheney tortured people? Why it rained yesterday?

Anonymous said...

What a world. David Rehr still has a job he doesn't deserve and is still getting paid for it and 35 hard working employees at Sheridan Broadcasting in Pittsburgh are out of work and living off severance (and anyone who's done so knows how long that will last). What a wonderful business we're in.

Anonymous said...

i dont have it in front of me but one of the radio on line trades i believe either or made mention of the performance royalty fee being one of the reasons for sheridan wanting out of radio. i believe i read it more than once. it could also be mentioned in one of the pittsburgh newspaper or tv stories on their firings. whatever the case it is true that david rehr's poor negotiating skills played into this.

Anonymous said...

Rehr is Swine, so it's entirely conceivable that he is indeed the cause of the dreaded Swine flu Virus!