Friday, February 3, 2017
Report: Radio Industry To Become Stronger
Assuming the deal gets regulatory approval, BIA/Kelsey believes the result will be a stronger radio industry. The combined Entercom-CBS Radio group would be closer to the size of the industry leader – iHeart Media – which only can foster the radio industry’s ability to compete against its many new competitors.
Here’s how the revenue landscape will be changed by this merger. Below are the shares of the major radio groups, pre-and post-acquisition, according to BIA/Kelsey’s estimated revenues. Where CBS Radio was more than 50% lower than iHeart, and Entercom was over 66%, in terms of over the air advertising revenue, now the combined company is only approximately one-third lower.
While the total share has increased, it is important to realize that in the local markets, the markets in which these stations compete, the competitive outlook has not changed much. Of course, the combined company will have to divest itself of some stations in markets where they exceed the present local ownership caps – Los Angeles, CA, San Francisco, CA, Boston, MA, Seattle-Tacoma, WA, San Diego, CA and Sacramento, CA. But, in most markets there is little, if no overlap.
The competitive outlook in those markets will remain the same except that the name of the parent company will be different and that parent company will be stronger to invest and compete.
Posted 10:33:00 AM