Big Radio’s Owners
  Updated 2009 results

These pages track the “BIG” radio operators in the United States – this section includes stations where the financial results (or other developments) have been updated to include 2009.

The original owner description documents were done in early 2009 and will be moved to this section as they are made more current. The primary source of information is the FCC’s ownership reports, supplemented by information from the owner’s web site and other media reports.

License count are approximate AM and FM radio license counts – no LPFM or FM Translators are included. The numbers also do not include TV stations.

Defining what “Biggest” means in radio is something that has no single answer. Is it the most number of licenses? Presence in the largest number of major markets? Income? Profits? Employees? Ratings? To people in the radio business, this is a religious issue – and I’m not in the radio business.

For our purpose, “Biggest” means the largest number of Full power licensed stations. It’s not a very good measure, but it is something that can be directly determined from FCC records.

Nothing in these pages should be considered as investment advice. Most of the companies in this list have suffered huge losses from declines in the value of radio station licenses in the past 5 years. Any investment in a company that owns radio stations is highly speculative, and should not be done without advice and extensive research done by a trained professional. In 2009 and early 2010, some radio stocks have seen enormous profits, others became worthless. Never invest money in the stock market you can’t afford to lose.

LMAs
To understand radio “Bigness”, you first need to understand what an LMA (Local Marketing Agreement) is. Back in the good old days of heavy regulation, an LMA was used to circumvent the intent of the FCC ownership limits. The LMA is an agreement to Lease a radio station to another party without actually transferring the ownership of the license.

If a “Too big for the limits” owner wanted to take “control” of another station in the market, they would enter into an LMA with the current owner. The original license holder would retain the license and the legal responsibility for the station, but effectively the station would be run by the Big Company. The FCC eventually closed that loophole, so when the Big company controls another station via an LMA today, that station counts against the big guy’s ownership limits. Conversely, if the big owner LMA’s a station to another owner, that station no longer counts against the big owner’s total (the big guy can’t provide substantial programming or be involving in the programming decisions of the leased station)

Since those limits are now much less restrictive and the LMA loophole was closed, the main use of the LMA today is for temporary control of a station while a sale is pending. The New Owner is given effective control of the station (programming, personnel, operations) while the FCC approves the transfer (or not), and the lawyers and bankers finish up the paperwork and transfer of assets.

LMAs are also used when the station owner doesn’t have the interest, ability or desire to continue to operate a station. The station owner turns over control of the station to a regional or national programmer (often a religious programmer like Salem or Moody Bible) and the station remains owned by the original owner – but effectively becomes part of the larger network. Generally this seems to be done for tax or estate planning reasons when the station’s owner has no children who want to carry on or work in the family business.

A recent development in the use of an LMA is to technically comply with Section 310 of the FCC rules requiring radio stations to have no more than 20% non-citizen (United States citizen) ownership (or 25% of a radio holding company).

A company in Mexico recently “acquired” control of a major radio station in Los Angeles via a long term LMA agreement, where that company from Mexico will run the station – on paper, the station is still owned by an American Company, but for all practical purposes it was “sold”.

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