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to the radio industry focusing on the number of owners and the number of stations held by the largest group owners.  Next, Section 3 examines changes in the radio industry at the local level, specifically examining various indicia of diversity and concentration in each of the areas that Arbitron identifies as a local radio market. Section 4 compares the financial performance of several publicly-traded radio companies to firms in the S&P 500.  Finally Section 5 analyzes the performance of small radio group-owners and small radio Metro markets.

2.Changes in the Radio Industry - A National View

The trends in the radio industry that were evident from March 1996 to November 1997 continued through March 2000.  Before discussing the specific changes, however, it is necessary to spell out certain assumptions used in the analysis.  This report uses the BIA MasterAccess Database of radio stations.  BIA regularly updates its database and continues to improve the data it reports.  To improve comparability amongst the various time periods, certain changes were made in the March 1996, November 1997 and November 1998 databases.  In order to make the March 2000 data comparable with the previous years’ data, the following changes were made.

First, BIA presents the ownership data to reflect "pending" or "proposed" transactions.  This means that when company "A" announces that it will purchase company "B", the owner of company B's radio stations are identified as "A."  If the proposed transaction does not eventually occur, either in whole or in part, BIA then readjusts the ownership data.  In describing the radio mergers, it makes more sense to document the effect of only those mergers that have been completed.  Therefore, we have corrected ownership data from BIA so that it reflects only mergers that have been completed.1 Second, BIA identifies the owners of stations subject to a local marketing agreement (LMA) separately.  Since the Commission's rules generally attribute an ownership interest to the brokering station, the BIA data were adjusted so that the ownership of stations subject to an LMA are attributed to the owner with the larger national revenues.

Third, in previous databases there had been a format category “News/Sports” which,

in the March 2000 database, was split into two separate categories: “News” and

1 In the 1997, 1998, and 2000 data, BIA identifies which transactions are pending, thus making it possible to reassign the stations to the "previous" owner.  However, BIA did not do this in the 1996 data.

2

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