Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-02-01
CAPITAL RUSHING
FOR RADIOS GOLD
Group Ownership of Stations
Objective of Several EN-
terprises."
BY MARTIN CODEL.

There's a rush now under way for
them thar gold fields" of radio broad
casting. Unlike Americas pioneer gold
rushes, however, this movement is one
of capital seeking a ripe, new field OF
investment that seems to offer a pecu-
liar sphere of expression and influence
as well as very substantial profits. For
it is true that broadcasting has not only
taken its place in the realm of show
business and audible Journalism" but
Is today also big business.
With the prospect of erecting new
stations practically nil, on account OF
the already overcrowded wave lengths,
business entrepreneurS are now seeking
to purchase outright or buy their way
into radio stations. The group owner
ship of stations, along lines similar to
the group ownership Of newspapers, is
the object in view Of several Of these
business enterprises.
Quit Buying Stations.
The networks report that they have
quit buying broadcasting stations. Pos
Sibly this Is due to the prospect OF
Synchronization, which one day may be
expected to give them full-time ma
tional radio outlets of their own. Each
of the two big chains acquired interests
in or control of a considerable number
of stations over the last few years.
Their stations are among the leaders in
broadcasting and like most Of the other
big stations, are doing "middling to
very well" in a financial way.
It is, however, among the local low
power stations rather" than the chain
owned or chain afiliated stations, most
of which are tightly held, that several
groups with abundant capital, in the
writer's knowledge, are seeking a field
Of investment.
Leaving aside the criticism often lev
eled against the local low-power broad
casters, who depend for their program
material on photograph records and
Who "sell time" for the direct or indi-
rect advertising of anything from tooth
picks to threshing machines, the fact
remains that they, too, have been doing
a thriving business. They can snow
audience reaction, so their time Is in
demand. Now their station properties
are also in demand.
Business Defies Depression.
1t is common knowledge that the big
broadcasterS have been doing good
business in spite of the economic de-
preston. What is not so well known is
that the little fellows have been making
even more money in proportion to their
investment One station of $50 watts
daylight power and 100 watts night
power is known to have earned net
income of $4,000 during the last fiscal
year.
Since they need make no accounting
to any one but themselves, these little
stations don't talk about their profits
very much. It might hurt their pros
poets for more power and better wave
lengths-and all of them want that.
But the fact that they are enjoying an
era of prosperity is we'll known in radio
circles. Whether it will last is another
matter
Even before the big broadcasters real
lied it, these little fellows of radio came
to appreciate the fact that the daylight
hours on the air are often more effec-
tive selling media than the evening
hours, for the simple reason that they
reach the housewives in the homes and
the housewives are by far the prepon-
derant buying element. They have
keyed their programs accordingly, they
have shown good returns, and now
with capital seeking way into their
business, they are demanding rather
substantial sums for the sale or partial
stock ownership of their facilities.