Entercom Communications Corp. and CBS Corp. said Thursday that they have agreed to merge Entercom with CBS Radio, a deal that would create the nation’s second-largest radio group and shake up the Boston market, where the companies own a combined 10 stations.
The merger would put Boston’s two aggressively competitive sports stations — WEEI and 98.5 The Sports Hub — under the same corporate umbrella, and affect the future of at least two local stations because of Federal Communications Commission restrictions on station ownership. The new entity, operating under the Entercom name and based in Philadelphia, would have two more stations than the FCC limit for the Boston market.
“We will move quickly to make required divestitures,” Entercom chief executive David J. Field said on a conference call. “We are going to put together a thoughtful plan . . . and try to facilitate an orderly process here that works for all.”
Field said the ownership cap would also affect about a dozen stations in several other cities, including Los Angeles, Sacramento, San Francisco, and Seattle.
Entercom is poised to get five Boston stations currently owned by CBS Radio. In addition to The Sports Hub, they include Mix 104.1, news powerhouse WBZ 1030, 103.3 AMP Radio, and WZLX 100.7 FM.
Entercom already owns seven stations in Massachusetts, five of them in Boston: WAAF 107.3 FM, WEEI 93.7 FM, WEEI 850 AM, WRKO 680 AM, and WKAF 97.7 FM.
For WEEI and The Sports Hub, the deal is in effect a forced marriage. The stations both attract large audiences and have long battled for ratings supremacy, with on-air personalities at each regularly taking swipes at their counterparts.
Of late, The Sports Hub has prevailed in the ratings war. For the three months ended Nov. 30, it captured a 13.1 Nielsen share in the crucial 25-to-54 age demographic. WEEI trailed with an 8.8 share. Both Boston stations are broadcasting from Houston this week in advance of Sunday’s Super Bowl.
Some local industry observers said three stations with especially thin audiences — WRKO, WAAF, and WEEI-AM — are the most likely to be jettisoned by Entercom. Field indicated that while the company would consider cash sales of some stations, it would also be open to swaps with other owners.
“You have a couple of stations that are not doing well,” said Donna Halper, a radio consultant and media historian who teaches at Lesley University. “WRKO, it was a dominant Top 40 station and it was massive in its day in the ’60s. Since talk radio moved to FM, the station has been floundering for years.”
In the latest Nielsen ratings, released at the end of January, WEEI 850 AM, which broadcasts ESPN satellite programming, captured a minuscule 0.2 share of the market and was tied for second to last out of all Boston stations. WRKO generated a 2.4 share, while WAAF earned a 1.9.
“I see cautious moves, strategic moves, getting rid of deadwoods — stations that are dragging down the bottom line,” Halper said. “There have been so many changes in this market.”
T. Barton Carter, professor of communications at Boston University, said he wasn’t surprised by the merger, which is expected to close later this year, pending approval by federal regulators and Entercom shareholders. “It’s the trend in the industry,” Carter said.
“Radio and TV used to be our primary sources of news, and so the public interest was much greater at that point about having diversity in terms of news, but the reality is how many people rely on radio for news these days?”
Nationwide, CBS Radio owns 117 stations in 26 markets, while Entercom owns 127.
Combined, Entercom and CBS would create an industry giant with 244 radio stations in 23 of the top 25 markets nationwide, with annual revenue of $1.7 billion. It would become the second-largest radio station owner in the United States, after iHeartMedia Inc.
New York-based CBS Corp. said last year that it planned to separate from its radio business, an industry that has been losing listeners to online streaming formats, such as Spotify, Pandora, and podcasts.
“CBS is a multimillion-dollar company for which radio has become a fairly small piece over the years,” said Scott Fybush, editor of the trade publication Northeast Radio Watch.
“CBS is really the last of the old-lion operators. NBC got rid of their radio stations in the ’80s. ABC sold theirs off in the ’90s, so CBS was the last one to hang on.”
Advertisers have fled traditional radio as listeners have migrated online and to satellite stations. But in a statement Thursday, Entercom said its larger platform — which would include the rights to broadcast 45 professional sports teams, including the Boston Red Sox, New England Patriots, and New York Yankees — would be attractive to advertisers.
“Entercom is a superbly run company,” CBS chief Leslie Moonves said in a statement he released with Entercom’s Field, “and together with CBS Radio’s powerful brands and remarkable people, we are creating an organization that will be even better positioned to succeed in this rapidly evolving media landscape.”