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Exhibit 32 Table 8 reworked: 2005 advertising spend, promotion in wide and narrow market, weighted for Gauteng listeners



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Exhibit 32

Table 8 reworked: 2005 advertising spend, promotion in wide and narrow market, weighted for Gauteng listeners.

Ad revenue weighted according to listeners in Gauteng

Wide Narrow

Jacaranda 69202575 13% 21%

Highveld Stereo 204369175 38% 61%

Kaya 59978611 11% 18%

YFM 96875541 18%

Metro 61148018 11%

5FM 43937725 8%

Source: AC Nielsen Media Research, Discovery file 5, p110: Proportion of listeners in Gauteng.

2006/3 Radio Diaries Mar/June-Adult

Examination of 2005 advertising revenue based on the stations in the wide and narrow definitions, weighted to take into account listeners in Gauteng, reveals that Highveld commands 61% of the narrow market and 38% of the widest market. With the inclusion of Kaya, this would increase to 79% in the narrow market.

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[47] If we observe the figures in Exhibit 32 we note its sensitivity to changing market definition, from the so-called narrow market to the wider market. On the Commission’s narrow market Highveld has 61%, which reduces to 38% assuming the wider market. Likewise Kaya moves from 18% to 11% respectively. Note as well that the Commission excludes Classic, which, as we see later, AME would include as a participant in this market.

[48] In this example, the premerger HHI for the wider market is 2243 and for the narrow market 4486. A market with an HHI above 1800 is considered to be highly concentrated. In a concentrated market an increase in concentration from pre to post merger of over 100 is a matter for concern. On this example, in the wider market if there was full control, the increase in concentration or delta, would be 836.31 This delta is alarmingly high. But on the assumption that this is not a full merger, but instead the acquisition of a silent financial interest, by Primedia in Kaya FM, and that financial interest is 19%, the delta would be 79,4.32 This delta is below the normally accepted range of concern. 33

[49] Let us try the same exercise with a table proposed by the merging parties, which represents their closest compromise to the position of the Commission. This we find in Exhibit 25 – again a table created only during the course of the hearing. Here the shares are:

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