Radio's record in 2007 speaks for itself: 1% revenue growth in the first quarter, a 1% drop in the second, then an alarming 5% drop in the third quarter, and no one is sure how bad a drop in the fourth.

According to the Radio Advertising Bureau, October revenue was down 2%, November 6% and December 5%. Without total dollar figures, however, it's difficult to calculate a total percentage for the quarter.

The poor economic report will be reflected and analyzed in the fourth-quarter results of individual companies, due to be released over the next month. Boyle has already made his judgment: "Our long-term view... is increasingly skeptical that radio can even get back to half of its historical 6 percent-8 percent growth pace, but is more likely to attain 0 percent-2 percent revenue growth in the out years."

In a separate note to investors, Boyle said the industry-wide downturn could derail the proposed sale of Clear Channel Communications to private-equity firms Thomas H. Lee Partners and Bain Capital. Citing the slump in Clear Channel's stock price and the worldwide contraction in credit, Boyle (who owns stock in Clear Channel) estimated the buyout has a less than 50% chance of success in the "near to mid-term."

In December, Clear Channel announced it had extended the possible termination date for the deal--the date by which either party can terminate the deal, provided it hasn't happened yet--to June 12, 2008.

When the deal was first announced in September 2006, Clear Channel's stock price rose from around $28.00 to about $35.50. Subsequent haggling drove the buyout price up to $39.20 before the deal was approved by shareholders in September 2007, with the stock itself edging up as high as $38.58 in June 2007.

Since then, however, weak radio revenue results from the fourth quarter of 2007 and the first quarter of 2008 have driven the price down to around $29.00. This also reflects skepticism among investors that the buyout at $39.20 will actually happen--an instance of the stock market's self-fulfilling logic. The private-equity firms may not be able to stomach paying a nearly 35% premium.

While the management of all three companies involved have generally kept quiet, there are still a number of factors in favor of the deal. If the sale were broken off, the private-equity firms would have to pay a $600 million termination fee. The deal also involves other assets, chiefly Clear Channel Outdoor, which is riding high on the boom in outdoor advertising.

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