Honolulu Star-Bulletin from Honolulu, Hawaii • 55

Honolulu Star-Bulletin USINESS Section Business editor: Stephanie Kendrick 529-4792 skendricksrarbulletin.com SUNDAY, JULY 4, 2004 529-4792 BUSINESSSTARBULLETIN.COM 1,4 4 Hawaii 3-? ,1 1 CINDY ELLEN RUSSELL CRUSSELLSTARBULLETIN.COM IV II JJ i (QJI THEBUZZ Erika Engle Rock station on shaky ground The pool deck is one of 12 guest decks on the Pride of Aloha, which was scheduled to be christened today. i. if, -T i 'if' 1 CINPY ELLEN RUSSELL CRUSSELLlgSTARBULLETIN.COM Elevators shoot upward from the festively decorated reception lobby of Norwegian Cruise Line's Pride of Aloha. Passengers on Norwegian 's U.S. flagged ships will be the state's highest spending visitor niche group of Honolulu ra dio stations are a step closer to local owner ship, The transfer of the broadcast licenses for KPOI-FM 97.5 and KHUI-FM 99.5 from New Wave Broadcasting LP to Salem Me dia of Hawaii Inc.

has been granted by the Federal Commu nications Commission. The ap proval is separate from the financial transaction announced in May. Data at the FCC Web site indi cates the transfer of KDDB-FM 102.7 from New Wave to Maui- based Visionary Related Enter tainment LLC was granted Thursday. It was unclear if the transfer of sister-station KQMQ- FM 93.1 had also been granted but the applications were filed the same day in May. John Detz, Visionary president and chief executive officer, could not be reached to discuss the transac tions or format plans for its part of the $11 million, four-station, two-buyer deal.

Salem Vice President and General Manager T.J. Malievsky was not at liberty to divulge Salem's plans for KPOI and KHUI, citing a confidentiality agreement. He expects the deal to close and the information blackout to lift in mid-August. "We just continue to operate; We're jn a transition phase and we're goinglntothe process of transferring thfe issets of the company and $1fig Up any loose ends with the customers, mak ing sure they're serviced prop erly, said New Wave General Manager Dan Manella. "It should be a seamless transaction as far as the public and advertisers are concerned.

However, it is unlikely Salem will retain the format of either station. KPOI is a so-called her itage rock station. It has long branded itself as the rock you live on," word-play keyed off its rock music format and the is land on which we reside. KHUI, referred to as "Bob-FM" has a hit-music format centered around the 1980s and 1990s. Neither decade was known for a preponderance of pop music anyone could consider conser vative.

The publicly traded Salem Communications Corp. is focused on religious and family themed programming with three primary formats Christian teaching and talk, newstalk, and contemporary Christian music. No mention of rock or hit music. In Hawaii Salem owns KAIM-FM 95.5, which plays contemporary Christian music, conservative talk radio KHNR-AM 650, Christian talk and teaching KGU-AM 760, KAIM-AM 870 which is also Christian formatted, country music KHCM-AM 940 and KJPN-AM 1170, which rebroadcasts KAIM-FM's music. It owns five AM stations in Honolulu, which exceeds the present FCC ownership limit for a market the size of Honolulu.

The rules allow one owner to possess seven stations in a single market, with a maximum of four on one band, either AM or FM. New Wave and Salem are in a customary hands-off period pending finalization of the deal, meaning many if not most employees are in the dark about their futures. Disclosure: Your columnist was employed by New Wave's previous management from 1994 to 1998. CINDY ELLEN RUSSELL CRUSSELLgSTARBULLETIN.COM Lolita Baybayan makes a passenger's bed on the Pride of Aloha. Baybayan, who lives on Maui, enjoys working on the ship although she misses her family while aboard.

EXPANSION POSSIBLE In addition to the Pride of Aloha and its sister ship the Pride of America, which is due in Hawaii in June of 2005, Norwegian Cruise Line has purchased the historic SS Independence and SS United States cruise ships and is looking at home port options, which include Hawaii. By Allison Schaefers aschaefersstarbulletin.com Norwegian Cruise Line and Hawaii will embark on a voyage together today when Pride of Aloha, the first new U.S.-flagged cruise vessel in decades, begins offering interisland ocean travel. NCL's expansion in the state is being touted by some as one of the most significant tourist developments to hit the islands since jet travel, and if successful, it could serve as a model for the rebirth of a U.S.-flagged cruise industry, they say. But it's a new route for NCL and for Hawaii's tourism industry, and plenty of people are watching to see if the business venture will find calm waters or choppy seas. NCL managers and most visitor industry experts have said they expect Pride of Aloha to make a smooth entry into Hawaii, boosting state revenues by keeping the dollars cruise passengers spend in the state.

Others have said they see rough seas ahead as the infrastructure demands on Hawaii's harbors and roads could outweigh revenues generated by buck from the 1 November time frame to 30 April, and then from 1 May through the remainder of the summer you have what is known as the summer doldrums," he said. "So, during that period I look for quick hits. It's more of a trading strategy for me in that period." Melton, a director with the nonprofit National Association of Investors Corp. in Hawaii, was up 7.3 percent at the midpoint of this year to lead four other local stock experts in the Star-Bulletin's annual survey of best investment ideas. Each expert was given a hypothetical $20,000 portfolio at the beginning of 2004 and isn't allowed to this fledgling industry.

Native Hawaiian groups have asked for impact fees and some members of the hotel industry have petitioned the state to make NCL pay accommodation taxes, like the hotels do. But all agree, today's christening of the ship in Honolulu Harbor is a big deal. "It's a very different model than we've had with cruise ships before," said Paul Brew-baker, senior vice president and economist for Bank of Hawaii, who remembers greeting cruise ship passengers at Honolulu Harbor back in the 1950s and '60s, "In the old days, people got on the Lurline to get to Hawaii," he said. "Now, they'll come to Hawaii as an excuse to ride a ship." During the next six months, the state expects Pride of Aloha to bring 50,000 visitors to the islands, generating $120 million in visitor spending and another $2 million in spending on supplies, according to data from the state Department of Business, Economic Development Tourism. Please see Cruise, E6 make any changes during the year.

Barry Hyman, vice president of the management team of Financial Investment Management Group Ltd. in Wailuku, Maui, was second with a 5.2 percent gain. He was followed by Certified Financial Planner Alan Matsuda, up 4.2 percent; InvestMentoring financial consultant Mike Corcoran, up 2.7 percent; and Richard Dole, chief executive of investment banker of Dole Capital LLC, down 11.1 percent. Melton diversified his selections among four mutual funds Please see Investing, E6 July 4, 2004 2,002 June 3, 1950 1,000 July 3, 1952 1,972 Pride of Aloha SS Independence SS United States Source: Norwegian Cruise Lines 1 108 feet 23 knots 77,104 88.9 feet 23 knots 23,719 101.6 feet 35.6 knots 53,300 By Dave Segal dsegalstarbulletin.com It's the summer doldrums. The Federal Reserve has just raised interest rates for the first time in four years.

The presidential election is up for grabs. And the Iraq situation is still as volatile as ever. What's an investor to do? For local stock expert Dwight Melton, a devout follower of stock market trend lines, it's to become more of a short-term trader and stay poised for another possible rate hike in August. "The way market cycles work, you get the biggest bang for the Mid-year top stock picker says short-term gains worth a look 2004 year-end forecasts A quartet of mutual funds hand Melton the best return so far for 2004 Hawaii stock experts predicted at major indexes would post gains 853 feet 682 feet 990 feet the start of 2004 that all three for the second year in a row. STAR-BULLETIN Name Dow Nasdaq Mike Corcoran, InvestMentoring 12,022 2,404 1,279 Richard Dole, Dole Capital 11,000 2,300 1,165 Barry Hyman, Financial 11,800 2,350 1,275 Investment Management Group AlanMatsuda, 11,499 2,204 1,223 Certified financial planner Dwight Melton, NAIC 12,700 2,600 1,400 Consensus 11,804 2,372 1,268 2003 close 10,453.92 2,003.37 1,111.92 June 30, 2004 close 10,435.48 2,047.79 1,140.75 Erika Engle is a reporter with the Star-Bulletin.

Call 5294302, fax 5294750 or write to Erika Engle, Honolulu Star-Bulletin, 7-210, Honolulu 96813. She can also be reached at: eenglestarbulletin.com.