Can Mel Karmazin pump up the volume at Viacom's ( VIAB) radio operations this year? That's what Wall Street is betting.

Driven in part by the Viacom president's public vows to whip the radio division into shape, analysts have modeled steady improvement in the radio business's revenue and bottom-line results.

But signs of strengthening radio aren't as clear as bulls might hope. And as media companies have discovered annually over the past few years, the second half of the year isn't obligated to bring the rebound that optimists expect in the first half. The grass isn't always greener on the other side of June 31.

Though radio is only a slice of Viacom's operations -- it amounted to 19% of earnings before interest, taxes, depreciation and amortization last year, according to Blaylock & Partners -- the Infinity radio operations carry a hefty amount of symbolic weight among investors. Not only did the can-do Karmazin work his way to the top of the broadcasting business via radio, but he has also made numerous public statements this year that Viacom's radio is broken -- and that he will surely fix it.

"The radio business is sort of Mel's baby, because that's what he grew up in," says David Joyce, an analyst at Guzman & Co.

On Friday, Viacom's shares rose 3 cents to close at $45. Shares in the media and entertainment conglomerate reached a 52-week high of $49.75 late last month.

Hard to Starboard

In the first quarter of 2003, Viacom reported radio revenue of $444 million, down 1.7% from the first quarter of 2003, and EBITDA of $198 million, flat from the prior year. But analysts see both measures improving this year. Wall Street firms projecting mid- to high-single-digit year-over-year EBITDA growth for radio in the third and fourth quarter include Prudential, Blaylock and Smith Barney.

And yet it's unclear whether the traction is there. David Miller of Sanders Morris Harris, for example, said in a research report earlier this month that the expected post-Iraqi-war ad market hadn't materialized in the radio business. "We are seeing very little improvement in radio fundamentals," wrote Miller, who lowered second-quarter estimates for radio while raising his price target on Viacom from $48 to $50 and maintaining a buy on the company.

In a late May note, RBC Capital Markets analyst David Bank was even cautious about prior expectations for the second half of the year. Despite the robust upfront television market, Bank characterized radio advertising growth as anemic, in a report entitled "Radio Advertising -- Where's the 'Pent Up Demand' in June?" Though radio operators, during first-quarter earnings calls held two or three weeks earlier, had projected a June acceleration, the positive sentiment that operators said they saw at the time wasn't translating into more ad selling, said Bank.

Not that Viacom is short on other things to crow about. By all reports, the upfront TV season was strong. And in the first quarter, cable networks' EBITDA rose 19% year over year to $480 million, driven by large advertising growth at MTV Networks and BET.

And late last week, Bank -- who doesn't cover Viacom -- said he saw conditions getting "incrementally better" for radio. "Particularly for Viacom and larger market players, national advertising has picked up....National is behaving robustly," said Bank. "This stuff really can turn on a dime," he added. "All you need is a couple of big buys to come in, and you could see a pretty quick turn."

And even if there is weakness in radio, not everyone finds it troublesome. "Would I like it if it was doing better? Of course," says Mark Greenberg, portfolio manager of the ( FLISX) Invesco Leisure fund, a Viacom shareholder. But radio's problems are offset by other businesses at the company, including the cable networks, he says. Radio "is not the only thing going on at the company."