"......everywhere, like, such as......" and other ruminations: BFT 10.0

Tucked away in the mass of hysteria that was the Presidential Inauguration this Tuesday was a slice of info, that unless one was looking closely for it, most assuredly passed quietly into the night, that being the layoffs at Clear Channel Communications. Timed to no doubt get buried in the Presidential coverage, Clear Channel on Tuesday removed 10% of their workforce, a total of 1850 people were shown the door the same time one man was being sworn in to take over his new job. For those that don't know just who Clear Channel is, they are the largest radio holding company in the United States, owning more that 1200 radio stations nationwide, as well as having holdings in outdoor media, television and international radio as well. So while I bemoaned my job loss late last year in my blog (at a non CC station), I was not kidding anyone when at the time I said that this is a intrinsic problem with radio in general and not my specific employer at the time. That being said, why did it have to happen and could it have been prevented? First, lets go with why it happened.

It doesn't take a brain surgeon to know that we are in an economic downturn, and one of the primary ways that radio succeeds is by selling advertising. The thing is, during a downturn, businesses are less likely to by advertising in any form unless they are sure that they can get a return on their investment. Think I am kidding? Then why is it that one week before the Super Bowl, NBC still hadn't sold out all of its spots for an event that every year is one of, if not the most watched TV event of the year? Sure cost figures into it, at 3 million per 30 second spot, it is a huge chunk of change for any business to part with, but the Super Bowl comes with enough buzz that businesses often unveil new ad campaigns during the contests, and part of the day after buzz in the papers is not just about the game, but talk about the commercioals themselves and whether or not they worked. In many ways, advertisers get free plugs for days after the game by the endless chatter about their efforts days after the game took place. Still, the idea that 8 days and counting before kickoff of such a largely viewed event, NBC hadn't been able to find enough buyers for all of its potential commercial avails (biz talk for availables, just so you know) . Larger companies such as GMC, who used to make sure that they had spots running during the game, have come out and said that this year they will not be spending money in such a fashion. If an event of this size and scope can have problems selling spots, the idea that somebody doing a radio show 5 days a week and looking to fill in the ballpark of 15-18 minutes of commercial avails per hour of every show with an audience far smaller than the Super Bowl, and you start to get where the problem begins. If you can't sell time, then you can't pay the simple bills that keep the lights on and your employees fed, so you do what you can to start cutting costs, and the easiest way to begin that process is to start cutting jobs, and taking salaries off of the books.

Second is oversaturation. Clear Channel is the most obvious, holding 1200 stations, but they are not the only player in having too much of a radio thing. Media owners have been buying multiple stations in the same market for quite some time now, and the goal of that media ownership isn't neccessarily to compete in the marketplace, but simply to hurt others that are trying to compete. In the grand chess game of corporate ownership, sometimes a station will be bought not because it is expected to be a big ratings winner, but because with little effort, you can hurt another company trying to do business in the same market. Here in Pittsburgh Clear Channel owns 106.7 FM (country), 105.9 FM (alternative rock), 104.7 FM (talk), 102.5 FM (rock), 96.1 FM (pop, or whatever they call it these days) and 970 AM (sports). Not that they are the only ones, CBS has at least 4 stations in this market, and many others also own multiple stations within the same market. Not all of the CC stations are successful, take 970 AM for instance, that is largley syndicated fare from Fox Sports Radio out of Los Angeles, but the goal isn't necessarily to be dominant in the market, but simply to harm the local ESPN affiliate, 1250 AM that relies on a similar sports talk format. If 970 AM can steal a few advertisers, while at the same time not spend that much on actual local talent, then their job is done, their goal isn't to try to compete to be the best station in the market. just steal enough listeners so that no one else can topple their bigger stations (102.5 and 104.7) from the lofty perches they currently have in the Arbitron ratings. The result is that a signal that may employ quite a few people and try to be competitive is run on the cheap and is just designed to harm other stations in the same market. Worse is if you feel you can't compete, which was the position my former station was in, then you opt not to, you basically just throw in the towel. You sell off blocks of air time to advertisers, usually in 30 or 60 minute increments, and live off of those checks. The quality of programming is not an issue, it is simply a matter of can you find enough Dr. McQuackens to hock their cure alls on your signal. Every market has stations like these, you scan the dial and it is usually some religious programming or some guy selling the latest product to save your colon from some unmitigated disaster that your eating habits created. While it generates money, it awful sounding radio, and usually such stations garner so little of an audience that they don't show up in the ratings at all, but they are paying to keep the lights on, and that is all that matters to them.

Third would be technology, which has allowed listeners more options than ever before. Whether it be MP3s and Ipods, the internet which allows access to stations and media previously unavailable or satellite radio, radio has never had this many challenges from outsides sources before.

Now the answer to trivia question, could it have been prevented. In a simple word yes. That doesn't mean that their wouldn't be a fall off in revenues, as long as fewer companies are spending advertising dollars, any form of business that relies on such revenue, whether it be print, television or radio, is going to feel some of those effects. To suggest otherwise would be foolish, but that doesn't mean that radio hasn't overreacted either.

Let's go back to the arguments and dissemble them just a bit. First is advertising revenue. Sure numbers are down, but audience size is not. In fact last year the number of people listening to radio actually increased, not decreased as is the case with newspapers and TV. One of the big failings of radio is that it hasn't been able to make the argument that now, more than ever, they are capable of delivering an audience to advertisers. When looking for how to spend advertising money, a business is going to look to get the biggest bang for its buck, and radio can deliver that, but it requires radio to stop with the "Woe is us" arguments that are permeating the industry and start dealing with facts and delivering those facts to advertisers. Sure TV and print have helped permeate the argument that radio is dying, they are going to do that because they are competing for the same advertising dollars, radio is just making it easier for them to get away with exploiting that myth.

Second, the oversaturation of markets by a few big time players. This is starting to play itself out in a way, those stations that were purchased originally as simple properties to hurt someone else are in fact bleeding money. CBS has put radio stations up for sale, and Clear Channel is trying to cut in markets where it overextended itself just to name two. Not that owning multiple stations is a bad thing, but owning multiple stations when one or more are just throw aways rather than actually trying to program something is. In the end you just end up hurting your own bottom line and maybe costing a few radio professionals jobs in the process.

The technology argument is another sham. Audiences for radio online are incredibly small, and chances that advertisers will waste a lot of money targeting an audience that small and scattered aren't great. Satellite radio may have the edge in sound, but it doesn't have the edge in listeners. When Howard Stern gave up his show for satellite radio he lost better than 80% of his audience despite the fact he was now available everywhere, not just in markets that carried his show, and now XM/Sirius are starting to realize that they overpayed for underperformance with a number of talents, so much so that they are facing bankruptcy. MP3 players and Ipods are nice, but the argument that people will only listen to what they want to has always be made false. When 8 tracks were introduced into cars, that was to be the death of radio, then it was cassettes, and worse, blank cassettes and cassette recorders, as people could now tape what they wanted to listen to ahead of time and just take it with them. But alas, those never killed radio, nor will current technology, what is hurting is radio trying to be like current technology. Regardless of the format, people have to have a reason to tune in and that reason is the personality of the station. If your goal is attracting lisrteners, just doing song, song, back sell, time, temp, front sell, song, song is not a reason for anyone to tune in, because they can get that from current techonolgy without the middle garbage. Likewise talk stations can't just plug in automation and walk away, there has to be a hook, a reason for the listener to care about what is on the station. Small local stations do this better than anyone, they identify their audience and communicate with them and the larger markets would be wise to follow their lead on this front. It isn't the small mom and pops serving 20,000+ that are cutting jobs, it is the big markets with the potential for big audiences that are hurting most. The reason why is simple, the listener isn't given a reason to tune in. Radio is being done on the cheap, rather than it being done well. Programmers need to better understand their audience, sales people need to understand the audience they are trying to reach when pitching the station to advertisers and talent needs to both be free to do a show and responsible enough to do the work required to put on a show.

If anything, technology has given radio many ways for free promotion that were previously unavailable. From podcasting to social networking sites, talent has been granted a unique opportunity to interact with listeners that heretofore was unavailable, and they need to take advantage of that. A show host that doesn't have at least an email account and one social networking profile is simply someone who isn't doing their job. Likewise, with the availability of information on such a grand scale, show prep these days should be better, not worse, than it was in the 1950s and 60s. Finding a clever anecdote about a song that was just played or is about to be played, or getting a bead on the pulse of what people may want to talk about has never been easier, yet radio fails in this regard time and time again, instead opting for what is easy as opposed to what is good.

So, at the end of the day, or days as I have been working on this post for a while now, the simple question of what is wrong with radio can be answered in one sentence, "Radio is what is wrong with radio.".