Monday, February 9, 2009

Will It Be Back to the Good Old Days?

A couple of blogs written by respected radio people caused a stir last week. First, former Inside Radio publisher Jerry Del Colliano wrote that most of the large radio groups would not survive 2009 without debt restructuring, a near impossibility in the current lending climate. Second, consultant Bill McMahon called On Air with Ryan Seacrest “a microcosm of what’s wrong with radio,” citing what he feels is the syndicated show’s cookie-cutter nature.

While bemoaning what they believe is the sad state of radio, with voice tracking, syndication replacing local personalities, unimaginative programming and massive layoffs, radio observers felt a tinge of hope. If the Clear Channels of the world were forced into bankruptcy, legions of stations would likely find their way into the hands of smaller, perhaps privately-held, owners.

When I listen to airchecks from the 60’s and 70’s, I get a feeling of fun and excitement. So what has happened since those goldie oldie years? Are conglomerates the root of all this radio evil? If the big radio groups were broken up, would everything with the world be right again?

It all started so innocently and for a perfectly valid reason. In the late 1980’s, approximately 70% of U.S. radio stations were losing money. That led to the LMA, local management (or marketing) agreement, the precursor to deregulation. The FCC’s blessing on LMA’s was universally applauded as logical and necessary. LMA’s popped up in markets everywhere.

Once the fox was in the henhouse, however, radio station groups wanted more. They got what they wanted when the FCC allowed them to purchase a second station which with they had an LMA. But that was not enough.

I remember reading a quote from Randy Michaels, then CEO of Jacor, making the case for owning more than 2 stations in a market. Mr. Michaels said owning several stations would enable radio groups to offer diverse programming, citing classical as a possible format. I thought, “Yeah, right.”

LMA’s notwithstanding, a lot of red ink still flowed in the early 1990’s. Armed with this ammunition, radio lobbyists pushed Congress for deregulation. When it happened in 1996, the radio landscape’s transformation was dramatic. In just several years, ownership rules had shifted from one end of the spectrum to the other. Station sales hit a frenetic pace, as small owners cashed out big time. Then major groups bought other major groups.

As consolidation marched forward, the new radio companies accumulated immense debt. But not to worry; the economy was booming. Station values were increasing. That the economy could eventually tank was not part of the business model.

A lesson to be learned is that, big conglomerates or not, multiple station ownership within a market should continue to be a fact of life. Taking into account good times and bad, as well as the proliferation of alternatives to terrestrial radio, some staff consolidation, such as office and engineering, will be necessary for stations to thrive. Nevertheless, I would prefer that stations under a single owner in a market be slightly less than the current numbers. After all, more competition results in better product.

So back to our question: Are the big radio conglomerates the reason for the mediocrity in radio? My conclusion is probably partially but nowhere near totally. A lot has happened since the fun days of radio.

In those good old days of chasin’ the blues just minutes from news, programmers had what seemed like good ideas and executed them. The only research was calling record stores. In the mid-sixties, programmer Bill Drake surmised that more-music radio without the clutter would beat traditional song-talk-commercial radio. And he was right. Drake’s format also manifested his other theories. For example, he figured playing a jingle going into a song would get listeners to associate his stations with music. But Drake was all about intuition; the ratings were his research.

Radio consultants were not new to the industry but started popping up full force in the 70’s. The John Rooks and Buzz Bennetts of the world were portrayed as the geniuses behind Y100 in Miami, 13Q in Pittsburgh and other success stories. Consultants refined Drake’s theories, and stations increasingly became more-music machines. That the audience was moving to FM accelerated the emphasis on music. Gone were the days when stations had time to talk about listeners searching for a Mustang key. Yet some great jocks still manned the turntables, such as Miami’s JoJo Kincaid and Robert W. Walker, San Diego’s Rich Brother Robbins and others.

Research became a byword in the 1980’s. Although Scott Shannon famously shunned research in favor of his own opinions at New York’s Z100, a consensus grew that a station could not be successful without it. Consultant firms hired researchers to learn and then teach clients how to pull listeners through quarter hours plus other techniques to amass Arbitron diary mentions. All of this was more bad news for lovers of radio as it once was.

Radio’s increasingly sophisticated ways of getting ratings in our judgment had much more to do with today’s bland programming than did Clear Channel or any other conglomerate.

Another huge force in the melding of today’s radio was technology. Of course, automation had been around for years, and had for the most part been unsuccessful. Today all kinds of voice tracking software are out there, enabling the better jocks to appear on air in multiple markets without listeners knowing it. And frankly, voice tracking has improved the sound of medium and small market radio. Gone are the days when my friends and I drove through a small town and had fun laughing at the jock on the local station. ISDN lines are another technology that contributed to radio’s sameness around the country.

Still another factor that moved radio to where it stands today was advertising agencies. Procter & Gamble had a perfectly legitimate reason for targeting 25-54 for most of its brands; large families buy more household products. But agencies use either 25-54 or 18-49 for virtually every client. That forced almost all FM’s to program for the same demographics and is what led to format fragmentation: AC, Hot AC, Soft AC, Pop Conservative, CHR, Adult CHR…and on we go.

When you fold large radio conglomerates into the mix of programming for ratings, technology and agency target audience, the picture is complete. Strapped with unwieldy numbers of stations and mountains of debt, radio companies were forced to cut costs, unloading superior talent and making enhanced use of voice tracking and ISDN technology. Super tight playlists became the order of the day; there was no room for experimentation. Today’s down economy did not figure in their business plans but has accelerated what many feel is a significant decrease in the quality of radio stations, on and off the air.

So if major owners were forced into a wholesale shedding of stations--well within the realm of possibility--and many of the properties ended up in the hands of smaller owners, would radio return to that way-back machine of yesteryear? Probably not, but things might improve to an extent.

Privately-held companies can afford to be more benevolent in tough times compared to public companies, which see their stock price go up when they lay off workers. Moreover, private and especially family owners, who might gain entry into radio by virtue of depressed prices, sometimes are willing to allow some creativity. Nevertheless, the forces of technology, research and virtually all FM’s targeting the same audience will still be a part of the landscape. Why employ an overnight personality when doing so is a money-losing proposition, especially in light of voice tracking technology?

Another big factor clouding the issue in major markets is Arbitron’s PPM, which has been indicating that a music station’s ratings are highest during music sweeps and lowest when someone opens his mouth. This too could have influence on the sound and creativity of radio as we move forward.

Thanks for reading. Your comments are welcome. Email me at

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