Monday, September 13, 2010

It's Double Talk For WSB

It's not that the idea of WSB adding an FM had not been predicted.  In recent years, the concept had popped up from time to time on  And as WSB-AM's audience decline became a legitimate issue this year, posts on the subject increased.

When WSB-AM added 95.5 on August 16, however, it still generated some surprise.  The sudden demise of 95-5 The Beat, a successful station, topped off the move with an element of shock.

As to why the action was taken, I can only speculate.  Below are the probable reasons:
  • WSB's declining ratings spiked worries about revenue and status.  Cox Media Group's Bob Neil's favorite station might be B98.5 FM, but he knows WSB-AM is the flagship of the empire.  During the past 15 years, WSB's advertising rates had been far higher than the market's cost-per-rating-point merited, and advertisers still flocked to the station given its #1 ratings, prestige and mystique.  And, high ratings and status have a direct correlation.
  • Young people never listen to AM.  Cox executives Dan Kearney and Tony Kidd were quoted as saying FM was added because people under 40 never visit the AM band.  Younger folks are much more sought after by advertisers than persons over 50.
  • WABE has been soaring.  WABE-FM, Atlanta's NPR affiliate, has been grabbing audience share concurrent with WSB's decline.  Over the past several months, WABE has been just under or at a 5% share in Persons 6+.  The public station's newfound ratings glory coincided with the hiring of popular Atlanta radio veterans Steve Goss, to provide local content in morning drive, and Dennis O'Hayer in afternoons, and with beefing up its news department.
  • Precedence for success exists within Cox and elsewhere.  In the Jacksonville market, Cox added an FM simulcast to news/talk WOKV, and the station has been #1 among persons 12+ in most ratings periods since.  The company did the same with its WHIO in Dayton and KRMG in Tulsa.  In all three cases, Cox used either a Class A (lowest-power FM classification) or a "rimshot" signal, as it did in Atlanta.
Was the addition of the 95.5 signal for WSB and the sacrificial killing of The Beat a prudent decision for Cox?  I would say that on balance and looking at the long term, it probably was.  How much will the change help WSB in the short term?  That's hard to say.

WSB had been losing audience since the start of the year, but the more dramatic erosion happened in the past 4 months.  Was it because WSB's longtime audience suddenly decided it did not like AM?  The answer is yes and no.  WABE's enhancements made the station an acceptable news alternative in the drive times, and the fact that it's on FM probably added to its attractiveness.  On the other hand, with WSB's losses occurring more during talk shows, most of the decrease might be attributed to listener weariness, a problem that FM will not solve.

Just being on the FM band will attract some new audience.  And some AM listeners probably will move to the FM simulcast.  All told, the Persons 6+ numbers are likely to increase.  But what about WSB's stated reason for the move, attracting younger people?

As the Cox execs asserted, younger people listen to FM only.  Nevertheless, News/Talk is an older-skewing format, and being on FM is not going to change that.  WABE is on FM only, and 66% of its audience is at least 55; 48% at least 65.  But as younger people reach the news/talk age demos, WSB will be more likely to pick them up as listeners, so the move augers well for the long haul.

Revenue is influenced heavily by ratings but is also closely tied to supply and demand.  It's hard to imagine that WSB's revenue will grow enough in the immediate future to compensate for the loss of The Beat.

The Groove at 105.7 has smartly taken advantage of the hole in the market left by The Beat's exit by adding a number of current Rhythmic songs.  But The Groove has been staying away from the more Urban-oriented product and still airs some older Rhythmic AC.  (Where else does B.o.B. meet Madonna?)

Clear Channel also has added a Groove simulcast outside the south-side Perimeter on the little 96.7 signal.  With 105.7 strong outside the north-side Perimeter, that leaves just one area not getting an effective signal, and it's called Atlanta.  The Beat's audience was 26% Hispanic and 33% African-American.  The 105.7 signal is powerful in Gwinnett, a high-density Latino area.

Based on The Beat's high black audience composition and The Groove's weak signal in town as well as absence of hard-core Hip-Hop, the biggest beneficiary of The Beat's untimely death might be Urban Hot 107-9.  The Radio One property been wooing former Beat listeners by proclaiming itself "Atlanta's only hip-hop station," and its age target of 12-34 matches The Beat's.  Even Q100 could snag some listeners.

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