We have a real-world example, when after 12 years of being in the Aloha Trust, iHeart finally off-loaded 2 stations in a donation to a shell non-profit that carries Salem programming.
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BREAK UP I-HEART!
- Thread starter blackgold
- Start date
Earlier was the post on how national chains have eaten up so many dollars local radio and newspaper once had. I think back to my first station in a town of 30,000. There was an AM and FM here. I worked the top 40 FM in this quite poor 97% Hispanic town with a median age of 21.6.
We didn't yet have a shopping mall but we had a Montgomery Wards, J. C. Penney (both advertised extensively). There were "home and auto" stores like White's that spent a bunch using co-op. By 1981 our stations were billing about $45,000. We had so many advertisers were average 6 commercials per song played. I ran the inflation calculator: $45,000 in 1981 is like $143,500 in 2022). It never eased up until about 8pm and on Sundays when we'd drop to about 24 units an hour from about 24 to 26 minutes an hour. In fact, compared to stations across the river in Mexico were charging about 1/3rd or 1/4th what we were. Don't think nobody listened. The county by county showed a 12+ share of 43.?% in 1981. The stations across the river sometimes averaged a dozen spots per song.
In the following years, the mall opened. Walmart was a flagship store. I helped an auto parts store advertiser by going with him and others to buy the limit on Fram oil filters that were priced below what he could buy them wholesale. There was a limit of 10. I recall us grabbing 10, getting in line and the guy before me telling the cashier to hand me the change from which I paid for my ten and told the cashier the same. In a couple of years half of downtown was vacant. The peso devalued. New stations came on the air on both sides of the border and a TV station signed on.
Fast forward to the 1990s and the station was charging 3 times as much for commercials and barely able to reach $17,000 a month or about $35,000 in today's money split between the AM and FM. They went silent last year.
There are so many barely hanging on. It's not just radio. A friend had a newspaper in a town with about 3,700 in the zip code. It was the only local media but there was a very aggressive shopper. When Dollar General came in the town saw about $1.7 million in retail sales vanish even though that Dollar General, they think, does 1.6 million. Plainly put, too many local businesses lost just enough business that it was work for far less than minimum wage or lose money. Then the local bank sold to a regional chain. Her revenue went from about $100,000 to $45,000 in a couple of years. Subscribers dropped as pages could no longer be supported. She lost 50% of readers and lost money for a year cutting back to a 4 pager from a 12.
This is to demonstrate an advertiser has tons of choices but even worse is the national chains force local advertising businesses out of business, hurting media even further. The national chains don't buy in markets with a single store.
We didn't yet have a shopping mall but we had a Montgomery Wards, J. C. Penney (both advertised extensively). There were "home and auto" stores like White's that spent a bunch using co-op. By 1981 our stations were billing about $45,000. We had so many advertisers were average 6 commercials per song played. I ran the inflation calculator: $45,000 in 1981 is like $143,500 in 2022). It never eased up until about 8pm and on Sundays when we'd drop to about 24 units an hour from about 24 to 26 minutes an hour. In fact, compared to stations across the river in Mexico were charging about 1/3rd or 1/4th what we were. Don't think nobody listened. The county by county showed a 12+ share of 43.?% in 1981. The stations across the river sometimes averaged a dozen spots per song.
In the following years, the mall opened. Walmart was a flagship store. I helped an auto parts store advertiser by going with him and others to buy the limit on Fram oil filters that were priced below what he could buy them wholesale. There was a limit of 10. I recall us grabbing 10, getting in line and the guy before me telling the cashier to hand me the change from which I paid for my ten and told the cashier the same. In a couple of years half of downtown was vacant. The peso devalued. New stations came on the air on both sides of the border and a TV station signed on.
Fast forward to the 1990s and the station was charging 3 times as much for commercials and barely able to reach $17,000 a month or about $35,000 in today's money split between the AM and FM. They went silent last year.
There are so many barely hanging on. It's not just radio. A friend had a newspaper in a town with about 3,700 in the zip code. It was the only local media but there was a very aggressive shopper. When Dollar General came in the town saw about $1.7 million in retail sales vanish even though that Dollar General, they think, does 1.6 million. Plainly put, too many local businesses lost just enough business that it was work for far less than minimum wage or lose money. Then the local bank sold to a regional chain. Her revenue went from about $100,000 to $45,000 in a couple of years. Subscribers dropped as pages could no longer be supported. She lost 50% of readers and lost money for a year cutting back to a 4 pager from a 12.
This is to demonstrate an advertiser has tons of choices but even worse is the national chains force local advertising businesses out of business, hurting media even further. The national chains don't buy in markets with a single store.
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Look with all sincerity, it sucks getting canned from a gig you enjoyed at the time. A wise ol' grizzled radio legend many moons ago told me: 'If you've never been fired or laid off in radio, you've never actually worked in radio.'
Fortunately I've never been fired for cause, but have been laid off because of economic challenges (2008 recession) and another where they sold the company to someone who had already had an employee in my role. These days being laid off in any business is much more common than it used to be. It's tough not to take it personally but in the end, it's just business.
Of course. From the people I know - including a close friend who was laid off from iHeart a couple of years ago - many of the laid off blame the company as much as economic conditions. He told me about a certain top-50 iHeart market that has lost more than two dozen employees (some were part-time, however) in the last 15 years. I can understand their pain.
And, proportionally, so has every other radio operator, both here and internationally. Radio ad revenue, in inflation adjusted numbers, is down two-thirds in the last 22 years.
Most of the complaining people miss 1960's style motor-mouth jocks and jingles and call-in-to-win. And they are in their 60's or older and of limited interest to advertisers.
Yet none of the "interesting" and "fun" things are the issue with 18-34 listeners. What they dislike are commercials and that's why they prefer, if they can afford it, streams and play on demand. On other words, they want one-for-one delivery, and radio is one-for-many.
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As I said, I was one of the 1,500 thrown overboard the third week of January, 2020. It sucked. It sucked even more when lockdown happened two months later. The good news, I had a generous severance package, but that was only because I had a contract. I was able to coast right up until the moment the phone rang from CapRadio. A lot of those people got two weeks' pay and that's it.
I was not born until the late '70s, so that comment does not apply to me. And if "interesting" and "fun" aren't relevant, why are there still some interesting and fun jocks out there, some of whom are paid well. Broadway Bill Lee, Big Joe Henry, Hollywood Hamilton, Gary Bryan, and Billy the Kidd are just some examples.
Keep in mind that the iHeart layoffs were made on a market-by-market basis. I studied the iHeart financials, and none of the savings from the layoffs went to pay off corporate debt. The $20 billion debt remained the same from 2008 until the bankruptcy. The layoffs were done locally because those markets didn't meet their sales targets. It's a similar situation happening now with Beasley. Some of their markets were unaffected by the layoffs.
Regarding Beasley, there was much talk about their Boston layoffs. I'm specifically thinking of their sports station. Not only did it meet sales targets, but, at least according to many, that station is one of the most profitable stations in the entire country (top five, if memory serves). Did the rest of Beasley's Boston cluster under-perform that much that a morning show producer from said sports station had to be laid off (I know he was re-hired and is now being paid by one of the hosts)?
The revenue figure is based on billings, not profits. Beasley debt hasn't increased, so the only assumption is that costs for the cluster exceeded revenues.
All News Captures Four Of BIA’s Top Ten Billing Stations In 2021.
For an eighth consecutive year, Hubbard Radio’s WTOP-FM Washington, DC (103.5) was the top billing radio station in 2021, according to BIA Advisory Services. The news giant pulled $70 million
iHeart has four stations in the Top 10.
And remember that WBZ-FM was acquired from the much larger CBS Radio. They had a lot more overhead to run expensive formats, whereas Beasley is smaller.The revenue figure is based on billings, not profits. Beasley debt hasn't increased, so the only assumption is that costs for the cluster exceeded revenues.
All News Captures Four Of BIA’s Top Ten Billing Stations In 2021.
For an eighth consecutive year, Hubbard Radio’s WTOP-FM Washington, DC (103.5) was the top billing radio station in 2021, according to BIA Advisory Services. The news giant pulled $70 millionwww.insideradio.com
The answer, of course, lies in total national programming like what is dominant in most European nations. A few really good talents, well researched music, access to the artists for on-air events and quality production.
TV proved 60 or more years ago that "live and local" is not the key factor in programming: it's all about entertainment and information. Nobody cared that the Tonight Show was not local or that Lucy and Desi did not film their shows in their town.
In Spain, the leading hit music station, "Los 40" began in the mid-60's as a national network, with hundreds of stations and repeaters. It's a magnificent station, and nobody cares that it does not originate in their little rural town or smaller city. In the rest of Europe we see the same kinds of stations and national programming with great talent.
Well, even the smallest TV markets still have live and local TV hosts.
Plus given today's automation systems and music scheduling software, it's possible to use national talent with local music.
It's becoming harder for big name celebrities and recording artists to do all of the interviews that come in. That's why national radio shows get priority over all of the local stations.
KXGN TV 5 Glendive, MT records their local news broadcast. It's an insert into a simulcast from the big city NBC station nearby
For local news. Most radio music stations don't do news, and if needed local inserts could be done in network music shows.
Keep in mind that iHeart owns Total News & Traffic, a locally based service that provides local news, traffic, and weather to radio stations in hundreds of cities.
Exactly what Seacrest does. Good point..
And national show hosts like Seacrest and Bobby Bones and Charlemagne have the trust and familiarity needed with artists to be able to do great interviews. (I use those three as examples... there are, of course, many others who do great national or regional shows)
Unfortunately that's a blanket statement which isn't true anymore. Small and medium market TV stations are being hit with very similar headwinds that radio is. Visit the Washington State TV section of this site, and witness how stations in smaller and mid markets are carrying newscasts from larger markets, or eliminating newscasts altogether.
And there are groups like TelevisaUnivision that have TV news departments that can provide both well-done news and great cross promotion.
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