Make radio strong again

[SomeRadioGuy]

i was involved in the proposed (but later aborted) sale of 3 stations in Western PA to a former employer of mine several years ago.. he wanted me to come back and run them.

None of the stations we were buying streamed and at the time, not many of our competitors in a nearby bigger city did.

I was proposing format changes on 2 of the stations... all 3 were older, male skewing stations.. i proposed to take one younger and female skewing.. and come hell or highwater, as long as we didnt lose money.. at least make it break even, we needed to stream and have an app.

Why? Beat our competors to the punch and not give out listeners a reason to tune to out of town station. our community had enough of a female presence to warrant the station i proposed but no one catered to that demographic.. old school old line stuck in their way stations were what we were taking over.

i told the owner "Give them everything they want from us, and make it easy to find... otherwise theyll go to the competitors and wont come back to us"

He fully agreed with my 4 page plan. We had the longest tenured sales people in the region and why digital is a hard hard hard sell in small towns.... we wouldve damn well found a way to at least make it not lose money.

 

[Kelly A]

So that puts a station between a rock and a hard place. You need to be streaming to capture listeners on their phones/alexa or computers at work, but streaming costs money and allows for out of market listeners--who don't generate any money for the station--to listen. Outside of only steaming through a geo-fenced site outside of the Audacy or iHeart universe, and losing easy access to those local listeners, what is the solution? Or does the station just have to absorb the added expense of streaming and "hope it all works out" I was always taught that "hope" is not a plan.

You hit the low-lights pretty well. The only groups making money on streaming are big national groups who sell spots to big national advertisers because they already have a national ad sales group. A stand alone station streaming music is a fools errand because between streaming service charges and royalties like Sound Exchange, there's no way small groups or ma and pa stations are going to get enough unique sponsors to cover costs.
Also, what local stations playing the hits, classic hits, AC, Hot AC, Alt, Country, whatever, is doing something SO unique over what just about any other stations within earshot would already provide?
A great example was "Island FM" carried on several of the Hawaiian Islands. It featured a unique mix of reggae and dance pop. Tourists would listen to the station, along with some residents. In fact, they found tourists took Island FM home with them via the stream. Problem was, as you mentioned, they blocked the local spots from the stream because local advertisers weren't interested in paying a premium for listeners on the mainland. The station was charged per stream from their streaming provider, which also tracked and paid their Sound Exchange fees. Ownership tried to make their stream for non-residents a $5 subscription. Even then, they still were losing money because VPN spoofing got around the geographic limits, and the number of subscriptions still weren't covering the costs.

 

[Kent]

So that puts a station between a rock and a hard place. You need to be streaming to capture listeners on their phones/alexa or computers at work, but streaming costs money and allows for out of market listeners--who don't generate any money for the station--to listen. Outside of only steaming through a geo-fenced site outside of the Audacy or iHeart universe, and losing easy access to those local listeners, what is the solution? Or does the station just have to absorb the added expense of streaming and "hope it all works out" I was always taught that "hope" is not a plan.

One solution would be to have your own station app and require all desktop streaming to go through the website. That would get you around the distribution requirements of the big aggregators. I understand it's changing, but a sizeable portion of your audience is going to be through your own station app rather than an aggregator. If you do your own streaming, you can also cap the number of listeners at a time to a more manageable number, though you subject yourself to the risk of having people complain they can’t listen when they want. That’s never a good thing.

As Kelly mentions, streaming is an expensive service. Just crunching the numbers, you will make money if you can sell every avail you have, but, unless you’re a large operator or have a really large audience, the money you'll make will be roughly equivalent to a rounding error. Selling every available spot on your own is also going to be a challenge. You might be able to do it with the help of someone like TargetSpot, but I'm not sure if TargetSpot will take you unless you have national distribution, which puts you in the previous pickle. That, by the way, is one of the benefits of using iHeart. Katz is part of the company, and it will sell on your behalf to people listening to your stream through its app and website, though I understand you have to cede a high amount of your inventory to iHeart. It will also take a commission for every spot it sells on your stream. I've been told Audacy and TuneIn will let you keep your inventory, and you only give them permission to run preroll ads when your stream is started. Not sure if you can have them sell on your behalf or not, but you apparently don’t have to agree to that.

 

[boombox4]

Besides being active on social media, any other ideas on how to capture young people’s ears? 🤔

Disney tried with Radio Disney, and they were only moderately successful, listening wise, but not so successful, when one considers the ROI.

They made no money off of it, it was nothing more than an advertisement for their own artists, basically. And when they went all online, it failed. Young people are less and less inclined to see Radio as a relevant medium any more than your average American sees horse and buggy as a viable transportation medium. As someone who has loved Radio since I was 3 and worked in the field for a few months shy of 20 years, it pains me, but it's true. The medium is slowly being eroded and bypassed for streaming. And just because you go online doesn't mean the listeners will come.

Even in the 2010s, the 18 year old barista across the street from my place of work wanted to know that the device was that I had with me (I often took my radio to work with me when I needed to work late at night). "It's a radio," I said. "What's a radio?" she said. This was in 2012.

I suppose Radio workers, owners and aficionados should feel fortunate for the numbers of younger demos that still tune in.

 

[Radio Bob]

You hit the low-lights pretty well. The only groups making money on streaming are big national groups who sell spots to big national advertisers because they already have a national ad sales group. A stand alone station streaming music is a fools errand because between streaming service charges and royalties like Sound Exchange, there's no way small groups or ma and pa stations are going to get enough unique sponsors to cover costs.
Also, what local stations playing the hits, classic hits, AC, Hot AC, Alt, Country, whatever, is doing something SO unique over what just about any other stations within earshot would already provide?
A great example was "Island FM" carried on several of the Hawaiian Islands. It featured a unique mix of reggae and dance pop. Tourists would listen to the station, along with some residents. In fact, they found tourists took Island FM home with them via the stream. Problem was, as you mentioned, they blocked the local spots from the stream because local advertisers weren't interested in paying a premium for listeners on the mainland. The station was charged per stream from their streaming provider, which also tracked and paid their Sound Exchange fees. Ownership tried to make their stream for non-residents a $5 subscription. Even then, they still were losing money because VPN spoofing got around the geographic limits, and the number of subscriptions still weren't covering the costs.

Who was their stream provider?

 

[Kelly A]

Who was their stream provider?

I believe it was Streamguys. There are cheaper providers, but none that offer as many services.

 

[Plate Blocker]

Nothing wrong with Spotify, but radio is special to millions of us.

Yes, that was kind of my point. This is a radio forum; radio is special to all of us. The train forum, full of train lovers, go on and on about how passenger service isn't dying and will re-surge.

Radio gave me a very comfortable life. I loved it, other than slow pay clients. But, for the most part, young people are absolutely not driven to listen to radio. Old ears don't matter to advertisers, and there are not enough new listeners coming in to replace those of us who grew up in the 60s-90s to whom radio is indeed special who are now dying off.

To quote my niece, age 33 with 3 kids under 3, radio simply isn't relevant to her and her contemporaries. And, those 3 kids will grow up in a home without a radio playing. With Android Auto, the exact music of her choice just comes on when she starts the car, with no spots or other annoyances. The kids will absolutely not be able to name a single station in the major market where she lives.

It's not going to die tomorrow, and probably in some form will probably around for a number of years. We can sit at our keyboards and theorize until "the cows come home", but the business simply is not healthy and it's prime target market is not tuning in much.

 

[TheBigA]

But, for the most part, young people are absolutely not driven to listen to radio.

Depends on what you call "radio."

 

[Kelly A]

Frequently we've discussed how reacting to the unpredictable changes in the media landscape has been problematic for traditional media like Radio.
It looks like there could be another one coming out of left field:

As Gen Z Ditches Driving, Radio May Need To Plan A Pivot - Radio Ink

With radio remaining king of the car, what happens now that Gen Z is becoming the first American generation to forgo car ownership?

radioink.com

 

[Mark Roberts]

Frequently we've discussed how reacting to the unpredictable changes in the media landscape has been problematic for traditional media like Radio.
It looks like there could be another one coming out of left field:

As Gen Z Ditches Driving, Radio May Need To Plan A Pivot - Radio Ink

With radio remaining king of the car, what happens now that Gen Z is becoming the first American generation to forgo car ownership?

radioink.com

Hmmm...maybe. This could also be overstated since so many places have poor or nonexistent public transit; thus, having a car becomes a practical necessity. Then there is the question of what someone listens to in the car. It doesn't have to be radio, and didn't have to be even in the era when the alternative was a cassette or 8-track player. In short, this might be a minor factor in listening (or not) but there are many others.

 

[Kelly A]

Hmmm...maybe. This could also be overstated since so many places have poor or nonexistent public transit; thus, having a car becomes a practical necessity. Then there is the question of what someone listens to in the car. It doesn't have to be radio, and didn't have to be even in the era when the alternative was a cassette or 8-track player. In short, this might be a minor factor in listening (or not) but there are many others.

I'm pretty sure they're talking about larger markets with denser population counts, not rural or smaller communities.
I know it's the common predication for this site to point at smaller markets as what really matters when it comes to the radio business. But the fact remains that any industry is more affected by what happens in larger cities than small communities and towns.
Nor do I believe 8 tracks, cassettes, or record players potentially competing for a radio audience has even the slightest level of association with live streaming.
It would be like comparing Lawrence Welk (very old school) with Taylor Swift.

 

[boombox4]

Frequently we've discussed how reacting to the unpredictable changes in the media landscape has been problematic for traditional media like Radio.
It looks like there could be another one coming out of left field:

As Gen Z Ditches Driving, Radio May Need To Plan A Pivot - Radio Ink

With radio remaining king of the car, what happens now that Gen Z is becoming the first American generation to forgo car ownership?

radioink.com

Stands to reason. And don't forget, a lot of the younger demos just stream their phone while driving their car. Bypassing radio already. And these are folks that already drive. I have Millennial cousins who never listen to radio in their car. They stream Spotify from their phone instead. Although that's anecdotal, I don't think it's outside the statistics.

If more Zoomers forego cars, that doesn't bode too well for Radio, especially when there are less actual 'radios' in homes, and there are so many other options on your smartphone (streaming apps, etc.).

 

[GerryB]

I remember some of the happiest moments of my life - long long ago - were just carelessly roaming around the radio dial to see what was being played (or spoken about). After about 25 years of not listening much at all, I took a renewed interest in radio. A year ago I set out to build an internet radio under about ten bucks (complete with speakers and wifi connectivity). I crammed it with over 40,000 station links and I took the time to order the stations in each city and town by their FM frequency (the AM ones, DAB, and web-only stations I just left in alphabetical order)

A few of my older friends ( I am now 50) sort of like the idea. It does work in the car on a hotspot too - and has an auxilliary cable output to plug into the sound system.

But my younger friends think it's just a bad idea - they all listen to Spotify and don't see any need for radio at all. Not even the web stations with the very niche and tailored music selections. So many new cars just have apple Car Play or whatever it is - with the screen - then they hook up the Apple whatever and that's it.

Some of the even younger ones (now going under age 30) want a random button so it goes to a random station somewhere in the world. Is this the TikTok generation? Zero attention span and just do random station every 10 seconds? That's what they do with the radio when I give it to them. Sometimes they will stay on a song until it ends.

I'm trying hard to tap into what it was, originally, that attracted me so much to radio.

 

[Kelly A]

Some of the even younger ones (now going under age 30) want a random button so it goes to a random station somewhere in the world. Is this the TikTok generation? Zero attention span and just do random station every 10 seconds?

Yes.

Put yourself if their place for a minute. Erase that memory of growing up with only radio and three local TV stations. Now imagine a literal supercomputer in your pocket that will play whatever you want to watch or listen-to whenever you want. Given that situation, why would anyone want to devote a bunch of time to appointment listening for music or news, or waiting around for something that interests you on a screen only in your home?

 

[GerryB]

Yes.

Put yourself if their place for a minute. Erase that memory of growing up with only radio and three local TV stations. Now imagine a literal supercomputer in your pocket that will play whatever you want to watch or listen-to whenever you want. Given that situation, why would anyone want to devote a bunch of time to appointment listening for music or news, or waiting around for something that interests you on a screen only in your home?

You're right. It's hard to admit, but the internet has changed everything irreversibly. The podcast-function is a bit more popular, and those shows play on demand. I guess that's the direction I need to keep moving in, if I keep developing this thing at all.

 

[Kelly A]

The podcast-function is a bit more popular, and those shows play on demand. I guess that's the direction I need to keep moving in, if I keep developing this thing at all.

If that thing gets too big, you should probably have a doctor take a look.

 

[michael hagerty]

I remember some of the happiest moments of my life - long long ago - were just carelessly roaming around the radio dial to see what was being played (or spoken about). After about 25 years of not listening much at all, I took a renewed interest in radio. A year ago I set out to build an internet radio under about ten bucks (complete with speakers and wifi connectivity). I crammed it with over 40,000 station links and I took the time to order the stations in each city and town by their FM frequency (the AM ones, DAB, and web-only stations I just left in alphabetical order)

A few of my older friends ( I am now 50) sort of like the idea. It does work in the car on a hotspot too - and has an auxilliary cable output to plug into the sound system.

But my younger friends think it's just a bad idea - they all listen to Spotify and don't see any need for radio at all. Not even the web stations with the very niche and tailored music selections. So many new cars just have apple Car Play or whatever it is - with the screen - then they hook up the Apple whatever and that's it.

GerryB:

I don't mean any offense by this, and I'm not being my (frequently) smart-ass self. This is a sincere observation from 53 years in the business (I retired in January):

Whatever thing in audio younger people will like next won't be thought up by a 50-year-old.

You're trying to build a modern equivalent of the DXing you enjoyed when you were younger, and that's great...but you were in the minority in your generation who thought that was fun. Which is why "a few" of your older friends "sort of" like the idea.

Some of the even younger ones (now going under age 30) want a random button so it goes to a random station somewhere in the world. Is this the TikTok generation? Zero attention span and just do random station every 10 seconds? That's what they do with the radio when I give it to them. Sometimes they will stay on a song until it ends.

Sounds like you've accidentally conducted a music research session...the song they stay with till the end? They wanted to hear the rest of it. The others, they didn't.

You've also illustrated why they don't like radio---they're telling you there's little playing that interests them. As Steely Dan put it, "somebody else's favorite song".

In fairness, with 40,000 choices, you've also diluted the percentage of stations that might be playing something they like. But even if you cut those links down to stations actively programming to the demographic of your younger friends, you'd likely see the same behavior. Which is why radio is in trouble. Technology and tastes have moved beyond individual over-the-air radio stations' ability to deliver the experience the new audience wants.

 

[tbolt909]

Sounds like you've accidentally conducted a music research session...the song they stay with till the end? They wanted to hear the rest of it. The others, they didn't.

You've also illustrated why they don't like radio---they're telling you there's little playing that interests them. As Steely Dan put it, "somebody else's favorite song".

In fairness, with 40,000 choices, you've also diluted the percentage of stations that might be playing something they like. But even if you cut those links down to stations actively programming to the demographic of your younger friends, you'd likely see the same behavior. Which is why radio is in trouble. Technology and tastes have moved beyond individual over-the-air radio stations' ability to deliver the experience the new audience wants.

There was a time when people had to wait for their Sports Illustrated, Time, Newsweek, Playboy, etc.. magazine to arrive in the mail. You had to wait to get sports highlights on the local news. If you were out somewhere, you had to find a pay phone to call a friend. I lived through those days and was actually quite happy. I liked NOT being available 24/7. For years, my parents didn't even want an answering machine. Their attitude was if they weren't home, that meant they were out enjoying dinner or a show.

Instant Gratification is now the norm. Radio cannot turn back the clock 30 years. Blockbuster Video was once an Empire and look what happened to them. Survival is a rough game. People cannot expect younger demos to have passion for a medium that is not relevant to them...

 

[GerryB]

I'm going to pivot away from it completely. I think you guys have convinced me of something I already knew but wasn't willing to admit. And no - I don't see a huge future for podcasts either. The message I seem to be getting on this idea is "Run! Run away while you still can!" All that said - people must be losing a LOT of money on this medium. I had a look at the stock trajectory of IHeart, Audacy, and Sirius-XM .. Yikes. But then look at Spotify and they are up. I read somewhere else that TikTok pays about 3 cents per clicked song fragment to BMI or ASCAP.

Generative AI will kill off what's left of the common DJ, and then you will probably have a thousand user-selectable flavors of the announcing voice (male/female, accented, by language).

 

[TheBigA]

I read somewhere else that TikTok pays about 3 cents per clicked song fragment to BMI or ASCAP.

However, they also pay royalties to SoundExchange, created after the Digital Millennium Copyright Act was passed. It requires all digital platforms to pay royalties to artists, labels, and musicians. Broadcast radio (so far) isn't required to do that.

That 3 cents figure assumes you own the content of the video.

TikTok Royalties: How do Musicians Get Paid?

Earn TikTok royalties for your music creations. Learn how to monetize your songs on TikTok and maximize your earning potential on the platform.

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TikTok Streaming Royalties Explained for Artists

This article aims to answer all of your questions about how TikTok royalties work and how to maximize your revenue from the app.

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