More Consolidation is Not the Answer to Poor Business Decisions

[TheBigA]

That being said, radio still needs to be compelling, and I don't find much of the radio out of the bigger companies to be compelling. \

The problem with the word "compelling" is that it's very subjective. I might point you to a very compelling host, but if you don't like the music format, then you probably won't like the host. Back in the day, KMPS had a morning host named Ichabod Caine who was so entertaining that people would listen even though they didn't like country music. Gerry House in Nashville was like that. Not many DJs who were that entertaining. So there may be a lot of very entertaining DJs out there, but you're not aware of them because they're not in your format.

In recent years, the most talented hosts have sought to follow the Howard Stern formula, and become talk show hosts, rather than play music. They found they had more time to entertain, and became known for what they did as hosts, rather than for the music they played. When a talented host has to share billing with music, it distracts from the talent of the host.

 

[Mark Roberts]

The reason I call stock options “funny money” is that you have to be able to exercise them to actually get the money. Can’t remember if my co-worker cashed his in when he made that $60,000, but, if he held onto them thinking they would go up further, he likely was disappointed if he held on much longer. I watched my options go up several times, but I didn’t stay with the company long enough to cash in on them. Plus, by the time I left, the options were higher than the stock price on the open market. I sold the stock I had in the company I had gotten at a discount through the employee stock purchase program two or three years after I left the company and even lost money on those shares.

The same big corporate conglomerate also offered tuition reimbursement, which is a benefit I’ve never seen at smaller companies. Having said that, you had to be able to get to the benefit to be able to use it. I never had any success getting approved the few times I tried to take advantage of that perk.

Stock options became common in the 1990s in part because accounting rules of the time did not count them as compensation, so a company could effectively offer a parrt of employee compensation without nit hitting their books. This changed in the early 2000s with changes that required employees to account for the value of options. Generally this is done with the Black-Scholes model but by necessity this is still an estimate. In some cases, companies moved instead to grants of restricted stock, which can be valued more definitively but which tended to be less generous than option grants.

As for big companies vs.smaller ones, most of my second career was spent in larger companies while most of my first career (radio) was spent in small, family-owned companies. I was treated way better and felt more secure in my second career compared to my radio career. (Who knows, maybe I just sucked at radio? That’s a possibility. I do know that I dealt with some good people and some fairly awful people.) With one exception I was treated far more professionally and empathetically in my second career, had far better compensation and benefits, and better opportunities to move up. Even that exception led to a couple of other opportunities that turned out to be rewarding. Nostalgia for small companies and family-owned companies, in my experience, is just overstated.

 

[davideduardo]

Stock options became common in the 1990s in part because accounting rules of the time did not count them as compensation, so a company could effectively offer a parrt of employee compensation without nit hitting their books.

I was fortunate to be with a public radio company that was sold to a private investor early in the "New Millennium" before radio began to deteriorate. All of use with VP titles or above were "forced" to exercise our options and even the not-yet-vested ones became active.

Nostalgia for small companies and family-owned companies, in my experience, is just overstated.

In my case, the company was a fusion of two "family" companies, Heftel and Tichenor. We had a family feel, yet with a public company with over 75 radio stations. Overall, spent 28 years there which was about 20 more than anyplace I had been before, even when I owned my own stations.

 

[vchimpanzee]

As far as your crack about "on-air talent to baby-sit consoles," of course they aren't hiring them to do that. Why would anyone hire a talented, creative person to push a button and read a liner card about a text to win contest coming up in 5 minutes? You hire talented, creative people to provide entertaining, compelling content.

Still, I have seen Youtube videos that show at least one Westwood One DJ doing this additional work just to make sure everything is functioning as intended.

 

[bobdavcav]

The problem with the word "compelling" is that it's very subjective. I might point you to a very compelling host, but if you don't like the music format, then you probably won't like the host. Back in the day, KMPS had a morning host named Ichabod Caine who was so entertaining that people would listen even though they didn't like country music. Gerry House in Nashville was like that. Not many DJs who were that entertaining. So there may be a lot of very entertaining DJs out there, but you're not aware of them because they're not in your format.

In recent years, the most talented hosts have sought to follow the Howard Stern formula, and become talk show hosts, rather than play music. They found they had more time to entertain, and became known for what they did as hosts, rather than for the music they played. When a talented host has to share billing with music, it distracts from the talent of the host.

This is true, but if I understand correctly, we know that even in PPM markets, the "Coming up in 10 minutes, I'll tell you why there could be a French fry shortage later this year" or "Coming up in 10 minutes I have another nationwide keyword to text to win $1,000" type of radio doesn't work, yet that's what we're hearing a lot of, especially in smaller markets. The bigger markets have moved away from that for the most part, but they can't get away from it entirely with owners doing nationwide contests.

 

[TheBigA]

The bigger markets have moved away from that for the most part, but they can't get away from it entirely with owners doing nationwide contests.

Here's what works: People who listen to music stations want music. People who listen to talk stations want talk. Nobody wants commercials. Right?

 

[bobdavcav]

Stock options became common in the 1990s in part because accounting rules of the time did not count them as compensation, so a company could effectively offer a parrt of employee compensation without nit hitting their books. This changed in the early 2000s with changes that required employees to account for the value of options. Generally this is done with the Black-Scholes model but by necessity this is still an estimate. In some cases, companies moved instead to grants of restricted stock, which can be valued more definitively but which tended to be less generous than option grants.

As for big companies vs.smaller ones, most of my second career was spent in larger companies while most of my first career (radio) was spent in small, family-owned companies. I was treated way better and felt more secure in my second career compared to my radio career. (Who knows, maybe I just sucked at radio? That’s a possibility. I do know that I dealt with some good people and some fairly awful people.) With one exception I was treated far more professionally and empathetically in my second career, had far better compensation and benefits, and better opportunities to move up. Even that exception led to a couple of other opportunities that turned out to be rewarding. Nostalgia for small companies and family-owned companies, in my experience, is just overstated.

This viewpoint makes sense from a worker's standpoint. I've only had one part-time job, and I can tell you that my supervisor didn't feel supported by upper management, and eventually the entire division I worked in was eliminated. It makes sense that bigger companies in general can provide more benefits than smaller ones. From a radio standpoint, I host a show that talks about the radio industry with a friend, and we are both sick and tired of having to talk about layoffs at these big companies. With our primary focus being format changes, the Hubbard cuts didn't even make our list of news the week they came down. The same applies with the cuts Bonneville made in Seattle several months back. Again though, those cuts affected maybe five stations in three markets combined, not several dozen stations in every market those companies own stations in.

 

[b-turner]

I was working for a former banker and CPA turned radio station owner. When consolidation began and prices for stations went through the roof I was in his office when the subject came up. In his opinion the numbers would never work and he said you could not cut enough nor generate enough new income to handle the debt they were taking on. He predicted all the major players would have to have much of the debt forgiven in order to survive. I think we know how things worked out.

I knew two owners who both had rimshots in smaller markets. Both were doing okay in their market, billing $60,000 to $100,000 a month. They both sold each for about 75-85% of the entire annual market revenue. A million to 1.2 million would have been fair but 3 times that was crazy money.

 

[Y2kTheNewOldies]

Exclusive: Nexstar pushes news viewers to lobby FCC for broadcast deregulation

Nexstar is encouraging news viewers to visit a website that includes pre-written comments directed at the FCC that lobby for broadcast ownership deregulation.

thedesk.net

Here's more this time Nexstar owned Stations are having to air segments about the FCC and deregulation push.

 

[vchimpanzee]

The problem with the word "compelling" is that it's very subjective. I might point you to a very compelling host, but if you don't like the music format, then you probably won't like the host. Back in the day, KMPS had a morning host named Ichabod Caine who was so entertaining that people would listen even though they didn't like country music. Gerry House in Nashville was like that. Not many DJs who were that entertaining. So there may be a lot of very entertaining DJs out there, but you're not aware of them because they're not in your format.

In recent years, the most talented hosts have sought to follow the Howard Stern formula, and become talk show hosts, rather than play music. They found they had more time to entertain, and became known for what they did as hosts, rather than for the music they played. When a talented host has to share billing with music, it distracts from the talent of the host.

I'm not conservative but Rush Limbaugh had the kind of talent that made me want to listen.

 

[TheBigA]

I host a show that talks about the radio industry with a friend, and we are both sick and tired of having to talk about layoffs at these big companies.

As I said, the media only reports the layoffs. But a lot of those people either get rehired or replaced. Cumulus laid off a whole bunch of people at the end of last year, and about half of them have already been replaced. You only talk about layoffs because you want to. Those of us who work in the business know the bigger story. In terms of how it affects the public, the government layoffs are a lot more consequential.

 

[bobdavcav]

Here's what works: People who listen to music stations want music. People who listen to talk stations want talk. Nobody wants commercials. Right?

Most of the time that makes sense, but one vary obvious example that debunks this logic is Seattle's KISW. KISW is and has been a rock station for 40+ years, but has a mostly talk morning show and a mostly talk afternoon show. It still does well with its target audience. Bob Rivers was another example of an all talk morning show that did well on an otherwise music station.

 

[TheBigA]

Most of the time that makes sense, but one vary obvious example that debunks this logic is Seattle's KISW.

Absolutely, and there are several similar stations that are doing the same thing. WMMS is a heritage rock station in Cleveland that is mostly a talk station similar to KISW. iHeart thought they could copy that success in Dallas at KEGL, and fell flat on their face. Hubbard thought they could bring back the success of commercial AAA in Seattle with KPNW, and it fell flat on its face. In both cases, they spent loads of money, hired heritage talent that people knew and loved, and in both cases, the audiences weren't interested.

This is why I bristle when people in this thread say radio companies don't invest in content or aren't hiring local talent. The heritage stations like KISW and WMMS may be great examples, but they also are exceptions to the rule. If all it took to be #1 in a market is to hire local personalities, everyone would do it. But the flops outnumber the successes.

 

[Deus Ex Machiato]

This is true, but if I understand correctly, we know that even in PPM markets, the "Coming up in 10 minutes, I'll tell you why there could be a French fry shortage later this year" or "Coming up in 10 minutes I have another nationwide keyword to text to win $1,000" type of radio doesn't work, yet that's what we're hearing a lot of, especially in smaller markets. The bigger markets have moved away from that for the most part, but they can't get away from it entirely with owners doing nationwide contests.

Ah yes, the "tease/payoff" model. "Coming up in 6 minutes we'll tell you something that may or may not be interesting to you!"

When that model debuted, my response was "why make them wait? Do something entertaining NOW!" I'm sure a lot of us have a collection of airchecks, and the best "jocks" were able to make something as mundane as the weather forecast entertaining.

As far as this goes:

Here's what works: People who listen to music stations want music. People who listen to talk stations want talk. Nobody wants commercials. Right?

People have never "wanted" commercials, but I'd counter that while people who listen to music want music, streaming services have taken the "station" out of the equation. It used to be that people who listened to music stations were just fine with some DJ talking over the intro to their favorite song, so long as it was entertaining. They'd call the station in hopes of getting "on the air." Tune in to hear (as the Howard Stern movie pointed out) "what will he say next?"

The model of "shut up and just read the liner card" took over, and of course there's no reason to have a liner card reader talking over the intro to a song pushing a "text to win" contest. You don't need a monkey for that. You can just put it in a promo leading into the stopset. Then the streaming services figured out "why even do that? Just play the hits and people will pay for the subscription."

The entertaining DJ becomes irrelevant. The promos and sweepers made by the Creative Services Director become irrelevant. The 10 minute stopset becomes irrelevant. Why hang on through the commercial break to hear another liner card? If they wanna hear talk, they subscribe to a podcast. Where does that leave radio?

Again, going the way of the phone book. Full service gas stations. Personalized checks in your checkbook. Was this inevitable? Maybe. Maybe not. It doesn't mater anymore, because you can't expect a music station with liner card jocks and 10 minute stopsets to compete with a streaming service that plays your favorite songs in whatever order you want.

 

[TheBigA]

The model of "shut up and just read the liner card" took over, and of course there's no reason to have a liner card reader talking over the intro to a song pushing a "text to win" contest.

Here we go again. Hatred for the "liner card readers." This is all ancient history. Liner card readers were popular in beautiful music formats in the 60s and 70s. These were basically automated stations with music provided by national syndicators with "local assist." There was a box of 5x7 cards on the console and the local host read the cards. That was the only format that used them. When beautiful music went away, it was replaced by various approaches to AC. The music changed but the approach remained the same. WNSR in NYC was one of these stations. Meanwhile, across town, you had Imus or other big name DJs doing their thing. Imus was not a liner card reader. There's no need for liner card readers today. It's all very 70s.

The entertaining DJ becomes irrelevant. The promos and sweepers made by the Creative Services Director become irrelevant. The 10 minute stopset becomes irrelevant. Why hang on through the commercial break to hear another liner card? If they wanna hear talk, they subscribe to a podcast. Where does that leave radio?

You can't generalize. There are 16,000 radio stations. You want entertaining DJ? They still exist. Right now, you can hear them, even in Phoenix where you live. They may not be there 24/7, but they're there. There are also stations that have absolutely no hosts at all. In Phoenix, there's KOAI, the Wow Factor. Name all the personalities. None. They don't even have liner card readers. Why bother, because the audience of over 65s don't care. It also doesn't affect the ratings. People listen for the music. At the same time, you have TALK stations. What a concept. Radio stations that play no music, and instead have local personalities who talk and entertain. No liner cards. If you want to hear talk, you listen to a talk station. You can also listen to a podcast. You can also listen to an audio book. Once again, you can't generalize.

Entertaining DJs still exist. They exist in many different ways. They might exist locally. They might exist through syndication. Steve Harvey is very entertaining because he's a comedian. He knows how to entertain. He's been doing it his whole life. Bobby Bones is also very entertaining. He's not just a DJ, but he's also in a band, and he does standup comedy. Bobby Bones doesn't read liner cards. I mention their names because they're national radio personalities and they're ONLY available on broadcast radio. They don't exist on Sporify, Apple Music, or Pandora. If you want to talk about a place where the DJ is irrelevant, it's in streaming. Yet millions of people use streaming radio. Nobody is insisting on Spotify hiring personalities. It's not that they can't. They make more money than the entire radio industry. When they hire a personality, it's Joe Rogan, who doesn't play any music. Is there something wrong with that?

People like what people like. It's not like how it used to be. Everything has changed. Get used to it. Going back to the way things were is not the solution.

 

[davideduardo]

The entertaining DJ becomes irrelevant. The promos and sweepers made by the Creative Services Director become irrelevant.

I have wonder throughout your barrage of negative comments about how much actual radio experience you have.

Today, I got my answer. "Creative Services Director"? Huh? I have never heard of or seen such a position (although titles are easy to make, so there may be one somewhere sometime in history).

Promos and liners are generally written by the PD. Even if the station had a copywriter, that was mostly for commercials, not on-air positioning.

The 10 minute stopset becomes irrelevant. Why hang on through the commercial break to hear another liner card? If they wanna hear talk, they subscribe to a podcast. Where does that leave radio?

Of course, no competitive station in a rated market is running an actual 10 minute stopset. Using hyperbole or ignorance of the facts does not enhance your argument. Yes, stations run ads. That is the only way for mass appeal music stations to exist. Unless you have an alternative idea, this is just a fact of life for as long as commercial radio continues to exist.

Again, going the way of the phone book. Full service gas stations. Personalized checks in your checkbook. Was this inevitable? Maybe. Maybe not. It doesn't mater anymore, because you can't expect a music station with liner card jocks and 10 minute stopsets to compete with a streaming service that plays your favorite songs in whatever order you want.

What keeps almost 90% of adults using radio as an alternative is that sometimes it is too much work to make a playlist and it is entertaining to hear a curated list instead. And sometimes it is too expensive to sustain streaming services, so radio is an alternative, too.

Sure, TSL has dropped due to alternative music and entertainment sources, but radio still is a very cost effective way for advertisers to reach big portions of their target.

 

[b-turner]

Here's the thing somebody needs to explain to me: radio is bashed for too many commercials, laying off air talent, being a computer in a closet and so much more as being the reasons people are leaving the radio dial to listen to non-stop music online. So if radio does the computer in a closet jukebox non-stop music on air it's driving people away from radio to online to non-stop music? Why is it all the stuff the complainers want radio to do (personalities, local info and such) driving people to non-local computer in a closet jukebox online stations. Something doesn't add up! Seems to me if you do what online radio is doing, you will do well because, as the critics say, we're all driving them to that online station with no talk, just music.

 

[Mediafrog+]

"Creative Services Director"? Huh? I have never heard of or seen such a position

“Creative Services Departments” are found in television, though the meaning of that term can vary from station to station. Generally it encompasses production, promotion and marketing areas. In my experience the term came and went, depending on the organizational thinking of top management at any given time.

 

[Theater of My Mind]

I have wonder throughout your barrage of negative comments about how much actual radio experience you have.

Today, I got my answer. "Creative Services Director"? Huh? I have never heard of or seen such a position (although titles are easy to make, so there may be one somewhere sometime in history).

Are you just making this up to hurl insults at this member? Creative Services Director is a key production position, and it has been for decades at every major radio group -- iHeart, Audacy, Cumulus, you name it. Considering your years in the business, it's not plausible that you aren't aware of this.

 

[davideduardo]

Are you just making this up to hurl insults at this member? Creative Services Director is a key production position, and it has been for decades at every major radio group -- iHeart, Audacy, Cumulus, you name it. Considering your years in the business, it's not plausible that you aren't aware of this.

If there is such a position, it is not where liners and positioning statements are created. That is my point.

I've never seen such a title myself unless it was related to creating ad copy and production for advertisers, not for programming.

And you did not address my main points about your exaggeration, use of hyperbole and general doomsday attitude towards radio.