Buffalo Cumulus sells AM to Buddy Shula

[SirRoxalot]

I was thinking about Crosley, which exited radio in 1975. The Buffalo Evening News got out of radio in 1978. GE sold most of its radio stations in the late 70s and was completely out by the mid-80s. National Life sold WSM in 1981. A couple other insurance companies got out around the same time. Of course the big one was NBC selling all radio in 1988. That was the canary in the coal mine.

The Buffalo News, Cleveland Plain Dealer, and others got out of radio because newspapers were forced to divest radio and TV stations. GE was under some anti-trust pressure after acquiring RCA in 1985 and was looking to cash out some of what it considered "non-core assets."

1985 Detail - General Electric Buys RCA, America's Best History U.S. Timeline, 1980-1989

America's Best History - United States History Timeline 1980-1989. The Reagan Revolution. Most important historical events of each year of the decade of the 1980's listed, including the 1985 detail of General Electric purchase of RCA in the largest merger outside the oil industry.

americasbesthistory.com

And part of the problem is that the audience was apathetic about local content. They care more about hearing the music than who presents it. They care more about "sound bites" and celebrity scandals than about the controversy about the local landfill.

It wasn't so much the audience that drove that. It was consultants in the '70s and '80s who insisted that "It's my format, not those pesky disk jockeys" who make a station successful. After all, disk jockeys might move on to bigger markets, or, worse, go across the street to a competitor who offered a better deal. Even non-competes couldn't eliminate that possibility. GMs were promised that de-emphasizing local personalities and adding "major market talent" via syndication would mean better and more stable profits. Real results varied. Howard Stern and others did well in some markets, not so well in others, depending the quality of the competition and the signal.

Add the dilution of markets by Docket 80-90 stations and the removal of the 7-7-7 rule and you get the buying spree by big broadcasters who sought to establish de-factor monopolies in some markets. If you were a station owner and somebody offered you 15, 20, or 25 times your annual profit to sell your station, how could you resist? You could invest the cash and take the dividends and make at least the same money without the headache of running radio stations and/or competing with the big boys and their deep pockets. It was a no-brainer for a lot of people. It led to bankruptcy for virtually all of the consolidators. "Synergies" and cutting their way to prosperity ended up reducing revenues, not increasing them, and the money lenders wanted their money. So, stockholders took it in the shorts and vulture capitalists ended up owning radio stations. Then came the internet, streaming, etc., and you know the rest. Skeleton staffs are trying to hang on until retirement while managers try suck whatever marrow is left in the bones to get their bonuses before they pull the rip cord on their golden parachutes.

 

[b-turner]

The FCC says: "In exchange for obtaining a valuable license to operate a broadcast station using the public airwaves, each radio and television licensee is required by law to operate its station in the “public interest, convenience and necessity.” Generally, this means it must air programming that is responsive to the needs and problems of its local community of license. To do this, each non-exempt station licensee must identify the needs and problems and then specifically treat these local matters in the news, public affairs, political and other programming that it airs. As discussed in more detail further in this Manual, each commercial station – and most noncommercial stations – must provide the public with information about how it has met its obligation in a quarterly report."

This is not simply a 30 minute Public Affairs program at 6am Sunday morning. This includes much more. This includes news stories, public service announcements, participation in community campaigns and working with local organizations to build awareness. The general programming can also provide a niche service not found elsewhere (a portion of the community underserved) where the service itself does this. With all the stations on the dial, we don't have to be all things to all people. And that 30 minute program at 6am is a public service by the time of day it airs because the audience of a music station and many other formats could care less. Those formats where listeners and/or viewers are that segment of the community that are interested have plentiful content in time frames convenient to them.

The mandate was formulated almost a century ago when many places could only hear one or two signals. There were not many media options. There are so many sources today for "public interest, convenience and necessity". Radio and TV are not the only game in town.

Ever since I got into radio in the 1970s I have always thought determining the needs and problems and presenting programming addressing it is the government's job, not that of a private business. I thought it was a pretty stupid requirement. I figured radio addressing such in programming was about as effective as Mr. Mackey on South Park with his "Drugs are bad. Don't do drugs, Umkay".

Like the useless time-waster of a public file, it's just a bunch of crap we have to deal with while non-over the air has no such requirement. I think the FCC has given us as much rope as they can allow. We are given great leeway on program content and the FCC accepts most any definition of public affairs. I've actually seen a couple of stations that say they offer 24/7 music formats missing from the dial until they came on the air. That is how they describe their public affairs. I know of another station that air any emergency announcement (ie: flooding, forest fire, tornado) and calls that public affairs. These are uploaded to the FCC Public Files for the respective station. I am of the opinion that having something current in Issues and Programs is more important than the description of programming.

 

[K.M. Richards]

It was consultants in the '70s and '80s who insisted that "It's my format, not those pesky disk jockeys" who make a station successful.

I have to ask what experience you have in the industry to have that negative bias against consultants. The best ones I encountered in those decades worked with the on-air staff to make presentation of "their format" more attractive to the audience.

Or is that a generalization from a listener who has a misconception about consultants? It certainly sounds like the kind of statement I have heard far too many times in the past from those outside of the industry, so I would like clarification on where you're coming from and what your comment is based on, please.

Add the dilution of markets by Docket 80-90 stations and the removal of the 7-7-7 rule and you get the buying spree by big broadcasters who sought to establish de-factor monopolies in some markets.

As I have said elsewhere, I think Docket 80-90 was a mistake. When FM finally "came of age" in the 1970s, there suddenly developed a hue and cry to "make more stations available" so a whole bunch of (almost entirely) Class A stations were shoehorned in everywhere they would fit. The result should have been expected by anyone who understands the business of advertising ... and let's face it, that's the business radio is in: The "pie" of available local ad revenue was cut into more, smaller pieces wherever the new stations signed on. That not only made it extremely difficult for the new stations to get a foothold, much less be viable long-term, it reduced the revenue of the existing stations. That led to a "increase revenue by volume" mindset, which first manifested itself as the relaxing of 7-7-7 to allow more than seven markets' ownership, then an increase in ownership caps per market.

That led to what you accurately describe as a "buying spree" by the major station groups, who took advantage of the smaller players wanting to get out of what was an increasingly less-profitable business (and who could blame them at that point?). Then came all of the alternatives that are already well-known and don't have to be listed, which ate into listener numbers, which reduced ad revenue, and here is where your bottom line falls apart.

Even a de facto monopoly -- or even a concentration among two or three big players, in the larger markets -- is no longer the advantage it once was. So here we are, with air talent having to voicetrack for multiple stations in markets outside their own, downsizing of everything the corporate bean counters can think of and still stay on the air, and now stations going permanently silent.

Let's face a fact that I personally hate to admit: The religious broadcasters like EMF owe their success to the fact that they can acquire stations from companies wanting to get out from the way the business has declined, install a satellite dish or high-speed internet at the transmitter site, and run it on auto-pilot. No local business office, no sales personnel, no local on-air talent. I personally see it as an unfair advantage, but it is what it is.

In the middle of all this, we still have independent operators like Buddy Shula, who finds opportunities to acquire stations at bargain basement prices and apply reasonable business models.

Oh, and I agree with @b-turner that public affairs programming has devolved into a total joke ... a joke impacting both the public and the FCC. If Carr is serious about eliminating "outdated regulations and requirements" he can start there.

 

[Voicetrack of Reason]

Public file is nonsense, and nobody cares. It's just a way for the FCC to collect fines... and big ones. I've worked for, or owned a total of 23 radio stations over 39 years. On only one occasion did anyone request to see the public file, and that would have been in 1988, for godsakes.

 

[TheBigA]

GE was under some anti-trust pressure after acquiring RCA in 1985 and was looking to cash out some of what it considered "non-core assets."

GE sold its own radio stations in 1983 long before it bought RCA. The NBC radio division was dead man walking before the sale to RCA, and the sale to a company that had already left radio made the NBC stations expendable. The decision had nothing to do with anti-trust.

The reason I brought this up was to point out a generational change in radio ownership that was happening in the 70s and 80s that saw many of the original radio owners getting out of the business because it was no longer what you call "core assets." All of the big corporations that built radio were getting out.

Add the dilution of markets by Docket 80-90 stations and the removal of the 7-7-7 rule and you get the buying spree by big broadcasters who sought to establish de-factor monopolies in some markets.

The Reagan push for deregulation led to the end of the 7-7-7 rule in 1984. The FCC voted 4-1 to replace it with a 12-12-12 rule. At that time, they announced that most remaining restrictions on ownership would end in 1990. Docket 80-90 came about in 1983, although it wasn't fully realized until a few years later.

Deregulation: Freeing the Air Waves

Ever since Congress passed the Communications Act of 1934, the broadcasting industry has chafed under increasingly heavy regulation. The reason: the air waves were considered to be a limited...

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[K.M. Richards]

Public file is nonsense, and nobody cares. It's just a way for the FCC to collect fines... and big ones. I've worked for, or owned a total of 23 radio stations over 39 years. On only one occasion did anyone request to see the public file, and that would have been in 1988, for godsakes.

My own experience in the business (50+ years) confirms your observation, sir.

 

[SirRoxalot]

I have to ask what experience you have in the industry to have that negative bias against consultants. The best ones I encountered in those decades worked with the on-air staff to make presentation of "their format" more attractive to the audience.

Or is that a generalization from a listener who has a misconception about consultants? It certainly sounds like the kind of statement I have heard far too many times in the past from those outside of the industry, so I would like clarification on where you're coming from and what your comment is based on, please.

I saw it first-hand in that era at multiple stations and heard about it from friends in the industry across multiple markets. I experienced the comings and goings of multiple consultants from the 1970s onward. Some were more talent friendly than others, but most of them wanted jocks to "stay out of the way of their format." If you've heard that kind of statement far too many times, it likely wasn't because "those outside of the industry" originated it. Most listeners aren't that aware of the operations inside radio stations. Some PDs welcomed consultants because a successful format made them look good, and a miss on a format allowed them to blame somebody else for the failure. They could throw the consultant under the bus and move on to the next new approach.

 

[tbolt909]

Some PDs welcomed consultants because a successful format made them look good, and a miss on a format allowed them to blame somebody else for the failure. They could throw the consultant under the bus and move on to the next new approach.

If the ratings tanked, the PD most likely wouldn't survive long enough to "blame the consultants". He or She would be looking for a new gig. They could cover that topic during their next job interview. Program Directors rarely made all the programming decisions. Some had more control than others depending on many variables(Format, Market size, the GM's philosophy, etc)...

 

[SirRoxalot]

If the ratings tanked, the PD most likely wouldn't survive long enough to "blame the consultants". He or She would be looking for a new gig. They could cover that topic during their next job interview. Program Directors rarely made all the programming decisions. Some had more control than others depending on many variables(Format, Market size, the GM's philosophy, etc)...

Blatantly untrue. Ask John Hager.

 

[Mediafrog+]

As I have said elsewhere, I think Docket 80-90 was a mistake. When FM finally "came of age" in the 1970s, there suddenly developed a hue and cry to "make more stations available"

Many small and medium markets had very little choice in FM stations 50+ years ago. The addition of more stations gave listeners in those markets something new: actual format variety. Gone were the days when an station owner could put little to no effort into broadcast quality because there was virtually no competition.

so a whole bunch of (almost entirely) Class A stations were shoehorned in everywhere they would fit.

Maybe in California and the Rust Belt, but in the rest of the country a lot of new stations were full Class C, C1 or C2. In that era many existing stations also upgraded their transmitters due to the “use it or lose it” threat to their potential coverage areas.

The "pie" of available local ad revenue was cut into more, smaller pieces wherever the new stations signed on. That not only made it extremely difficult for the new stations to get a foothold, much less be viable long-term, it reduced the revenue of the existing stations.

But what you are describing is common to any kind of business: The more direct competitors you have, the pie is cut into smaller pieces, whether you are running a hardware store, landscaping business, appliance dealership, or a restaurant. Why should broadcasting have limits placed on competition when other businesses don’t? (Yes I am playing devil’s advocate here.)

That led to a "increase revenue by volume" mindset, which first manifested itself as the relaxing of 7-7-7 to allow more than seven markets' ownership, then an increase in ownership caps per market.

The 7-7-7 rule was archaic. It had to go.

That led to what you accurately describe as a "buying spree" by the major station groups, who took advantage of the smaller players wanting to get out of what was an increasingly less-profitable business (and who could blame them at that point?).

Once again, this is what you see in any other type of business: Stronger companies buying up weak ones. How many restaurants out there with different names and different food are actually owned by the same company?

Then came all of the alternatives that are already well-known and don't have to be listed, which ate into listener numbers, which reduced ad revenue, and here is where your bottom line falls apart.

I’ve posted this thought before, but what if Docket 80-90 had never happened? What if the number of available stations (and formats) was far less, and other technologies had nonetheless evolved in the same ways we are familiar with? I think that might have actually accelerated the demise of traditional broadcast radio, as listeners fed up with the lack of choice would have migrated to new platforms much quicker and sooner.

Let's face a fact that I personally hate to admit: The religious broadcasters like EMF owe their success to the fact that they can acquire stations from companies wanting to get out from the way the business has declined

I wonder if anyone has ever made a list of stations EMF built from complete scratch, rather than through an acquisition? And nothing is stopping other broadcasters from doing something similar.

install a satellite dish or high-speed internet at the transmitter site, and run it on auto-pilot. No local business office, no sales personnel, no local on-air talent. I personally see it as an unfair advantage, but it is what it is.

Which is the way things are done in much of the rest of the world, as David Eduardo has pointed out countless times.

In the middle of all this, we still have independent operators like Buddy Shula, who finds opportunities to acquire stations at bargain basement prices and apply reasonable business models.

WECK works because Buddy Shula embraces listener demographics that most broadcasters and advertisers ignore. But that might only succeed in certain markets. Would the same approach work elsewhere, with a different format? (Classic Country comes to mind.)

 

[TheBigA]

Many small and medium markets had very little choice in FM stations 50+ years ago. The addition of more stations gave listeners in those markets something new: actual format variety. Gone were the days when an station owner could put little to no effort into broadcast quality because there was virtually no competition.

Good for radio listeners, but bad for the heritage owners, who in many cases reacted badly to the new competition. Perhaps accelerating their desire to sell when money was presented.

I’ve posted this thought before, but what if Docket 80-90 had never happened? What if the number of available stations (and formats) was far less, and other technologies had nonetheless evolved in the same ways we are familiar with? I think that might have actually accelerated the demise of traditional broadcast radio, as listeners fed up with the lack of choice would have migrated to new platforms much quicker and sooner.

That assumes that the music could keep up with all of the new stations. As it turned out, it could. The music of the 80s continues to drive several formats today.

 

[davideduardo]

The Buffalo News, Cleveland Plain Dealer, and others got out of radio because newspapers were forced to divest radio and TV stations. GE was under some anti-trust pressure after acquiring RCA in 1985 and was looking to cash out some of what it considered "non-core assets."

The Cleveland Plain Dealer did not get out of radio due to divestment rules... which happened much more than a decade later. The chairman of the Plain Dealer (Forest City Publishing) board, Herman Lansing Vail, had decided around 1956 that radio was not going to be viable in the future and that they should sell "while they could". That was when John Kluge bought it and made it "Color Channel 14" and took it to a very strong #1 against the market's first fulltime Top 40, WERE.

It's in all of GE CEO Welch's writings that he did not believe in being in any field where he could not be #1 or #2. His mantra was "change before you have to." Radio was not a field where station ownership had the possibility of achieving dominance due to the 7/7/7 rules, so he got out of radio.

It wasn't so much the audience that drove that. It was consultants in the '70s and '80s who insisted that "It's my format, not those pesky disk jockeys" who make a station successful.

When I first got to program a million+ population CHR in 1964, I followed the lead of what I read in the trades as well as my experience with group owner Radio Centro in Mexico. I read Billboard, subscribed to the Gavin report, and had visited lots of "big" Top 40 stations. And I was counseled just before his death by Todd Storz who showed me deeply how to create categories of rotations and require all air talents to follow the lists and rotations.

So in the earlier 60's, I saw multiple successful Top 40 stations playing strictly rotated playlists. Before carts, we usually had a box (or bin in a box) for the 45's of each category and we played the one at the front and put it in the back after airplay. We could only change the order by moving a song back by one position if the same artist was just played in a different category.

After all, disk jockeys might move on to bigger markets, or, worse, go across the street to a competitor who offered a better deal. Even non-competes couldn't eliminate that possibility. GMs were promised that de-emphasizing local personalities and adding "major market talent" via syndication would mean better and more stable profits. Real results varied. Howard Stern and others did well in some markets, not so well in others, depending the quality of the competition and the signal.

In the early 60's we understood "stationality" and wanted to make sure that the music and the rotations were "as planned" in all hours and with all the jocks. If you know of actual exceptions, that is what they were: "exception".

To the rest of us, "Top 40" meant around 40 songs divided into categories that had different rotations. The top song, such as at WABC, might have played every 90 minutes to two hours. Then another group played perhaps 30 minutes more distanced. If you do the math, on 40 songs at about 14 an hour (short songs in the 60's but lots more commercials and newscasts), it gave only about 3 hours average rotation. Some played multiple times, others just barely played in 3 hours.

And "Top 40" was exactly that. About 40 songs, maybe 5 "hitbounds" and the like, and sometimes a "flashback" as we got into playing gold even in the early 60's.

Add the dilution of markets by Docket 80-90 stations and the removal of the 7-7-7 rule and you get the buying spree by big broadcasters who sought to establish de-factor monopolies in some markets. If you were a station owner and somebody offered you 15, 20, or 25 times your annual profit to sell your station, how could you resist? You could invest the cash and take the dividends and make at least the same money without the headache of running radio stations and/or competing with the big boys and their deep pockets. It was a no-brainer for a lot of people. It led to bankruptcy for virtually all of the consolidators.

No, it did not. You are focusing on the very big ones, but not the smaller regional groups like Sorenson in SD, NE and MN or Lotus in CA, NV and AZ or UnoRadio in Puerto Rico and many more local or regional groups. And look at "bigger" groups like Saga, Summit, Townsquare and the like who have been very successful by more focused consolidation.

"Synergies" and cutting their way to prosperity ended up reducing revenues, not increasing them, and the money lenders wanted their money.

Initially, the idea of consolidation was not to save on operations. In fact, the main focus was being able to present a 3, 4, 5 station "menu" to local advertisers and take large parts of local budgets. Only after the 2008 recession did we see cost cutting come into effect because the economic downturn caused many businesses big-and-small to cut advertising.

In fact, the first dozen years or so of consolidation worked very well... just as it had done in much of the rest of the world.

In the 60's I built a cluster of 5 FMs and 4 AMs in Quito, Ecuador, a market of about 1,000,000. By making it easier to buy for ad agencies... and by offering better and easier paperwork and by giving huge combined ratings efficiency, advertisers preferred my group to the other 35 station in the market. And that was sixty-some years ago.

Where did I learn that building a cluster was the best way to operate? I interned in Mexico city at a group of 5 stations. We competed with several groups that had 3 and 4 stations each, and several more that had two stations. The bigger the package you could offer to agencies, the more you sold.

So, stockholders took it in the shorts and vulture capitalists ended up owning radio stations.

Most of the "big" issues had to do with one of two factors: the 2008 recession or a couple of less-than-competent group CEO's who "dicked" around and ruined good stations. There was, however, nothing wrong with consolidation; there was a lot wrong with the economy.

Then came the internet, streaming, etc., and you know the rest. Skeleton staffs are trying to hang on until retirement while managers try suck whatever marrow is left in the bones to get their bonuses before they pull the rip cord on their golden parachutes.

This is where I have to avoid the comparison with blacksmiths and horseshoes.

 

[tbolt909]

Blatantly untrue. Ask John Hager.

You mean the same Hager that was fired at 97 Rock?
You proved my point. I seriously doubt that he told his morning guy to make a stupid racist joke. PDs can held be accountable for the programming, but that doesn't mean they control it all. The 97 Rock playlist isn't unique. Every Classic Rock format in the country follows essentially the same list...

 

[SirRoxalot]

You mean the same Hager that was fired at 97 Rock?
You proved my point. I seriously doubt that he told his morning guy to make a stupid racist joke. PDs can held be accountable for the programming, but that doesn't mean they control it all. The 97 Rock playlist isn't unique. Every Classic Rock format in the country follows essentially the same list...

Hager lasted over 30 years at 97 Rock and outlasted more than a few consultants. He was aware of the "toast" bit before it was aired. That was likely a combination of poor judgement and an excuse for the latest regime to cut salary as programming became more top down. In this case, as is often the case, you simply don't know what you're talking about.

 

[davideduardo]

The 97 Rock playlist isn't unique. Every Classic Rock format in the country follows essentially the same list...

And that is due to the same songs testing well from Seattle to Atlanta. Stations are not "following the same list" but, really, are all following what listener consensus dictates.

 

[tbolt909]

Hager lasted over 30 years at 97 Rock and outlasted more than a few consultants. He was aware of the "toast" bit before it was aired. That was likely a combination of poor judgement and an excuse for the latest regime to cut salary as programming became more top down.

If Hager was OK with the "Toast" comment, he deserved to be fired. Hate to bust your myopic Buffalo balloon, but he didn't invent the Classic Rock format...

 

[SirRoxalot]

If Hager was OK with the "Toast" comment, he deserved to be fired. Hate to bust your myopic Buffalo balloon, but he didn't invent the Classic Rock format...

Nobody said he did, but he was responsible for not slavishly following national charts, particularly on the weekends. Buffalo stations, like those along the south shore of Lake Erie and the Detroit/Windsor area, have been far more willing to play music by Canadian bands that fit the format and attracted local audiences. Special Weekends did, and do, give listeners a relief from the endless recycling of the same songs and allow the station to go a little deeper into the catalog, lessening fatigue with the weekday list. Several Buffalo programmers have fought to maintain that practice as corporate programmers have skewed music in various directions. The success of that practice allows it to continue.

 

[Theater of My Mind]

True, but WECK came with studios, real estate and Tower. WHLD comes with a relativity expensive tower lease and nothing else. Still no question Buddy got a deal on the station.

Can WHLD be diplexed on the WECK tower?

I know, it's so low I almost wish I put a bid in for it.

If you're serious, it's not too late to put in a bid on one of the many other stations Culmulus just shut down.

 

[SomeRadioGuy]

Can WHLD be diplexed on the WECK tower?



If you're serious, it's not too late to put in a bid on one of the many other stations Culmulus just shut down.

40khz is likely too close.... plus it would go to miniscule night power with 1 tower down from 5.

 

[tbolt909]

Nobody said he did, but he was responsible for not slavishly following national charts, particularly on the weekends. Buffalo stations, like those along the south shore of Lake Erie and the Detroit/Windsor area, have been far more willing to play music by Canadian bands that fit the format and attracted local audiences. Special Weekends did, and do, give listeners a relief from the endless recycling of the same songs and allow the station to go a little deeper into the catalog, lessening fatigue with the weekday list. Several Buffalo programmers have fought to maintain that practice as corporate programmers have skewed music in various directions. The success of that practice allows it to continue.

Again, Special weekend programming is not unique to Buffalo. Many West Coast Rock stations used to feature deeper tracks. California based groups like Jefferson Airplane, Santana, Byrds, etc.. The now tired "Block Party Weekend" and Twofer Tuesday was used everywhere.

According to David, listeners aren't fatigued of the same songs at all. He believes a deeper Album Track is a tune out. Real music lovers who like wider variety aren't expecting it from Radio anymore...