2009 Predictions

[The Voice of Reason]

My predictions for the coming year include the following:
• There will be layoffs at both commercial and public broadcasting stations.
This is mainly due to the economy and the falling price of some company stock.
• Don’t be surprised to see some stations reduce or eliminate local news entirely. It has already happened in some markets.
This “experiment” with a 7pm newscast for instance on Channel 10, I believe, will end in 2009.
• Both radio and TV stations will have to do more with less meaning more people will have to multi-task.
• Local personalities on radio, what few there are left, whose contracts expire this coming New Year may either see less money in their paychecks or be replaced with someone who will work for half the salary. And it’s possible that some TV veterans maybe let go because of tight financial times.

 

[Mark Giardina]

I can hear the ax being sharpened right now.

 

[SirRoxalot]

Wow, you really went out on a limb with those predictions. I feel like I'm in the presence of Kreskin.

You might as well add:

"OTA radio will increasingly rely on syndication and voice tracking."

"On-line listening will increase as OTA programming quality decreases."

"Radio revenue will decline as listening declines."

"Sales positions will be cut as revenue declines."

Meanwhile, any management cuts will take place at the local level, not at corporate headquarters.

 

[The Voice of Reason]

I feel like I'm in the presence of Kreskin.

More like Carnac from the Tonight Show with Johnny Carson ;D

Now what I would love to see happen in 2009 is:

The return of personality radio.

The end of HD and IBOC.

More radio stations with their own news departments and not depending on TV for news coverage.

The sale of radio stations to more local owners.

 

[Bob1370]

Voice of Reason wants to see the following;

"The return of personality radio."

This will happen in 2010 and 2011 as the radio business bottoms out, and the research which has been showing all along that personality and localism are the way out of the pits starts to scream so loudly that the suits finally begin to pay attention. Hopefully it won't be too little, too late.

"The end of HD and IBOC."

HD and IBOC will not make much headway on AM, and eventually will fade away, as it becomes clear that the same ends--better sound and better reach--will be served by returning to the old 15 kHz rolloff for AM audio, mandating installation of C-Quam stereo for all stations, and perhaps allowing power increases for all fulltime stations (to 2500 watts 24/7 for Class Cs, 25,000 to 50,000 for all fulltime class Bs, 100,000 for class As) the way the Canadians have done, to boost signal strength and signal/noise ratios in prime market areas even at the expense of tolerating additional interference on the fringes where listening and revenue are at a minumum anyway. Well controlled, tight tolerance directional patterns, easier to achieve in these days of computer-controlled antenna phasing systems, will help keep added interference to a minimum.

HD will remain a viable factor on FM simply because there's room for it, it seems to cause far fewer problems in terms of adjacent channel interference than its AM counterpart, and there's a use for it as a vehicle for multiple program streams and added program choice within the footprint of a typical FM signal.

"More radio stations with their own news departments and not depending on TV for news coverage."

This will happen simply because more TV stations will cut back to the point that they're no longer reliable news partners, and radio stations will realize they need their own local information content to retain and attract listeners.

"The sale of radio stations to more local owners."

This will happen as more of the big national owners hit the rocks (seen the share price of some of these outfits lately?) and need to divest in order to keep their balance sheets healthy. The stations will be affordable, and not all of them will make it under new owners. But the smart owners with decent up-front working capital will find they've bought into a business with good profit potential, especially a year or two down the road after the economy starts recovering. (It's bottoming out now, but we won't see a lot of daylight for another 9 to 12 months...that's when the changes will start to come.)

 

[umtrr-author]

I guess a lot depends on when the economy turns around. I'm not optimistic about this happening in "months"-- I think the metric is "years".

I'll be provocative for a Monday Morning:

If advertising dollars decline to the point that they could, for example we see a "HUUUUUUUGE!!!!"* decrease in spend from car dealers-- for one thing, simply because there will almost certainly be fewer car dealers in 2009-- could we actually see entire radio stations go dark? It's true that with automation, it doesn't take much to keep one on life support (cf. 950 AM), but could things go so sour that there's not even enough money coming in to keep the really marginal players going? I'll defer to those more expert about this than I, so please note the above is a "just wondering".

I'm not sure I see local personality radio coming back any time soon, as much as I'd like to believe it could. (And if the live and local is polarizing angry talk, you can keep it, thanks.) I do see more work for a certain Mr. Seacrest and his brethren and sistren.

And I'm concerned about public radio. I can easily see a scenario where individual contributions go down, being squeezed out by higher medical costs, higher food costs, higher energy costs ($1.xx gas is not going to last), etc.

*Sorry, couldn't resist.

 

[The Voice of Reason]

"The return of personality radio."

This will happen in 2010 and 2011 as the radio business bottoms out, and the research which has been showing all along that personality and localism are the way out of the pits starts to scream so loudly that the suits finally begin to pay attention. Hopefully it won't be too little, too late.

"The end of HD and IBOC."

HD and IBOC will not make much headway on AM, and eventually will fade away, as it becomes clear that the same ends--better sound and better reach--will be served by returning to the old 15 kHz rolloff for AM audio, mandating installation of C-Quam stereo for all stations, and perhaps allowing power increases for all fulltime stations (to 2500 watts 24/7 for Class Cs, 25,000 to 50,000 for all fulltime class Bs, 100,000 for class As) the way the Canadians have done, to boost signal strength and signal/noise ratios in prime market areas even at the expense of tolerating additional interference on the fringes where listening and revenue are at a minumum anyway. Well controlled, tight tolerance directional patterns, easier to achieve in these days of computer-controlled antenna phasing systems, will help keep added interference to a minimum.

HD will remain a viable factor on FM simply because there's room for it, it seems to cause far fewer problems in terms of adjacent channel interference than its AM counterpart, and there's a use for it as a vehicle for multiple program streams and added program choice within the footprint of a typical FM signal.

"More radio stations with their own news departments and not depending on TV for news coverage."

This will happen simply because more TV stations will cut back to the point that they're no longer reliable news partners, and radio stations will realize they need their own local information content to retain and attract listeners.

"The sale of radio stations to more local owners."

This will happen as more of the big national owners hit the rocks (seen the share price of some of these outfits lately?) and need to divest in order to keep their balance sheets healthy. The stations will be affordable, and not all of them will make it under new owners. But the smart owners with decent up-front working capital will find they've bought into a business with good profit potential, especially a year or two down the road after the economy starts recovering. (It's bottoming out now, but we won't see a lot of daylight for another 9 to 12 months...that's when the changes will start to come.)

I wish that I had your optimism when it came to the future of radio; return of localism and local radio news coverage and the end of IBOC.
Unfortunately I just don't see a massive "garage sale" of radio stations in the near future. Granted some major corporations' stock (per share) is worth about as much as the price of a snickers candy bar. And while the smart thing would be to unload some of their radio properties, the ones they would try to sell are the ones either with weak signals, or the ones they've (management & owners) have run into the ground.
TV news will remain on radio just because it's cheaper, as you yourself have mentioned before, to trade out news coverage versus hiring people to staff radio news departments.
As for IBOC, hopefully it will die a quick death. Supporters of IBOC are having a difficult time arguing in favor of this system when it distorts the signal of one of their 50kw stations in another state.
2010 and 2011 are a long time away. I have to wonder how many more people will lose their jobs between now and then, and how many more stations will revert to jukeboxes, or even go dark before
the owners of these stations "see the light?"

 

[SirRoxalot]

You have a lot more faith in corporate radio than I do. Their idea of "personality radio" is to syndicate Ryan Seacrest from coast to coast.

I think that one or more major players will bite the dust in 2009, either opting for or being forced into bankruptcy in order to get out from under massive debt loads. My candidate is Citadel. Chapter 11 reorganization and renegotiation of debt would be the course of choice, but you can't rule out Chapter 7 liquidation. In the meantime, more ugly cuts will be coming down the pike, and they're likely to cut everywhere except the corporate suite - where the problem really began.

What worries me more is that some of the big players will ultimately use their own failure as an excuse to shut down radio as we know it and reallocate the bandwidth into digital spectrum. On one hand, digital broadcasting would allow the number of stations to increase exponentially. On the other hand, do we really want to hand these guys even more channels for syndication and VT? And, every existing receiver would end up useless, or requiring a "converter box" to decode the digital signal. Where have we seen that before?

 

[Savage]

Umm....I feel like Rip Van Savage who has just awakened from a nightmare-studded 30-year nap (the nightmare being IBOC.) Mr. Bobster 1370:

I missed this. When did the Canadians authorize 100kw on AM for Class As, 50kw fulltime for Class Bs, et cetera?

Can I just change our callsign to CYSL and go for it??

 

[oaktree]

100kw on Canadian Clears? Don't think so.

Also, power increases such as 2500 watts for AM "C's" will have no effect on signal strength and pattern. It's all relative, as long as the AM band, especially those graveyard channels - are still so overcrowded, especially at night. It wasn't a big help when they went from 250 watts to 1kw years ago.

 

[Bob1370]

Bob Savage asks, "When did the Canadians authorize 100kw on AM for Class As, 50kw fulltime for Class Bs, et cetera?"

They never went to 100 kW (at least not yet) on the clears in either Canada or the US, at least not after they told WLW to power down during World War II, although according to NARBA, they still could, it'd just be a matter of the FCC and CRTC voting to change the rules. And I think the class-As should be allowed to go for it wherever it won't step on co-channel or adjacent channel stations in the same general region of the country. (Which of course would leave WBZ out in the cold, but some others, maybe including WHAM, might be able to do it...)

But 50 kW class Bs are everywhere in Canada...for example the three main Hamilton AMs (CHAM, CHML and CKOC), every Toronto AM station but class-A CFZM/740, all the Ottawa stations still on AM, most of Montreal's, not to mention the big 8, CKLW, and most of the AMs in markets like Winnipeg, Calgary, Edmonton and Vancouver. And we've started it too in a few locations like Detroit and Milwaukee where regionals like WWJ, WXYT and WTMJ are joining the 50-kW brigade with some heavy-metal DA systems. It might be time for us to start using more power with the appropriate DA patterns to protect co-channel and adjancent channel stations while boosting signal strength, in order to pour more signal into our prime markets to cut through the electronic noise and penetrate all the commercial and office construction more effectively in our core service areas.

Bob, I can see you running 50,000 by day, 10,000 by night with WYSL, and who knows, we might be able to join you in that club...

 

[Savage]

Oh, I can do 50kw DA-2 here. Just need 30 acres, some VERY friendly neighbors somewhere in Rush or Wheatland and enough cash-ola for a 6-tower broadside array. Which would mean: about $750K and about five years, so I could put about 2000 mv/m over Rochester and still get city-grade over Avon. THAT would mostly fix WBZ-HD.

Send your goodwill offering to: Box 236, Avon, NY 14414.

 

[Savage]

BTW, oaktree nails the salient issue: big increases in power often fail to have much effect in terms of improved coverage. He correctly points out that when the six graveyard channels got across-the-board authority to quadruple night power to 1kw from 250 watts back in the 80s, most of those station saw no improvement in coverage. The fourfold increase in power was more than offset by increased interference, which is/was already horrible on those frequencies. In fact: because many of those "Class IV" stations were sited as closely as 60 miles to one another, some actually LOST coverage after the night power-up to 1kw.

We initially designed the upgraded WYSL to run 10kw daytime. But then I modified the concept to be "everything we can get with the present array and the existing real estate," which proved to be 20kw. The difference between the proposed 10kw and 20kw? The 5.0mv/m moved out about 5 miles in the main lobe over Rochester.

Even with 13.2kw critical hours, WYSL puts over 13 mv/m daytime over Kodak Park. Where I actually measured it yesterday afternoon in conjunction with "a pending project." (Don't ask. Can't tell ya yet.)

 

[doctorcomputer3]

I think things will get better for internet radio. Nowhere to go but up.

 

[Element9]

Does anybody else hear "When You Wish Upon A Star" playing underneath all of this. Jeez Lou-eez! Sure, hand out those AM CP's for 50k like Monopoly money! Comapnies will rush to ppend ridiculus sums, more than it's worth, putting more copper and iron in the ground so there can be more stations AM's like CJRN, Niagara Falls, 3 towers for 10 kW day and 10 towers for 3.5 kW night; or WISN with 6 towers (50 kW) day and 9 towers (10 kW) night.

Sorry ladies and gentlemen, don't see this kind of investment being made in AM radio when some clusters' FMs are struggling.

Crystal ball sez: Mensa Boy Mike Schopp will discover an alternative fuel source, nuclear fusion, but he'll continue to do his radio show and be an insufferable, arrogant chooch.

 

[superset weekend]

Nothing can be worse than 2008! Well, i suppose it could be, but not by much! Radio is alive and well. It is a great cash flow business model. Here are a few of my thoughts for 2009

More Talk and Niche formats that are not music driven!
Revenue a little down, but not some some other industries!
Thinking out of the box!
More consolidation!
Great opportunities for smaller (rural) markets especially in light of the digital TV stuff
Compelling radio stations that focus on delivering results in both programming and sales win.

The downs that radio is facing now is happening to most every industry, and infact, it is world-wide. Radio has some work to do, but the declines are not something that are just happening to radio. Some of the biggest blue chip companies are having problems too. Remember, radio STILL reaches 96% of Americans weekly. As along as it is compelling, and finds ways to incorporate with new technologies, radio will continue to win. Also of people on here get influenced by a radio companies stock price. Overall, the most personal portfolios are down over 40%, it is just not radio, and it not a fair assessment of a stations value.

 

[SirRoxalot]

Going to the "Fair"

A "fair assessment of a station's value" would be a fair assessment of their product - i.e. PROGRAMMING.

Cuts have been wide and deep. Quality is suffering. Expect a negative response from listeners, which means further revenue declines.

Radio "reaches" about 92% of Amercans weekly, and TSL is falling. AQH ratings have declined steadily since the '80s. The generation under 30 has little affinity for radio - and radio has relatively little programming targeted at them.

IMHO, the first quarter of 2009 will be bloody, mostly because corporate doesn't understand the medium.

 

[Bob1370]

Bob Savage points out that "big increases in power often fail to have much effect in terms of improved coverage."

All true in the sense that the size of your 2.5 mV/m footprint may not grow all that much compared to some folks' expectations. But we have another issue today that AM stations weren't facing to the same degree 20 years ago, and more power may help us within our primary coverage area. Because of the proliferation of computers, and the growth of office parks and apartment and condo complexes whose buildings sometimes act like Faraday cages, we are contending with both an electrically much noisier environment and a need to push through a lot more RF-resistant real estate in order to get the kind of workplace and in-home listening we used to have back in the day. More power might help AM stations cut through the steel and the noise. Anyone who works in a downtown building or a recently built office park and has to battle the static and buzz to hear his favorite chatter will know what I'm talking about.

 

[Element9]

Bob 1370 wrote, "Because of the proliferation of computers, and the growth of office parks and apartment and condo complexes whose buildings sometimes act like Faraday cages, we are contending with both an electrically much noisier environment and a need to push through a lot more RF-resistant real estate in order to get the kind of workplace and in-home listening we used to have back in the day. More power might help AM stations cut through the steel and the noise."

Sounds like an "AM Bailout" to me. Ah, but what the hell... we gave Wall Street and the banks $700 Billion ($700,000,000,000), so why not give AM's more juice too.

Bob 1370 also noted, "Anyone who works in a downtown building or a recently built office park and has to battle the static and buzz to hear his favorite chatter will know what I'm talking about."

Streaming on line might help combat this problem. As to cranking up the power, the AM band is chock full of sideband, co-channel and all kinds of hash, so it seems to me that allowing stations to crank it up will only increase the problem exponentially.

Better to s-can iBoc. There's a start. It would be easier to wide-band AMs, even the critical directionals.

And while I'm frothing at the keyboard, maybe it's time to get back to licensing engineers and operators, y'know, the old First, Second and Third Ticket with Broadcast Endorsement? Maintaining rigorous standards isn't necessarily a bad thing.

Some might also argue that AM is a lost cause, so why even pay attention to the pervasive hash and sizzle that's washed over the band. I disagree, especially as it relates to independent operators busting their rumps to operate AMs and making a living.

 

[superset weekend]

Look at Net Revenues in the industry and tell me radio is declining. Radio's net profit is huge. It may have gone down, but still huge. Check out one of the corporate balance sheets or financial statements