That doesn't surprise me at all. In 2012 it was "what's a radio?" This decade, it's "what's a TV?" Who needs cable when you've got a smartphone that will display and play every form of content? That's the way it's going.
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- Thread starter RadioGuy1864
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And yet Apollo Global Management has been buying a lot of those TV companies.
That does not explain that Best Buy, Costco and others could not keep 55" and larger screens in stock during the pandemic. I had to wait nearly 90 days for a 77" OLED, as they were out of stock and delayed due to shipping. I asked at Best Buy about alternatives and was told that last year they sold more large screen TVs than the previous 3 years combined.
They priced out the people who would have focused radio on the things that it uniquely does like no other medium still is capable of in 2022!
-Small guys don't get to play the Wall-street games and shenanigans that the conglomerates use and abuse. I'm certainly not a Socialist, but D-1s getting 20 million dollar bonuses as they run the business into the ground sure as heck is not Capitalism in our Democratic Republic!
-They get their bonus, and they sure do love money, but more than that is their addiction to power, and even better to them than that bonus, is the high they get when they bone us!
-Small guys don't get to play the Wall-street games and shenanigans that the conglomerates use and abuse. I'm certainly not a Socialist, but D-1s getting 20 million dollar bonuses as they run the business into the ground sure as heck is not Capitalism in our Democratic Republic!
-They get their bonus, and they sure do love money, but more than that is their addiction to power, and even better to them than that bonus, is the high they get when they bone us!
You can buy a radio station just about anywhere for less than the price of a nice house in that same location.
Or start an LPFM somewhere nearby for the cost of the filing and buying the requisite equipment.
You can buy stock in Audacy for 60 cents a share.
If you can't afford the cost of buying a radio station, you certainly can't afford the cost of running one, in terms of paying staff and all of the other expenses.
Great Post "TheBigA", you are certain right that I can now in 2022 buy a radio station for myself, just as I can go to the back of a grocery store and get a very great steal of a deal on expired milk and rotted vegetables and fruits!
I may not have been able to afford the ingredients when they were fresh and I had a chance to make some wonderful mouthwatering dishes at my restaurant, but hey, now I can get all I need for real cheap, I can make everything with my pennies on the dollar rotten ingredients! Whu-Hoah!
I may not have been able to afford the ingredients when they were fresh and I had a chance to make some wonderful mouthwatering dishes at my restaurant, but hey, now I can get all I need for real cheap, I can make everything with my pennies on the dollar rotten ingredients! Whu-Hoah!
Radio stations are not food. That comparison doesn't work. John Cats bought WABC for a 10th of what it would have cost many years ago, and has turned it into a station getting fairly decent ratings. So it's still possible to buy a failing radio station at an affordable price, and fix it. No one is going to give you Z-100 or KIIS for nothing. But if all you want is a tower and a transmitter with the potential to do what you want, the opportunity exists. In the words of Paul McCartney, "take a sad song, and make it better." All it takes is the will to do so.
So true. Think you can do better at operating a successful radio station profitably with minimal, or no prior experience? There are ample affordable opportunities out there. Put your money where your mouth is, then make sure they report back about how wonderful things are.
The bigger issue is that many people with skills and experience would not put their own money into radio today.
I've talked about this with friends who are industry veterans and none of us would risk our investments and capital to buy a station today.
A few years ago, I had a chance to pick up a controlling interest in a group of good smaller markets in the Southwest. My vision was a version of Saga or Townsquare. I realized the risk was considerable from competitors underpricing me out of profitability as well as the changing scenario of radio.
After decades of things like getting to the station at 5 AM to work with the morning show or setting the alarm for 3AM to get to the airport for a music test in Miami or Houston or wherever, the possible upside was not worth sacrificing some plain old lazy days.
Not really. Consolidation in 1995 came about because over half of all US radio stations were not making money. The FCC had allowed profitable markets with full service radio to become unprofitable through Docket 80-90's added drop in FM channels. And America's profusion of daytime AMs, directional AMs, Class A FMs and the like was a background of licensing too many bad stations. All that forced consolidation on us.
There is no shenanigan in getting big loans for a big group of stations. One of the problems in the early 80's was that local and regional banks and lenders would not touch radio because they knew that the industry was broadly unprofitable. Even the Small Business Administration sponsored loans generally would not touch radio.
For decades, the attitude of the FCC was "if it fits on the dial we will grant it". The result was too many stations, many never capable of being profitable or serving the public. Canada, for many years, required new stations to prove viability... and until recent years and the impact of the Internet, they had much better radio there.
Very clever, but just not true. Executives everywhere are scarce, whether at your local hospital or university or in radio; the few that are good demand high prices, just like pro sports stars or actors or singers.
I'm one of those people who previously owned lots of stock in radio, and don't any more. It's because radio has only one revenue stream and that's advertising. I believe diversification of revenue is important to any business, and radio for the most part doesn't work that way. Radio is not a growth business. Investors want to see potential for growth.
Back when I was part owner of a small group, by the early 2000's it became clear that lenders were starting to shy away from lending to radio. We sold one station for a lot more than it was worth, because (at the time) Clear Channel wanted to move the station to another (already pretty full) market. I voted we either reinvest the proceeds back into growing the group, or plan on selling the rest of the stations before radio got caught up in another economic downturn. In other words; get bigger or get out. My partners thought I was crazy. Then came 2007/2008 just a couple years later and the bottom fell out. As an example; our one full Class C FM that had tremendous coverage about to go on the block for $5M pre-recession, was now worth around $500K, mainly because cash flow went negative. Recently the same station was offered to me because the owners were about to default at $100K. Spent about two days thinking about the offer, ultimately declined.
Ah, the perils of opportunity. I was working to sell my stations in Ecuador in 1969 and the proceeds would have bought me 25% of EZ Communications with Art Kellar and Col. Draper owning the rest. The government in Ecuador changed, and before I could sell I had to "leave" at gunpoint.
I think 25% of EZ would have been worth about $200 million. Instead, I got out with a $1350 check from Llorilard (cigarettes were not bad for me back then) which got me to Puerto Rico and a GM position.
Half of this business is timing and the other half is luck. Like poker, but with background music and free concert tickets.
To me an example of the problem is when Mary Berner became CEO of Cumulus. Her first order of business was to return programming decisions to local markets with the intent of improving station ratings, and therefore improve revenues. The results were that in many cases the station ratings improved, but the revenues didn't. Or they didn't improve to the degree that would make a difference. If there is no real connection between improved ratings and increased revenues, then what can stations do to improve profitability? The only area for growth in these companies that we can see is in digital.
And that's what I've seen too. Ratings (let alone useless 6+) can be in the top ten in a preferred demo, in some cases never translates to revenue. This is especially true in small to medium markets that have been taken over by big box stores like Walmart and Home Depot, combined with the recent loss of local auto dealerships. And as you know, getting into streaming/digital requires quite the back-end investment, including enough contacts and clout to negotiate whatever streaming royalties. Prior radio-only companies like iHeart and Townsquare were able to leverage their radio group size to help build their streaming services into something worthwhile that a one'sy two'sy station owner would never stand a chance.
The main thing to understand in all this is that in the advertising world, size matters. Advertisers want their ads to receive millions of impressions. They get that with large radio groups. So while it's nice to romanticize about the old days of single station owners and what they were able to do, a single station today (even one like Z100 or KIIS) can't deliver the impressions the advertisers want. When we're talking about ad-supported media, that is critical.
Layoffs At Audacy To Reduce Company Workforce By Less Than 5%.
A workforce reduction is underway at radio’s second largest company. After several years of growth through acquisitions, platform enhancements and adding hundreds of employees to its workforce, Audacy said Tuesday
Here is an update on the Audacy cuts.
I suspect a lot of talented sales people departed the former Disney / ABC stations during John and Lew Dickey's regime at Cumulus.
Digitally, Cumulus' efforts at the time were a joke (Rdio, anyone?), and owning just one or two music FMs in major cities when the competition owned three, four, or five such stations a piece likely did not help matters, either.
Mix 107.3 is a station that witnessed a ratings renaissance after the Dickey Brothers were ousted yet failed to enjoy much in the way of revenue growth. Hence, its inclusion in the sale to EMF.
Digitally, Cumulus' efforts at the time were a joke (Rdio, anyone?), and owning just one or two music FMs in major cities when the competition owned three, four, or five such stations a piece likely did not help matters, either.
Mix 107.3 is a station that witnessed a ratings renaissance after the Dickey Brothers were ousted yet failed to enjoy much in the way of revenue growth. Hence, its inclusion in the sale to EMF.
Only if they endured 5 years under Citadel.
As I said in post #96, size matters. Mix 107.3 was one of the stations Cumulus inherited from Disney/ABC. The problem was the company only owned 3 radio stations in DC. That made their sales package smaller than those of their competitors. So there was no financial benefit to owning WRQX, just as there was no financial benefit to owning WPLJ. In the last few years we've seen Audacy making some trades, exiting certain markets while improving their positions in others, for similar reasons.
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