Could this mean the end to small market radio?

[Kent]

KRMS 93.5 was doing at least some live and local programming before the flip to Mike FM.

KRMS 93.5 had a live morning show, which I mentioned. The only other live programming it had was when it was doing remotes. It didn't make money, even with the staff cut to the bone. So, it changed formats. To Klautzer's credit, he didn't fire anyone when the station changed to Mike FM. However, I can't see them going on a hiring binge if the regulations change. He's pretty well stated that on some of these messageboards. He says he does what he can afford, and that's why he has a skeleton crew. I believe him.

 

[JimmyJames]

It just seems I remember hearing a lot of sets (jockless) on KRMS that would throw in deep album cuts or some more recent (Coldplay, REM, U2) type of adult rock and I haven't heard a satellite service in years playing that mix of currents and classics. What network was sending out that mix? It sounded far more like something a local playout would be doing.

 

[Kent]

KRMS was running ABC's classic rock. They may have used a local version of the format, which would have allowed them to run music off their hard drive while using voicetracks from ABC's jocks. KLAK in the north Dallas suburbs uses a local version of the ABC "Today's Hits and Yesterday's Favorites" format, which has a local morning show, John Tesh at night, and ABC network personalities voicetracked in middays and afternoons (though not all are on the AC format). At one time, ABC was planning to take the whole network in that direction, but they've since backed off that idea.

 

[Kent]

The biggest problem most of you are talking about is the station is incapable of selling its airtime.

You could say that about any struggling radio station.

Most radio stations I have ever seen have a staff of order takers but lack true sales talent.

This is a chicken and egg issue. It's very hard to keep true sales talent in smaller markets where spots are cheap and commissions are low. So, you get great salespeople, and they either move up to a bigger market or start selling something that will get them a better commission. This is also a problem with jocks. You get great jocks, and they quickly move up to a bigger market or leave the business because of the pay and/or working conditions in smaller markets. A lot of people will try to convince you that Clear Channel invented the Prophet System. However, it was created by the owners of a 1 AM/2 FM combo in Ogallala, NE (I believe it was just called Ogallala Broadcasting Company). Although the stations eventually got sold to Clear Channel because AMFM, which was acquired by Clear Channel, bought Prophet and had to buy the stations, too, the original owners created Prophet to be able to pay their talent better wages, give them better working conditions and keep them in Ogallala longer. It was a direct response to the high amount of turnover the stations were having, and this problem was not unique to Ogallala.

In my experience, I have found that many small businesses would love to advertise on radio. They are just looking foe someone to show them how. Go to a small business and talk to the owner about abritron or ratings and watch them get a glossy look in their eyes.

This may be the case in some markets, but I don't think I agree with respect to many of the small markets. The smaller the community, the harder it will be to get advertisers. When word of mouth works and everyone knows them, they're either not going to advertise on the radio at all or will not do so regularly. The only businesses that will be extremely eager to advertise on the radio are start ups. They have an extremely high failure rate and are historic no pays. It's not a sale unless you collect the check! Also, the Arbitron issue doesn't apply in many of the smallest markets and unrated markets. Owners don't buy the book and don't sell the numbers. The county-by-county numbers for those unrated markets are old, outdated and unreliable anyway.

If a small station would become a active participant in the city it is in. Build relationships with the business community and be a contributor to the community. They will have the advertisers on the station. It isn’t easy and it takes very hard work to do this. The truth is that most people don’t want to work and enjoy the status quo. They believe they want to win. They tell themselves, spouses, staff or whoever else will listen they want to. But, when the rubber meets the road they really don’t. To make it you just need to work smarter and harder than your competitor. But most wont, they like fun and easy and stay away from hard and necessary.

If the business community isn't strong enough to support a radio station, it can't happen. Really, this issue should have been debated in the late 70's and early 80's when Docket 80-90 was starting up. There were a lot of stations that should never have been licensed. They were put into communities that could never support a radio station, and many others that were in larger areas were at a competitive disadvantage by being class A's that couldn't compete with the class B's and C's already around. The problem, however, is that what we have is what we have, and we have to make it work. I have my share of problems with the consolidation and the automation, but it seems better than just letting stations go dark never to return, which really is about the only alternative.

 

[richmcdonald]

Your correct in much of what you say. But, if you have a station from a small rural community that really has no economic utility. Their is no way a business community could support such a station. Because their is no business. I live in a town of 30,000 people in ten years it will grow to 100,000 people. Their is unprecedented amount of oppourtunity in an area like this. Hard times come and go for one reason or another. What it does is washes out the weak and makes the strong stronger.

 

[virgilstreetnc]

I think Kent was dead-on with all his points. Well done. Saved me a ton of typing.

 

[Flying-Dutchman]

Since we are talking about small market radio, there is a man I need to bring up. His name was Jerrell Shepherd. He was recognized by many publications as the most successful small town operator in
America.

It was almost 20 years ago when the FCC gave me my first CP for Attica Indiana. 4,000 people and
23 miles from Lafayette.

Jerrell Shepherd contacted me and informed me that I was going to travel to Moberly, MO to meet him.
He said,"I have the equipment for your new radio station. I have a five year old Harris tranmitter, ERI
Antennas, and a board. You are going to pick them up. My engineers have already tuned it all to your
new frequency. I am going to teach you what you need to know to survive in this radio business. Spend
a couple days in Moberly."

His lesson that saved my butt was, sell community events. "You can't make it with good music. Even
if your number 1. The ad agencies that buy ratings take 90 to 120 days to pay, and you still need to
pay your people. Community events bring in fast money. The advertiser gets satisfaction that he paid
and made something possible on the air. Play music only, and you won't be able to pay jocks, or you.
Sell community events and you will be able to support several families

If you are in the big city, you have big events. If you are in a small town, you have what some on this
thread have called podunk events. We all as station owners and managers had the option to skip those
so called podunk events. Along with that option was the option to go broke.

So you guys can stick your noses up at those podunk events I did, all you want. I don't give a XXXX.
And , I can thank Jerrell Shepherd of KRES in Moberly MO for giving me the knowledge, of how to survive
at a time, when almost evwery other station around was going broke.

And where is this West Podunk? Someone wouldn't be refering to 106.7, the frequency I had alotted
for my friend Kelly in West Lafayette? Is that supossed to be West Podunk?

Here's a link to a story about Jerrel Shepherd. If you are a small town operator his advice could help
you too. http://www.smays.com/default/2007/06/interview_with_.html

 

[Kent]

A few points:

(1) At the time you went to Moberly, he had a lot less competition than he does now. There were far fewer stations. No commercial Columbia stations put a citygrade signal into Moberly. When I worked at KPLA, we had several accounts in Moberly that would have been unattainable even 15 years ago, and it was the first Columbia station to upgrade to a regional signal. That account would have belonged exclusively to KWIX/KRES until at least KPLA's upgrade in '92 and probably not until the second upgrade happened a few years later. Now, even a Kirksville station citygrades Moberly.

(2) Shepherd was not a local operator so much as he was a regional one after he got the FM's. His company used to claim to cover at least part of all but about 3 counties in the state. He sold and focused on the entire region, not just Moberly. He even called his FM's "Regional Radio" to emphasize that approach. There was also a situation 25-30 years ago where he lost the Cardinals in Farmington because he was too aggressive on selling the games and intruded on KMOX's exclusive sales territory. So, he employed this regional strategy for a long time. Although I would run a station far differently than Shepherd if given the opportunity, I do agree with him on one thing, which is to make it in a small market, you have to focus on the entire region you cover, not just the city of license. That's another reason I don't like the idea of forcing stations to locate in and broadcast exclusively from the city of license.

(3) Shepherd's kids sold. Think maybe they saw their business model producing less and less?

(4) I certainly will not criticize you for doing podunk events or being a locally focused operator. I'm glad you got a chance to operate stations passionately, and I don't question your passion for the industry. The only issues I may have are that I don't believe doing things your way is the only way to have passion for a station or the industry and that I don't believe running a station that way should be mandatory.

 

[Goat Rodeo Cowboy]

Well, Kent, I went to Moberly 46 years ago as News Director. I watched as Jerrell Shepherd returned to the station after spending some time pursing another business interest. It was at that time the most successful radio station I had ever seen. I was there was he kicked in the afterburners and took off for levels of business not believed possible by a lot of contemporaries.

I think my tenure was about 2-1/2 years. I moved into sales and a sales manager got between me and Jerrell and I was cut loose.

The logic you just presented assumes the "Shepherd Style" is somehow fixed, frozen, unmoveable. Yes, Shep was rigid at any given time on policy, but what I admired about him and what I tried to appropriate from him as I moved on was this ability to analyze the CURRENT market place and implement a business plan to respond to conditions.

I don't see his move to REGIONAL as some kind of curruption of his plan. AS the industry (and technology) and FCC rules changed, his grinding innovative mind was two steps ahead of most people.

Shep ruined my radio career. <Insert a really big silly grin here.> From him I inherited the idea that I could only work for the best..... and I eventually said: If I can own my own and run it RIGHT, I'll just get out of the business. Which I did.

For the last four years I have been looking for a little station where I could be a 21st century Shepherd Junion. I've spent many hours halfway watching TV and scribbling notes on what Shepherd might do if he were jumping into the local radio market today. As Rush Limbaugh used to be fond of saying: "Thinking is HARD WORK"

I guess if you competed with him, you wouldn't have the same affection for his business style those of us would who had to chance to bluntly ask him once in a while: Why do you want to do it this way?

 

[kenhawk1160]

Since we are talking about small market radio, there is a man I need to bring up. His name was Jerrell Shepherd. He was recognized by many publications as the most successful small town operator in
America.

It was almost 20 years ago when the FCC gave me my first CP for Attica Indiana. 4,000 people and
23 miles from Lafayette.

Jerrell Shepherd contacted me and informed me that I was going to travel to Moberly, MO to meet him.
He said,"I have the equipment for your new radio station. I have a five year old Harris tranmitter, ERI
Antennas, and a board. You are going to pick them up. My engineers have already tuned it all to your
new frequency. I am going to teach you what you need to know to survive in this radio business. Spend
a couple days in Moberly."

His lesson that saved my butt was, sell community events. "You can't make it with good music. Even
if your number 1. The ad agencies that buy ratings take 90 to 120 days to pay, and you still need to
pay your people. Community events bring in fast money. The advertiser gets satisfaction that he paid
and made something possible on the air. Play music only, and you won't be able to pay jocks, or you.
Sell community events and you will be able to support several families

If you are in the big city, you have big events. If you are in a small town, you have what some on this
thread have called podunk events. We all as station owners and managers had the option to skip those
so called podunk events. Along with that option was the option to go broke.

So you guys can stick your noses up at those podunk events I did, all you want. I don't give a XXXX.
And , I can thank Jerrell Shepherd of KRES in Moberly MO for giving me the knowledge, of how to survive
at a time, when almost evwery other station around was going broke.

And where is this West Podunk? Someone wouldn't be refering to 106.7, the frequency I had alotted
for my friend Kelly in West Lafayette? Is that supossed to be West Podunk?

Here's a link to a story about Jerrel Shepherd. If you are a small town operator his advice could help
you too. http://www.smays.com/default/2007/06/interview_with_.html

Dutchman:

Excellent story. Our Jerrel Shepherd in Central Pennsylvania is Cary Simpson. He operated his stations on the same philosophy. He grew his empire from one little Class IV AM in 1950 to the group of 11 stations he has now. He even made the cover of Radio Ink magazine in the mid-90's.

More than that, he did it by doing exactly what you're talking about. He broadcasts parades, high school sports, events honoring the veterans, and he airs a local news block almost an hour long at ten AM. Tourists who come into the area and visit the station, he'll put them on the air and ask them what they like about the area.

He began his stations in very rural areas that he felt deserved their own radio station, but maybe not be able to support what was then considered a typical radio station's staff. Thus, he centralized a lot of administrative functions, with only airstaff and sales reps at the individual stations. He was doing this for decades, and now that's become the accepted industry standard.

I should also note that Cary has just turned 80, is in fabulous health, and answers his own phone. When you call WTRN and hear a voice pick up and say "Radio Station", that's him. Very much a hands-on operator, as is his son Ted, who is being groomed as his successor.

LONG LIVE THE "PODUNK" OPERATORS!!!

 

[media1170]

This is one heck of a good thread. The one central fact is that all radio is local. What the owner does with that is the issue.

The Shepards and Quinns make "Podunk" radio work. All those rim shot FM station trying to make a living, and how many are succeeding as a business?

Anyone have some facts?

 

[Kent]

The logic you just presented assumes the "Shepherd Style" is somehow fixed, frozen, unmoveable. Yes, Shep was rigid at any given time on policy, but what I admired about him and what I tried to appropriate from him as I moved on was this ability to analyze the CURRENT market place and implement a business plan to respond to conditions.

Not really. It actually assumes much the opposite, which is that Shep realized he needed to change his business model when he went from graveyard and daytime AM's to class C FM's. That's hardly a frozen plan!

I don't see his move to REGIONAL as some kind of curruption of his plan. AS the industry (and technology) and FCC rules changed, his grinding innovative mind was two steps ahead of most people.

Nor do I. My point was that saying Shepherd was focused only on Moberly when he had KWIX/KRES, which is effectively what Dutchman said, was a misstatement, and it demonstrates a clear lack of understanding as to the way Shepherd did business. It also implies, quite falsely, that, even in a small town, a station needs to only focus on the city of license regardless of what else it might be able to cover. Shepherd focused on everywhere his signals covered, and that was the right thing to do. As I stated before, my point was that, especially in small markets, stations need to focus on all of their listeners, not just the ones in the city of license. The fact that it was an effective business model for Shep and his family for as long as it was is a testament to that.

I guess if you competed with him, you wouldn't have the same affection for his business style those of us would who had to chance to bluntly ask him once in a while: Why do you want to do it this way?

I don't know if you'd call it affection for his business style, but I had a great respect for Shepherd as a competitor. In fact, we often had one of our radios in the KFRU newsroom tuned to KRES during severe weather coverage! They had half or less the resources we did, but we felt they did an excellent job. However, I do wonder why his kids sold. I understand it's their business, and they had a right to do with it as they pleased, but I still wonder why, especially if the business model had them rolling in the dough.

 

[Flying-Dutchman]

Anywhere a stations signal is heard, is fair game when it comes to selling advertising. No one- not Jerrell
Shepherd, the FCC, or I have ever said anything to restrict that, so go get em!

I was the guy who actually found the frequencies, wrote the petitions for rulemaking, and alloted the
channels for which I received license grants. In the allocation proceding, you promise to build the station in a certain town. So, I kept that promise I made to the FCC. My towers were 10 miles from Lafayette, IN and
10 miles from Indianapolis. I could market those large cities while my stations were in their community of
license.

Being part of your community of license is one thing. Being restricted to it is another..

Jerrell Shepherd did say, "A radio station is the heart of a community. As the community makes the station grow, the station makes the community grow too."

 

[gr8oldies]

It is interesting that KWIX and KRES came up, I could recieve KRES pretty well in the Hannibal/Quincy area when I worked at KGRC briefly in 1985-86. For the gentleman who worked there: I had read "back in the day" that KWIX/KRES had a full in-house telemarketing department selling literally every element of the stations, in fact, even running seminars for other station owners and managers so they could do the same thing.

I don't believe I ever said, if I'm the one being called out on this, that a small market station shouldn't do events like fairs, ball games, etc. I question though that that might be the best use for, say, 50000 watts in Shelbyville, IN (unless you're away from a large city as in the case of KWIX/KRES, which did sell everywhere and anywhere ). I use "West Podunk" generically; could be Asheville, OH (where one of the Columbus move-ins from Chillicothe is licensed..city of 1000 or so) or Battle Ground, IN (does anybody seriously think a station in Battle Ground could survive on retailers in Battle Ground alone?). I still believe that there should be a way to do move-ins that make sense without the legal fiction of "first aural service" to a place that may not even have a zip code, but make sure adequate service is left behind, particularly if it's not an immediately adjacent suburb your moving in from.

 

[Goat Rodeo Cowboy]

To make this on-going conversation more meaningful to all who read, maybe we should review some changes of the last 60 years.

In the era when Jerrell Shepherd applied for permission to build KNCM (later changed to the calls KWIX) you had to demonstrate to the FCC that you had the financial strength to keep the station going for a number of months even if revenue did not develop and then you had to provide some logic that the community to be served could reasonably be expected to eventually generate the revenue needed to support the operation planned. You submitted a pro-forma business plan. (I am not so naive as to assume that games were never played with these numbers.) This meant stations were not granted to make-believe communities with 17 residents. I can't confirm this with an example but from the conversations I heard as a young announcer, the bureaucrats at the FCC had a pretty good idea what size town it took to support a radio station, or two stations, or three, etc. When people started filing apps for towns of less than 10,000, FCC eyebrows were raised. After some of those got pushed through with a lot of effort, then it was assumed 9,000 was too small etc.

Localism. Today we talk about localism at the station level, the programming level. Let's talk about localism on the customer side in the 1950s and 1960s. So you get your CP and then your license for your new station in say Clarksville, Arkansas. Things are going fine and as you get things moving and shaking in Clarksville, you run down to Russellville and call on a car dealer, an appliance dealer and a furniture store. You come home with a couple of orders and put them on the air. The next day you have some of your original home town customers giving you a grim look and delivering an ultimatum: This is our town, you are OUR radio station. If you keep running out-of-town ads, my schedule will be cancelled! I never focused on the concept that Shep was smarter than everyone else and was bright enough to go sell in the neighboring town. What impressed me was that he figured out how to sell to neighboring towns and keep peace in his home-town book of business IN THAT ERA.

The other thing that captured Shep's attention in that era was working the vendor reps who controlled co-op advertising AND the franchise relationship with the retailer. So you wander from your Clarksville AR station down the Russellville and sell some advertising to the hot-shot appliance dealer selling Maytag product. Your hometown C'ville Maytag dealer complains to Maytag that R'ville dealer is poaching his franchise area and Maytag Man gets ahold of the advertiser in R'ville and says: Knock it off. The Jerrell Shepherd I knew in the early 60's was obsessed with methods to cultivate these factory reps. I'll bet that's not been a problem for you guys in the last 10 or 20 years.

The broadcasters of the 50s and 60s lived in a totally different world than today. You may need to be smarter than the average bear to take the business philosophies of the good operators of that era and translate them into today marketplace.

 

[Flying-Dutchman]

We have about two choices here. We can say independent and mom and pop radio is dead. We can just
sell our stations to the corporations and get out now. We can say it's all over.

But, some of us took the time to get to know guys like Simon Geller. He ran WVCA (The Voice of
Cape Ann) in Gloucester, MA all by himself. He learned to fight his own legal battle before the FCC
when the big boys tried to take his license because they said he was podunk. After years in hearings,
Simon Geller won. Then there was Stanley Coning of WCTM in Eaton OH. He too was a one man
station and like Geller faced and won a legal battle with big boys trying to get his license. Stanley told
me he had to sell his FM license 92.9 so he could pay the lawyers.

Then there was Jerrell Shepherd of KRES in Moberly, MO. They say he was the most successful
small market broadcaster ever. Jerrell Shepherd was not a man of secrets like most station owners.
He was not afraid to show his books. In fact the stations sales were posted in the station lobby
for all to see.
The truth to the success of Jerrell Shepherd and KRES was in Jerrell himself. He was the kind of man
who believed he had just given you a good deal. He would call you months later to make sure you
were still happy. You see, what mattered most to Jerrell Shepherd was HIS NAME.

So for those of you who say it's all dead and in the past, I guess it's over for you. But then there
are those of us who are going to keep on going. Doing what we do.

 

[Goat Rodeo Cowboy]

And if the guys you named could do the small station without the tools available today, think of the advantage you have at your fingertips today. Program automation. Transmitter automation. Internet. Fax machines. Copiers. Word processors. Computerized accounting and billing. Telephone answering machines. and the list goes on and on.

Comparing the task faced by small town operators in the late 40s and on into the 60s to what we should be able to do today is like comparing the kitchen where your greatgrandmother fixed meals to today's kitchen with refrigeration, microwave, etc. etc. etc.

On second thought, maybe the kitchen is a bad analogy. How many of you get great grandmother's home cooking out of the modern kitchen, and how many of you get corporate designed and packaged pretend-food out of the microwave.

On third thought, maybe that is a great analogy of radio today.

 

[IndyDan]

So for those of you who say it's all dead and in the past, I guess it's over for you. But then there
are those of us who are going to keep on going. Doing what we do.

Right off hand, I can think of the Martins down in Salem with their AM-FM-TV combo. It's about as local as it gets, in spite of offers to buy the stations.

 

[BobOnTheJob]

So for those of you who say it's all dead and in the past, I guess it's over for you. But then there
are those of us who are going to keep on going. Doing what we do.

Right off hand, I can think of the Martins down in Salem with their AM-FM-TV combo. It's about as local as it gets, in spite of offers to buy the stations.

No automation equipment in that radio studio...but there are a couple of record players.

Regarding offers to buy, Peter Smith (former WNAP PD) and I were there once & the board op introduced us to Don Martin...Don looked us up & down & simply said "it's NOT for sale".

 

[cold_coffee]

When people fail to participate, democracy doesn’t work. The broadcasters of America didn't

believe that the FCC would listen to a few left wing leaning types in the community radio

movement. But they were organized and filed 60,000 comments, mostly form letters demanding

radical change. The government thought the form letters represented the will of the people, as

most of us just sat on our hands not paying attention.

Here's what I have found from Indiana's station owners. Many small stations would have to move.

They want out of this business before this would pass. Stations in our mid-sized cities might be

broken up and forced to answer to advisory boards in small towns. And now even the Christian

broadcasters are alarmed.

We need to speak up unless we want only a few loud mouths to be heard and ruin it all.