landtuna said:One of the unfortunate laws of economics is that the economy will go up and it will go down. You have to cover the down periods.....or else. That is why smart companies will have little to no debt and live below their means.
As the recession proved over a wide range of businesses and industries, there is a degree of economic slow-down that no model and no amount of preparedness can predict.
For the better part of a century, business schools have taught that the way to grow is to use someone else's money as long as your ROI is greater than the cost of money. That is a fundamental part of the American Dream... just as fundamental as the idea of buying a home or even a car and paying for it out of anticipated income.
Just as some wage earners were no longer able to pay for their home, some companies were not able to pay their loans. Some sold out, some used bankruptcy protection, some ceased to exist.
The largest number of such cases in radio lie with folks who had successful radio careers who made the step into ownership with the aid of financing and bought a station or three to have their own business. These are not the Clear Channels and the Citadels... they are Mom and Pop and they are in Big Rapids or Bemidji or Prescott.
I'll take your word for it but the bottom line is.....radio is still in decline. When the man puts the lock on the studio door it really doesn't matter what the worst reason was.
Transmitters and towers are in decline. But radio, via other distribution methods, is not. Pandora now has, per their own estimates backed by research, 7% of the audience... those who make the digital transition will grow. Those who don't will not.
Content, yes. Mobility, not exactly. I doubt alternative distribution methods are going to overcome technical drawbacks any time soon. TCP/IP cannot handle the multitudes of connections. Cell phones cannot handle the thousands of data streams. HD radio, with its many drop outs will seem like nirvana compared to wifi hot spot jumping.
It's funny but of the thousands of interviews dealing with usage in its different forms I have been party to in the last few years, lack of reliability is not a factor. When the subject of drop outs comes up, they say "well, all kinds of radio drop out, like when you go under a bridge or under electric wires..." No perception of wireless being any worse than OTA Radio... and in some case, with people with long commutes or in workplace environments, they feel mobile is better.
OTA - perhaps not. Internet - absolutely. I can point to stations running Internet simulcasts right now that are doing just that. Just like an OTA station geared to twenty-somethings I can get a free ride on the Internet.
My point is that a streamed format that depends on advertising is not going to do any better selling 55+ than an OTA station.
Now....can we please drop the 55+ demo thingy? I fully understand that there is nobody out there, save some medical providers, who want to sell me anything.
Lots of people want to sell you something. However, radio is not a profitable way to sell to 55+, given the increased number of impressions required to make the sale and the cost of delivering those impressions.
It does not matter if the item is a $2.99 McNuggets meal or a $29,999 car.