Ruining Radio Is Just Part of The Bankers' Plans to Re-Shape The World

[Debaser]

I belong to a radio discussion group to which the following was posted:

In 2000, I flew to Cincinnati to look at various parts of a group that was selling off some of their markets. I was in at the end of the process and as I sat in a room at he company's law firm, I began to read the notes on the margins of the P&Ls, the Executive summaries and other parts of the presentations. What I saw were notes like "one engineer for the three markets?" The markets consisted of 3 clusters a total of 13 stations and the markets were no closer than 60 miles from each other! I saw things like, "put in sales system and eliminate multiple GSMs?", "Why 3 program directors in market XXXX?" One PD already did the AC and the Oldies station, one did the News-Talk station and the other did the Country and the Classic Rocker. Anyone in sales and programming who made over a 100k had lines through their names. The stations were profitable at the time, they were not over staffed or fat in any way, shape or form. The only reason for the cuts was to over pay for the stations and be able to pay the bankers every month. After I left I kept an eye on the market they went through huge staff cuts, the Country PD was handed the balance of one of the clusters to program and of course his baby the country station suffered. The company who bought the stations and several more markets at the same time eventually went bankrupt, the stations dropped from market leadership and were 'reorganized" with new financing.

Who won in the deal? Only guys I can think of were the 'bankers", the guys who financed the same group twice. We already know who paid the price, don't we?


That really says it all, doesn't it?

 

[TheBigA]

The exact same discussion is going on in the education business. If you haven't heard, governments are cutting back on school budgets. Teachers are being let go. Classrooms are getting bigger. School systems are consolidating. There's a line of thinking among educators that there's a direct relationship between money and test scores. You want to see kids get smarter? Devote more money to education. Simple. At the same time, politicians want to cut taxes, and tax money funds education. One could easily generalize and say the tax cutters are creating a society of stupid people. Less money for education means more uneducated people, which means politicians can get away with anything because no one will question what they do. So to paraphrase the topic, ruining education is just part of the politicians' plans to reshape the world. True? Keep in mind that Hitler didn't become the leader of Germany by coup or revolution. He got elected. He told the people what they wanted to hear, and he became the leader of Germany.

So what about bankers? In my line of work, bankers are the life blood. They provide the working capital. Unless you're really rich, you need to go to someone else for the money to do what you want. We could all save money and buy our houses with cash. Or we could get a mortgage and pay interest. Is the mortgage company the devil? It is if it forecloses on you. But until then, it makes it possible for you to live your dream. So it's a double edged sword. But ultimately it wasn't the bankers who caused the problems in broadcasting. It was the broadcasters. They dreamed too big and mortgaged their assets. Whose fault is that?

But as with the discussion about education, is money really the problem? Or is it actually a lack of imagination. We know what the challenges are. We recognize that the playing field has changed, and there's not as much money to do what we want as there used to be. What's gained by assigning blame, pointing fingers, and saying "You ruined everything?" What does that change? Nothing. Here's what we know about radio: If the only thing that changed in radio over the past ten years was increased debt, these companies would not be in the trouble they're in now. They factored in the increased debt when they took it on. Just like my mortgage company factored in my loan with my salary and ability to pay. That's how I got my loan.

What changed in radio was that we had a communications and sociological revolution driven by computers and cell phones. The problem in radio wasn't the debt, but adapting to everything else. You can't solve the problems that exist in radio today by spending more money. That option has been taken off the table because of debt. Just like the problems in education won't be solved by raising taxes. That option is not on the table. No one wants their taxes raised. The solutions in radio will require new ideas and new ways of using media. That's how Apple went from being an also-ran in the computer bbusiness to a world leader. They created a market with iTunes and iPods. That's what radio needs, and I'm not talking about devices, although that wouldn't hurt. The tool for Apple is the device. The real money is the software. Amazon is a similar company. It just reported a huge increase in revenues, brought about by their Kindle device. Motley Fool had an article yesterday pointing out that the Kindle itself is losing money. But it's driving revenues in Amazon's other businesses. That's what radio needs. That's partly why radio companies are investing so much money in new media rather than traditional OTA programming. The money has to come from somewhere, because the banks are tapped out. Now it's time for real creative thinking to take place. How much do you REALLY know about broadcasting? Or do you just want to apply the same old ideas in a new and changed world? The old ideas are not going to work. Hiring more staff or pouring more money on a problem won't solve it. Just as hiring more teachers won't make the kids smarter.

 

[SirRoxalot]

Wow. Now you're an expert on radio AND education. Whew.

Simply put, radio groups bought radio stations for sums of money so large that the original owners couldn't say no. They could take the cash, invest it in government bonds at that time, and make as much money as they made for sweating over a hot corner office desk. They couldn't see how these big corporations were going to pay off the loan and make enough to keep shareholders happy.

The consolidators sold the banks on the idea that they could create "synergies", and cut costs. Those synergies would reduce the operating costs enough to maintain the profit margin (which kept shareholders happy) while paying off the leverage (keeping the banks happy). The reality was that the cut a lot of the talent in sales, programming, and management that made the stations profitable in the first place. Bottom line? A reduction in revenue that outpaced the "savings".

Radio successfully withstood challenges by other music delivery systems before. Radio can adapt - probably more quickly than any other medium - if there's talent and intellect in charge. What did we get? Morons putting "stations on shuffle" and trying to out-MP3 MP3 players. We're still getting stations doing iNonsense - imitating the competition instead of offering what the competition can't.

Radio has gotten more generic just as being more relational got more important. There's a lot of bad timing involved, but it has less to do with the business cycle and technology than it does with short-sighted management among a handful of major corporations.

 

[TheBigA]

Try going to a bank and "selling" them on an idea that you have more money than you actually have. Go ahead. Do it now. Banks aren't as stupid as you portray them.

You can't sell banks on something that isn't true, and radio companies haven't really created the "synergies" they've talked about in press releases. If they did, radio would be a lot different than it is right now. Because the fact is that radio is still pretty much the same as it was ten years ago. That's part of the problem. Radio is still staffed for the most part by local DJs, while audiences are interested in their own music lists. The people running radio aren't bankers or accountants, but actual broadcasters with more than 30 years in running stations. They seem to be trying to hold on to the past, while the business cycle and technology has changed. Take a listen to the radio stations in Buffalo right now. Which ones have 24/7 syndication? Which ones are using out of town TV 24/7? Sure maybe a fringe daypart, but not where it matters. That's my point. Even with all the financial challenges that exist in radio today, the industry is basically unchanged from the previous century.

 

[jas2525]

What changed in radio was that we had a communications and sociological revolution driven by computers and cell phones. The problem in radio wasn't the debt, but adapting to everything else. You can't solve the problems that exist in radio today by spending more money. That option has been taken off the table because of debt. Just like the problems in education won't be solved by raising taxes. That option is not on the table. No one wants their taxes raised. The solutions in radio will require new ideas and new ways of using media. That's how Apple went from being an also-ran in the computer bbusiness to a world leader. They created a market with iTunes and iPods. That's what radio needs, and I'm not talking about devices, although that wouldn't hurt. The tool for Apple is the device. The real money is the software. Amazon is a similar company. It just reported a huge increase in revenues, brought about by their Kindle device. Motley Fool had an article yesterday pointing out that the Kindle itself is losing money. But it's driving revenues in Amazon's other businesses. That's what radio needs. That's partly why radio companies are investing so much money in new media rather than traditional OTA programming. The money has to come from somewhere, because the banks are tapped out. Now it's time for real creative thinking to take place. How much do you REALLY know about broadcasting? Or do you just want to apply the same old ideas in a new and changed world? The old ideas are not going to work. Hiring more staff or pouring more money on a problem won't solve it. Just as hiring more teachers won't make the kids smarter.

Luring very smart people who are also good teachers takes money. Not everybody wants to volunteer to take a lower paying job just to teach future generations. You go cheap, you get what you pay for.

Hiring more teachers also allows there to be smaller classes...and if you think THAT doesn't help, you're misinformed.

One of the reasons many people complain about school taxes is because they severely underestimate the importance of primary education. Half the population seems to see teachers as babysitters and schools as daycare.

Going cheap on early education will set us back like nothing else. Go tell a third grade inner city school teacher with 40 students in her class that she has to use more imagination. :

It's amazing how shortsighted so many are on this.

 

[SirRoxalot]

"A", you keep trying to equate TV and radio, and they're simply not the same, and not consumed in the same way. The expectations for the media are different. TV has traditionally been mostly network, with a little local news and maybe infotainment content. Radio has traditionally been local, with a little syndication and maybe national infotainment content. There are many more radio stations than TV stations, and many more formats than TV formats. Cable has changed that somewhat, but TV is still primarily sedentary, while radio is primarily portable.

The amount of local programming has likely been halved in the last 10 years at the major companies. Maybe you don't see it in the top 10 markets, but we sure see it in markets 25 and above. In fact, the number of jobs cut is much greater than that if you go back to '96, when the Telecom Act became law.

The people running radio are doing it at the behest of bankers. Clear Channel has completely changed their way of doing business since Bain took over. The Dickie Boys will do whatever the bankers want as long as they keep making fat salaries, whether it's good radio or not. The bankers will keep paying the Dickie Boys as long as they keep cutting, or as long as they Dickie Boys can convince them that they're "making progress". Town Square is owned by bankers. Emmis might as well be owned by bankers.

You don't have a clue as to who is doing what in Buffalo, so why pretend? Cumulus took over after Citadel cut half the staff. Town Square has less than half the staff that they had 10 years ago. Entercom has cut, but not as drastically as the other two. They're seen by local radio people - including the people who work there - as being the best of a bad lot. Your contention that "the industry is basically unchanged from the previous century" is not only inaccurate, it's laughable - at least in the WNY markets.

 

[TheBigA]

"A", you keep trying to equate TV and radio, and they're simply not the same, and not consumed in the same way.

Where did I say that? My entire post was about radio, and you ignored everything in it, as though you didn't read it.

Maybe you don't see it in the top 10 markets, but we sure see it in markets 25 and above. In fact, the number of jobs cut is much greater than that if you go back to '96, when the Telecom Act became law.

You're too limited to radio. What you don't understand is that entire industries in this country have disappeared since 1996. Entire job categories that once existed then have gone away. You should know, because some of those industries used to be in Buffalo and upstate New York. So it's very selfish to think that radio jobs shouldn't be affected by the sociological and technological changes that have happened in the last 15 years. As I've always said, even without 96TCA, those radio jobs were going to go away. They were starting to go away in the 80s. That's when radio stations started to do away with local news staffs and engineers.

The people running radio are doing it at the behest of bankers. Clear Channel has completely changed their way of doing business since Bain took over.

Hmmm, perhaps that’s because they changed from being a public company, where they had to do what their stockholders wanted, to a private company. And they’re doing a better job, in my opinion. Taking off that pressure to produce quarterly numbers was a good change for Clear Channel, and many other radio companies would like to do the same, including Emmis. Bain isn’t a bank, it’s an investment company. That’s a very different kind of company, and you show your lack of knowledge by equating them.

CC was obviously cutting jobs long before they went private. So that hasn’t changed. What’s changed is they’re now being run by an actual broadcaster, not an accountant. So the cuts they’re making are about reinventing what a radio company is in this new century. Bob Pittman isn’t some puppet doing what Bain tells him. He knows how to program radio stations, and can’t be snowed by some station guy telling him he needs more staff. That’s the real problem with radio now. When radio stations were owned by insurance companies, you could BS the CEO into giving you more money because he didn’t know what you were doing. You can’t do that to Pittman or Dickey.

The funny thing about this thread is that you guys make the assumption that before 1996, radio was owned by individuals using their life savings, and they had no debt. There may have been some stations run that way, but anybody who knows anything about radio can tell you that General Electric, Westinghouse, and RCA were much bigger companies than Clear Channel. They were public companies with billions in stock, plus billions in bank loans. If you read David Sarnoff’s autobiography, you’d discover how many times RCA came close to bankruptcy. Same with ABC. Transforming ABC-TV to color almost bankrupted the company. Paley’s failed experiments with TV brought CBS to the brink. This is all nothing new, and there’s nothing wrong with operating with credit. The US government is doing it right now.

Your contention that "the industry is basically unchanged from the previous century" is not only inaccurate, it's laughable - at least in the WNY markets.

I’m talking about the way radio is done. As I said, name me a radio station in Buffalo that’s syndicated or voice-tracked 24/7. You can’t because there are none. Just because some jobs were cut in 15 years doesn’t mean a thing in a country where entire industries have disappeared. The fact that radio still exists after 85 years when other technologies from that era have gone away proves what I’m saying. Down the road in Rochester, Eastman Kodak is bankrupt because it failed to adapt to digital photography. How could that have happened? How many jobs disappeared because of that? Yet all you can do is whine that radio people didn’t get to keep their jobs for life, as though that was ever a guarantee. There are coal miners in this country out of work, steel workers, car makers, and electronics companies that have all shut down in the 15 years since the 96 Act. Don’t cry about poor old radio.

 

[JustPastBuffalo]

Debaser! Get it right, it's banksters. Rhymes with gangsters.

Banks borrow money from the Fed at 2% and lend it at 5%. That's a broad example, the lending rates are not exact. The point is, the banks and lenders make money off the spread. Lots of money. On the street, they'd call it "the vig."

The banks also made loans to media savants like the pinheads who ran Citadel into the ground. Oh, sorry, bad timing. Stop. Staff members got the bone, while the CEO walked away with $35 Million.

The banks wrote hundreds of millions of loans and of hundreds of thousands of toxic bundled mortgages that were robo-approved to buyers who didn't have two nickels to rub together. Directly or indirectly, taxpayers bailed out the banks and the radio companies.

Education? Radio and education are two professions with which I'm very familiar. The USA can spend $2.7 Billion a week in Iraq and Afghanistan, but our schools are laying off good, experienced teachers and our roads and bridges are crumbling. FUBAR!

This is a legitimate radio thread, I hope the mods don't press the TIO key. (The Buffalo board isn't the Cincinnati board.)

 

[TheBigA]

The banks also made loans to media savants like the pinheads who ran Citadel into the ground. Oh, sorry, bad timing. Stop. Staff members got the bone, while the CEO walked away with $35 Million.

The part you leave out is that his money wasn't from the banks or loans. It was from stock. And stock is federally regulated. That's what people don't seem to understand. Borrowing money from a bank isn't the same thing as putting company stock on the market. Those are two very different things. What Citadel did was issue stock, and lots of people bought it. The CEO got stock grants. That's where his millions came from. Not the banks or the investment companies. Although Farid worked for the investment company, so he got it from several places. The funny part is that you make it sound like he committed a crime and got away with it, but no one ever challenged him. Finally, one stockholder took him to court. How about all the other losers? How about all the employees? How many took him to court? How about the feds? People break the law every minute in this country. But if they don't get caught, it doesn't matter. THAT is the real theme of this thread. Crap happens every hour, but if you let it happen, you're just as guilty as the guy who breaks the law. We live in a country where priests break the law. And we expect people in business to be honest? Oh come on! Grow up!

 

[jas2525]

I’m talking about the way radio is done. As I said, name me a radio station in Buffalo that’s syndicated or voice-tracked 24/7. You can’t because there are none. Just because some jobs were cut in 15 years doesn’t mean a thing in a country where entire industries have disappeared. The fact that radio still exists after 85 years when other technologies from that era have gone away proves what I’m saying. Down the road in Rochester, Eastman Kodak is bankrupt because it failed to adapt to digital photography. How could that have happened? How many jobs disappeared because of that? Yet all you can do is whine that radio people didn’t get to keep their jobs for life, as though that was ever a guarantee. There are coal miners in this country out of work, steel workers, car makers, and electronics companies that have all shut down in the 15 years since the 96 Act. Don’t cry about poor old radio.

Radio jobs aren't gone for/haven't disappeared for, the same reasons as other entire industries, as you put it. The demand for radio is still there, with substantial penetration nationwide. Radio operators, buried under a mountain of debt after paying ridiculously high amounts for properties during the acquisition tsunami, decided to make the product more cheaply so they could save more and make those giant debt payments. You can make money by reinvesting in content, thus giving audiences a reason to keep coming back, or you can make money by cutting and cutting. Of course you can only cut so much before you compromise the product to the point where it's nothing special---and there's a whole generation of people coming up who have never known radio to be anything special. Nice going.

As Steve Jobs alluded to, once a company starts cutting as a way to make money, they are already dying.

 

[SirRoxalot]

After a decade and a half of cutting, Clear Channel brings in Pittman, so now they're "run by radio people". Puh-lease.

You've equated radio to TV in past discussions, on more than one occasion. You keep trying to equate radio with other industries. Well, it's not. It's radio, and you can't run it like a widget factory, no matter how hard you try.

Investment companies are banks on steroids. The aim is the same - make MORE money, with little regard to the long term health of the companies because the money is in doing deals, not managing long-term. You're right in one sense - radio isn't the only industry that's been raped by money manipulators. That doesn't make it right, or make it smart or healthy for the country's economy in the long run.

In Buffalo, there are SEVERAL stations that are syndicated or VT 24/7. Let's start with the obvious - Jack, a class B FM with a killer signal owned by Townsquare. 'KB, a 50KW AM that once ruled in markets up and down the east coast. WWWS, formerly WYSL, is now a computer in a closet. And there are several others. Of the leading stations in the market, several are only live in drive times. Only 2 are live from 6AM to 10PM.

Otherwise, your contention that it's only a crime if you get caught tells me all I need to know about your character. Let's hope that education escapes your dissemination of such "expertise".

 

[TheBigA]

decided to make the product more cheaply so they could save more and make those giant debt payments.

What makes you think they're making giant debt payments? From what I can see, they keep delaying those payments.

And what makes you think they're making the product more cheaply? Every day, I read a bunch of press releases from radio stations who just signed their morning team to new deals. You think they're getting paid less? That's not what I hear. Every time the morning show gets a new deal, someone who doesn't have a contract loses their job. Kill or be killed. In the meantime, have spot prices gone up? You tell me. Advertisers haven't increased their budgets in years. But there are lots more people who want a piece of it. Until radio finds new sources of revenue, it will be tough to hire more staff.

As Steve Jobs alluded to, once a company starts cutting as a way to make money, they are already dying.

There are entire divisions of Apple that have gone away thanks to the creation of the iPod, the iPhone, and the iPad. Apple cuts lots of jobs in departments that are no longer growing. That's what radio companies are doing. OTA radio has peaked. It's not growing, and it won't grow because you spend more money on it. People aren't buying computers and cell phones instead of radios because WHAM isn't doing overnight news any more. No amount of investment in radio will get me or anyone else to throw away my cell phone. The ONLY chance for radio to survive is to get its content on devices that people want to use, because radio companies don't make radios any more. And the companies that do make bigger profits making other devices.

 

[TheBigA]

In Buffalo, there are SEVERAL stations that are syndicated or VT 24/7. Let's start with the obvious - Jack, a class B FM with a killer signal owned by Townsquare.

Jack is neither syndicated nor voicetracked. It's a packaged format, like Mike Joseph's Hot Hits, that's actually programmed locally. That's the difference between Jack and some other packaged formats.

WWWS, formerly WYSL, is now a computer in a closet. And there are several others. Of the leading stations in the market, several are only live in drive times. Only 2 are live from 6AM to 10PM.

But it's a Buffalo closet, which means it's local. They could easily carry a 24/7 satellite delivered format from ABC, but they don't.

'KB, a 50KW AM that once ruled in markets up and down the east coast.

You got me on that one. Congratulations. One station isn't the death of radio.

Entercom and Townsquare each have a lot of employees. Their music stations frown on syndication and VT. The fact that each of them has a station that operates on the cheap can be excused by the number of people they employ elsewhere. Even Apple farms out its assembly work.

 

[jas2525]

What makes you think they're making giant debt payments? From what I can see, they keep delaying those payments.

They're either making debt payments...or pocketing the profit. In either case, they're ruining the product for short term gain.

And what makes you think they're making the product more cheaply? Every day, I read a bunch of press releases from radio stations who just signed their morning team to new deals. You think they're getting paid less? That's not what I hear. Every time the morning show gets a new deal, someone who doesn't have a contract loses their job. Kill or be killed.

Great, you read some morning shows are getting a raise! Glad to hear it! Last time I checked, morning shows go off the air by 9 or 10 in the morning. What about the rest of the day? Even if EVERY morning show in the country got a raise, that still does not mean the product hasn't been cheapened in this TWENTYFOUR HOUR medium.

There are entire divisions of Apple that have gone away thanks to the creation of the iPod, the iPhone, and the iPad. Apple cuts lots of jobs in departments that are no longer growing. That's what radio companies are doing.

NO, radio stations are NOT eliminating obsolete departments as much as they're eliminating employees who receive paychecks, irrespective to the roles they play. Are you so naive that you don't realize what has been going on in the last 15 years? I have seen people with great ratings eliminated for a cheaper option, often times voice tracking.

The problem is, you try to quantify in concrete terms things that are somewhat abstract and ethereal in nature, like the long-term effect this cheapening of programming has on the public. As radio stations become less human, they lose more of a connection with the audience. Do you not see that as a problem, because it is a HUGE one.

This isn't about getting on twitter, this is about simply being good at your PRIMARY task, which is putting a great product ON THE AIR, and then worrying about how and where it's distributed.

Maybe if the product hadn't been diluted so much in recent years, people wouldn't be so inclined to disregard it.

I personally listen to A LOT less radio now than I did 10 years ago. Why? It's not interesting, particularly AM talk. Not much variety. Not much local.

 

[SirRoxalot]

Jack isn't voicetracked? Boy, that guy must be getting tired. He's been on 24/7/365 for years now. And "Solid Gold Soul" is local? Have you heard the station? Satellite would be more expensive, and require more equipment. It's a package. And you conveniently ignored that the three major players in Buffalo have cut half their staff since '96, and more than half the airtime in Buffalo is now VT or syndication. Sorry if reality doesn't fit your theory that they're not "making the product more cheaply".

Every day, you "read a bunch of press releases from radio stations who just signed their morning team to new deals. You think they're getting paid less?" Well, in fact, most of them ARE. And it's not just Buffalo, it's all over the country, in markets big and small. And it's not just mornings. Some of the most successful stations in WNY cut employees, salaries, and benefits - particularly at Townsquare and Cumu-del during bankruptcy - and many of those cuts have not been restored.

BTW, if CC isn't making giant debt payments, they're surely making giant interest payments. And the debt isn't going away. Deferring the inevitable isn't going to make the problem go away.

 

[TheBigA]

They're either making debt payments...or pocketing the profit. In either case, they're ruining the product for short term gain.

What you haven't figured is that costs for running the stations have gone up, while revenues are either holding steady or going down. So a lot of the money is going to pay higher electric bills or higher insurance premiums. As for "ruining the product," it depends on what you think the product is. If you think the product is local DJs talking up the post, or blabbing about hanging backstage with big stars, those days are ending. But not just because of money. PPM ratings have changed the way the product is being done in order to improve the numbers. It's not as simplistic as you make it sound.

Even if EVERY morning show in the country got a raise, that still does not mean the product hasn't been cheapened in this TWENTYFOUR HOUR medium.

As I said in the first post in this thread, spending more on “product” doesn’t make it better. It certainly doesn’t make it more popular. Radio is about being popular, and quite often, the cheapest homemade videos are the ones that get the most views on YouTube. That’s the competition for radio. Radio has been cutting back on costs since the 1920s. Radio is a business, not a charity. And it’s been my experience that the amount of money being spent has nothing to do with the quality.

Are you so naive that you don't realize what has been going on in the last 15 years? I have seen people with great ratings eliminated for a cheaper option, often times voice tracking.

That’s how business works. I’ve seen American-made products replaced by those made in Mexico and Malaysia. I recently interviewed an entrepreneur who is trying to bring back “made in America” products. He was going to finance a plant to make American made jeans, and he found out the cost would be more than double what the foreign-made ones sell for. He realized the market for the more expensive products wouldn’t pay for his investment. Consumers don’t want to pay lots of money for their products. In radio, they want fewer commercials. Couple that with advertisers wanting lower spot prices, and you get where we are in radio. Fewer spots, selling for less money, means less money for salaries. If you think it’s easy, offer to sell spots. You’ll get an instant education in why radio sounds the way it does. The advertisers aren’t buying product. They’re buying audience. So what you spend on the product, as far as the advertisers are concerned, doesn’t matter.

As radio stations become less human, they lose more of a connection with the audience. Do you not see that as a problem, because it is a HUGE one.

There are still thousands and thousands of people on the air in radio. Maybe not so much at the big corporate stations. Big companies own less than 18% of all radio.

Also, the human connection operates on a lot more than geography. Most people aren’t as concerned about where the human is, as they are if the human is of their life group, involved in their activities like raising children. We’ve done actual research on this, and the people we’ve spoken to don’t care as much about where the talent is. Examples include Rush Limbaugh, Sean Hannity, Howard Stern, and Don Imus. All syndicated hosts, all immensely popular, all getting paid lots of money. If fact, as I said a few months ago, if you divided Rush’s salary by the number of stations who carry his show, you’d get more than enough money to pay for a local talk host. So it’s not always about the money.

The other issue, and this goes to the “product quality” thing you talked about is that quality talent isn’t universal. I’ve said this many times before. Just because someone happens to live in the same town doesn’t mean he has the ability to convey a human connection with an audience. That’s the lazy way out. Talking about local issues doesn’t necessarily result in the most or best quality calls. Sometimes, the audience is more motivated about national issues. In talking about the new ESPN sports station in NY, some posters here wondered who would call into to talk about sports other than NY area teams. The answer is people who have moved to NY from other places, and they still retain their original loyalties. There are also sports P1s who just love to talk sports regardless of the location. Once again, the goal is to attract audience, not fulfill some kind of jobs program. And it’s not about banks, debt, or greed, because even non-commercial stations that operate on a different system are doing the exact same thing. Eliminate the big companies and their debt, and you’ll still have owners trying to do more with less.

 

[TheBigA]

And you conveniently ignored that the three major players in Buffalo have cut half their staff since '96, and more than half the airtime in Buffalo is now VT or syndication.

I didn't ignore it at all. I put it into context that most businesses in this country have cut back on staffing, and that includes government gigs like schools and parks. Check in with what your governor is doing as far as the state employment roles. One big issue in hiring or keeping staff is the rising cost of benefits. The easiest way to guarantee your job is offer to work for salary and no benefits. I promise you your employer will gladly pay you an extra $10K a year if you'll pay for your own benefits. As I've said many times, we're in a depression in this country. It's a worldwide depression. And the money is not coming back. Advertisers have lots of options, and they're all MUCH MUCH cheaper than radio, and some reach a lot of the same people. That's a real problem that won't be fixed by hiring more staff or investing more money in product.

 

[jas2525]

The other issue, and this goes to the “product quality” thing you talked about is that quality talent isn’t universal. I’ve said this many times before. Just because someone happens to live in the same town doesn’t mean he has the ability to convey a human connection with an audience. That’s the lazy way out. Talking about local issues doesn’t necessarily result in the most or best quality calls. Sometimes, the audience is more motivated about national issues. In talking about the new ESPN sports station in NY, some posters here wondered who would call into to talk about sports other than NY area teams. The answer is people who have moved to NY from other places, and they still retain their original loyalties. There are also sports P1s who just love to talk sports regardless of the location. Once again, the goal is to attract audience, not fulfill some kind of jobs program. And it’s not about banks, debt, or greed, because even non-commercial stations that operate on a different system are doing the exact same thing. Eliminate the big companies and their debt, and you’ll still have owners trying to do more with less.

Your contrarian nature has you simply outlining all the alternative positions without regard for the fact that many of the scenarios I describe ARE the case. Many times a local show IS better than the canned but cheaper product that replaces it. Yes sometimes, there isn't a difference in quality when a station goes the cheap route. Yes, sometimes there isn't a difference---or maybe even an improvement when a syndicated talk show is put on instead of a local show----BUT that's often not the case as well. The problem is, the bean counters don't care. This negligence in the care and feeding of an easily discarded medium IS the problem, because once you start cheapening the product and subsequently blowing off listeners, they're sometimes gone for good---not necessarily immediately, but certainly over time.

Comparing consumers wanting to pay less for jeans with listeners (in your mind) somehow being satisfied with the cheaper radio choice, is comparing apples and oranges on several levels and misses the point entirely.

 

[TheBigA]

Comparing consumers wanting to pay less for jeans with listeners (in your mind) somehow being satisfied with the cheaper radio choice, is comparing apples and oranges on several levels and misses the point entirely.

Sorry, but it actually IS the point. OTA radio competes with lots of other sources, and all of them are being done much cheaper than OTA radio. That has no effect on their popularity. Over 20 million people pay $18 a month for VT'd and non-local satellite radio. I've spoken with a lot of subscribers, and they tell me they like the fact that they can hear the same station over the course of a 3 hour drive. They also say they prefer the quality of the NY-based host to that of a local host. Quite often, the satellite host is a recording star like Little Steven Van Zant, and that gives him much more credibility than some local guy who's never played a guitar in his life. Over 80 million people are using Pandora, and that service offers NO on air talent. As I said, radio is in the audience business. If having local DJs isn't attracting a local audience or local sponsors, then those local DJs are extraneous. And the local sponsorship is more important. Yes, I've read where a top-rated evening show was replaced with syndication. But that was because there was no local sponsorship. As I said, advertisers don't buy the product. They buy the audience. So the local evening show may have been #1, but it was at a time when the audience was 20% of what it is earlier in the day. The advertiser wants to be on at a time when his ad is most likely to be heard, even if it costs more. Advertising is about reach, and you simply don't reach as many people after 7 PM. That's not a function of quality, but reality. Even in the cases where a local DJ, who was top-rated and getting local sponsors, got fired for no reason, that opens the door for that talent to take his talent and money to other platforms and keep the money for himself IF he's done a good job of establishing himself with the audience and sponsors. In Buffalo, you had Brad Riter try and do that, and it didn't work because his audiences didn't follow him to WECK. But that's the responsibility of the talent. It's not the owners job to make the talent rich and popular. WECK's owner hired Brad in the hope that he'd bring some of his old audience to the new station. It didn't work. But in other markets, you have Steve Dahl or Adam Carolla have had great success taking their radio show to the internet.

But here's the most frustrating thing about it: Radio is a business, and the giuy who owns the business is allowed to run it however he wants. If that means running it cheaply, then that what it means. We can discuss this all day, and it doesn't matter. The operation of radio stations is left to the owners. And owners like to run businesses on the cheap. That's just how it is.

 

[jas2525]

In Buffalo, you had Brad Riter try and do that, and it didn't work because his audiences didn't follow him to WECK. But that's the responsibility of the talent. It's not the owners job to make the talent rich and popular. WECK's owner hired Brad in the hope that he'd bring some of his old audience to the new station. It didn't work. But in other markets, you have Steve Dahl or Adam Carolla have had great success taking their radio show to the internet.

No offense intended to Riter, but the problem was Brad couldn't bring the Sabres games with him. Without that, his numbers would drop dramatically, anywhere from 75-90%.