The Rise of Clear Channel and the Fall of Commercial Radio

[DashRiprock]

This sounds like an interesting book...

RIGHT OF THE DIAL
The Rise of Clear Channel and the Fall of Commercial Radio.
By Alec Foege.
294 pp. Faber & Faber. $25.


http://www.nytimes.com/2008/04/13/books/review/Steinberg-t.html

TRG had the author on their show. Here’s a quote from the NY Times article:

The reader need wait only three paragraphs before Foege renders his final verdict: "Having spent a lot of time talking to some of the company’s most prominent critics, as well as some of its most devout supporters, I have concluded that Clear Channel is indeed to blame for much of what it has been accused of."

 

[bnaivar]

Why do I hear the Star Wars Galactic Empire theme music? ???

;D

 

[jabba17]

To be fair, I don't know what CC is guilty of that the rest of the Five C's (CBS, Cumulus, Citadel, Cox) aren't.

Although, from the looks of their ATL cluster, it doesn't look like they know what they are doing (film at 11--you can pick oh, say, 1-2 dozen threads on this board for examples).

One thing I will say about consolidation, though, is you don't have a bunch of little operators going after the same country or AC or CHR pie. At one point ATL had six AC stations (including rimshots Fox 97 and Lite 106), and the country market in ATL has been in flux for the last 10 years, as stations jockey for position (with the losers going away to a different format, examples being WNGC on 95.5 and more recently Eagle).

An operator with a bunch of stations can put narrowcast/niche formats on the weaker signals, and share overhead with the stronger ones. Radio One in ATL is a great example of this (whodathunk that the ATL would have gospel and urban talk on FM?), with Cox being a lesser example, although still a good one. Even CC is doing the right thing in ATL in principle, with their Latino, active rock, experiments with 80s and hot talk, and classic country formats (although flipping Peach to Bull was silly, but may be proven in the end), but their execution has generally been horrid.

As an example, what would you prefer: two country stations playing the same Vince Gill/Shania crap, or one that pipes in a VTed classic country format while the other sticks with the country hits?

Similarly, do you really think that someone would shell out to put a locally-produced 60s-70s oldies show on the air in the ATL here and now in the Aughties (and we're only a year and a half away from the Twenty-Teens)?

You won't get diversity on the air if you have a bunch of small operators constantly targeting the money formats (notably hit country, AC, CHR, urban) and nothing else (notably alternative, oldies, FM talk, religious, AAA, classic rock, jazz, classic country)

 

[taylorengineer]

I agree Jabba - ALL the operators, large and small, have demonstrated a decided lack of programming ability.
Take HD radio as an example. Radio operators can't seem to grasp this simple concept: Give the radio listener something he/she can NOT get on analog radio.
Example: Bluegrass. There is a very large niche which would be religiously GLUED to a HD station playing bluegrass. Thousands of people would buy the radios.....literally thousands. If you actually INVESTED (there's that nasty word again)in advertising(which, BTW, you are supposedly the "experts"at) AND putting local talent on the air, 24/7. And the talent would not have to be "expensive." You could go to WRFG and get some pretty good DJ's for minimum wage - Hell, they would do it for free.
This is NOT rocket science - it's not creative in any way, it's immediately available.....and it's CHEAP!
Why is there NO ONE who gets this?
Blues would be another format niche.....I could go on but I'm sure you see what I'm getting at. I'm not suggesting intelligent, thoughtful programming innovation....I'm saying just do something different.
Where is the leadership in this business?
If the cream really does rise to the top then radio's cream has turned to butter!

 

[DashRiprock]

There is a long list of missed opportunities and bonehead decisions in Atlanta. If you read the boards for other markets you’ll see similar stories all around the country. The ‘rank and file’ employees at cc deserve better leadership.

 

[davideduardo]

The reader need wait only three paragraphs before Foege renders his final verdict: "Having spent a lot of time talking to some of the company’s most prominent critics, as well as some of its most devout supporters, I have concluded that Clear Channel is indeed to blame for much of what it has been accused of."

The author has done miserable research to the extent that he attributes the "invention" of Top 40 to Gordon McLendon, not to Todd Storz... the rest of the book (which I did a speed read on last night) is similarly full of errors... some as significant as stating that Clear invented "voice tracking" whcih, in fact, was more used in the 70's than under Clear.

 

[RTibbs]

The reader need wait only three paragraphs before Foege renders his final verdict: "Having spent a lot of time talking to some of the company’s most prominent critics, as well as some of its most devout supporters, I have concluded that Clear Channel is indeed to blame for much of what it has been accused of."

The author has done miserable research to the extent that he attributes the "invention" of Top 40 to Gordon McLendon, not to Todd Storz... the rest of the book (which I did a speed read on last night) is similarly full of errors... some as significant as stating that Clear invented "voice tracking" whcih, in fact, was more used in the 70's than under Clear.

Almost 13,000 posts???? You must be at Platinum level.

 

[taylorengineer]

There is a long list of missed opportunities and bonehead decisions in Atlanta. If you read the boards for other markets you’ll see similar stories all around the country. The ‘rank and file’ employees at cc deserve better leadership.

Today's radio management and leadership - mucus plugs in the birth canal of radio innovation.

 

[TheGreenskeeper]

TRG’s interviewed the author. If you want to listen, the mp3 file is at:
http://cumuluspodcasting.com/media/WNNX/WNNX239/RG_AlecFoege_041808.mp3

 

[rho01]

I also interviewed the author today and read the book. For anyone who knows the Clear Channel story, it breaks nothing new. But it's a nice historical compilation of what happened. I'll be posting something over the weekend about the book.

 

[DashRiprock]

Corporate owners looking to cash out and massive job cuts are everywhere. The cc story probably has a lot in common with any big organization these days, but I’d still like to see the people who screwed up Atlanta radio "move on to pursue other opportunities."

 

[trig]

CC simply pulled a Hitler, however, I doubt the Mays were blowing out candles yesterday.

The rest of the other side of it is very clear. Create a company that micro manages its sales force so much, send them in 10 different directions selling 20 different things that don't always work for the client (i.e.; :30's among many other things) that it forces any good salespeople left thats good in the business out completely or over to their competitor across the street.

Driving your best people out to work for your competitor? Think about it. However companies like Cumulus will do exactly as they are now and repeat this very same obvious mistake.

Does anyone know anyone in any city that made CC their first choice or place they want to work at? It just doesn't happen.

 

[OldRadiopro]

Between less is more and the ridiculous "new programming fundamentals", CC has destroyed a once great business model. Less is more was an admission to those who believed radio was running too many commercials. It seems to me, if you ran too many commercials, your ratings would show it .So why did they need to force a limit that in reality made things much worse? Less in minutes but MUCH more in clutter. All while they confirmed the buyers fears to a point that gave them the support they needed to divert money to "new media". In essence, we showed them the way to justify moving money out of radio. Add to that the "new fundamentals" which was nothing more than trying to justify and clean up the disaster created by LIM. Lipstick on a pig as it were. The big chant in CC was we need to compete with the IPod. I don't care what you do, you can never compete with an individual's choice of music nor do you have to. As far as I'm concerned, the IPod needed to compete with us!!!! Radio was, is and always will be an entertainment medium. Radio can do far more than an IPod will ever do. Radio can inform, be spontaneous and contriversial. Radio can deliver breaking news, weather and traffic. Radio can entertain and be involved in a persons life. Radio has always competed with alternatives like the 8 track, cassette and CD. After all is said and done, according to the RAB, radio has lost 2 shares through all this....which means radio reaches 91% instead of 93%. Boy, is the IPod and satelite radio kickin us!! The key to radio's success is in programming with LIVE announcers who live and work in their community's. LIVE announcers who add what an IPod can't.....ENTERTAINMENT! I believe that with CC's mass and size came a responsibility to help us grow and evolve. The path they took, while well meaning, was a path of destruction. LIM killed revenue so they began to cut and for the most part, they cut our most precious resource...Talent! They continue to sit in the proverbial ivory tower blinded by their own arrogance and refuse to change course. When Hogan, on a CC conference call last year announced that over 60% of CC rated markets went down in Arbitron ( year to year ) and over 50% did not meet or beat their markets in revenue growth, wouldn't you think somebody would have realized there's a problem??

 

[Inside your head]

what does clear channel own here. project and dave?

 

[beefjerky]

And now... a brief selection from the new book on Clear Channel – “Right of the Dial.”

“Growing up in Clear Channel, it was all about how much profit we could make, “ says (a GM) Webb. “It was all about the margins.” And those margins were formidable by anyone’s measure—in the 50 percent range, by some estimates, putting Clear Channel in its first few years around the 98th percentile of profitable radio companies in the nation.

“Mays had zero in programming,” says Webb. “It was all about how much are we going to collect? Not bill, but how much are we going to collect this month?”

 

[jabba17]

what does clear channel own here. project and dave?

CC owns Bull, Project, WGST, Viva, Legend, and Patron.
Cumulus owns Q100 and Rock100.5 (the Dickeys own 680, 1230, and 1340 themselves)
Cox owns WSB, B98.5, River, WALR 104.1 (whatever they moniker themselves), and Beat, and will soon own WNGC and Bulldog.
Citadel owns Kicks and True Oldies.
CBS owns WAOK, V-103, and Dave.
Salem owns Fish, WGKA, and WNIV (both 970 and 1400)
Radio One owns Praise, WAMJ, Smooth Jazz, and WHTA.
Lincoln owns Star and Zone.

 

[Inside your head]

thx jabba. i didnt know cumlus owned 3 other stations too. wtf. if they wanted to put rock 100 on y didnt they put it on one of the AMs. u cant tell me 1230 or 1340 did more than 99sx 12 million. i get trg has a fewfans in this city. they couldve put them on one of the other signals. or move 99x to an AM. whatever, they got lots of sticks they didnt need to take it off totally to the internet.

AND to top it all off CC has 6 stations and only 1 of them is a sh*t rock station they cant even get that rite?
i dont know what legend is but im guessing viva and patron r mexican. 2 mexican stations and only 1 classic rock semi-alt semi-active rock not sure what it is rock station. figures.

 

[jabba17]

thx jabba. i didnt know cumlus owned 3 other stations too. wtf. if they wanted to put rock 100 on y didnt they put it on one of the AMs. u cant tell me 1230 or 1340 did more than 99sx 12 million. i get trg has a fewfans in this city. they couldve put them on one of the other signals. or move 99x to an AM. whatever, they got lots of sticks they didnt need to take it off totally to the internet.

AND to top it all off CC has 6 stations and only 1 of them is a sh*t rock station they cant even get that rite?
i dont know what legend is but im guessing viva and patron r mexican. 2 mexican stations and only 1 classic rock semi-alt semi-active rock not sure what it is rock station. figures.

Viva (105.7) and Patron (105.3) are both Latino. Legend (96.7) is classic country. Buzz used to be on the latter two.

Cumulus doesn't own the three Dickey AMs, but the Dickey family is in the corner office of both groups.

You wouldn't like 99X on 1230 or 1340--trust me. I wouldn't like TRG on them, either. Not even with HD.

 

[Marv-L.A.]

OldRadioPro---Thanks for that superb post on how CC's addiction to pleasing Wall Street as opposed to their listeners has become a megacolossal disaster.

I'm sure they've taken a chainsaw to some of their Atlanta properties, and have undoubtedly thrown some of your fine city's market legends under the bus in the process; they've certainly done that here in LA.

I also agree with you--LIM was a spectacular failure, and the addiction to voicetracking is another reason to despise them.

 

[OutOfTheBiz]

OldRadioPro---Thanks for that superb post on how CC's addiction to pleasing Wall Street as opposed to their listeners has become a megacolossal disaster.

I'm sure they've taken a chainsaw to some of their Atlanta properties, and have undoubtedly thrown some of your fine city's market legends under the bus in the process; they've certainly done that here in LA.

I also agree with you--LIM was a spectacular failure, and the addiction to voicetracking is another reason to despise them.

I hate to break it to you... but EVERY radio group that is publicly traded is "addicted to pleasing Wall Street." That's the very definition of what you must do when you decide to go public.

I would say that fact is the single biggest reason for the overall decline in broadcast radio in general. And it's certainly not limited to LA, Atlanta or any other market. It's systemic from the very largest markets to the very smallest.