vadar said:
Wow, love all the naysayers here.....NOT!!!!!
Seriously, it's time for another country powerhouse. This is a viable and hot format. There are plenty of underperforming 100k stations ready to flip.
Let's look at the math, not personal preferances.
K92 bills right around $8 million. A new station, figuring to hopefully carve out an initial nut of about half that (more on this dangerous assumption in a moment) would thus bill about $4 million. No 100 kw FM that is home to the metro is doing that low a figure right now now. Every single one bills
over $4 million.
Then there is the startup cost. To flip a format, you lose a lot of your revenue. If you go from urban or Churban to country, you would likely lose nearly all of it. If you go from A/C to country, you lose some of it. And so on.
Nobody will pay rates that are based on one demographic for another, and they will not pay for unproven results vs. proven ones. Agencies like to see four, six and even 12 months of rolling multi-book averages. Just like in the diary, where agencies used two-book and four book averages, they do the same with PPM to make sure the investment in advertising is based on solid facts.
So, while you are building a hopefully meaningful share and a track record of many, many books, you are going to bill a lot less than you are now. So, an owner would wipe out $4.5 million or more in current billings, incur high start-up expenses (including severance for the existing staff, promotion, etc) and lose money for perhaps a year or more... even if they beat K92 eventually and get higher billing, it will take several years of really good profits to make back the millions lost in doing the switch.
Then there is the "tradition" factor with K92. They have annual or extended period buys and a firm client base. Even a station that beats them in the ratings is going to be the underdog for several years because they are new and unproven.
This is just so not going to happen.
As Dr. Tillery has shown with his posts, the only "less to lose" station is not even home to the market. It might cost $1 million or more to raise the tower of WPCV in order to put a usable signal over more of Orlando. At present the 70 dbu... where in most cases 85% of the at home and at work listening occurs... just barely gets north to downtown Orlando. Good signal, yes, but not competitive.
And... ready for this?... WPCV already bills $4 million in a market they "own" where they don't have to get into a PPM battle with a dozen other very good stations.
High costs, no underperforming stations, no guarantees, bad economy. While radio has its normal quotient of idiots who might do something terminally stupid, there is not much of a case to be made for becoming country station number two in the market.