Why 2007 Will Be Another Bad Year For Radio

I love the radio business. I truly do. Radio people are like an extended family. They are with you in good times and Clear Channel times. It pained me to have to write repeatedly in Inside Radio after consolidation that it would kill the medium. Many of my long time and new friends were redeployed as a result of all the station mergers and some of them took it personally. Others didn't. They just hoped and prayed I was wrong. Ten years later the record on radio consolidation speaks for itself.

Well, I'm about to do it again.

The radio industry just doesn't get it. You can't grow a business that doesn't have a&hellip

Let’s Get Real About Payola

Yesterday, Entercom finally gave in and agreed to pay New York Attorney General Eliot Spitzer $4.25 million to make his payola investigation go away. Several other big radio consolidators including Clear Channel and a few major record labels have already settled.

Anyone who has been or is presently in radio knows that there was and is various kinds of payola. The record industry denies it. Independent promoters have a habit of disappearing -- I heard of one going to Sicily and returning when the heat was off. Radio stations can't bring themselves to admit their complicity. They're in denial. Hey, President Clinton told us he&hellip

Disney Shows The Labels How to Make Hits

The Disney Channel kids program "Hannah Montana" is a smash hit. And so is the music 14- year old Miley Cyrus sings as the fictional pop star Hannah Montana. She has sold over 1.6 million songs in about two months beating out the likes of Jay-Z, Sarah McLachlan, The Beatles Love album and a slew of others. It highlights the potential of the 8-14 year old market sometimes known as the "Tweens". These days the usual mojo from teens is not there in the record business. Teens and older Gen Y youths have found their way to music downloading. They're not such a hot record market anymore. But "Tweens", that's another story. Let's break&hellip

Verizon — Can You Hear Me Now?

Coming early in the year ahead, Verizon customers will be seeing -- that's right -- seeing their first banner ads on news, sports and weather sites among others that users visit and display on their mobile phones. This morning's New York Times is reporting that the decision has some major implications for users and advertisers along with many risks. Ad averse consumers could cancel if irritated enough by this new barrage of advertising and switch to other competitors. Some view the cell phone utilities the way they look at&hellip

Other Voices On Google Radio Ads

Consultant Jack Taddeo, a long time radio friend of mine and very thoughtful observer of the radio scene is interviewed on ZD Net's technology web site regarding the Google AdWords initiative in the radio industry. A sample: Taddeo is asked whether AdWords was a win-win for radio and advertisers:
"Not for stations. That is unless you are trying to reduce your ad inventory to pennies on the dollar. I call it the "station going out of business rate". The argument goes: if you have an open slot then why not get some money instead of no money? Plus you will be "sold out" which can help increase unit rate based on supply/demand pricing.&hellip

The Problem With SNL’s Cingular Deal

NBC Universal has signed a deal with Cingular to allow their upgraded video customers to access clips, new content and archived material from Saturday Night Live. NBC recently launched a section for SNL on its web site. It seems like a good deal for Cingular, one of the largest mobile phone utilities and NBC Universal. But wait. Is it? In their race to be content conduits, utilities such as cell phone companies are beginning to scare me. They think exclusive deals for content will be a win-win and enhance their ability to get customers to upgrade phone service. The problem is that in the long run if SNL content is only available&hellip

Clear Channel Liquidation Company

If you had a doubt as to what Clear Channel was up to when its actions proved it wasn't up to running a large radio group, you can now rest easy. The latest news is that Clear Channel plans on selling an additional 75 grandfathered stations for an approximate $1.1 billion dollar minimum take. That's on top of what they will earn from their already announced strategy of selling 448 stations below the top 100 markets. Clear Channel is doing better getting out of the business than it did by being in it. The same can't be said for their brethren -- the owners who lived in their shadow and sold ads against their mighty combos. But that's&hellip

A Better Radio Sales Idea

Why not let the Radio Advertising Bureau supervise radio sales on a market by market basis? The groups and stations willing to opt in can finance the effort from savings derived from fielding a full sales staff. Yet the concept allows stations to opt in as much or as little as they feel comfortable doing on their own time, at their own speed (i.e., start by submitting unsold inventory and later, add other avails). I mention the RAB or some other sales organization so as to keep the effort fair. Standards should be set. Bids can be raised or lowered similar to how airfares are routinely priced. Two more advantages: RAB fields a&hellip

Inside The Beta Test of Google Radio Ads

AdWords customers involved in beta testing are experiencing a new kind of radio advertising sales. The AdWords system is similar to the online ad selling approach Google has made its name and profit from. Prospective radio advertisers -- and this could be companies or individuals who have never advertised on radio or thought of radio as an advertising medium -- can bid on the spots and target their ads by time of day, demographics, format and location. The advertisers see instant reports. Google is also working on a program that will refer new advertisers to people who can help them write copy and produce ads -- something like the&hellip

The New CBS Records

It's not the old Columbia Records, but CBS is getting into the new age record business. This time it is doing it on the cheap. No start-up expenses, no worries about artist development, no expensive infrastructure. CBS wants to be paid for music that appears on its television shows. One of the benefits of the transitioning music business is that all it has to do is release songs on iTunes and voila! -- their in the record business. They can also take advantage of their broadband channel to deliver the music to the market. Imagine what they might do with radio or TV to promote it. Now old line media companies are beginning to think&hellip

The Real “Person of the Year”

I don't know about you, but this time I think Time Magazine is reaching for it's "Person of the Year". God knows, I wouldn't be the one to take anything away from the Internet or the mobile world we are increasingly living in. The "revolution" Time credits is, well -- old news. If they didn't want to name the now wealthy, wet-behind-the-ears YouTube founders, that's fine. But naming "You" as the "Person of the Year" is a cop out. If -- and I say if because Time editors are more qualified to narrow down their candidates for this honor -- they had to have an Internet-based "Person of the Year", they're missing the point. My candidate&hellip

It’s Already Too Late For YouTube Competitors

Viacom, News Corp, NBC Universal and maybe CBS are this close to announcing that they will compete with YouTube. They want to get into the distribution business that YouTube -- now Google -- is in. There are many problems with this grand plan not the least of which is can these traditional media rivals get along? There are big egos and longtime rivalries here. What has YouTube wrought? Apparently, it has scared these old media competitors into working together. I'm not betting that this coalition will last long if it ever launches.

There are lots of concerns:
True, they own a lot of content that can be re-purposed on&hellip

CBS Is The New Clear Channel

Things are so quiet on the Clear Channel front that you just have to know that the Mays' want to get out the back door with as much money as they can and with a private radio group in tow. They won't even contest the sale of their valuable grandfathered radio stations by seeking waivers. Anything to get this deal done fast. Many expect the new Clear Channel radio group that emerges to be like the old "Cheap Channel" before its consolidation days -- a nice, "little" family business. That paves the way for number two to become number one -- CBS will have more influence than the new private version of slimmed down Clear Channel even&hellip

41 Days of Radio Listening A Year

The Census Bureau projects 41 days of radio listening by adult Americans in 2007. Some 65 days for television. One week each for the Internet and newspapers -- this according to an account in Inside Radio. Don't celebrate too soon. This is definitely good news for radio stations aiming at adult listeners, but we didn't need the Census Bureau to tell us older listeners are still hooked on radio. The harsh reality is that radio listening and resulting radio advertising revenue has peaked and is heading down. The straight scoop is that young people -- the next generation, the people media must&hellip

A Great Idea From Bill Gates

The Microsoft Chairman said that consumers should just buy CDs and rip them onto their mobile music devices. Sound idea. It gets around digital rights management (DRM) which will never fly with the music buying public and will only serve to depress online profits until labels give it up. Perhaps Gates was prompted to make his comment in light of a Forrester research study that alleged Apple iTunes sales were down. Forrester has since modified their dire projections and blamed it on too small a sample size. One thing they are correct about. DRM is hurting digital music sales. And the average amount of new music per iPod owner is only&hellip

Honey, They Stole My 12-24’s

At the Arbitron Fly-In yesterday some much needed straight talk from researchers and consultants about how radio has lost a generation of teens. I had my epiphany a number of years ago when I first began teaching at USC. I couldn't believe that the next generation had such high disregard for radio. I couldn't believe that these young people knew Clear Channel -- almost the way I knew Clear Channel and that they didn't much like what Clear Channel was up to. Even though its late, the public outpouring of what radio did -- or more precisely, didn't do -- to lose an entire generation of 12-24's is healthy for radio. After all, you have&hellip

iPod “The Oldies Station”

Who would have thought that the home of the "Greatest Hits of All Time" would be an iPod instead of a radio station. With radio gradually getting out of the oldies business I'm thinking that consumers really consider their iPods and MP3 players their music collections. Odd, but research tells us these same consumers on the average have fewer than 200 songs on their iPods and they play them over and over again. Geez, that's more repetition than a Steve Rivers playlist! Why don't they complain about such repetition? Because it's their music. They are the program director. They play what they want -- take that, Jack! CBS overreacted&hellip

Next for Cell Phones: Bling Tone

A Washington Post article says "Women who have historically wielded serious power of the purse as consumers are now buying all kinds of technology for their families and themselves, outspending their male counterparts 3 to 2, according to the Consumer Electronics Association." A CEA study earlier this year showed that women prefer their cell phones while men prefer high definition TV. Sterotypical or not -- there is money to be made here expanding beyond the bland mobile phone. Here's the article.

Best Buy Adapts to The Next Generation

No schedules. No meetings. A company traditionally known for its strict work rules has gone head first into becoming a worker friendly company. It has its risks. Best Buy is looking to judge its employees not on hours but on results. It's amazing enough that a draconian approach to employee relations is being dropped by Best Buy. I found this plan to be fascinating and worth reading for my students as well as my friends in traditional media companies. From Business Week Online: "Hence workers pulling into the company's amenity-packed headquarters at 2 p.m. aren't considered late. Nor are those pulling out at 2 p.m. seen as leaving&hellip

Social Insanity

The latest rumor is that Yahoo has offered $1.6 billion to Mark Zuckerberg's social network Facebook and Zuckerberg has declined it. I don't know what's more insane -- Zuckerberg turning down $1.6 billion or Yahoo willing to pay $1.6 billion. The acquisition would get the ailing Yahoo it's own social network to counter Google's YouTube which also sold for $1.6 billion. Facebook is projected to earn $1 billion in revenue by 2015. But projections are meaningless in the fickle world of the next generation. And it's odd to see new age companies such as Yahoo acting in desperation like an old line media company such as Viacom. The only&hellip

Inside iTunes’ Decline

Forrester Research delivered some shocking news recently. Apple iTunes' sales are off 65% since January and the average size of transactions is down 17%. This sounds like the decline and fall of iTunes, but it really isn't. It's the continued decline of the record business because the entire downloading sector is down and the old CD business continues to erode. Just visit any Apple store during the Christmas holidays and you'll know how many iPods are flying out of the store. The concept of iPods is not going away. The concept of selling music to the next generation is. Digital Rights Management that prevents easy use and transfer&hellip

Consolidation Hurts

The Future of Music Coalition is releasing a damning report at 12 noon Eastern time today that will document in a meaningful way what many have thought and few can now escape -- consolidation hurts the public. This is particularly important because some radio groups are using Internet advances, new technology and satellite radio as their excuses to get the FCC to relax ownership rules further. Here's a look at the key findings:
The top four radio station owners have almost half of the listeners and the top ten owners have almost two-thirds of listeners.The "localness" of radio ownership

The End of The World As Labels Know It

This generation of music fans is no fan of digital rights management. Everyone knows it but the major labels continue to tread water before they drown in their own miscalulation. Now, we're beginning to see signs of a change -- a very small change -- in the attitude of at least one label. EMI is offering Norah Jones' Thinking About You and Relient K's Must Have Done Something Right for 99 cents each as MP3 downloads from Yahoo. It's hard to say how much of this little toe in the water is to test the efficacy of selling music without DRM or how much is designed to get under Apple's skin. The labels have a hate-hate relationship with&hellip


I was Christmas shopping at the Scottsdale Fashion Square a few days ago and wandered into the T-Mobile store to play with the new Blackberry Pearl. Within minutes a sixteen year old girl and her mother broke into a fist fight at the check-out counter -- that's right, holding nothing back -- with another teen and her mother. Four different customers had to restrain these holiday bundles of joy. The language was right out of HBO. Merry Christmas! Happy Holidays! Holy Moses -- what is happening to us? Mobile connectivity is growing exponentially. We text each other. We talk on the phone while we walk. While we shop. While we&hellip


I feel dirty saying anything against Google, but I am worried about my friends in the radio industry. Radio is ice cold and Google is red hot. I've written previously about how the radio industry should beware of geeks bearing gifts (i.e., online bidding for radio time). I'm happy the early experiments seem to please the terrestrial broadcasters participating in the Google initiative, but they are frankly hard put for good news these days. I believe if this thing catches on, it will do more damage than good. Let me make my case. The Google radio ad system reaches out to anyone who wants to advertise on radio. They bid for ads (and&hellip

The $1.6 Billion Garage Sale

Google, a new age company -- the rage, the do-no-wrong new media conglomerate had to go outside Google's significant brain trust to buy YouTube from a couple of kids they then made into billionaires. Couldn't Google have invented YouTube on its own for a lot less? YouTube could only have been conceived of in a garage by a few fools who thought pirating other people's copyrights could be a big business. Imagine if Viacom had a skunk works and its brainstormers came up with YouTube first. How fast do you think corporate lawyers would have shot down that idea? In the music-related media we tend to blame new technology when sales go down&hellip

Solutions For The Labels

CD sales are down again. Legal downloads are up but not as much as in the past. Labels are getting hooked on ring tone sales to help make up for the short fall in CD sales. Music is as stale as the latest innovative idea from a big four label. Desperation is setting in as labels try to get more merchandising rights in artist contracts. Even hit albums are not dominating the charts. Big artists start with big sales and then decline rapidly. Christmas sales figures are not in, of course, but barring the unforeseen, it will be another down year for record labels and trouble aplenty ahead. Here are some good ideas I've heard to turn&hellip

Radio’s Declared Victory Over Satellite

This is what's wrong with terrestrial radio. Their leaders have lost focus on what's important. Cumulus CEO Lew Dickey mocked the satellite industry at a UBS conference saying it would have been cheaper to put toasters in cars. Many radio broadcasters let their egos get in the way when it comes to satellite radio. Satellite is not their real competition -- the loss of the next generation to the mobile Internet is. And some satellite operators are trash talking radio as well. Sirius CEO Mel Karmazin's disingenuous comment that he'd love to see terrestrial radio's revenue up by double digits is the same thing from the other side.&hellip

Help the Needy — Radio Consolidators

It's Christmas and time to help the neediest. And CBS, Citadel, Entercom and Clear Channel would have you believe that they are the neediest. These groups along with TV and newspaper execs are trying to get the FCC to repeal the "severe ownership restrictions" in a time when technological and marketplace developments have made competing more difficult. Are these people serious? The radio industry got everything they wanted in 1996 with passage of the Telecommunications Act. And all they've proven ten years later is that they couldn't run more than two stations in a market even with a virtual monopoly. Now they want another bite of&hellip

Ads On Your Cell Phone

There is fairly recent research that shows about one-fourth of all cell phone users would be willing to look at advertising on their mobile phones in return for free service. A Harris Interactive research poll in August also says that 7% of current mobile phone subscribers would be interested in receiving relevant promotional text messages with some caveats. The ads-for-free-service trade-off is consistent with what I have observed among samplings of the next generation. They have ways of ignoring advertising to keep things free. But it's the 7% of&hellip

Texting Getting Out of Hand

Pardon the pun. It's a vile habit of young people driven to distraction by the mobile media they are addicted to. It is equally also a very rude habit of older people who whip out their Palms and Blackberries while you are talking to them, eating or trying to communicate with them face-to-face. The texting craze can be harnessed by the media to get instant input, participation or even -- with some imagination -- instant sales. But the one or two finger tap is the potential enemy in my view. Old and new technology can compete in this new age by emphasizing content, but how are they to compete with repeated distractions that have very&hellip

More Sirius Trouble

It didn't take Sirius CEO Mel Karmazin to announce yesterday that the satellite company was going to miss its subscriber projections -- by 200,000 by the end of the year -- to know it was in deep trouble. At least not for me. Working with the next generation at USC, I have become all too familiar with the reason why Gen Y doesn't subscribe in great numbers to a satellite service. It's money -- or the lack of it and a disinclination toward subscription services. Howard Stern boosted Sirius' subscriber count in his first year, but Stern appeals to older adults. And even the 500,000 paid subscribers he attracted was nowhere near what&hellip

The New Radio

UK radio stations will begin being able to sell digital music downloads to their audiences in real time early next year. It's significant because the developers are calling it "digital radio's killer application". All the major radio groups and labels are on board for the roll out that requires a pre-paid plan for anyone interested in buying music from a digital radio station. Here's the part that's revealing. They claim more 15-24 year olds are listening to radio than ever but that as UBC's CEO Simon Cole says, "radio revenue is not rising to sustain the development". Come again? More listeners than ever in this demo but not a&hellip

The Emerging Mobile Middleman

Google is complaining that mobile phone operators are asking them to stop allowing people to access Google Mobile Maps by phone. Google's service gives interactive maps, search results, satellite images and very detailed directions to local businesses. The mobile operators are thus becoming the middleman between Internet companies and the public. The reason is obvious. Mobile companies offer their own detailed direction programs -- for a monthly fee. And what happens when VoIP becomes widely available on mobile phones -- in other words, cheaper service on phones with existing phone service through Internet access. The move to watch&hellip

The Reluctant Broadcaster

By Dave Van Dyke, Inside Music Media Contributor

For many of us who have been in this great radio business for more than three years, the idea that the paradigm is/has shifted out from under us is a bit like feeling your first earthquake. It's crazy! Unlike most natural disasters, earthquakes give you the feeling that you are no longer in control - that there is, indeed, a greater force at work and you can't do a damn thing about it. Welcome to the world of traditional Radio 2.0 - the new reality. Does traditional radio's senior management have trouble seeing that their legacy businesses can not only peacefully but constructively&hellip

Consolidation – The Bad & The Ugly

Ten years ago during the euphoria surrounding the passage of the Telecommunications Act I spoke out against media consolidation as publisher of Inside Radio. Not only that, I exposed as often I could, the heartbreak of an industry. I saw able managers overloaded with the responsibility of running too many stations. People fired because they got in the way (we wrote of a cancer patient who one of the consolidators fired even knowing he was being treated for the disease). The disconnect between Wall Street euphoria and Main Street neglect. Questionable practices like packaging more than the stations some groups owned with LMAs to offer&hellip

Navigating the Digital Future

Can anything stop YouTube or MySpace or TiVo or peer-to-peer downloading or the iPod or iTunes or mobile entertainment? Yes. Yes. Yes. Yes. Certainly not traditional media. Radio, television, print, movies, the record business -- they're stymied. Lost in old ideas and the technology they hang onto and misdirected when they embrace a new interactive one. What can put a hurt on the current runaway digital future is the interactive media itself -- all of it. My long time friend and media futurist John Parikhal recently wrote: "The biggest "missed" story was the continuing damage to productivity that is caused by e-mail. If you get&hellip

CBS — Clear Channel “Lite”

In spite of the fact that Clear Channel owns so many more stations than CBS, you have to wonder how number two gets away with so much less blame for helping the radio industry into the dumpster. It's true that Clear Channel started off the consolidation era with great hubris and litigiousness, but CBS shouldn't get a free pass in my view. Imagine if these two companies decided to lead rather than bleed the radio sector through consolidation. Imagine if even one of these giant companies decided to run their stations as separate entities and take a pass on the cutting and running they both did. Imagine more choices for the listeners.&hellip

Proctology And Satellite Radio

I love the colorful Mel Karmazin. He's a brash, confident -- alright, over-confident -- success story and right now the never-ending-salesman that he is is doing what you'd expect him to do -- whip up interest in his company's lagging holiday sales by talking up a merger with competitor XM (again!). I laugh every time he does this. And I hope I never have to eat my words when I predict that a merger of the two satellite services will never happen. Or should I say, a merger of the two satellite companies should never happen. Even in a country where we are all supposed to live the American dream until we consolidate our assets and&hellip