Alpha Revolt

Larry Wilson used to be the bomb.

Bought up all those stations and put them into his Alpha-male company.

Went out of his way to remind us that they are all live and local with autonomy that could only be hoped for at other groups.

And then … well, the wheels came off.

Alpha is no longer the quintessential live and local radio outlet touted.

Suddenly, orders were coming down from on high at corporate.

No choice – just yes, sir!

The natives were getting restless.

All of this because Larry Wilson was hell bent on buying that crappy little radio company known as Digity with only one or two markets that could enhance the company.

But the debt made him act funny.

He dreamed of going public but that ship has sailed.

Now we learn that heavy-handed corporate decisions are being met with such resistance in places that it is tantamount to open revolt.

And then the unthinkable happened.

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The Cumulus/Dickey CBS Radio Merger May Be Back On

CBS Radio’s move to Nashville (home of “Nash”) is very suspicious.

Yesterday it was revealed that this anonymous company has negotiated a favorable new tax deal to move 200 employees to Nashville.

The Nashville Business Journal outed that company as none other than CBS Radio.

Huh?

CBS – the Tiffany Network people are doing a deal to up and move out of the Big Town for the rolling hills of Tennessee.

Oh boy, would I love to drink that Kool-Aid.

But it all tastes like B.S. to me.

Blah, blah, blah – I know Nashville isn’t New York even if it is a great city.

But CBS Radio isn’t your father’s CBS radio anymore, either.

200 jobs.

An average salary of $48,000 per employee – at least that’s what this secret new entity told the state of Tennessee during tax abatement negotiations.

Who could be THAT cheap?

How about Lew Dickey?

And/or Cumulus.

Who is synonymous with Nashville, none other than the creator of “Nash” itself, Lewis Dickey, Jr and his brother Fredo.

You think I’m kidding?

CBS is ready to launch an IPO or so they want everyone to think.

But they blew their best opportunity to sell the entire group to the one company that needs and wants them – Cumulus (with or without Dickey).  Lew has lost a reported $200 million as his Cumulus shares have declined.

So either CBS has gone nuts or they are setting the table for a December surprise the likes of which will have their employees heading to CVS to buy Depends and shaking up an unstable radio industry.

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Cumulus — Time Running Out

Mary Berner is the best thing that ever happened to Cumulus Media.

Too bad it wasn’t five years ago when she took over from Lew Dickey.

Now, Cumulus is in a bad way – worse than they are letting on and worse than Wall Street cares to admit.

There is a reason why Cumulus is selling for $1.15 a share even after a recent reverse buyback. 

The future is catching up with the present and debt, poor revenue results and middling programming success does not leave the second largest radio group much room to avoid bankruptcy.

Earnings are disappointing with no fix in sight.

And its $2.4 billion debt (second to iHeart’s whopping $20.8 billion) is hardly manageable under current conditions.

Over 50% of their larger PPM markets deliver about 50% of their revenue.

Even an optimist recognizes that impairment charges taken by Cumulus last year that adversely affected their performance are good comps for this year.

Even with Berner firmly in charge after a year, there is one thing that could push the company into bankruptcy.

Only one way to avoid it.

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What the Morning Show of the Future Looks Like

  • A woman personality as the main entertainer and not the sidekick.
  • Less emphasis on outrageous and funny.  Humor will work with the emerging in-demo audience as long as it is not at the expense of another.
  • Commercials that are delivered in a more authentic way.  Not easy because it will require stations to win the confidence of local advertisers to allow their top personality to also show the blemishes on their products or services.  Sponsors may fight it but for the first adopters who trust you with this plan, their response rate to advertising will rise dramatically.
  • No traffic reports.  Research shows more than 50% of morning show audiences do not listen to radio for traffic choosing Waze, Google Traffic and emerging services like TrafficCarma instead.  We know why stations run traffic – compensation.  But audiences are turned off.  Do deals with Uber and Lyft.
  • A consumer feature that helps listeners deal with their problems.  A place for them to turn when they have been ripped off or misled.  This feature can build strong loyalty – a station that will fight for them.
  • A contest that is fun to play because it bridges some listeners with other listeners – dare I say, radio returns to being the original social media.  And we’ve been looking in the wrong place to Facebook all these years!
  • Weather like real people actually do it:  “cold outside”, “a blizzard is coming”.  Most people have weather apps on their phones and the importance of weather as a major ingredient in morning shows for in-demo audiences has moved down their list of priorities.  Change the way you do it.
  • Music, maybe.  Conversation, definitely.  In-demo audiences now want conversations.  They know where to get music (and often it’s not on the radio).  Howard Stern has had a million careers morphing into many different people – talking all the way without music.  But if music is included, wake up to discovery not repetition.

Let’s get into this and complete the list of what the morning show of the future looks like at my next executive briefing.

2017 Radio Solutions Conference

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Misreading Millennial Audiences

It doesn’t seem like the media are learning its lessons from writing off Bernie Sanders and Trump for their favored candidate, Hillary Clinton.

New York Times Publisher Arthur Sulzberger, Jr. sent an apology letter to subscribers and vowed fairer reporting.

But go to the site and see if anything has changed.

Same with cable news.

This is a wake up call that the news media are not getting but I believe radio executives should get.

Radio needs to spend some time learning about an audience that has always made them uneasy – 86 million Millennials between 18-34.  

  • Is there any kind of radio that Millennials will listen to – and let’s be honest here?  I can name several things.
  • How to deal with their shorter attention spans while still appealing to older Gen X and possibility younger baby boomers.  Actually, there is a path that will not offend current listeners.
  • Music repetition is a problem and PPM is helping to blindside otherwise very smart radio people.  Here’s a workaround that deserves discussion:  Millennials love playlists – just not station playlists.  I can imagine a brilliant purveyor of music such as Michael Tearson, John Sebastian or young Dan Mason creating addictive, personal playlists.  After all, look at the inroads streaming music service Spotify has made in offering and helping subscribers create playlists.  Radio PDs don’t want to give up all that control, but I’ll bet you’d love some creative ideas in this area.
  • Millennials despise rules and what are radio station formats – a bunch of rules.  Without opting for total chaos or disorganization, an alternative throws out the rulebook and replaces it with the one thing 18-34 Millennials are addicted to.

More at my April radio executive briefing.

2017 Radio Conference

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The CBS – Radiate Traffic Mess

The traffic business is becoming a joke.  It now exists for radio stations to gain compensation because listeners are turning elsewhere for traffic information in “yuge” numbers (I include startling research on that today).  Imagine a business where listeners want out, advertisers are more cautious and owners and traffic providers seemingly have their heads up their butts.  I wanted to know why.  Here’s what I found. -- Jerry

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The Demise of ESPN

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