How to Fix the Music Industry

(Claim a pre-registration discount at my upcoming Media Solutions Lab and reserve a seat for the January 27th event at The Phoenician in Scottsdale here).

How crazy is this?

The music industry is broken yet more music is being consumed than ever before in history.  What’s that all about?

Well, if you’re in the business – radio, music or the rapidly growing mobile Internet field – you’ll want to take a no nonsense look at the 14 biggest problems killing the music industry right now and how to fix them – pronto.

If the record business continues its decline, what happens to the media businesses that rely on music?

This article proposes an actual fix for each one of the music industry’s problems.  You’ll have to have an open mind reading it because most if not all of these fixes are not commonly thought of as solutions by the powers that run the majors.

But I’m betting you’ll put it all together.

Among the 14 issues we’ll discuss:

1.  What to do about iTunes.  The record industry can’t seem to live with it and can’t live without it.  Now, here’s a workable solution.

2.  The answer to the contentious music licensing problem that the labels need because they really don’t have another source of income growth but they are shooting their growth potential in the foot.

3.  The one sure way to spike interest for consumers to own music.

4.  Why streaming revenue was lost and what can be done to save the revenue stream.

5.  How critical is music video to the music industry – online?  You may be surprised.

6.  The quick and effective road to concert pricing.

7.  RIAA lawsuits – continue them or try something new.  I’ve got something new for you.

8.  Music royalties for radio.  This issue had better be settled properly or else …

9.  The one guaranteed way labels could get back into relevance and generate profits tomorrow if they would do this one thing.

10. One hot button that Gen Y cannot resist when it comes to music.  You’ll own them.

11. The effect of record label mergers ahead this year. EMI is in trouble and if it “solves” its problems the way I think it will, EMI will actually create even more problems for the greater music industry.

12. The anti-record label.  Ever hear of it?  You may want to get acquainted with it now because it could be the replacement for traditional record labels as we know them.

13.  The labels hate Apple.  They need them.  They have enabled them, but there is one thing the labels never thought of that can put the power back in their hands with regard to Apple.  I’ll share.

14. iTunes pricing.  With Steve Jobs ready to make a major announcement that could reshuffle the entire music industry, it’s time to get real about the pricing of digital music.  Read this before Jobs backs the labels against the wall again.

If you would like to read this story, have access to my entire archive (over 1,100 pieces) and get the next month of my writing included, click “read more” for your choices. 

Get the real story about 14 painful fixes for the music industry that could turn it around in the foreseeable future.  If the labels don’t want to listen, you will because as long as music is a consumer obsession, there is  a lot of work to do to understand the new rules.


Dickey’s Citadel Takeover Strategy

Lew Dickey told employees this week he is damn serious about taking over Citadel even though Cumulus is burdened with debt while Citadel is not (thanks to bankruptcy) and that the Citadel board has virtually no reason to be taken over by a much smaller company with a lot of financial baggage.

This article examines:

• Why Dickey cannot back down in his attempt to buy Citadel.

• The best thinking on how he will proceed – how long he will try – and what Dickey is really after.  The Citadel Takeover Playbook.

• How the three main consolidators – Clear Channel, Citadel and Cumulus – will reshuffle their dominance and which one will emerge the most powerful.  I think you’ll be surprised.

• As a consequence, what Clear Channel will look like – a picture that may emerge even within the next 12 months.

• Citadel’s plan to stick it to Dickey

• And what the prospects will be for Cumulus if Dickey should fail to win Citadel after many more months of public haranguing about a hostile takeover.

• Plus, selling without ratings and the truth about the Cumulus seller hiring plan.

If you would like to read this story, have access to my entire archive (over 1,100 pieces) and get the next month of my writing included, click “read more” for your choices. 

Get the story no one else will tell with our remarkable reliability on what the Cumulus Citadel takeover strategy really is – not what they’re telling you.  And how the big consolidators are ready to change places in a major way.

You’ll only read it here and you’ll get it first.


Baby Boomer Audience Turns 65

The radio industry is at it again and it’s only January 4th!

The trades are full of analyst and CEO predictions of 2-3% growth (analysts) or even higher (radio CEOs) in the year ahead.  That after what will probably turn out to be a 5-6% increase (in the 2010 election year) compared to a disastrous year in 2009.


What they and you should be watching is the migration of the generations – the available media audience.  How many generational listeners are available and what do they want.  That's how to build an audience base to increase radio's share of revenue.

This year Baby Boomers will start turning 65 and about all the radio industry can do for these 79 million Boomers is program a few oldies stations (being careful not to use the word “oldies”).

Disaster is ahead.

Apple CEO Steve Jobs is a baby boomer.  Some of his best customers are Baby Boomers, but he has a generational strategy so sound, I am going to share it with you in a radio context.

This piece will discuss the similarities between Baby Boomers and guess who?  80 million Gen Yers coming of age now.

That’s right – similarities

I’ve got four useable pieces of strategy for you if you are serious about being more like Steve Jobs than the hapless CEOs of radio consolidation.

Specifically …

1. The one thing you must get right to hit a bull’s-eye when creating saleable content for younger as well as older generations.

2.  Which market do you aim for – the kids or the adults?  There is no margin for error here.  Do you know which one to aim for?

3. The Great Technology Misstep – how to avoid it.  That is, while radio CEOs are fighting for FM chips on mobile devices, you should be doing this …

4.  How traditional media is actually driving away audience by making the same mistake over and over again.  Any idea what that mistake is?

If you are already a subscriber, thanks very much for supporting Inside Music Media and recommending it to others. 

If you’d like to read this story, have access to my entire archive (over 1,100 pieces) and get the next month of my writing included, click “read more” for your choices.

Get insightful information on what Baby Boomers turning 65 means to an industry that is struggling with Generation Y coming of age.

It starts here.


The Crazy Clear Channel Refi

(With my son, Jerry, of whom I am so proud -- publisher of Modern Home Theater and founder of Audio/Video Revolution on a happy holiday visit)

2011 promises to be the year in which Clear Channel deals with its nearly $20 billion in outstanding debt.

To wrap your arms around just how gargantuan this debt really is, go back to 1996 when the company began implementing its strategy to eventually become radio’s biggest consolidator with over 1,100 stations at one point.

I sat at my desk when I was owner and publisher of Inside Radio flummoxed and had endless conversations with media brokers who were busting their buttons over the huge sale prices of radio stations and how hefty their commissions were.

Remember back then how companies paid individuals bogus fees for simply “introducing” the dealmakers to each other?  Of course, that was just another Wall Street charade for paying millions of dollars to someone for doing nothing.

In my conversations with media brokers, I would ask over and over again, how can Clear Channel (and other consolidators) ever pay back the debt.  You may remember the times were good and radio stations were cash cows.  Who thinks about such silly things as debt in heady times?

But one wise financial expert flat out said the consolidating radio companies could never pay back the debt.  That in the end, they would refinance and then refinance again until they couldn’t do it any more.

About two years ago, they couldn’t do it anymore. 

Money was too expensive and radio was no longer the free cash flow attraction that it was in the 90’s.

Now, within the next 12 months, I expect that Clear Channel will have only two options to avoid defaulting on their $20 billion in debt and none of the options are good.

But don’t let that stop you. 

As I am about to point out, it isn’t going to stop them and they’ve got a cagy way of trying to stay alive that will affect a lot of people in their company.


Low Powered FM Is a Joke

(Note: January 27th is my Media Solutions Lab)

If you’re a radio company and have been opposed to the creation of thousands of low powered FM competitors for the past ten years, you can thank the NAB for riding in on a white horse – in the middle of Congressional debate – to, you guessed it – support the bill.

And you thought Don’t Ask Don’t Tell took forever to pass.

I’m telling you, your NAB is a day late and a nickel short on all the issues radio supposedly cares about.

NAB CEO Senator Gordon Smith is turning out to be an appeaser like Neville Chamberlain, the World War II British Conservative politician who conceded the Sudetenland region of Czechoslovakia to the Nazis.

But not to worry.

This bill so cutely named the Local Community Radio Act is relatively meaningless for a number of reasons.

The legislation opens the radio spectrum to potentially thousands of local independent low powered radio stations (LPFMs) to bring new choices and voices to those poor suckers who can’t get dial-up, broadband, a signal of some kind or anything that conveys news and entertainment.

How can the advocates of this bill talk about choices and voices when American media is under attack from all sides when they actually use their voices? One of the hardest fought freedoms is freedom of expression and to me the era we are living in does not seem to value it.

My definition of freedom of expression is allowing others to say things that may be painful for the rest of us to hear, see or read. At this time in our world, I am concerned about free speech.

The creation of thousands of low powered FM stations is really a disappearing act.

Fight it, and you disappear.

Embrace it, and you disappear.

We’re forgetting the most important thing.