What's Ahead for Radio Industry?
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Which of these four statements is false?
CBS Radio pushes over 100 employees out the door.
Emmis releases a financial report that shows a substantial drop in revenue.
Radio industry trade magazine to go silent.
There's a bright future for radio.
Audio Graphics has a 10-year reputation for reporting news about radio without hiding behind glowing language or the puffy articles seen in industry trades. This will not break that tradition.
Radio is in a disarray like no one in the business has ever seen. Take what's happened over the past week, please.
CBS Radio has just let go of 100+ employees nationwide. Among those given a pink slip were GMs, GSMs, NSMs, etc, etc. But hold on, according to a memo from CBS radio boss Joel Hollander: 1) "...today's move affects a small overall percentage of CBS Radio employees," and 2) "we are responding with programming and format changes at many of our stations, and working to bring our message to our audience with expanded and creative marketing initiatives."
In response to 1), what about the work that the survivors are going to have to absorb, like KCBS's accounting department which will now be doing the job for KFRC and KIFR? And 2), how?
How is the radio industry going to bounce back from its dreadfully weak showing over the past few years if it keeps letting people go? How will it rebuild if the more expensive, talented individuals are the ones on its hit lists? How will it deliver better local programming with fewer bodies?
Radio has been operating off smoke and mirrors for so long its execs are unable to see the damage being done by continually cutting the meat - not the fat. This CBS blowout is another example of a growing inability to deliver what the radio industry has built its reputation on - quality, local programming.
Been keeping up with the Emmis Communications story? Industry trades report that the Emmis Form 10-Q says: "On a pro forma basis, net revenues of our domestic radio stations were down 7.9%..."
But here's something you didn't see reported in any industry trade, which was filed in the Emmis 8-K report by the company's J. Scott Enright, VP, Associate General Counsel and Secretary: "On June 28, 2006, the Board of Directors determined that, as additional compensation for serving on the Special Committee, each of the three members of the Special Committee will receive a one-time payment of $50,000, plus the reimbursement of reasonable fees and expenses incurred by such members in connection with the performance of their duties as members of the Special Committee."
Don't think the above is a move that's only being made by Emmis either. There are many executives that are pocketing money while claiming revenue drops are solely the results of a "soft market." How many production directors could have been hired for $150,000?
We also have the purchase of Radio & Records by Billboard Radio Monitor's parent VNU, resulting in it shuttering one of only two industry trades that - in my opinion - reports negative news about radio. Left standing is "R&R" (where you can read nearly any corporate press release verbatim), the independent "Friday Morning Quarterback," Clear Channel-owned "Inside Radio," and "Radio Ink." (Publisher's Note: "Radio Business Report" will soon be the lone industry trade that offers straight-talking commentary about the industry.)
When's the last time you remember Radio & Records (or any trade magazine, for that matter) running an investigative report or doing an article on the local effects of cutting a radio station's staff?
Consolidation has left the public with hearing only the information that the group owners want disseminated. It will also result in fewer negative stories getting out to the people who have made radio a $20 billion industry.
Radio has a bright future! Really?
Having spent a few decades working in radio when its future was bright, when a programmer concentrated on one station, when competition was strong between all stations in any market, when jocks were given the leeway to communicate with their audience, and when stations had a local news staff - I'll report that things aren't looking so bright now.
Which, I suppose, gives you the answer to the question that opened this commentary.
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