Disney Gets The Last Laugh

Could it possibly be that Disney did something right when everyone else thought they were doing everything wrong?

Radio Disney, the kids radio format, may now find a reportable audience when Arbitron's Portable People Meter (PPM) is set to become the new standard in audience ratings. The meter measures all media within its path and kids don't have to fill out diaries. Their listening can now count.

Formerly, Radio Disney was the joke of consolidation.

A bunch of AM stations with horrible signals patched together to offer the Disney kids programming to the tween-agers. This in spite of the fact that the quality of the kid's programming was rather good.

Of course, the consolidators laughed.

Who would want to buy crappy little AM stations when big, expensive mega-signals were available through the legalized monopoly game known as radio consolidation?

Michael Eisner, that's who.

The much maligned bull-in-the-china shop former boss of Disney who absolutely kept Disney's corporate powder dry while Wall Street led the invasion of the money snatchers to buy up FM signals and big signal AM stations.

This would be a footnote to consolidation except the joke was on the radio consolidators, Wall Street greedy-people and shareholders themselves. It turned out the blind were leading the blind.

Disney didn't buy up the big properties that were available and it could have. Yet all through consolidation Disney's ABC remained one of the top billing radio groups based on what it had previously purchased and presently operated. Big billing from excellent, established money-making major market stations.

They just kept buying these little AM stations for Radio Disney and doing deals with small station owners that turned their facilities over to Disney kids programming. It was the coalition of the willing except, unlike the term "coalition of the willing" commonly used to describe the few nation partners in the Iraq conflict, this coalition actually won the war.

Disney/ABC kept the assets they owned and then, later, did a complicated (and tax-friendly) sale to Citadel making tons more for its investors.

Oh, and while the record labels were consolidating, cutting back, being seduced by Steve Jobs and suing their young customers, Disney was out running an old-fashioned record label.

You know, the kind that sells -- dare I say the word -- CDs!

Through its Miley Cyrus (aka Hannah Montana) and other sub-teen goodies it started to outsell rap, hip-hop and mainstream artists on a regular basis. Even outselling the holy grail of the record business these days -- compilation albums.

And High School Music 2 broke all-time cable records Friday night.

So, let's do the math.

Disney sits out consolidation -- that's one big one for them.

Disney keeps its existing ABC Radio stations, a top biller during consolidation without getting into the post-consolidation acquisition frenzy -- that's two.

Sells the entire shooting match to Farid Suleman at the exact right moment and cleans up -- three!

Disney proves to be the one company to run a record label that is trending upward in the face of dying CD sales and music piracy without having to sue one of its cute little young people -- more than the RIAA can say, by the way.

Skillfully integrates its television and film platform into everything else it does -- just as master marketers do.

I've lost count of all the things Disney did right?

All of this flew in the face of conventional wisdom.

All of it.

Look, I'm not here to rile up the Disney haters or demoralize the rest of us. But you can't say they didn't take the road less traveled during consolidation.

I'd simply like to point out that conventional wisdom is overrated.

If Wall Street likes it, I personally look in another direction. And Disney did that while it was a considerable public company.

Turns out that the new kids on the block -- (the new rich) radio consolidators were blinded by the money and couldn't see the light. Radio had no future without the next generation and no one way paying attention to the next generation -- except, well you know who.

Consolidators were paying attention to Wall Street analysts who in the end didn't know their head from a hole in the -- market -- to use a radio term.

In other words, to borrow a phrase from that great 21st century sage and soothsayer Steve Jobs, "think differently" was the business plan that radio and the record business never adopted.

Their motto instead was "Think Indifferently" which bought them the mess they are now in.

Saggy stock prices.

No upside.

An uncertain future and lower shareholder value.

Who are the Mickey Mouse operators now?

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