A Survival Plan for Radio

"If you're going through hell, keep going" said Winston Churchill.

That best describes the critical situation the people of the radio industry find themselves in again this week -- perhaps the most crucial in the history of the business.

Clear Channel is getting ready to implement the Lee & Bain plan to drastically cut personnel while swinging to a model of national syndication in order to further cut costs.

What is likely -- perhaps as soon as this week -- is the unraveling of local radio as we know it for the repeater station concept -- especially in the non-major markets. So what we could soon see is radio groups with one operations manager and no PD, not much of a local staff, minimum local management oversight -- and programming from larger cities in the same or similar format genres.

There will be a lot more talented people out of work once Lee & Bain (through their minion John Hogan) implement the latest bean counter strategy to save their bottom lines. And you know what will happen next -- either now or in time -- the followers will follow. That is, other groups will give in to the policies of the largest radio consolidator to do the same damn thing.

Since we're going through hell, let's keep going.

This morning, I'd like to offer two things.

One, the plan that I believe should have been enacted by consolidators to keep terrestrial radio as healthy as possible while the industry ramps up a significant presence in the digital content business. Some smaller groups actually do some, but not all of what I am suggesting.

There are small stations still making money, but their success is dismissed by the Wall Street know-it-alls who look down on the industry they invaded.

Ironically, it seems like the monopolies are having the worst time. And, because they own most of the big real estate in radio, they are taking the radio industry down with them. It's obvious from their actions that consolidators think they have all the answers.

What follows is a few they don't have -- but should.

The second part is a survival plan I'd like to offer to help radio employees who have had to suffer fools for too long now.

In the end, I hope you'll conclude that in spite of the dire straights radio is in, sound ideas are still available for owners and their loyal employees. It didn't have to come to this.

A Survival Plan for Radio

1. Offer all your talent (managers, programmers, sales managers, air talent, support staff and engineers) a chance to work at decreased pay. Look, no one wants to do that, but they want to lose their livelihood in the industry they love a lot less. These are reasonable people. They know these are tough times. Go to them, ask for wage concessions effective immediately. Then be honorable and make it up to them should you succeed in turning your station(s) around.

2. Commit to a "local-first" business plan. It's too bad the owners will be the last to find out that they can't turn local radio into network radio. The healthiest radio stations today -- even in this economy -- are operating like radio stations of 20 or more years ago. Simple local programming for local advertisers who represent the lion's share of a station's revenue.

3. Almost every daypart must be local so if you want to win, start there. Being a repeater station for repurposed programming should cause you to lose your licenses. And you know, someone out there who got screwed by one of the big consolidators may just take it to Washington -- the political atmosphere is right. Raise a stink about the loss of local radio. Pressure members of the House of Representatives -- they know the need for local radio stations up close and personally. You want reregulation -- not more consolidation. Your consolidation rights have been taken away.

4. Don't trust the National Association of Broadcasters. They were responsible for tacking on the radio consolidation section of the Telecommunications Act of 1996. They are now representing the interests of a small handful of powerful consolidators who continue to prop up the antiquated broadcasting lobby. The NAB is Judas.

5. Radio groups should show some fiscal responsibility that applies to their top executives. Ground the private planes (if for no other reason than to show they are making sacrifices, too). The reason the major groups are unwilling to at least appear to care is because they don't. Repeater Radio is the goal. People don't matter. They've been heading there for a long time. If they wanted to succeed, they would realize they need the support of local talent and would be willing to make the same sacrifices that they are asking employees to make. It happens in other sectors, but not radio.

6. Triple the sales staff. Put more troops on the street when times are tough -- more relationships that may produce increased revenue. Clueless CEOs like Fagreed Suleman are trying to cut the staff that feeds them.

7. Invest in sales training so that the people you are relying on to increase the revenue will be the most skilled sales force in the media business. Faxing out fire sale rates to local advertisers is an act of desperation not a business strategy. Want a business strategy? Charge a fair rate and build relationships between your local station and local advertisers. Nothing has been conjured up that can beat this approach to raising revenue. And, leave your sales manager alone to do his or her job. Set the goals and get out of the way. They know what will happen if they accept your goals and do not deliver.

8. Never utter the word HD Radio on the air or off again. It will not help. Selling a turkey to automakers who are still agreeing to make HD radios available to consumers is going to backfire. The auto industry will soon discover that younger listeners would rather have a hard drive they can program than a radio -- and just like radio consolidators, they'll someday cut one of them out. Guess which one?

9. Devote 20% of next year's operating budget to your digital future. Radio has no future because one of the first mistakes consolidators made was to let the next generation get away. They assumed young people would always listen to radio and while surveys keep telling us how radio listening is growing, it's not growing among the generation radio needs the most to have a future. Find that 20% -- beg, borrow or steal for it -- and invest in mobile, podcasting and Internet streaming businesses. All of them should be local. None of them should have anything to do with what you broadcast on the air -- after all, that's still radio.

10. Play local music -- lots of it. Do local news. Yes, people love news. We all get it on our Blackberries, iPhones, laptops or wherever. Become involved with the community. Once radio began laying off of what it thinks is corny promotions in local markets, they cut the tie between the listeners and their stations. It' so transparent -- radio stopped being radio when its leaders got rich in consolidation.

11. Never do a liner or promo again promising something to listeners. Baby boomers hear and tolerate them -- few intelligent people believe the promises the media business makes to them these days. Today, you have to do it first. It's harder that way. I love promos as much as the next guy, but we're doing them for ourselves. It's old. It's doesn't work and it's time to move on.

12. Innovate. Bring young talent in for Sunday nights. Let them play their own music. Drop the hot clock. Invent a new one. At his death, Bill Drake was working on a new radio format. New means not old. Radio would be wise to learn this lesson. There are plenty of people who are qualified to go on the air in any locality. Only snobs say there is not enough talent in small or medium markets. Your listeners would prefer local over voice tracks. Local over Don Imus. Local over just about anything with rare exceptions.

13. Oh yes, no voice tracking. Enough said.

14. Set realistic local budgets. Offer your key manager a "one-sheet" contract. On the page, list what you demand of them -- when judgment day will be -- and what will happen if they meet or fail to meet your written (and mutually agreed upon) goals. Then leave them alone. If this approach is good enough for Warren Buffett, the mega billionaire, then it should be good enough for the Dickey boys and the rest of the Jive Five consolidators.

15. Get rid of all corporate staff. Each station manager works from the one-sheet she or he mutually agreed to. They send the profits to you. Never appoint another manager to oversee a local station no matter how successful they are at their station. If you analyze this false management strategy over the past 30 years, you'll soon see it never worked. It still doesn't. One manager. One station. One profit center. Autonomy and responsibility are the two key words. That's what will work if you really want to turn your industry around.

There's more - much more, but you and I know this is just an academic pursuit. It's for us. They're not listening.

Now here's something for you -- the people who made this business what it was. Made it worth the billions that were paid to acquire the fruits of your efforts.

A Survival Plan for Radio Employees

1. Draw up an exit plan right now from the radio industry - today. Don't get me wrong, I'm not pushing you out. The incompetents who are running the major groups are. By "plan" I don't mean something you're simply kicking around in your mind. Not fear thought. Forethought. Isolate three things you'd love to do (other than radio). They may be in the media business, new media 0r something different. Do this for yourself if you're thinking about the future.

2. Spend one-tenth of your day (if you're still employed) looking for a job in one of those three areas you just described. If you've been let go, devote hours a day to working your plan. By the way, job interviews are a big deal. This isn't the day for that discussion here, but I have a pretty successful interview technique I taught my USC students in the four years I was a professor there. This technique almost always gets them the job. If that's a topic that interests enough people, I'd be happy to share it in the weeks ahead.

3. Consider a career in new media. As I always say, the best qualified people to provide content, marketing and sales for new media are radio people. We do professional programming 24 hours a day -- or used to before voice tracking and repeater radio. Be aware that new media has many problems that must be solved. How to monetize it, legal agreements regarding rights ownership and growing audience through social networks to name a few. But new media means growth (podcasting, streaming and mobile content). You may want to be available for it and to be available it will take more than a resume -- it will take knowledge.

4. Becoming familiar with generational media is not an option going forward, it's a requirement. What makes a boomer listen to the bad radio programming they're increasingly getting and why a Gen Y'er wants to program his or her own content. Why national programming impresses the next generation less than what their peer group can share with them. Look to Steve Jobs. Read about him. Get your hands on books about the generations. My years at USC that were quite accidental changed my life. I saw firsthand why traditional media -- music, broadcasting, movies, newspapers, etc would fail and what it would take to grow replacement businesses. You must do things like this if you want a career in new media.

5. Never lose your dignity. Radio CEOs have debased their employees, lied to them, abused them, left them feeling inadequate and unwanted. But there is a lot to be proud of beyond these misguided managers. The bottom line: who among us does not believe that a working radio manager left to their own intelligence and hard work couldn't run a station better than radio's Gordon Gekko wannabees?

6. If you've been wrong and can afford it, hire an attorney to sue your employer for wrongdoing, discrimination or other legal related matters that will reverberate to the shareholders. Public companies must disclose these lawsuits. I am surprised we haven't seen more class action suits against radio consolidators. You know where the bodies are buried, dig them up very carefully.

7. Change comes from organizing. The secret is to pressure your Congressmen. Local radio is important to their reelection. That's why they have legislated favorable ad rates into radio and television broadcasting. Gather people. Call, mail, email, text message. Consolidators may be buying more trouble than they know if Congress decides to make the licensing of radio stations more competitive. Obviously, they should -- to weed out operators who would make radio one product for all localities.

8. Become skilled in social networking. Take this website of mine. It started out as a closed tool for my USC students. Two years later it is bigger than Inside Radio when I owned it in terms of readers (thanks to you, by the way). It is also read by, yes, Wall Street, corporate media, managers, talent, music, mobile and new media folks. I mention social networking because while the media barons are out cutting everything back they should be looking to grow their brands among social networks. See, they think Facebook is a social network. And while it is, it is more like a tool. Barack Obama knows what a social network is -- he has millions of followers and his people communicate with his followers. It's a two way, beneficial relationship -- not a new age direct mail list. I can't encourage you enough to make social networking your focus if you want a career in the media business.

9. Finally, deal with your problems and challenges knowing that sometimes you can solve them and sometimes -- no matter what you do -- you can't. Then, commit to using your gifts and talents every minute of every day unconditionally. Radio people do this by instinct, but it's worth mentioning. Look what they've put up with. And finally, be grateful for that which you have even the everyday problems.

I've mention the near death experience I had with Clear Channel less than ten years ago when they sued me for $100 million.

I counter sued for $125 million. They settled, then bought my company and required a non-compete that prohibited me from working in the radio industry for a number of years. Hell, about the only thing that was left was to teach.

Who knew Clear Channel was sending me to school to learn about their business -- and a generation they didn't understand.

The advantages of disadvantages.

Out of bad comes good.

And this is what I wish for my friends and those I admire in the radio business during the tough time ahead.

Radio people are survivors.

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