Disney's New Radio Killer

Disney's ESPN is up to something big that radio and new media interests should keep a close eye on because they are about to steal local listeners away from radio and move them to the Internet.

A number of months ago ESPN the sports giant (television, radio, publishing, online, mobile) began testing a concept that is reminiscent of local radio when radio was in fact local.

Three months ago in Chicago, the test site, ESPN began digging down deep into local communities in an effort to create total domination of all things sports. In Chicago, ESPN is up against Randy Michaels and Tribune. So far ESPN is leading the race for faces with 590,000 unique visitors in June beating the locally-oriented Chicago Tribune with 455,000.

These numbers are very impressive in and of themselves after such a short period of time, but what is more significant is the ESPN strategy.

It goes beyond the major sports teams.

ESPN, the brand, is now moving to penetrate local sports -- high school football, baseball, hockey, basketball, soccer -- you name it. They are not too proud to include middle school, either. The idea is for students and parents to find sports schedules and scores on their ESPN site.

In addition, they could have game summaries, statistics -- and the starting point for conversation in a social networking setting.

It's all on the ESPN site and on their mobile products.

ESPN can use all its media operations to drive visitors to their new local sites and that includes ESPN radio. You'll see ESPN launch its local web branding in New York, Los Angeles and Dallas in the near future.

And eventually, ESPN will cover every market worth owning with sports from pro to little league. In other words, ESPN will get bigger by thinking smaller.

Smaller teams.

Local focus.

All this may be boring to Lew Dickey, Cumulus and Dickey Broadcasting which just signed a five-year contract to air the Atlanta Braves. Clear Channel is giving up the broadcasts.

And that's what traditional radio calls sports -- either play-by-play of the major sports or talk about sports. Sometimes there is college sports talk but high school info -- especially in the detail that ESPN is obviously going -- is ignored.

Look for the Dickeys to put the Braves on their AM and FM in Atlanta and on some nearby market stations as part of a network. Imagine all the money they will save from airing the Braves everywhere.

Don't put it past the Dickeys to get the rights to Atlanta's favorite sports team and then fire the radio play-by-play announcers. That's happening right now on Long Island where the hockey Islanders wasted their two play-by-play announcers so they can save money by simulcasting the TV audio.

Any hockey fan can tell you the level of description needed to enjoy a hockey game on radio. The TV simulcast will not suffice.

Radio has been ruining a lot of formats for itself in the past 13 years of consolidation, but I chose the ESPN example because if they succeed, they will be doing what radio should routinely be doing -- building local brands on multi-media.

Young people -- 80 million of whom are of age or coming of age now -- are happy to subscribe to Major League Baseball on their computers or NFL goodies on their cell phones. They don't need radio here, either.

Disney-owned ESPN gets an "A" in my book for reading radio's potential or lack of it and the same grade for innovating.

I take you to Radio Disney, the kid's channel that plays more new music than any traditional terrestrial radio station. Their production is more appealing to youth. All of this was done on crappy stations (I'm being unfair using that description but I'm trying to convey that Disney didn't buy great signals).

Many radio executives laughed when Disney fired up Radio Disney for kids, but who is laughing now?

Disney stuck Citadel with its ABC operation -- just at the peak of its value -- and Citadel is currently dismantling everything good about the previously excellent ABC stations.

Interesting -- Disney didn't sell Radio Disney (those "crappy" signals).

And they continued to buy outlets for its ESPN venture almost as if they knew what they were doing -- an oddity for media companies these days.

Now, you can see what Disney is up to.

ESPN, one of its strongest and most dominant brands, will seek to become all things to all people on a local level using not just radio but everything technology can bring its way.

Haven't I been saying radio should have done this when it had all that investment capital?

But consolidation CEOs never could see the future. Hell, they can't even see the present.

You'll note that ESPN's local sports initiative is not repeater radio or national syndication. They are hiring -- that's right, hiring -- real people. You know, the kind who breathe, work, make good content.

Meanwhile radio groups come up with asinine ways to cut costs, fire people, take their eyes off the future and they are failing even before this new challenge from ESPN comes along.

Tribune is not a radio company, and Randy Michaels is not going to let ESPN take his bacon without a fight -- I can promise you that. Of course he's working for a bankrupt company owned by Sam Zell so his resources are more limited than ESPN with the backing of Disney.

Look, radio knows how to do what ESPN is taking to the next level.

It's called being local.

I remember observing the hardest working dj I have ever known, George Michael of WFIL, Philadelphia and WABC, New York who later went on to sports fame in Washington and nationally.

As a young jock doing a teen radio show, George visited virtually ever school in the listening area, called his contacts and taped high school news and sports on a daily basis. I don't supposed you'd be surprised if I told you his show was far and away number one for years with that formula.

Imagine what a George Michael would have done if he had the Internet, iPhone, iPods, Facebook, Twitter and all the rest of today's new-age tools available to him then.

Other stations and formats have also made it good business to be part of their communities and offer things listeners crave.

Over the years radio people got to believe traffic and weather was the reason for existence even though audiences had changed and found other ways to get that information. Radio has become more national for at least the last 20 years in slow and painful steps.

The last real local format was all-news developed by an appliance and light bulb company named Westinghouse that also owned a few big city radio and TV stations.

Even local talk didn't last long when greedy managers figured out that syndicated political talk could get ratings and give them low cost content to sell. In the process, they set up their own eventual demise as social networking has become the new talk radio to the next generation.

Talk radio has become a bloated, aged imitation of its former greatness.

And herein lies the magic of what ESPN is doing:

1. It isn't about terrestrial radio right now or for that matter only TV or print or online -- it's all of that being employed to drive a multi-media local brand.

2. Just because websites reside on the world wide web does not mean that national trumps local. In fact, ESPN is going to show radio and print what happens when you build a brand from national to local and even micro-local (including children's sports).

3. The mission going forward is to nurture the brand, enhance it, hire talent locally to make it compelling and then embrace every technological way to distribute that content.

Go back and review 1, 2 and 3.

Radio could have and should have done all of this.

Instead, it got into a pissing match with satellite radio -- a medium that doesn't matter.

Caught up in cost-cutting that has not insulated them from the bankruptcy they now face.

Fooled itself into thinking they could get away with cheap radio that is increasingly national.

No Internet, mobile or social strategy in site even in this day and age.

So, closely watch ESPN teach the radio industry a lesson that it should have learned in its illustrious 75 plus year history.

It's not about AM or FM or XM or PM or iPods and iPhones and Macs -- it's about all those things where applicable.

To survive -- radio must take strong brands and build them across all technological platforms and concentrate on every sociological area at the same time.

It takes money this industry doesn't apparently have.

So watch the outsiders come in and clean the clocks of all broadcasters who try to just do terrestrial radio in an era of great change.

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