Unfortunately in radio these past few years, consolidators are screaming “We didn’t start the fire” louder than Billy Joel sang it.
A lot of what has passed as good management and smart strategic thinking has been ill-advised and mean-spirited.
So we find ourselves 12 years removed from the origins of radio consolidation and three years since draconian cutbacks have compromised most live and local broadcasting.
On that note, here are the latest new stupid (and smart) radio tricks being played in our industry.
Citadel Cuts Sales Commissions in a Recovery
Okay, maybe it’s not a big recovery but go figure what this strategic move does to morale and the bottom line.
Citadel stations in Birmingham, for example and in particular WJOX (said to be the only one making money), are reported to have cut commissions very recently by – well, you guess.
How about one-half!
Insiders say this came from the new GM who has been there only a few months.
Here’s an in-market account:
“I know it affected the top billing station, WJOX, it went to 9% direct from 12% and 7% on agency from 10%. WJOX is supporting the others in the cluster so I guess they need the money to make the month."
Who is supervising these geniuses?
You guessed it again, Judy Ellis, Citadel CEO Farid Suleman’s radio wife.
Cutting commissions to save money at the start of a recovery – as we used to say in Philly – stoopid!
WTOP Employs New Media to Cover a Rare DC Earthquake
This Bonneville top-five billing combo doesn’t own the all-news franchise in Washington by just cranking out headlines every 20 minutes.
When a rare earthquake – okay, only a 3.6 but the biggest ever measured in Washington – hit the nation’s capital recently the usual calls came in, but also tons of emails, texts, tweets and posts on their Facebook page. Immediately, WTOP got a snapshot of where the tremors were felt – a robust flow of information. A powerful demonstration of social media as a news gathering tool not just a chatterbox.
Smart, that Jim Farley.
Clear Channel Lobbying Hits Nearly $1 Million (Every Three Months)
How’s $940,000 – up from the last quarter of 2009 and up from $760,000 compared to the first three months of last year. Those folks at Lee and Bain sure know how to cut back, don’t they?
First they pay Randall Mays to go away as CFO and sign him to a lucrative part-time employment contract plus hire a new man meaning Randall really doesn't go away.
Then, they make Mark Mays go away at the end of this year by giving him a lucrative new contract to stay -- a contract that pays Mark Mays millions to do 20% of his current work.
And, he gets to buy the Gulfstream jet he now uses. First right of refusal if anyone outbids him. Plus, Lee and Bain will hire a new man (probably a man).
They keep trimming local radio staff.
Hey, you have to lobby, don’t you?
This is a model takeover company that should be studied by Harvard Business School, but I’m going to say – not so smart as a good radio operator.
Michigan Looks to Outlaw Broadcasting Non-Competes
House Bill 5750 sponsored by Representative Fred Miller.
The bill would prohibit an owner or operator of a broadcast television or radio station from requiring certain employees (primarily "on-air talent") from signing non-compete contracts or agreements.
House Bill 5750 would amend Section 4a of the act (MCL 445.774a) to create an exception for contracts or agreements between a broadcast industry employer and a broadcast employee or prospective employee. "Broadcast employee" would mean any employee of a broadcast industry employer except for those providing primarily sales or management functions.
California has led the way on this and there are other states that protect talent from greedy owners who think it is smart to limit the living professional broadcasters can make because they are no longer working for their former station.
Farid Suleman as Convention Co-Chair
Radio Ink turned to Farid “Fagreed” Suleman to be co-chair of their December convention in New York City saying the event “will benefit from his valuable insights into what top executives most need to know and understand in these complex times”.
This guy ran Citadel into bankruptcy and walked away with a lucrative new employment contract.
If you want to know how to eradicate shareholder value, help the previous investors who hired you lose their stake in the company and screw hundreds of employees out of their jobs and get a promotion, you won’t want to miss it.
The Radio Ink event is usually smart.
Choosing a bankruptcy loser to show us the future – out of touch with the radio industry.
The CBS Media Player that Replays Commercials
Last week CBS Interactive Music Group and CBS Radio released a new streaming media player at Radio.com. It integrates 130 radio stations and Last.FM. A proud CBS news releases boasted better functionality and more ad placement opportunities, but the last line of the release is the real kicker:
“Users will also be able to scroll back to commercials they missed”.
Now that’s the real killer app! Replaying those cool commercials.
The CBS Interactive people are at least trying even though you get the sense that it’s still all about the terrestrial stations and not about separate new content.
Let’s hope some PR flak who doesn’t get it wrote that sentence and if so he or she gets a "stoopid" the way they say it at 3rd and Shunk in South Philadelphia. No one -- zero -- is going to replay a radio commercial.
If the radio industry is going to recapture its live and local radio magic, it needs more smart strategic management decisions.
Think of it like this.
iTunes revenue in the first quarter of the year was $1.1 billion.
Clear Channel’s was $623 million for the comparative period.
iTunes revenue is only 7.9% of Apple's total revenue while radio represents half of Clear Channel’s revenue.
iPad revenue is forecast by at least one analyst to be $1.95 billion in the third quarter of this year.
Live, local radio is still a good business but repeater radio is not.
Radio with new media content and social networking as a separate tandem is a growth business.
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