This week's All Access newsletter reacts to a story saying the obvious, and how it applies to the radio industry as well:
The Wall Street Journal had a story about the newspaper industry's continuing woes the other day, and the very first line said that publishers are "running out of costs to cut, and they need to show some real ad-revenue gains soon." An analyst was quoted as saying that if revenue doesn't pick up, expense cuts won't be enough to drive earnings anymore.
And it took this long for him to figure it out?
You undoubtedly recognize the situation, because radio's been "cutting costs" for a long time, and, as it is for newspapers, the cuts have propped up some companies' earnings. Newspapers are, of course, in a somewhat more dire situation from radio, because technology is fast rendering the model of printing and delivering a hard-copy product obsolete, while radio broadcasting remains a competitive -- although no longer the only, or in all ways the best -- way to deliver audio entertainment. Besides, the audience for radio is still strong and at least holding steady, unlike the circulation numbers for newspapers, the vast majority of which are losing readers (for their print version, at least) at a truly amazing rate.
Still, in a lousy economy with advertising revenue gone elsewhere (or, alarmingly, away for good), companies are shoring up their bottom lines, and trying to make their debt payments, by cutting salaries, and there aren't too many more salaries to cut. Not that this stops some managers; Everyone can cite examples of stations ruined by overzealous cuts. The bottom line is that there aren't many more cuts available. And while top management is hoping against hope that swapping debt for equity will keep the Wall Street folks from pulling the default trigger, all of this -- the "cost savings," the debt-for-equity -- is just delaying the inevitable.
The line in the article about newspapers to which the people who manage radio need to pay attention is from an analyst who warns that these companies are "cutting costs to a level that accelerates the departure of their audiences towards other outlets." Does that resemble any other situation you've seen? How about:
-Cutting out local news departments?
-Reducing or eliminating the main competitive advantage radio holds: personality?
-Putting one person in charge of too many stations to pay attention to detail at most of them?
-Programming decisions made entirely based on cost rather than quality?
I've talked here before about glitch-prone stations running on an unattended computer with nobody in charge apparently listening. I've mentioned how too many stations ignore major breaking news -- even earthquakes -- because there's nobody in the building to make the call to interrupt the infomercials. I've talked about infomercials, and the damage they do. I've been talking about that for a long, long time now, even before the economy tanked to give the bosses a convenient scapegoat for their woes. Nothing changes. Somehow, radio's survived. That's great, but the moment of truth is coming, just like the article says it's coming for newspapers. Now, they can't improve the bottom line by just cutting bodies again. They have to start to grow the business. Concentrating on what radio does well -- personality, live news coverage, live interaction, local as well as national material -- would be a good start.
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If you're going to be in Atlanta a week from now, stop by the syndication panel at the Talk Radio Boot Camp in Atlanta on November 14th, with agents Eric Weiss and Lisa Miller, syndicated host Doug Stephan, Envision Radio Networks' Danno Wolkoff, Dial Global's Jessica Sherman and Phil Tower from the Allen Hunt Show on the panel and me as moderator. We'll be talking about how to get syndicated, whether you SHOULD be syndicated, what to look out for in the process, independent syndication, and more, plus your questions. Go to talkshowbootcamp.com for more about that.
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This column started as a way to promote what we do at All Access in general and in the News-Talk-Sports section in particular. It's too late to stop that now, so just go to AllAccess.com, log in (it's free), click on Formats, then click on News-Talk-Sports, then click on Talk Topics, and that's how you can get a lot of material for your show every single day. This week, you'll find mashed potato-related violence, the cat-declawing controversy, things that are still selling in this economy, why it pays to fight certain speeding tickets, a DVD price war just in time for people to stop buying DVDs, a particularly unfortunate allergy, why increased productivity may be a bad thing, bald bears, the latest Lee Harvey Oswald news, several stories about bodily excretions, the fine print in the healthcare plan, an interesting excuse for public exposure, and many items about the SWINE FLU!!! and the economy and politics and much more, from breaking news like the shootings at Fort Hood and Orlando and sports and science and stuff. There's also "10 Questions With..." WNRP/Pensacola afternoon talker Brandon Rathert and the rest of All Access with complete industry news coverage, music charts, ratings, job listings, and forums where you can complain about me and anything else. Go take a look. Now.
Again, see you next week in Atlanta. I... what? Baseball? They played baseball this week? Gee, I hadn't noticed. Sorry, doesn't ring a bell. It's November -- that's football season. Baseball ended when the Phillies won the National League pennant.
Or so I wish. Johnny Damon stealing second and third will haunt me all winter.