The Future of Radio
Ten years ago, Eric Rhoads asked me to appear on the cover of Radio Ink in a suit of armor. Since Eric is one of my closest friends and a major supporter of Wizard Academy, I agreed to do it for him.
Since 1998, my Wizard of Ads column has appeared in every issue of Radio Ink, more than 200 in all. The columns I write for Eric are never released to another outlet.
Today I’m making an exception to that rule because I believe 2008 will be a major growing-up year for radio and readers of the Monday Morning Memo need to understand what’s going on.
The following is an excerpt from my column in the current issue:
Syndication came to television 50 years ago. Networks like ABC, CBS and NBC offered local TV stations better shows than they were able to produce themselves. And these better shows were cheaper than local productions. The viewers won. The stations won. Television became much more profitable. National advertisers loved placing ads in hot, national shows.
In the past, national shows have been the exception in radio, rather than the rule.
They’re about to be the rule.
I predict that half of America’s morning drive jocks will soon be replaced by 10 or 12 syndicated morning shows beamed in from somewhere else. This will happen in other dayparts as well.
Frankly, I’m in favor of it.
Wait! I hear the voices of broadcasters clamoring, “But radio is local. Our listeners want local. Syndication is anti-radio.”
I respond, “Listen to the people of your town. Are they saying, 'We don’t want Desperate Housewives, Grey’s Anatomy, American Idol, and Lost! We want the local TV shows?'”
“Are they saying, 'We don’t want Spiderman, Pirates of the Caribbean, and Lord of the Rings in our theaters! We want the local movies?'”
“Are they saying, 'We don’t want Rush Limbaugh and Howard Stern, we want a local political pundit and a local shock jock?'”
Ten years ago, radio’s consolidators cut costs by cutting the fat. Then, when pressured for more profits, they did the only thing they knew to do; they cut deeper, but this time into muscle. Radio was crippled. Occasionally they cut arteries and radio stations began dying. Wall Street prices dropped cold and hard, icy hail on a barren landscape.
There were plenty of heroic efforts in the emergency room. Not all radio group heads were selfish. Not all were shortsighted and stupid. I’ve watched from the sidelines as good men and women did the best they could under impossible circumstances.
Now radio is going private again. Deconsolidation has begun. The age of syndication is upon us.
Don’t be afraid of it.
# # # #
Now I hear the voices of Monday Memo readers, asking, “What about satellite radio? What about the iPod? Aren't these eroding radio's audience?”
Sure, these new technologies, along with online attractions like youtube, myspace and facebook, and video game platforms like the Sony Playstation and the Nintendo Wii have added to the list of attention-gobbling gadgets that began with CDs, DVDs and cell phones back in the dark ages. In short, Americans have too many gadgets and too little time to play with them all.
The net result is that media is getting trickier to buy. But make no mistake, broadcast radio remains a powerful tool for local business. As soon as I find a better value, I'll let you know.
Keep in mind that
(1.) my consulting firm doesn't work by the hour and
(2.) I don't charge according to the size of the client's ad budget, and
(3.) my income is adjusted annually according to the growth of my client.
The moment any new media has the potential to be a more efficient use of my client's ad dollars, I'll be on it like a duck on a June bug. My future depends on it.
Now chin up, eyes forward.
You're going to have a great week, I promise.
Roy H. Williams
PS – It would be wrong of me not to acknowledge my friend Roy Laughlin as the inspiration for today's memo. A good friend for 15 years, Laughlin reminds me of Babe Ruth. Remember how the Babe walked up to the plate in the 1932 World Series, pointed to the center field bleachers with his bat, then hit the next pitch over the center field wall? Laughlin is like that.
The inaugural, sold-out session of Writing for Radio and the Internet was a booming success that's still echoing. Move quickly and you can snag free room and board in Engelbrecht House for the session coming up in May. Look at the bottom of the course description and read what students wrote about it.
Rare Opportunity – As I write this, 3 rooms remain unclaimed in Engelbrecht House for the April 22-23 session of Michele Miller's class on Marketing to Women, (and Michele won't be back at the Academy until late October.) Can you think of a better way to grow your market share when market potential is shrinking?
Free room and board in Wizard Academy's student mansion makes the trip to Austin very affordable. If you want Tamara to check and see if one of these 3 free rooms is still available, she's at (512) 295-5700 and/or (800) 425-4769.
Brad Cook donated a hot tub for Engelbrecht House! Hooray!