Reed Bunzel
is a veteran media executive with over 30 years of service in the
radio, music, and digital media industries. He is president of Bunzel
Media Strategies, a full service consulting and analytics firm that
assists companies with industry research, analysis, business strategies,
platform development, and communications/marketing.
Remember the movie Sybil?
That's the 1976 miniseries and film starring Sally Field, whose main
character was alleged to have up to 13 different personalities, all
struggling to coexist inside one body at the same time.
I mention this
because this week at the NAB/RAB Radio Show in Indianapolis I was having
a conversation with a respected broadcaster (name withheld upon
request) who compared the U.S. radio industry in 2014 to the Sybil
character. Not in the sense that he thought the business was fraught
with mental illness or that it needed psychotropic drugs in order to
maintain a "normal" life, but because at any one time there are a number
of distinct personalities inside this industry that give voice to its
collective persona.
While the analogy could be
perceived as a bit of a stretch, a distinct parallel can be drawn
between Sybil's internal voices and the discussions I've had with radio
broadcasters these past few days at the Radio Show. All of these
conversations (and some comments made at general sessions) have been
fascinating, some of them are scary, and many of them contribute to a
universe that seems founded more on perception than reality. Depending
on whom you talk to, the American radio industry is a) healthy, b)
doomed, c) challenged, d) blind, or e) all of the above.
Here's what I mean:
- In her now-traditional role of the industry's statistician, Wells Fargo Securities senior analyst Marci Ryvicker insisted radio's revenues will remain flat until broadcasters prove her wrong, with local and national spot revenues most likely going nowhere this year. She has a strong record of accurate forecasts, so her macroeconomic view can be trusted. Her prediction of "flat" growth is not a truth many attendees in the audience wanted to hear, but as Ryvicker so eloquently put it, "radio has a lot of shit."
- Several major group heads insisted that the radio remains strong and, while saddled with the uncertainties of change, its strengths far outweigh its weaknesses. Example: Cumulus Chairman Lew Dickey, while acknowledging myriad challenges, observed that radio is "America's daytime medium" and emphasized that its greatest audience occurs during the time when most commerce is conducted.
- RAB President/CEO Erica Farber stressed that digital is radio's most direct and imminent path to growth, a position self-avowed BS specialist Bob Hoffman (author of "The Golden Age Of B.S.") almost immediately refuted by declaring "online advertising is a fraud." While Hoffman quickly clarified that he really was referring only to display advertising, his "WTF" moment resonated long after he left the stage.
- Univision Radio President Jose Valle stated that digital audio streaming is a $20 million revenue line that produces cash flow for his company, and noted that "we don't abandon our over-the-air audience but we have to be where our listeners want us to be. Listeners dictate."
- Seconds later Emmis Chairman Jeff Smulyan insisted he's never made a dime from streaming, stressing instead how critical it is to get NextRadio functional in every smartphone sold in America, so consumers have access free FM radio rather than pay the near-usurious rates charged by major phone carriers. This move, Smulyan insists, will almost single-handedly propel the radio industry into the future.
- Of course, a healthy contingent of tech-heads are adamant that it's too late for either NextRadio (which is at the mercy of AT&T and Verizon) or HD Radio to shift the digital tide that has begun to rise - a tide, they insist, that will not float all boats.
- Then there's the die-hard cheerleaders who point to radio's 92% 12-plus reach and insist that all is good in the world of radio, despite measurable TSL erosion among younger demographics and the growth of such online digital services as Rdio, Spotify, iHeartRadio, and Pandora.
- These folks also tend to be harsh Pandora critics who don't grasp that the streaming service is a company, not an industry, and that if it didn't have to pay the performance royalty fees dictated by the Copyright Royalty Board (from which AM/FM radio is exempt), its margins actually could be far greater than those of many radio companies serving the same number of listeners.
- And then there are the "rapturists," those individuals who are convinced that radio's apocalypse is imminent, and nothing can be done to save it from the four horsemen who are fast approaching from the other side of the digital horizon.
I want to stress here that I
am not trying to simplify the passions or opinions of radio
broadcasters, or to declare the radio industry "psychologically
unstable" or "mentally unfit." Far from it. But today (Sept. 12), as the
Radio Show closes here in Indianapolis and we all go back to our
regular roles in the radio business, we need to recognize that it's
impossible to color the radio industry with one broad stroke. I'm
constantly asked "what's the big take-away" or "what's the buzz at the
show"?
I understand the questions, but I don't have suitable answers. No one does. And
that's because the radio business is comprised of many interconnected
parts, with multiple priorities and goals, and no two perceptions (or
personalities) are alike. Each of us knows what we know about our own
corner of this business, and we are influenced by the factors that
affect us personally and professionally.
For instance, some
broadcasters are being chased by debtors who have no option but to let
them to continue kicking the can down the road in an endless game of tag
that causes many folks to doubt the overall health of the industry.
Others are ruled by fear of change and cringe at the approaching reality
that spot revenue might just not be enough to get them through to
retirement, or to identify a reasonable exit strategy. Still others are
managing to generate small revenue gains through hard work and
diligence, and are accepting that digital and social media can push real
dollars to their bottom lines.
In the movie and TV
miniseries, Sybil was affected by what today is known as multiple
personality disorder*. It's important here to draw a distinction between
that and what I've mentioned above, which is radio's multiple
personalities. Period. (Whether there's a disorder involved is open to
discussion.
My only point here is to initiate a conversation about the U.S..
radio industry as we head into the fourth quarter, and to introduce my
new initiative, Radio 2015. This new "media intelligence
platform" is designed to engage everyone in this wonderful business in a
discussion about our collective fates, futures, and fortunes, and to
offer actionable analysis and information to ensure that we are guided
by intelligence rather than fear.
You'll be hearing a lot more about Radio 2015 next week - and in the weeks to come. Meantime, I invite you to email me with
any questions or comments you might have regarding the radio business,
as well as suggestions about what you think needs to be addressed as we
set our sights on tomorrow...and the next day.
*In a book titled "Sybil Exposed," author Debbie Nathan maintains that most of the story Shirley Mason, the "real" Sybil, was fabricated.
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