Road Trip Time Again

2019 Southern Cross-Country Road Trip

We’re off again!

Last year we drove over 11,000-miles on a Cross-Country Road Trip that took us from our home in Virginia to the State of Washington and back. You can read more about the planning of our 2018 trip HERE and the re-cap of our adventure HERE.

Yesterday, we set-off on our 2019 Cross-Country Road Trip that will take us from Virginia to the International Balloon Fiesta in Albuquerque, New Mexico, a visit with Pennie & Roy Williams (aka The Wizard of Ads) on the campus of The Wizard Academy just outside of Austin, Texas, a trip to Mission Control in Houston where they’ve recreated the nerve center that put the first man on the moon 50-years ago, a trip down Bourbon Street in New Orleans, a moment to reflect on a historic moment in American Civil Rights at the Edmund Pettus Bridge in Selma, Alabama and lots more along the way, finally returning home.

Our road trip this year will be only 3-weeks long and under 5,000-miles.

When we complete our 2019 Road Trip, Alaska will be the only state in America we both have not visited.

This blog will be on vacation for the next three weeks.

I’ll return with a new article on Sunday, November 3rd.

 

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Hope You Enjoy Your Stinkin’ Phones

Express FinalThat headline graced the cover of the final edition of Express, the free commuter paper published by The Washington Post. It was created only 16-years ago, as a free paper for commuters in the DC area to read on their daily metro commute into Washington. It all came to an end on Thursday, September 12, 2019.

“I’ve always known this day would come.”

-Dan Caccavaro, Executive Editor

The 130,000 daily circulation Express launched in 2003. At that point in time, iPhones weren’t even on anyone’s radar and Facebook was something only students at Harvard were using to communicate with their fellow classmates. The world had yet to be invaded by Tweets, SnapChats or Instagrams.

Those of us in business were getting our first Blackberry smartphones that allowed us to read our emails while away from our offices.

Flip Video

When it debuted in 2007, the Flip Ultra became the best-selling camcorder on Flip_VideoAmazon.com. It was so popular the line was taken over by Cisco in 2009. Fifteen improvements were made to the Flip video camcorders, until in 2011 when Cisco shut down the entire Flip Video division.

From its introduction as the “Pure Digital Point & Shoot” video camcorder on May 1, 2006, till it vanished only four short years later, the reasons for its demise can be traced to the same root disruption that took down the Express.

The introduction of the iPhone on January 9, 2007.

Downton Abbey Movie (No Spoiler Alert Needed)

This past Friday, Sue & I went to see the Downton Abbey movie. The theater was packed. Many of the movie’s patrons had not been in a movie theater in years, but due to this series airing on PBS and now all six seasons being available on Amazon Prime, legions of fans were heading off to their local movie houses.

“Studios ignore the maturing audience at their peril.”

-Hugh Bonneville, Lord Grantham in Downton Abbey

It’s not just the movie studios who are ignoring mature audiences, other forms of media would be well advised to sit-up and take notice.

The movie continues asking the central question raised by the television series; how does a place like Downton Abbey fit into the modern era? I’m sure It’s the same question every form of traditional media is asking themselves.

The Radio Corporation of America (RCA)

IMG_3994Following World War I, America saw a future in long-distance wireless telegraphy using high-power radio stations. In the United States, British owned Marconi Wireless Telegraph Company of America ruled the airwaves, but in order to stay competitive, it needed the new equipment for broadcast, manufactured by General Electric Company.

President Woodrow Wilson and the U.S. Navy decided that America needed to become the leader in global communications, convincing GE not to sell its equipment to Marconi, unless he agreed to give up his American based division to an all-American company.

That new company, RCA, would begin business on December 1, 1919. Its Chatham Radio, WCC (Wireless Cape Cod), became the largest U.S. maritime radio station. RCA succeeded in making America the leader in global radio communications.IMG_3974

2019 marks the 100th anniversary of the birth of Radio Corporation of America. RCA was reacquired by GE in 1985 who proceeded to breakup its assets. The RCA brand today is now owned by a French multinational corporation.IMG_3981

At one time, WCC was fully staffed with 30-people, most of them radio operators. Working around the clock, they would handle 1,000-messages a day. During the busy periods, as many as 10-operators would be on duty at the same time. The messages were all sent in Morse Code.

The radio station closed in 1997. The 100-acre site was sold to the town of Chatham, Massachusetts. The Chatham Marconi Maritime Center was founded in 2002 and operates the center as a museum and promotes the advancement of youth STEM education in the communications science.

Morse Code served as the international standard for maritime distress until 1999, and was replaced by the Global Maritime Distress Safety System. The French Navy ended its use of Morse Code in January 1997 with the final transmission “Calling all. This is our last cry before our eternal silence”. The final Morse code transmission in America was on July 12, 1999. The United States signed off its use with Samuel Morse’s original 1844 message, “What hath God wrought and the prosign “SK”. (The SK prosign was Morse code short-hand for “End of Contact” or “End of Work”.)

Commercial Radio Turns 100 in 2020

Next year, on November 2, 2020, commercial radio in America will celebrate its 100th birthday. That was the day that KDKA became the first commercially licensed radio station to begin broadcasting.kdka

Which brings me back to the Downton Abbey movie, which asks the question of great estates that I feel also applies to commercial radio stations, “Are we right to keep it all going, when the world it was built for is fading with every day that passes?”

“Hope is a tease designed to prevent us accepting reality.”

-Dowager Countess of Grantham

One has to wonder how long the style of radio that many of us grew up with will still be around. In many ways, it’s already disappeared, such as people being replaced by computerized automation. It’s much the same path that the radio station WCC experienced before it was closed down and turned into a museum.

To paraphrase the words of the Dowager Countess in dealing with the world’s only constant, change, and putting it in perspective; today’s broadcasters are the future of radio. The broadcasters who came before us lived different radio lives, and our descendants will live differently again. They will take over and build upon a communications world where we left off. Soon, today’s broadcasters will be the old curmudgeons keeping everyone up to the mark. I’m sure the future of communications will be an exciting time. “I think I shall prefer to rest in peace.”

“At my age, one must ration one’s excitement.”

-Violet Crawley, Dowager Countess of Grantham

 

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Putting a Face on Change

Downton Abbey Movie

If you want to learn how technology has impacted our lives,

watch the Downton Abbey series on Netflix.

This past Friday, I watched the movie.

Stay tuned for my thoughts.

_________________________________________________________

Previously, Here’s what I’ve written this about the series.

They Bought a Wireless

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Taking a Media Break

IMG_7870

Back with a new article in two weeks.

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What’s the Purpose of a Radio Station?

WSM Tower SiteRadio is a business.

Peter Drucker said the purpose of a business is to create a customer.

For radio, that means creating two types of customers: 1) a listener and 2) an advertiser and when done correctly, a radio station makes a profit.

Making Money

For most of my radio career, radio enjoyed a revenue expansion that rivaled the infamous “internet bubble.” Owning a radio station was considered a license to print money. Bottom lines often delivered a profit of 25 to 50% or more, so, while those profits were noticed by Wall Street investors the ownership limits on radio stations kept them away. Investors were frustrated that there was no way to scale up the size of a radio broadcast company.

Telcom Act of 1996

Then President Bill Clinton signed the Telecommunications Act of 1996. It relaxed radio’s ownership rules making it possible for one company to own multiple radio stations in a single market.

Wall Street loved the change! The money poured in from eager investors, and companies like Clear Channel, Citadel, and Cumulus quickly bought as many stations as they could using other people’s money. Mom & Pop radio operations had multiple companies vying for their properties and radio station values soared.

Ownership Limits

In 1953, the Federal Communications Commission (FCC) adopted its so-called 7-7-7 rule to encourage diversity of broadcast ownership. In essence, no single owner could own more than 7 AM radio stations, 7 FM radio stations, and 7 television stations in the entire United States of America.

By July of 1984, the FCC said they sought to encourage media competition and increased the number of radio and television stations a single owner could control to 12-12-12. The FCC Chairman was Mark S. Fowler. The President of the United States was Ronald Reagan. The five member FCC was 3 Republican appointees and 2 Democratic appointees. The vote to expand the ownership limits was 4 to 1 in favor.

“Bigness is not necessarily badness,” Chairman Fowler is reported saying. “Sometimes it is goodness.”

The New York Times reported reaction on Capitol Hill to the expansion of ownership limits this way:

On Capitol Hill, there was mixed reaction to the plan to abandon all limits on broadcasting ownership in 1990, although sentiment has grown in recent years for raising the ownership maximum somewhat.

Representative Timothy E. Wirth, the Colorado Democrat who is chairman of the House telecommunications subcommittee, said, ”The 12-12- 12 rule is just as arbitrary as the 7-7-7 rule.”

Mr. Wirth said a broad bipartisan consensus in Congress favors adoption of ”objective, long-term rules that assure diversity and competition.” He said such rules would provide for increased broadcast ownership but would not completely deregulate it.”

He went to say “If they deregulate in 1990, we could end up with a handful of companies owning every broadcasting outlet in the country.”

President Ronald Reagan

Reagan loved two things, cutting taxes and eliminating regulation. Remember Reagan famously said that “Government isn’t the solution to our problems, government is the problem.” Reagan’s pick for FCC Chairman, Mark Fowler, fully embraced this vision and actively applied it to the FCC.

However, the prediction of Congressman Timothy Wirth wouldn’t come into existence until President Bill Clinton signed the Telecommunications Act of 1996. It would be the first significant overhaul of the 1934 Act in more than sixty years.

Radio station ownership in the first five years under this new act went from 5,100 owners to 3,800.

Instead of opening up ownership to new and more diverse ownership, it created an opportunity for media monopoly. The Wall Street funded radio companies could now buy out the Mom & Pops and the temptation to sell at never-before-seen-multiples was too good to pass up.

Operating in the Public Interest, Convenience and Necessity

When no one really knew what radio broadcasting would become, they did know they wanted radio to be a communications business that would serve its community of license for convenience in good times and of necessity in times of trouble. The airwaves were considered to be owned by the public, so operating in their best interests was a requirement to being an FCC broadcast licensee.

Changing Competitive Landscape

Historically, radio stations competed against one another. Most markets had such battles as, WLS vs. WCFL, WMEX vs. WRKO, WPTR vs. WTRY, KHJ vs. KRLA etc. When FM radio began to take over from AM, a station such as WABC no longer had just WMCA to beat, but now WTKU-FM too, which offered better fidelity and stereo. This new radio competition replicated in every radio market in America.

Then came Satellite Radio, followed by Pandora along with other pureplay streamers, and podcasts so that today, the radio competition landscape lines are blurred beyond recognition.

Mission vs. Platform

Today’s communications company needs to clearly define its mission and needs to earn the trust of all of its stakeholders. That means building trust between its employees, advertisers and listeners.

We need to stop thinking of “radio” as AM or FM.

We need to think of radio as being the audio leader for creating an environment for convening and supporting groups. We need to be preparing for a future that is still coming into focus.

 

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The Birth of Radio in America

Early Radio ListeningWhen World War I ended, it didn’t go unnoticed what a powerful role radio communication had played in the outcome. Led by the General Electric Company, the Radio Corporation of America (RCA) was formed in October of 1919. With guidance from the federal government, RCA brought together GE, Westinghouse, and AT&T to develop the radio broadcasting industry in the United States.

In the early 1920s, no one knew what radio might become. RCA would be the entity to coordinate the manufacturing and sales of all radio receivers. They held all the patents from GE, Westinghouse and AT&T and it was RCA that would authorize others to use these patents to produce radio receivers, as well as collect and distribute the royalties to the patent owners. GE, Westinghouse and AT&T could manufacture equipment for their own use, as well as build and operate their own radio stations.

The Interstate Commerce Commission

Initially, the regulation of radio broadcasting fell under the jurisdiction of the Interstate Commerce Commission (ICC). In 1920, interest in broadcasting ranged from amateurs to experimenters and businesses. Some talked, some played music, and some began broadcasting news of local interest and weather reports. In an effort to bring some order to what had become a chaotic broadcasting environment, the ICC decided to place amateur broadcasters into the less desirable air space, below 200-meters, as well as restrict the type of broadcasting they could air. Amateur broadcasters had to agree that their radio stations could no longer air weather or market reports, music concerts, entertainment, speeches, news or other similar information. The ICC would begin to issue a new broadcast license on the 360-meter band for radio broadcasters that would be licensed to provide such services. All the members of RCA, including RCA itself, would begin to build radio stations. Westinghouse would be the first to establish one of these new radio stations, with their own inhouse amateur radio enthusiast Dr. Frank Conrad, and what became KDKA in Pittsburgh on November 2, 1920. Westinghouse followed this station with WBZ in Springfield, Massachusetts and WJZ in Newark, New Jersey.

However, Westinghouse management quickly realized that merely providing a superior broadcast service, which would create demand by the public to buy the new radio receivers they manufactured, would be futile if their broadcasts were harassed and interrupted by uncontrolled amateurs disrupting their ability to be heard.

Quality vs. Quantity

The ICC now had a new problem on its hands. Broadcasters interfering with other broadcasters, and what kind of culture should America’s new, growing middle class, be hearing through their radio sets? Since the decision had been made to not have radio be government controlled in the United States, broadcasters said they needed the government to regulate radio in order to help establish order and control.

Westinghouse proposed a solution to the ICC, to create two classes of commercial radio service.

Broadcasters on the current 360-meter band would become Class A broadcasters and a new service on the 400-meter band would be reserved for Class B broadcasters.

In order to qualify as a Class B broadcaster and receive higher power authority (500 to 1,000 watts), the licensee would need to never play phonograph records on the air, or any other kind of recorded material. Class B broadcasters would only air live talent and performances. Such a requirement would insure the public was receiving radio entertainment that was unique and original and not available on any other radio station.

The new license would also mean that only wealthier and more established organizations would be able to afford to operate radio stations under these new conditions.

Westinghouse’s concept, having government and business working together, was a way to “improve” radio broadcasting through restricting it to “responsible” parties without stepping on anyone’s First Amendment rights as to what a radio broadcast should consist of.

The Radio Act of 1927

This act laid the foundation for what radio broadcasting in America would be for the next several decades. The first being that radio broadcasting would not be open to everyone, but restricted based on quality. The feeling being that Americans would be better served by a few quality broadcast radio stations, rather than a plethora of mediocre ones. The new act also introduced the hard to define concept of “operating in the public interest.”

Radio, unlike newspapers or the movies, was to become a government regulated medium, with decisions about quality and public interest being made through an alliance of government and private interests.

And it was with the Radio Act of 1927, that America decided that radio broadcasting would be a commercial medium operated in private hands. Radio would support itself through the selling of advertising.

Today’s Radio Marketplace

From June 1927, when 705 commercial radio stations were on-the-air in America (all on the AM band and most with transmitter power of under 1,000-watts) to June 2019, we now have 25,819 radio stations (21,209 FM / 4,610 AM) with transmitter power up to 100,000-watts on the FM band and 50,000-watts on the AM band.

The concept of quality over quantity is certainly no longer the guiding principle.

The Ad Pie

As I read about how radio revenues are doing, I’m struck that both public and private radio broadcasting companies are reporting that local advertising revenue is dismal for Q2. However, major radio stations that enjoy eating from the national trough, saw this category of advertising as their only bright spot for radio ad revenue.

While digital revenue is hoped to be a new area to grow advertising revenues for radio broadcasters, the reality is that Facebook, Google and Amazon are already gobbling up about 90% of those dollars, so how fertile is this area for broadcast radio?

Reading comments being made about radio advertising conditions, I was struck by what Beth Neuhoff, CEO of Neuhoff Communications had to say when Radio Ink asked her, “what are local advertisers saying about the economy?” She responded by saying: “Local advertisers seem less focused on the economy and more concerned about over-saturation of the competitive landscape.”

It’s something that I believe the radio industry should be just as concerned about when it comes to OTA (over the air) broadcasting.

Gone are the days when putting another broadcast station on-the-air is a license to print money. People who aren’t use to quality, always will chase quantity.

quote-quality-is-more-important-than-quantity-one-home-run-is-much-better-than-two-doubles-steve-jobs-51-96-69

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The Competition for Attention

County_Cricket_BoardsA recent news item caught my attention. The English Cricket Board says “There are 200 million players of Fortnite…that is who we are competing against.” Welcome to the 21st Century and the attention economy, where everyone – yes, EVERYONE – is competing against everyone else. This blog competes for attention against not just other blogs, but everything else in our over mediated, world. It is our technology that has caused us to be over-saturated.

Blame Gutenberg

Johannes Gensfleisch zur Laden zum Gutenberg was a German blacksmith, goldsmith and inventor. It was Gutenberg’s introduction of movable type and oil based ink printing that ushered in the communications revolution via his printing press. This was the beginning of mass communication.

Wireless Communication

The next big development would come in the form of wireless communication. First Marconi, turning wired Morse code into wireless transmission. Then the advent of voice communication followed by voice and picture communication via radio and television.

The series Downton Abbey perfectly captured how was received in the home during season five.

Smartphones

The introduction of the smartphone bumped the radio off its perch as the #1 invention of the 20th Century. The smartphone, along with the internet, changed the way we communicate with one another. They would destroy the original communications concept that professionals would communicate to amateurs. Those days are gone. Social Media Theorist, Clay Shirky, says “in a world where media is global, social, ubiquitous and cheap” and where audience is now a full participant in the communication process, it’s no longer about “creating a single message to be consumed by an individual but about creating an environment for convening and supporting groups.”

Gaming

The advent of online video gaming, such as Fortnite, is not just creating that environment for convening and supporting groups of like-minded video game players, but is competing for our time and attention. “There’s 200 million players of Fortnite,” says Sanjay Patel, managing director of The Hundred, part of the England and Wales Cricket Board. “That is who we are competing against. So, if you don’t interrupt young people in a different way, if you don’t engage them in a different way and you don’t talk to them in a different way, they’re not just going to automatically come into your sport.”

And it’s not just Cricket or something happening overseas, America’s national pastime, Major League Baseball, has seen an attendance drop of 233,000 at their ballparks from the same time period in 2018. And the 2019 NFL preseason opener, the Hall of Fame Game from Canton, Ohio broadcast on August 1st, looks to be at an all-time low in TV ratings, for the second year in a row. Down about 15% from last year’s game. Crikey, what does this mean?

Too Many Choices

We live in a world with too many choices and as broadcasters, we need to face that reality. Again, to quote Clay Shirky, “the decision we have to make is not whether this is the media environment we want to operate in, it’s the one we’ve got. The question we all face now is how can we make best use of this media?”

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