Tag Archives: Netflix

The Past is Not Prologue

200px-Duck-Rabbit_illusion

Thomas Kuhn used the duck-rabbit optical illusion, to demonstrate the way in which a paradigm shift could cause one to see the same information in an entirely different way.

One of my favorite weekly reads is Tim Moore’s “The Midweek Motivator.” You can sign-up for Tim’s weekly wisdom here.

This past week, Tim wrote about how people inside radio stations are asking him, “is radio failing?”

Now Tim’s a student of history, and he responded with “If you care about history (because the past is prologue) here’s the simple truth: some large groups are faced with debt loads that will either force bankruptcy or massive reorganization.”

Tim’s analysis about how America’s two largest broadcasters dug huge debt holes that can’t be re-filled by current operating revenues is spot-on. With radio, like a lot of businesses, it’s a matter of buying it right from the get-go. Start out upside down and most likely you won’t have a good day.

A system that is over-reliant on prediction through leverage, hence fragile to unforeseen “black swan” events, will eventually break into pieces.

-Nassim Taleb

Technology

Crystal balls are hard to come by but my tea leaves are leading me to believe that mass mediated communication is confronting more than just debt loads. What we are also dealing with is “paradigm paralysis.”

Radio’s leaders are holding onto a set of beliefs and views that radio is invincible.

Thomas Kuhn coined the term “paradigm shift” in his influential book “The Structure of Scientific Revolutions” in 1962. The business world adopted this terminology of “paradigm shift” to describe a profound change in a fundamental model.

Paradigm paralysis, on the other hand, is the inability or refusal to see beyond the current models of thinking.

Let Me Share a Story

John C. Harrison told this story at the First World Congress on Fluency Disorders held in Munich, Germany in 1994. See if you see a parallel to radio and the advent of satellites, streaming, podcasts, and smart speakers.

In the late 1940s a man walked into a laboratory of a major photographic

manufacturer in America to demonstrate a new photographic process.  But

he didn’t bring along a camera or film.  He brought along a red box with a

shiny steel plate, a charging device, a light bulb and a container of black

powder.  The picture he created was faint but discernible.

 

“But where’s the film?” they asked.  “Where’s the developer?  Where’s the

darkroom?  Why, that’s not really photography!”  And so, the company

passed up an opportunity to acquire the process for electrostatic

photography, or xerography…a process that has grown into a multi-billion

dollar industry.

 

Why did they pass up such a great opportunity?  Because the people who

saw the process were suffering from PARADIGM PARALYSIS.

 

Call Me an Outsider

Joel Barker wrote a book called “Paradigms: The Business of Discovering the Future.” Joel says that anyone who develops a new paradigm is often labeled an “outsider.”

Truthfully, when you’re running a cluster of radio stations, you don’t have time to think let alone take a step back and look at things with a fresh eye. I know. I’ve been there.

What teaching and now blogging have given me the opportunity to do is listen to everyone talk about the prevailing paradigm of radio broadcasting, in all of its subtleties and contrast it, to what I’m witnessing taking place before my eyes and ears by the end users of mass media.

And what I sense may be happening, is the radio industry being on the verge of a “black swan event.”

Black Swan Events

Credit card companies, who amass tons of data on their customers, still managed to miss the huge financial crises in housing back in 2007-2009.

When a tidal wave struck Japan’s Fukushima nuclear plant, the predictive model used to calculate how high the protective wall should be built, provided for a 20-foot wave. Yet, the wave that struck the plant was 24-feet high.

AIG, an insurance company in the business of predicting risk, missed seeing the financial collapse that bankrupted them.

Digital Advertising

Now Facebook is dealing with a black swan event over their data breach by Cambridge Analytica. Only this black swan could have major implications for how digital advertising is bought and sold in the future. The UK and Europe will put in place in May 2018 the “General Data Protection Regulation,” that will protect their citizens’ personal data or offending companies will suffer stiff penalties and fines.

So, what the Facebook story is doing, is making its two plus billion users aware of such massive collection and abuse of our data, but the fallout from this breach of trust will impact the ad supported business model of everyone in the digital advertising world.

30% of American Homes Don’t Have a Radio

Edison Research and Triton Digital’s annual “Infinite Dial” research just produced this astounding statistic. Close to a third of America’s homes no longer have a radio set in them.

Many people see smart speakers as the way back into the home for radio. But are they really?

Cable TV & Over-The-Air (OTA) TV

In the beginning, cable television was called “Community Antenna Television.” The concept was simple, TV stations were primarily located in big cities and the suburbs couldn’t receive those TV signals. So, antennas were placed high on mountains and cables would carry the signals received to homes in the valley.

TV operators loved this back then. It was like getting a power increase for no money.

Ah, but remember, there’s no such thing as a “free lunch.”

As the cable industry grew, channels such as ESPN and CNN and The Weather Channel were born and would compete with OTA TV.

Then along came streaming video.

Netflix

At the end of March 2017, one year ago, Netflix surpassed cable TV with its number of subscribers. And if you were to add up all the other streaming video services available to today’s television consumer, the lead over cable wouldn’t be a couple million viewers, but tens of millions.

What happens when a household begins subscribing to these advertising free channels? They find it almost impossible to return to ad supported ones.

Smart Speakers

Now we circle back to the smart speakers, Amazon’s, Google’s, Apple’s and Microsoft’s for starters. Instead of a handful of audio choices, the smart speaker delivers an almost infinite choice, and many, advertising-free.

When you put a prime rib steak next to hamburger and they are both the same price, which do you think most folks will choose?

The smart speaker lets you customize your favorites, much like the pre-sets on your car radio does. I’m willing to bet that the average consumer will end up with about 3 to 5 favorite audio streams they spend the bulk of their listening time with.

In fact, Nielsen’s Total Audience Report released in the second quarter of 2017 said that 87% of OTA radio listeners spent their listening time tuned to one of their three favorite radio stations. And 58% of that time was spent listening to just one station, what Nielsen calls their 1st Preference or P1 station.

Why would we expect this number to grow with the advent of smart speakers?

Goldstein’s Words

I think Steve Goldstein summed it up best in his recent blog when he wrote, “Commercial radio should put down the hammer and stop searching for nails. As they think beyond the stream, they will see how people are using audio media these days and create on-demand solutions in-sync with the vast opportunity of the exploding Smart Speaker universe. On Smart Speakers, the listeners are asking for it.”

 

 

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Voice Command

Voice CommandIt’s only been about two months and Alexa has changed the way I interface with my devices.

I’ve had Siri since I switched from a Blackberry to an iPhone4S. (The S stood for Siri.)

The new smartphone was such an improvement over my Blackberry Pearl that I never used Siri much in the beginning, later, I would use her to type my text messages, but that was about it.

Enter Alexa…

All that changed this past Christmas when my fiancé, Sue, put an Amazon Echo Dot into my Christmas stocking. It took about two weeks before I finally got around to plugging the Dot into electrical power, downloaded the Amazon Echo app to my iPhone7 and connected the Dot to our house Wi-Fi.

Now Sue has never been thrilled by all the remote controls to operate our TVs, radios and audio systems. And truthfully, I wish it could be simpler too.

Alexa teaches us both new tricks, by simply talking to her artificial intelligence voice. And we both love it!

Hey Siri…

Once adapted to Alexa, I began to use Siri to do more things on my iPhone7 and AppleTV.

We cut the cord last year but to satisfy my news diet, I put in Sling TV with the news package. The rest of our TV watching is filled up with Netflix, Amazon Prime and YouTube. New movies that we missed at the local theaters or never played in our area are viewed using iTunes.

Finding something to watch used to be rather tedious, but now, I just say “Hey Siri…”and she goes off and finds it, offers me the viewing options available to me (I always opt for the FREE route) and the program begins immediately.

GARMIN

Something that has long been on my bucket list has been driving across America from coast-to-coast and seeing those things I’ve only seen by flying over them. Places like Mount Rushmore, Yellowstone, the Grand Canyon etc. Lucky for me, that’s been on Sue’s bucket list too.

We put up a big map of the United States in our kitchen and have lined out the route we plan to take with bright yellow dots marking our planned stops along the way.

In preparation for this 8,000-mile, eight-week trip, I bought the latest GARMIN SmartDrive 61 GPS. It comes with the ability to do “Voice Commands” for plotting your next destination, finding hotels, restaurants and points of interest.

Thanks to Alexa and Siri, I quickly embraced this feature.

But it doesn’t stop there, my new GPS also links to my smartphone and displays news bulletins, real-time traffic, weather conditions, my complete contact phone book, helps me to find parking and then remembers where I parked when I want to return to my car. And it makes it all easily accessible by just using my voice.

But You’re a Radio Guy

Whenever I write something about new technology, what I hear back are things like, “You’re a radio guy” or “you love technology.” The meaning being, I’m not like your average consumer. But, I believe that just as Amazon has changed the way we shop for just about everything, Alexa will bring about a similar change in the way we interface with our devices.

Carnegie’s Constant Reminder

One of the many radio publications I would read daily was Jim & Cathy Carnegie’s Radio Business Reports (RBR). If there was one thing I remember most about that publication under Jim’s reign, it was about dealing with change. Jim constantly banged the drum warning the radio industry “to get with it or be left behind by it.”

He reflected change by taking his own publication and changing the way it would be delivered and cover the broadcasting industry. He led by example.

Seniors & VADs

I know the young person’s perception are that senior citizens (anyone with an AARP card) is stuck in their ways and not likely to adopt anything new. Well, I’m here to tell you, you would be wrong. Especially, when it comes to voice activated devices (VADs).

I fully anticipate that seniors, aka Boomers, will lead the adoption of these devices. One of the reasons being they enable us to eliminate the multitude of buttons and collection of remote controls by simply using our voices.

What I Learned About Seniors from a Pharmacist’s Son

Back when I was put in charge of a thousand-watt, daytime, Music of Your Life radio station, I remember going out and meeting with clients to build up my new radio station’s client base.

One day, I walked into a pharmacy thinking that my “old folks format” would be perfect for people needing medication. Well, I never got the pharmacy on-the-air for drug announcements.

Upstairs above the pharmacy, the youngest member of the family had started an electronics division, selling the latest computers, phones, and other gadgets. He told me he’d love to be a big advertiser on my radio station catering to the over 65 age group.

Why?

Because, he told me, unlike young people who when something new came out, would look at it and say, “I’m going to wait until they come out with the new and improved version,” seniors would buy it on the spot.

What he learned was, seniors felt they could afford to have the latest technology now, and if something better came out, they’d trade up to that next. And this was almost 40-years ago!

Now, with my AARP card occupying a place in my wallet for more than decade, I can tell you, that’s exactly how I feel.

Get on board the change train

OR

Get left behind

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FM Chip, Data Usage & Streaming

121Apple recently introduced the iPhone 8, iPhone 8 Plus & iPhone X (it’s 10th anniversary iPhone). Each of these new iPhones have an FM chip in them, I’ve read, that if turned on, could receive OTA FM radio signals, but these chips are not activated.

I’m not an engineer, but I suspect there’s more to making an iPhone receive FM radio than just turning on a software switch. I will let those more knowledgeable about these things weigh in on this aspect.

Streaming Audio & Data Usage

One of the reasons broadcasters cite for having FM chips activated in smartphones is that it uses less battery power and doesn’t consume your data plan like streaming does.

And the other reason is that FM radio stays on-the-air when cell towers go down in a storm, like Hurricanes Irma or Harvey.

NextRadio says it’s seen a big percentage jump in usage to their App in Florida during Irma by allowing a smartphone equipped with an FM chip to listen to over-the-air FM radio broadcasts.

Verizon’s Smallest Data Plan

I’m a Verizon customer. Have been for a long time. I was on their unlimited data plan until a Verizon rep said my data consumption was not even half of Verizon’s smallest data plan and that I could cut my monthly phone bill in half by getting off that plan. So, I did.

This past Memorial Day weekend I streamed Allan Sniffen’s WABC Rewound while driving from Massachusetts back to Virginia. I consumed almost all of my 1GB plan due to this. I called Verizon about what I could do and was told they would switch me to their new small data plan at no charge. It’s now 2GB, plus any unused data rolls over.

I have something like 4+GB now and it grows because most of my music streaming is done when I’m connected on WiFi and not over-the-air.

I expect that this will be expanded again by Verizon due to competition from other wireless carriers.

T-Mobile Unlimited Music Streaming

Back in July 2016, I wrote a blog article titled “SiriusXM Radio is Now Free.” That article still sees lots of traffic from people searching for this service. I think they thought I wrote that it was now free, but the nature of the article mused what if they made some of their music channels free and then sold commercials in those nationwide free music channels. It’s actually something that’s been kicked around by America’s only satellite broadcaster.

But in 2014, T-Mobile introduced “Music Freedom.” T-Mobile wrote, “With Music Freedom, T-Mobile Simple Choice customers can stream all the music they want – without ever touching their high-speed data – at no extra charge.”

Then in 2016, T-Mobile expanded this to more than 100 music and video services. T-Mobile CEO and president John Legere vlogged: “Music Freedom and Binge On have radically changed the way T-Mobile customers watch video and listen to music.”

T-Mobile & Sprint Merger

CNBC says that T-Mobile and Sprint are in active merger talks. If they do become one, they would become America’s second largest wireless carrier. Can you see how both Music Freedom and Binge On would provide a very competitive stance to AT&T and Verizon?

Radio’s Streaming Effort May Be Screwed

Then Mark Ramsey published part one of a two-part blog post titled “Radio’s Streaming Effort May Be Screwed – Part 1” and showed Triton streaming activity for broadcasters and pureplays year-over-year. It’s not pretty. Pureplays up 16.2% and broadcasters down 1.6%.

Radio is not getting more important in the streaming world.

I believe it’s because, like most people, I listen to OTA radio using a device designed for listening to this service, a car or home radio set.

When I stream, I go to things I can’t get over-the-air, like Smooth Jazz music.

I put two new Smooth Jazz radio stations on the air in my radio career. Both of them are gone, as is the format in most radio markets in America today. Streaming is about the only way to listen to this genre of music.

Streaming Audio & NetFlix

Streaming audio teaches people to expect a different listening experience as Netflix taught people to expect a different viewing experience. Like getting an entire season of a show (House of Cards, for example) released on the same day and not dribbled out one episode per week, like broadcast TV.

Dave Van Dyke’s Bridge Ratings just showed how broadcast radio is being impacted by streaming: “New behavior by on-demand streaming listeners has accelerated time-spent-listening attrition because radio has not been able to accommodate the volume of songs released by popular artists.”

Broadcast radio can now sympathize with broadcast television with the way new product is released to the listening/viewing audience.

JJJRH

In my broadcast capstone class, one of the books my students read was by Gary Vaynerchuk called “Jab, Jab, Jab, Right Hook: How to Tell Your Story in a Noisy Social World.”

Gary skillfully shows how you can’t take your message and just paste it across all the various forms of social media. That each platform is like a different radio format. Your message to be effective and cut through needs to be molded to fit the social medium. Facebook is different than LinkedIn that’s different from Twitter, that’s different from Pinterest et al.

I believe it’s the same with taking your radio station’s over-the-air signal and simply streaming it (with a few exceptions, like a 1010 WINS or WTOP).

When your offering can be as easily received, as every other audio offering from anywhere in the world, yours will need to be either the very best, very niched or one-of-a-kind.

 

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I Cut the Cord

113I finally did it. I cut the cable cord in July 2017. It had been something that I had been thinking about for well over a year now.

Each time my local cable company was gobbled up by a larger cable company nothing really changed except that my bill went up. And up. And UP.

How Many Channels Do I Really Watch

I did an analysis of my TV viewing habits and found that most of my TV habit revolved around LIVE news programs, YouTube, HBO, Showtime and Netflix.

I can spend a whole evening sometimes just going through the viewing options on Netflix and call it a night without ever watching a single program sometimes. (I know if you have this service you’ve probably done it too.)

When I looked at the number of shows I was watching on HBO and Showtime, it came down to about one program per service each. So, I’m temporarily going without either of them for the time being. But I also know that if I access these services via OTT (Over The Top) TV, I can get full access to their library vs. only selected access via a cable bundle’s On Demand offering.

LIVE TV

The thing that had me staying connected to the cable bundle was access to LIVE TV, especially the news channels like CNN, MSNBC and FOX.

I also am a weather geek and so The Weather Channel often would be on my TV screen while I played the radio. My new set-up doesn’t access the live meteorologists on TWC but I have the TWC App on my iPhone7 and so I really have access to all the weather information I need at the touch of my screen.

SLING TV

My dilemma to accessing LIVE TV for news programming was solved when I learned about SLING TV. SLING offers CNN, MSNBC and FOX 24/7 LIVE. I bought the SLING BLUE package for $25/month. No contract to sign and I can terminate the service (though I serious doubt that will happen) at any time. I also added the news option to SLING BLUE for $5/month. My total TV package is now $30/month.

SLING TV now controls the lion’s share of subscribers according to comScore with more than 2 million users as of June 2017.

APPLE TV

I access SLING through a 4th generation AppleTV. AppleTV offers quite a few other options for news and entertainment viewing. One being CBSN, the new CBS 24/7 news channel that reminds me of the old Headline News.

AMAZON PRIME

My fiancé had Amazon Prime when I moved in with her in Virginia but was not taking advantage of her access to Amazon TV that comes with a prime membership. AppleTV doesn’t have a way to access Amazon TV (I don’t know why this is) but Amazon TV can be accessed on any Apple computer, iPhone, or iPad. So, I downloaded it to our iPad and now stream it to our large screen HDTV with excellent quality for both picture and sound.

USA OTT Viewing Time

In a report released by comScore the research company reports that SLING, AT&T’s DirecTV NOW and Sony’s PlayStation Vue garner around 3.1 million viewers. Those same services now command 54.6% of OTT usage.

Impact on Radio

Does any of this have an impact on radio? Well it just might when you consider what Amazon just introduced in June 2017, the Amazon Echo Show.

While the radio industry was just beginning to wrap its head around the Amazon Echo, Google Home, Apple HomePod and Microsoft/Samsung’s Cortana Voice Activated Devices (VADs), along comes the Echo Show with a touch screen. “In addition to its usual Alexa powers, the Echo Show is a phone, TV, karaoke machine, and digital photo frame. The screen stays on even when you’re not using it,” writes CNN tech.

The world of communications technology is changing at breakneck speed.

It’s a “Winner Takes it ALL” game.

“Just when I think I have learned the way to live,

life changes.”

-Hugh Prather

P.S. on Monday, August 7th, a great new book “Fired Up! SELLING” will be released. If you’re in sales or just a lover of inspiring quotes like me, this little book is a MUST HAVE for your library. 268 people are quoted in this book.

Full disclosure, I was one of the quote judges that worked on putting together this book. It was a labor of love and working on it made for a very inspiring year that truly fired me up.

Here’s a link to the book on Amazon: https://www.amazon.com/Fired-Up-Selling-TM-Energize/dp/1885167830/ref=sr_1_1?ie=UTF8&qid=1501771980&sr=8-1&keywords=fired+up+selling+quotes

 

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SiriusXM Radio is Now Free

43

What would you do if you woke up one morning and saw this as the headline in all the radio trades? Have you ever considered the possibility of this happening? Well lots of people woke recently to this headline “Angie’s List is now free: What this means for your business.”

Call it a subscription, a membership fee or a paywall, what happens when they are eliminated? In Angie’s List’s case, less than one percent of Americans were members at the $40/month fee that had been in place. Paying that fee let people see the reviews of other members that had experienced certain businesses or services they had used. Now everyone can see those reviews. Angie’s List had developed a reputation for its members writing rather substantial reviews as well as being a website that is strong, trusted and contains valuable content.

Why Did Angie’s List Tear Down Their Paywall?

Angie’s list is a publicly traded company. Their stock is down seventy-five percent from three years ago. Management is under pressure. Tearing down their paywall means increased page views. When page views go up, revenue goes up. See the strategy?

Could SiriusXM Follow Suit?

Satellite radio currently captures about ten percent of radio listening and mostly in vehicles. The new digital dashboard entertainment centers will be a gateway to Pandora, Spotify, Apple, YouTube and more. Having an XM button on my Honda Accord, I know that my access can be selectively turned on or off by SiriusXM. When they do one of their free listen promotions, they don’t turn on all the channels, just the ones they think will hook me to listen. So, I would imagine, they could create a group of channels that could be on all the time and carry a limited commercial inventory attractive to national advertisers. Like the most popular musical venues, such as adult contemporary. Even if they only turned on the top five music formats, it would mean drivers could listen to them wherever they drove across America, plus SiriusXM would have the ability to pop in promos for their other channels that remained behind a paywall. It’s almost too scary to consider the possibility.

Teens Love Streaming

Teens love streaming audio and their smartphones. According to the Music Business Association and their data partner LOOP, teens spent 51% of their listening time on a typical day streaming their music versus only 12% of their time with AM/FM radio. This is a media usage habit being formed in the next generation. It not only affects traditional AM/FM broadcasters but satellite radio as well. This is a problem that needs to be addressed.

NextRadio App

Thanks to Jeff Smulyan and Emmis, the NextRadio App is the way FM broadcasters can get their audio into those smartphones, without running up a user’s data plan. However, Sprint has already removed many audio streaming services from running up their data plans by letting their customers listen as much as they want at no extra charge. Since teens avoid paying any fees whenever possible, free is always an attraction.

Less Than 1% of World Pays For Streaming Audio

AM/FM radio has been built on free. That’s an advantage that too often gets taken for granted. According to Nielsen 61% of people find out about new music via their AM/FM/satellite radio.

Price is the number one reason more people don’t pay for streaming audio. Out of a worldwide population of over seven billion people, about forty-one million buy some form of audio streaming; 0.58% of the world’s population. That percentage turns out to be lower than the total number of people who have a Netflix subscription around the planet.

23,870 AM/FM Radio Signals On-The-Air

The FCC just published their latest numbers for broadcast stations as of June 30, 2016. We are approaching 24,000 signals for radio in America. 19,194 of those signals are FM and 4,676 are AM. Plus we have two satellite radio signals, Sirius & XM, which are now under a single owner.

Pay & Free

It doesn’t take a whole lot of imagination to see satellite radio one day deciding to have the best of both worlds. Offer premium pay channels to those willing to pay for them and at the same time create a free tier of channels that could be ad supported by national advertisers.

What history shows us are things that happen in other industries and services eventually make their way around to virtually all of them. It’s only a matter of time.

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History’s Technology Rhyme

Transistor Radio, Car Radio and Rock & Roll

Transistor Radio, Cars & Rock ‘n Roll

I’ve written before how history never repeats itself, but usually rhymes. So when I was reading an article in the NY Times about “Tech’s ‘Frightful 5’ Will Dominate Digital Life for Foreseeable Future” it hit me. Here was how history was rhyming when it came to communications. Fasten your seat-belt, this will get bumpy.

What this article’s author Farhad Manjoo wrote was how Amazon, Apple, Facebook, Google and Microsoft (others include Netflix in this mix) came along at a perfect time to roll up their user base. They were in the right place, at the right time in other words.

Geoffrey G. Parker, a business professor at Tulane University has co-authored a book called “Platform Revolution” where he explains how these tech companies were able to ride the perfect wave of technology change – that being a decrease in the cost of IT, an increase in connectivity and the introduction/fast adoption of mobile phones.

And when it comes to advertising, these companies are in the right place to leverage digital marketing and enjoy most of the benefits of this growth area as well. In fact, since there is a sense that these major digital companies will receive most of the online advertising monies, traditional media – like radio & TV – could see advertising monies return to them.  Let’s hope that happens.

So, where’s the rhyme in this story? Well consider this other time in communications history when television burst onto the scene after the end of World War Two in the 1950s. Radio, a lot of people thought, would cease to exist. Radio’s stars, programs and advertisers, to a large measure, jumped into television. Radio had to find a new act.

Radio was in the right place, at the right time for the birth of three things when TV came along; the transistor radio and the car radio. Both of these technology advancements would be the savior of radio along with one other important development; rock ‘n roll.

Radio was in the perfect place to ride the baby boomer youth wave of rock music, cars and transistor radios. Television grew in large measure by scarcity, only two or three television networks and few TV stations.

When broadband came along, that scarcity factor went poof. Radio now sees its dominance in the car being challenged by a digital dashboard.

The newest radio format to have come into existence – all sports/talk – is now 29 years old. Clearly, innovation in the radio world has stalled.

The good news is radio in America has more reach than any other form of mass media. The bad news is it sees annual erosion of its TSL (time spent listening). This can be fixed. To do this, radio needs to address the very factors that are causing its TSL to erode.

The thing most often heard from consumers about what they dislike about radio are its commercials. Yet, commercials don’t have to be a tune-out factor. No one tunes out the Super Bowl when it’s a blowout because they want to see what other clever commercials might still be coming on their television.

Most radio stations long ago did away with their copywriters. These masters of the spoken word who can craft a story about businesses need to be enticed back into the radio business at every radio station.

The number of commercials in a break needs to be reassessed by the radio industry as well. You can’t kill the goose that lays your gold revenue egg and expect it to continue to lay you golden eggs.

Bring back personalities. They not only sell the music (the record companies need you!); they sell your station and through live reads, your advertisers’ products and services.

Those who remember Paul Harvey News & Commentary will tell you that page two (his first live read commercial) was always something you turned up the radio for. I remember reading Paul Harvey brought in more money for the ABC Radio Network than everything else they did. And everyone loved Paul Harvey’s commercials and bought the products he talked about.

I think retired CBS Radio President Dan Mason said it best when he said this about radio:

“Without community and companionship, we have nothing.”

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Evolve or Lose Relevance

23In two months, the world’s largest radio meeting will once again be taking place in Las Vegas; the 2016 NAB Show. Ironically, since leaving the radio industry and entering academia at Western Kentucky University, I attended my very first NAB show in 2011 and have every year since. So as visions of massive crowds and very sore feet dance in my head, I thought I’d look back over those past years and see how the theme of these meetings has evolved.

In 2011, the NAB highlighted that media consumption had become more digital and connected. TV everywhere strategies, mobile TV, the connected TV and the use of social media dominated the show.

In 2012, everyone was shouting about 4K video, ISP content delivery and the evolution of special effects technology. Everywhere you went you were shown 3DTV (I didn’t care for it, personally.)

In 2013, the NAB show hosted its first ever 2nd screen Sunday and the impact of more than one screen (the television set) vying for the viewer’s attention was fully recognized if not totally embraced by broadcasters.

In 2014, the NAB show wasn’t so much memorable for what it had but for what it didn’t have 3DTV. What had once been prolific throughout all the convention halls was now nowhere to be seen. 4K video & TV was now all the rage with Japan’s NHK demonstrating 8K video & TV. NHK said they will be recording the Rio Olympics in 8K and plans to televise (in Japan only) the 2020 Olympics in 8K. When you see TV pictures this detailed, you can instantly see why 3DTV bit the dust. 4K and 8K feels three dimensional and you don’t need any funky glasses.

Which brings me up to last year’s NAB show in 2015 where the theme was “Evolve or Lose Relevance” voiced by NAB President/CEO Gordon Smith. Smith urged broadcasters to embrace the new technologies like ASTC 3.0 & 4K for TV, and NextRadio’s mobile app for FM radio on mobile devices. Smith also talked about the spectrum auction which begins in March 2016 and characterized the auction as both “exciting and daunting.”

What may have been most daunting and certainly not exciting was to have been an AM broadcaster at this meeting – or any of the meetings of the last five years. Move along guys and gals, there’s nothing for you to see here. HDRadio was there every year and I think they had more cars outside of their convention hall than any previous year featuring their spiffy HDRadios, a technology that has been better embraced by the automakers than radio broadcasters for the most part. And of course, there were drones. Lots & lots & lots & lots of drones. Big drones, little drones…a drone for every size and budget. I’m wondering if the FAA will start coming to these meetings along with their friends from the FCC.

The only thing I haven’t seen addressed over these past five years is what seems to me to be the elephant in the room. Everything is supported on a business model that has been around since commercial broadcasting began in 1920, that being the selling of advertising. The covenant with the consumer of radio/TV programs was we will give you the programming for free if you allow us to expose you to our advertisers; a business model that worked extremely well through the birth of the Internet and dial-up connections. It would be the introduction of broadband and its rapid expansion that would challenge everything.

Blockbuster vs. Netflix is a good example. 2004 Blockbuster has 9,000 stores and almost $6 billion in revenue and only 4.4% of American homes had broadband. Netflix was mailing DVDs to its customers. 2010 Blockbuster files for bankruptcy, 68% of American homes have broadband and Netflix had been streaming to their customers for three years. Today Netflix has a market cap of almost $33 billion.

That really brings home the concept of “evolve or lose relevance” doesn’t it?

So what will the business model for media be evolving to? That’s the billion dollar question. Nobody knows. But what we do know is that Apple gave up its free iTunes music streaming at the end of January 2016 and now will only offer a paid subscription model. Disney’s ESPN is suffering the “agony of defeat” as more consumers cut their cable bundle (for which it’s reported that ESPN gets $7 per sub) and is causing this revenue stream to dry up while the cost of bidding for live sports events continues to escalate. Everything appears to be moving in a direction of asking the consumer to pay for what they want – like they do for HBO, Showtime, and Netflix etc.

So what’s the plan Stan for broadcast radio and TV? Or for any advertising supported medium for that matter? I think about this a lot.

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