Tag Archives: Spotify

Bring Back the Radio Hackers

We never called them that back in the early days of radio’s reinvention period after the birth of television in the 1950s, but that’s what they were.

Radio from the beginning basically was a medium that killed Vaudeville. Radio enticed the performers of Vaudeville to bring their acts to this new mass medium. The sales pitch went something like this: you won’t have to travel every day of the year, sleep on trains and eat your meals on the run. When you move your act to radio, you will be able to go home every night to your family and have a “normal” life. And you’ll make more money!

Not all performers would make this transition. The downside to moving their act to radio was that no longer could they have one act that they could perform night after night. On the radio, they needed a new act every performance. That’s a BIG CHANGE.

When television came along, the successful radio acts moved to TV and radio needed a new idea.

Enter the Hackers

 Alan Freed would hack the term Rock ‘N’ Roll and become the first famous disc jockey introducing a new venue for radio.

Todd Storz and Gordon McLendon aka “the Maverick of Radio” would hack the idea of Top 40 radio introducing a tighter playlist and higher repetition of the biggest hits. After observing teenagers playing the same songs over and over in a juke box.

Better Practices

 Today’s world is infested with the concept of “Best Practices.” It can be a stifling thing when it comes to creativity.

Today’s radio was born out of hackers that were constantly thinking up “Better Practices.” Ron Jacobs and Bill Drake certainly did at Boss Radio in Los Angeles with 93 KHJ. John Rook did it in Chicago with both WLS and WCFL. Rick Sklar did it in New York at Music Radio 77 WABC. Plus there were so many others in all size markets. Radio was different everywhere you listened because it was being hacked in so many wonderful ways. It was exciting to turn on your radio and hear what was going to come out next.

Insanity

 The definition of insanity is doing the same thing and expecting a different result. We have a lot of that kind of stinking thinking today and I’m sure you’ve heard all the reasons for why this is the path some of our biggest broadcasters are taking. As the radio business grew from a mom and pop business to the behemoths of today a ritual of “Best Practices” replaced hacking.

Today’s Economy is a Hacker Economy

 We live in a world where it seems everything has been turned upside down by the World Wide Web, the Internet and mobile Apps. The power is shifting from the big to the nimble; the hackers. Learn to hack or be attacked by those that hack.

Radio is not exempt from this shift. And it doesn’t have to lose.

Radio has what everyone else would love to own, a mass audience. Radio today is delivering the largest mass audience of all the mediums.

It’s why every entity trying to play in the audio medium calls itself “radio.” Pandora Radio, Spotify Radio, TuneIn Radio, RadioTunes, Beats 1 Radio etc. What radio folks have that these folks don’t have is a broadcast signal that is ubiquitous and a listening habit that has been cultivated over many years.

However, what those pure plays have that radio is missing are hackers.

Radio needs to stimulate agility, creativity and take risks.

Stop thinking about where you want to be in 5 years and start thinking about what problems you want to solve most right now. The winners will be those most able to adapt.

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The Limitations of a Spreadsheet

This is probably going to make me sound ancient, but I remember doing my radio station budget with a calculator, a #2 pencil and a Big Pink eraser. I wasn’t alone; everyone did their budgets this way once upon a time.

In those early days of computers entering the radio station, the first department I remember computerizing was the traffic department. Oh, I so remember our doing that transition.

We were going into our first holiday weekend, that time when traffic needs to prepare five traffic logs for each radio station to get through a three-day weekend. What was supposed to make us fast and efficient saw us spending time going into Saturday to get the logs done. I remember the look on my traffic director’s face. It was one of those “are you going to make me do this again” kinds of looks. (I did)

Computers weren’t really all that fast in those early days, but the promise was clearly there that this would be a better way over time.

Seeing budget time coming up, I said to my business manager, let’s take a course at the local community college in Excel and do our budget this year on a computer. She loved the idea and the two of us went back to school to learn how to use Excel spreadsheets.

We cranked out our first budget and it was amazing. It was clean, easily read and best of all it showed that we were going to have a great year for the company.

Everything was great, until my boss, one of the two owners of the group showed up to review my budget. He was NOT impressed that we had computerized the process. He basically said I don’t care how it looks or what it says, but is it right. He then proceeded to take a calculator out of his pocket and crunch the numbers. Very quickly he found all kinds of errors.

Color me embarrassed.

The bad news was we hadn’t mastered the Excel spreadsheet in our first attempt doing our station budget on this computer program. The good news was we were able to fix all the problems and hand my boss a revised budget for him to take back on the plane to the home office.

The following year, the home office announced that all radio stations in the group were to do their station budget on Excel.

Spreadsheet programs, as it turns out, can allow us to manage a lot of numbers and monitor what’s going on in our businesses. They are invaluable, but not omniscient.

Results can’t be engineered. Just simply knowing the inputs doesn’t allow one to always accurately predict the outputs.

It was Benoit Mandelbrot who first said that economic analysts were too dependent on “Joseph effects” which means things happen in a continuous and predictable model and turning a blind eye to “Noah effects” which creates chaos and completely destroys those same models.

Another way of saying it is that when something doesn’t fit your nice little model, just ignore it. That’s never been a solid plan. It’s why people don’t often see stock market crashes coming or innovations like the iPhone, the Internet and WiFi, but these things always happen and when they do they steer the course of history.

Remember the financial crisis of 2008? Mandelbrot understood how things like this happened. (Noah effects)

In the world of radio today, we have BEATS 1, Pandora, Spotify and others. Over-the-air broadcasters did not see these “Noah effects” on their data driven and ROI focused spreadsheets. They were living in “Joseph world.”

In his new book “Team of Teams” General Stanley McChrystal tells the story of when he took over Special Forces in Iraq. Specials Forces was winning every battle but America was losing the war. McChrystal learned that the problem wasn’t that his teams weren’t doing their jobs right but that they weren’t doing the right jobs.

McChrystal says “In complex environments, resilience often spells success, while even the most brilliantly engineered fixed solutions are often insufficient or counterproductive.” For many radio companies the problem isn’t that they’re not performing to plan, but that the plan itself is flawed. It often is based on assumptions that don’t hold true in every radio market the company operates in.

The answer to this problem is to hire great leaders and let them lead.

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More is Less

In 1994, Dan O’Day was holding one of his famous “PD Grad Schools” in Dallas, Texas. One of the speakers he invited that day – and whose presentation was recorded by “Radio’s Best Friend” Art Vuolo – was a young Randy Michaels. Dan O’Day still sells this video, now on DVD, and labels it “The best radio video ever.” I would agree.

The video is titled “Positioning Your Radio Station by Randy Michaels.”  It addresses the explosion of new FM radio stations after the first round of radio deregulation brought us Docket 80-90. Then the LMA (Local Marketing Agreement) was born. Randy tells the audience:

“This was a fundamental change for the radio business. Just as TV was a fundamental change, duopoly fundamentally changed the radio business. This moved the radio business from being a franchise to being a commodity. McDonalds was once a franchise. Today burger fast-food restaurants are a commodity and we all know how that’s working for the ‘Golden Arches.’”

On May 24, 2004 the Federal Communications Commission (FCC) held a “Broadcast Localism Hearing” in Rapid City, South Dakota. The president, general manager and co-owner of KLQP-FM licensed to Madison, Minnesota (population 1, 767) Maynard Meyer addressed the commission. He told them (I’ve edited his comments. The full text can be found here.):

“Localism in radio is not dead, but it is in dire need of resuscitation in many areas. I have been involved in the radio business in announcing, sales, engineering and management for about 36 years, all of my experience is in communities of 5,000 people or less. We personally live in the communities we serve so we know the ‘issues,’ we work to address them in our programming and have been doing so for the past 21 years. “

“A few years ago, many stations operated this way, but much of that has changed for a variety of reasons. I think the beginning of the end of local broadcast service started in the 1980s when the Federal Communications Commission approved Docket 80-90.”

Mr. Meyer went on to explain to the FCC how many communities that “on paper” had a local radio station actually found that the transmitter was being fed from another location tens of miles away. Mr. Meyer went on to say:

“I don’t think this is the best way to promote local radio service. From what I have seen through my personal experience, as soon as a hometown studio is closed and relocated, the local service is relocated as well.”

Now put another decade plus on the calendar and we find that the FCC has decided that adding even more FM radio stations would fix this problem of local radio service that operates in the public “interest, convenience and/or necessity” by issuing FM licenses for FM translators and Low Power FM radio stations.

The most recent BROADCAST STATION TOTALS AS OF MARCH 31, 2015 issued by the FCC shows that there are 4,702 AM commercial radio stations, 6,659 FM commercial radio stations and 4,081 FM educational radio stations on the air. But wait; there are also 6,312 FM translators & boosters on the air; plus, another 1,029 Low Power FM radio stations. That’s 22,873 radio stations! And they now compete with SiriusXM satellite radio and streaming audio from Pandora, Spotify, Radio Tunes etc.

If Randy was thinking back in 1994 “being a media company today is a really tough business” he was seeing just the tip of the broadcast iceberg.

Randy’s prescription that day in Dallas was as prescient then as it is today; maybe even more so. He told the audience of program directors:

“In a crowded media environment radio needs to super-serve its local community. Be everywhere, all the time. Miss a day, miss a lot. Radio’s BEST when it’s personal.”

“What’s your station’s impact rating? Great radio stations are listener-focused.”

“If you’re smart enough to win in today’s radio, you’re smart enough to have done something legitimate with your life. This is work. This is a real job. It’s the merger of art and science and you’ve got to have both.”

I’m encouraged by my students who have big ideas about the future of radio and a desire to serve the communities they will be moving to and living in. I’m encouraged by some great radio broadcasters getting back into the business who are bringing back the fundamentals of great radio while extending that sense of purpose to the digital component that must be a part of today’s media company.

The pendulum is swinging back and it can’t get back here soon enough.

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Radio’s Challenge

David Goldberg pa1ssed away on Friday, May 1st at the age of 47; too soon to be sure. He was an Internet radio pioneer having created LAUNCHcast in 1999 which evolved into Yahoo! Music Radio. Until his passing he was CEO of SurveyMonkey and he was married to the Chief Operating Officer of Facebook. He was very savy about our Internet connected world.

Brad Hill in RAIN wrote that in 2005, Goldberg was the RAIN keynote speaker. To put his words into perspective, you should know he spoke just before the iPhone was first launched. For it was the iPhone that really launched what we now refer to as the smartphone and mobile music revolutions, that would provide Pandora with its launchpad. Hill wrote that Goldberg said:

“We hope that 10 years from now almost no one is accessing Yahoo services on a PC. It needs to be in my living room, in my car, on my cellphone. This will affect the change in replacing the CD, as well as moving music off of broadcast radio which is also what we believe will happen.”

Fast-forward to Pandora’s latest earnings call and Hill reports that Pandora execs said:

“We really want to replace broadcast radio for music discovery. We believe music will migrate off of terrestrial radio to the services we are offering because we can deliver the music consumers want, when they want it, where they want it. CDs will be replaced by on-demand subscription services. ‘Personalization’ and ‘community’ features will be key ways we’ll be able to deliver the right music to people at the right time, on devices, on a global basis.”

And Pandora is not alone in this quest. Spotify recently reported a market cap more than twice that of Pandora’s in the neighborhood of $8 billion to pursue their quest of being the world’s music provider. (Contrast that to America’s largest radio group iHeartMedia $20+ billion in debt.)

The world is also watching Apple. It made a $3 billion acquisition of Beats and is working on its iTunes streaming audio product. More about Apple in a moment.

Then Fred Jacobs authors a column talking about “Moodstates.” Jacobs’ latest Techsurvey continues to find how much emotion plays a role in broadcast radio listening. Jacobs writes:

“While consumers enjoy hearing their favorite songs, personalities, and information, mood plays a role why they continue to come back to AM/FM radio stations. In our research, it is often in the form of companionship, mood elevation, and escape.”

I’m a big fan of Rewound Radio and their weekly Saturday feature “The DJ Hall of Fame.” What I’ve personally found is that I’m not so enamored with just listening to old tapes of radio broadcasts from the 60s & 70s – I can hear this music anywhere, including my own CD library – but hearing the air personalities that provided me with hours of companionship, mood elevation and escape. And I’m not alone in feeling this way. I’m a member of a couple of DJ groups on Facebook and we all experience these same emotions.

This fact evidently hasn’t been lost on Apple. Apple has been raiding the talent at the BBC. Zane Lowe was their first hire. Lowe is known as a trend-spotter. He’s also a presenter (they don’t call them disc jockey’s in jolly old England) that builds a strong rapport with his listeners. At least three more folks from this BBC talent tank have announced they are joining Lowe at Apple.

Unlike Pandora or Spotify, it appears that Apple plans to put the personality into their streaming. Could Apple be the first to do for today’s generation what Dan Ingram, The Real Don Steele, John Records Landecker, Bob Dearborn, Ron Lundy etc did for my generation? Put the personality front and center in music presentation?

Horizon Media undertook a comprehensive study on the impact mood plays in effective audio advertising. As the results of what they’ve learned are implemented, the placement of those advertising dollars under Horizon’s control will be affected.

Back to Goldberg’s 2005 RAIN Keynote, he predicted that over-the-air radio would be reduced to a mostly-talk medium.

            “We don’t believe music will continue to be broadcast on analog radio,” Goldberg said.

A survey that I conducted with the 300 radio stations in Kentucky showed that local radio stations planned to take their talk programming more locally originated and less national syndicated talk. It also showed that no local music research was being done, but that national charts were being relied upon along with consultants and music programming service providers.

All of this comes at a time when the CEO’s of public radio companies report they’re facing strong headwinds on their advertising revenues. Radio is being attacked from all angles.

Not since the introduction of television back in the 50s has the radio industry faced such a big challenge. We are living in revolutionary times in the communications industry.

Commercial radio is 95 years old. When television presented its challenge it was only in its 40s. Still a young medium with lots of new blood entering its doors with a vision for a new kind of radio.

Boss Radio was born on 930AM-KHJ in Los Angeles and News Radio was born on 1010AM-WINS in New York City both in 1965. But even the new radio formats that were born in that era are now 50 years old.

I challenge my broadcast students to create the radio that will be meaningful for them and their generation. But for those students to have that chance, the owners of radio stations will need to open their doors and let them innovate.

Will radio pick up the challenge?

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Who’s in Their Ear?

When radio was first introduced, to listen to it, you needed to wear headphones. Radio was one-to-one and very intimate. As the technology evolved the radio speaker would change the medium from one-to-one to group listening. Radios were expensive. If you owned a radio you shared it. A family would gather around the radio and listen together. Families would transfer this together media habit to TV and the transistor radio would become the refuge of teenagers who wanted to go in a different direction.

Zenith Transister Radio

My first radio was a Zenith transistor with a little ear piece for one ear. I would go to bed and turn it on under the covers and listen to “the world.” It was all AM radio and after sunset, the DX’ing of the nighttime skywave would always bring a new radio station into my ear to savor.

In the mid-70s the Boombox would be introduced to America and these radios grew both in size and the amount of bass they 1could produce. By the 80s they could be as big as a suitcase and carrying them around on your shoulder was a status symbol.

Go to a beach resort, and whether you were walking the boardwalk or on the beach, radios were blasting music from every direction.

When Y2K didn’t impact our fully computerized radio stations, we all breathed a short-lived sigh of relief because it was quickly followed by a new threat; the iPod and ear buds. Once again listening to music became a very personal activity.

The ear buds would transfer to the iPhone and iPad. The introduction of the iPhone6 may have killed the iPod, but not the use of headphones or ear buds to listen to your audio.

So what exactly are all those people listening to? lady listening with ear buds

The latest research from Edison Research says American Teens are spending more time with streaming audio services from places like Pandora and Spotify, than they are listening to either streaming AM/FM radio or over-the-air radio. Edison reports this finding in their fall 2014 “Share of Ear” report.

Remember it was my generation that grew up hooked on radio & TV that were credited with eroding newspaper readership. (Full disclosure: I read all my news online using my computer, iPad or iPhone.)

It’s not all bad news for AM/FM radio. It is still popular Edison tells us “by a significant margin among all other age groups.” So where did the teens go? Pureplay Internet streamers. What do they love most? The ability to skip a song they don’t like.

That’s really not hard to understand. I love my DVR for a similar reason. Especially when it comes to award shows. I never watch them live anymore. I record them for later viewing and I can watch a 3+ hour awards show in about 20 minutes time. I skip all the bad parts.

In fact, I rarely watch anything on TV live anymore. Everything is recorded so I can control it. So is it any surprise that teenagers once they are given this kind of control will ever want to give it up. A new habit is being formed.

The other aspect about pureplays that AM/FM radio could be addressing is their complete focus on the quality of their streaming product. What I’m hearing is a clean commercial insertion. Nothing gets cut off in the middle or repeated multiple times in the same long break. Pureplays deliver their commercial messages in a style that compliments the music programming; in a way that actually has you enjoying listening to the commercial message.

The teenagers have moved their listening to streaming and podcasts. The spectrum auction being held by the Federal Communications Commission is all about creating more wireless connections for all kinds of mobile devices.

I live in South Central Kentucky. I can stream my iPhone into my car’s seven speaker sound system through Bluetooth and everywhere I drive it’s clean and clear with no dropout or buffering. It’s scary good. It’s as easy to do as turning on my car’s audio system. Nothing to plug in or connect. It happens automatically.

South Central Kentucky is also blessed with some excellent over-the-air radio stations. So they very effectively compete, in my opinion, with streaming. But I wasn’t raised on streaming. I also like a good air personality.

The next generation is being raised on streaming that they have some power over to skip things they don’t wish to hear. Reminds me of the old saying “How are you going to get the kids back on the farm, after they’ve seen New York?”

baby listening to ear buds

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