Tag Archives: Zane Lowe

Colleges That Give-up Their FCC License

fcc-logoI recently wrote an article for Radio World about the impact of colleges that sold their student radio station’s FCC license had on the pedagogical program at those institutions. You can read that article in Radio World here.

 

 

Today, I’d like to share with you something else I learned in talking with educators from around the country while researching this article. The FM license in every case connected the student station to the community. It was the heart and soul of the operation. When the license was sold and the station would become an online Internet only radio station it lost that connection.

 

Now the irony is that all of these student radio stations didn’t stop broadcasting over the FM band and then become Internet radio stations. No, they already had been streaming on the Internet and had listeners from all over the world in many cases. So why didn’t that continue to sustain these radio stations?

 

Let me make a comparison to help you understand this a little better. When you buy a magazine, do you read only one article and then toss it away or do you turn all the pages and look at other things in addition to that cover story that first attracted your attention and caused you to purchase the magazine? You read, if only skimming, the entire magazine. You spent time with that publication and became a little more invested in it. If you subscribe to the magazine this would be akin to being a P1 listener to a radio station.

 

When you see an article from a magazine online do you read the whole magazine or just the article that captured your attention and then leave? You do what we all do. It’s one and done. No investment in the magazine, just the article.

 

Well, what I learned is that it apparently isn’t all that much different when it comes to student streaming radio stations. It’s more of a hit and run.

 

There’s also a problem with student online radio stations in that they have limited connection capacity in most cases. That means only a limited number of people can listen to the stream, unless the college makes a big investment in expanding the capacity in the number of listeners can be connected at the same time. This is somewhat solved if a student station goes with a large online aggregator like TuneIn or Live365.

 

But let’s be real, when you enter a store and everything in the place is priced the same – FREE – which would you chose? The best you could find. Good Luck student stations.

 

Contrast that with student radio stations that broadcast over FM radio. What you find is that they are now only competing within the local community of service and in that playing field, have a chance to break through and be heard.

 

Over 92% of Americans 12-years of age and older still have the radio habit and listen every week. When it comes to listening to streaming stations on the Internet the percentage of penetration doesn’t come close. And those that do listen to streaming Internet music are very likely tuned to Pandora, if the current data available about such things is to be believed.

 

Another thing I heard was how more and more of these student radio stations were working to get a LPFM license so they could return to the air on the FM radios in their community.

 

When Zane Lowe was getting ready to launch Apple’s Beats1, he told the trades that a big part of the three months leading up to the launch was spent trying to come up with a better name for the new service than radio. They couldn’t do it.

 

Radio is the brand, because it works.

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A War on Talent

When iHeartMedia wooed away Kurt Alexander aka “Big Boy” from Emmis’ Power106 to their Real92.3 it was a big deal in more ways than one.

The top performing radio station for Emmis was their one station in Los Angeles, KPWR. That is until Alexander departed for KRRL-FM across the street. His leaving impacts both ratings and revenue.

It reminds me of the walking across the street of Scott Shannon in New York City. Shannon left WPLJ where he had been a morning fixture at the station for 23 years to take over mornings at WCBS-FM. Unlike Alexander in LA, Shannon didn’t go head-to-head with his former radio station but to a different format than the one he had just left. However his impact on both stations is much the same. WPLJ went down and WCBS-FM captured the #1 position beating WLTW for the first time.

At a time when the major radio companies are saying things like “flat is the new up” the only way for a company to grow its revenues when the revenue pie isn’t growing is to re-divide how the existing pie is being cut up. To do that means to raid another company’s talent in an effort to increase their ratings while decreasing market competition.

If we look at how talent gets created we find it’s not a quick process. In the case of Alexander, Emmis spent 20 years and millions of dollars turning him into a morning radio star. Shannon has been at the radio game since his army days, tenaciously practicing his craft to become the hall of fame legend he is today.

Radio is not about transmitters, buildings, music etc. it’s about people. People make the radio business fun; personalities behind the microphone and personalities on the street selling the ads. Strong personalities on both sides of the mic are what make for a winning radio station. Neither can be taken for granted.

Emmis didn’t think they were taking Alexander for granted. Heck they were paying this former body guard $1.45 million along with some sweeteners, but iHeartMedia was willing to up the ante to $3.5 million (which Emmis reportedly was willing to match). But what evidently Emmis couldn’t match were the other perks that a company the size of iHeartMedia could create that a company the size of Emmis could not.

The BBC has also been subjected to a talent raid. Apple enticed presenter Zane Lowe to join their iTunes Radio division which led to several more following Lowe to the Cupertino based company. The BBC has a worldwide reputation for great programming, programming talent and the discovery of new music.

The audio entertainment world is like the animal kingdom where the small animals get eaten by the bigger animals in the food chain of life.

Competition for talent that has proven it draws a big audience, not just on-the-air but also online and through social media has never been more sought after. Competition for talent that can package, present and close advertising sales also has never been in more demand.

It’s a war on talent. Good for talent, but an Excedrin headache for small operators battling the big boys; made all the more difficult in a lackluster advertising environment for many radio operators and an ever increasing amount of radio signals vying for that shrinking advertising pie.

The radio dial – including online streamers – may have become infinite, but the revenues that support it have not.

Radio Darwinism has escalated to the global village.

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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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