A Message from Radio Ink’s B. Eric Rhoads
Historically, change rarely comes from within any industry. We are all too close and set in our ways. Most innovation comes from outside, from those who can see our mistakes more clearly. Therefore we as an industry should embrace outsiders, even though we may think their unusual ideas aren't a fit, or aren't "the way things are done" in radio.
Jeff Hinson came to radio as an outsider, known for his turnarounds and innovation in other industries. A couple of years ago, he was hired by the board of Border Media Partners to save the failing radio company.
Turning Radio Upside Down
Now Border Media Partners' lenders are taking over the company, and CEO Jeff Hinson
has chosen not to stay on as the lenders try to divest, though he is leaving on good terms. Since Border is not on
everyone's radar, this may seem like a minor story. But I believe the loss of
Hinson at Border could have an impact on the future of radio, because he was
one of those outsiders who was reinventing radio and turning the business model
upside down.
What few people knew (unless they attended our Convergence conference, where Hinson unveiled his plan) is that Border Media Partners was taking the lead in a sea change regarding how radio and digital media intersect. Jeff had invested heavily in the creation of a new digital radio model unlike any in the world.
Looking Cross-Eyed
A traditional, dyed-in-the-wool broadcaster would look cross-eyed at Hinson's
moves as risky, which is why Jeff's plans will probably be shut down with the
change in control. But Hinson was not some wet-behind-the-ears rookie who
didn't understand radio. He was a wise innovator who believed radio could not
continue to survive and thrive in its present form.
Hinson came in as an outsider willing to throw tradition under the bus, and he put his entire radio group on the line, reinventing how it did business. How many people do you see willing to do that today? Most people only talk about it, but Hinson did it. Instead of being a radio company that integrated digital offerings into its stations, he flipped it around, and Border was becoming a digital media company using its owned radio stations as a vehicle to reinforce the digital properties.
Rules for Radicals
If what Hinson did sounds radical, it was. Though his recently launched efforts
had no time (or environment) to prove themselves, Jeff understands that rules
for radicals require burning the ships behind you, no longer relying on past
models that aren't working anymore and investing in new ways to do business.
As you know, I spend my life immersed in digital media. I created a conference devoted to digital media for radio, and I try to spend as much time as possible working on models that will reinvent radio and make it thrive again. Jeff was among the two or three people in the entire radio industry who I believe understood what needs to be done, and one of the few who persuaded his board to allow real investment in reinvention.
A Back Full of Arrows
Though pioneers are the ones with arrows in their backs, I think the Border Media experiment had a strong chance of success, had it been given time to succeed (it wasn't even six months old). Though Hinson employed the important radio basics to try to save an already-broken company, he was also willing to take some big chances to move it where all radio stations belong. But the recession and advertising climate, combined with the problems plaguing Hispanic radio, placed too much pressure on the business, which left investors Goldman and Vestar no choice but to take it over.
Reinvesting in Reinvention
As we all suffer through this economy, our tendency is to stick to the basics
and not reinvest or reinvent. Why risk it? (Plus, who has the money to invest,
right?) Yet risks like Jeff's, with the right timing, will capture revenues the
radio industry would never otherwise see. Necessity forces innovation, and it's
critical not to cling to our history, but to focus on what customers and
consumers want. We must make sure we design a digital-centric radio platform
that works. If not, someone else will, and it probably won't be a radio
company.
Yes, There Is Good News
Everyone could use a little good news about now. The good news is that the
struggles you're experiencing will not only strengthen your skills and resolve,
they will force you to come up with new ways to do the things you've done for
decades. The other good news is that your customers are seeking better
solutions too, and will be open to almost anything fresh and new. Are you
listening to them? Are you innovating to give them what they need? Are you
burning the ships behind you?
Break the Rules. Please!
Though Jeff Hinson's experiment failed, it was only because of timing and
market conditions. Had he been able to ride out the storm, there was a fair
chance he would have emerged ahead of the rest of the industry. In radio, we
must seek outsiders like Jeff to break the chains of our past. We must demand innovation.
We must promote rebels to break the rules.
Though sticking to our knitting is comfortable, "just the basics" won't move us into a new era and allow us to be competitive in this new digital world. Though no one else may encourage you, you have my permission to break the rules. Please.
A Message from Radio Ink VP/GM Deborah Parenti:
Eric talks about reinvention, and he's charged me with making our Forecast Conference focused on breaking the rules, finding new forms of income, and taking a serious look at survival in this environment. Please join Chair Bill Stakelin at Forecast '10, December 8 at the Harvard Club in New York. This event has become the premier forecasting event in the industry and is attended by a who's who of radio -- and it's followed by the most elegant event in the industry, honoring the 40 Most Powerful People in Radio.
Limited to 200 people. To register, call 561-655-8778 or go to www.radioink.com/forecastsummit.
Please don't reply to this e-mail, but respond in comments.
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