A message from Radio Ink Publisher Eric Rhoads
Before I begin: In the interest of full disclosure, Citadel Media (formerly ABC Radio Networks) is an advertiser of Radio Ink.
Imagine,
if you will, that your local radio station has spent 15 years and loads
of money establishing a local personality. We all know that the
personal connection to the talent on our radio stations is one of the
most important assets we have. Radio's value is not its signal or its
tower. The value comes from the relationship we have with our
listeners.
Our Worst Nightmare
When I was a
programming consultant, our worst nightmare was having to find a way to
take audience away from a heritage air talent who had a lifetime
relationship with the listeners. We knew that if we could get that
talent to jump ship, there was often more loyalty to the talent than to
the radio station itself. If we could take the two or three most
established personalities and move them to our station, we could have a
much more successful start -up and destroy a competitor. If we couldn't
get them to come to us, we would look for ways to get them hired out of
the market. That's how important a strong local talent can be.
Sounding Local
Today,
thousands of radio stations around the country rely on radio network
feeds of formats and talent. The big sell is that you cannot afford to
hire personalities this good in most small towns. Technology has become
so flawless that local listeners most of the time don't know that a
talent is voicetracked or coming from a satellite network. The ability
to sound local has improved significantly. Therefore, to the local
listeners, the talent they are hearing is local talent.
Sleight of Hand
Last
night we received a press release about how Citadel Media had shifted
some talent around. What the spin didn't indicate is that these changes
were because of a bloodbath of network talent firings. Today my phone
has been ringing off the hook from affiliates who are either
immediately canceling their Citadel contracts or talking to alternative
providers with the intent of canceling. Why? As one local manager I
spoke with said, "Our stations success has been built around two air
personalities who have been on our air for 15 years. Suddenly, they
have been replaced. Our listeners don't know these are satellite guys.
They are local as far as they are concerned."
Destroying Hundreds of Stations
Imagine
the impact of this decision, which was economically driven. This casual
decision to remove some high-priced talent on several formats is
disrupting the competitive advantage on hundreds of radio stations in
one fell swoop. One format alone may have several hundred stations that
had built their entire businesses around those personalities over
decades. Their competitors are popping open the champagne because the
toughest talent to beat just got replaced by people who don't have a
bond with listeners. Of course, doing this across several formats could
destroy (yes, destroy) the businesses of hundreds and perhaps thousands
of radio stations. All to save a little money on highly paid talent.
Self-Destruction
This
cost-saving move, which corporate executives may see as harmless, could
result in loss of ALL of their format affiliates. Citadel Media's
competitors are on the phone today with every affiliate. In fact, while
I was talking to one manager today, he received a call from Dial Global.
Killing Trust
Look,
I would not want the debt, the pressure, the bankruptcy Citadel may be
facing soon. And I too would be looking to save as much money as
possible. I wouldn't want to be in their shoes (though I'll be one step
closer when they cancel their advertising because of this missive). But
don't make material changes that kill the trust of your customers.
If you want to do it at your own radio stations and risk losing audience and revenue, so be it. But today millions of radio listeners woke up to new talent, wondering where the people who have been their friends for decades have gone. Radio owners across America just lost their heritage brands, and that has to severely impact their business. Advertisers have talent loyalties too, and this move could kill these affiliates.
How Dare You?
Where
is Citadel Media's loyalty to its affiliates? Without them, they have
no business. How can affiliates trust Citadel Media now, when they've
raped the airwaves in hundreds of markets that built their business on
the heritage brands and air talent? Farid, how dare you treat your
customers like this?
Broken Eggs
Corporate
responsibility must go beyond financial responsibility to shareholders.
Thousands of affiliate radio stations had all their eggs in the Citadel
Media basket, and those eggs were broken over a decision to make the
next quarter look a little better. The ironic thing is that this move
will worsen shareholder value because of affiliates jumping ship,
knowing they can never trust the company again.
Undo This Decision
If
Farid Suleman were savvy, he'd call all those fired talent back,
apologize to his affiliates, tell them this was a terrible error in
judgment and that he did not realize the negative impact to his
affiliates. This, and only this, will save his format business and
might prevent a class action lawsuit.
Revenue Lost
I
don't make a habit of cutting my own throat. I know I'll never see
another advertising dime from Citadel Media. I know Farid will probably
decide not to make his annual appearance on the group heads' panel at
our Forecast conference. I don't care. I'm livid, and someone has to
speak up and defend these radio stations, even at the expense of losing
a substantial advertiser.
Hundreds of radio stations may be destroyed over this, millions of dollars in advertising may be lost, entire businesses may be destroyed because of this decision, which could impact the incomes of hundreds or thousands of radio station owners. This decision was simply irresponsible.
Best,
Eric Rhoads
Radio Ink
A Message from Deborah Parenti, VP/General Manager of Radio Ink:
Important Independent Broadcasters Panel to Be Held at Forecast
If you own a small or independent radio station, we invite you to join us at Radio Ink Forecast, less than four weeks from now in New York. The panel, Independent and Optimistic: How Small Radio Companies Succeed, sponsored by Arbitron, will discuss the secrets of successful independent operation in today's media and economic worlds. A panel of leading independent owners will discuss what it takes to keep revenues pumped and cash flowing at their stations and how their ability to act -- and react -- nimbly works to their advantage. What are their plans and strategies heading into 2010? Find out as leadership, independent-style, addresses the issues facing all broadcasters.
Moderator: Bill Stakelin, President/CEO, Regent Communications
George Laughlin, President, GAP Broadcasting
Steve Newberry, President/CEO, Commonwealth Broadcasting
Gary Rozynek, President/CEO, Maverick Media
To register, call 561-655-8778, or register online at www.radioink.com/
Attendance is limited to 200 people. Please book your seat early.

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