Smooth Operator


KMUR - Neil Ross resize
Neil Ross –  KMOR

Most of the guilty in this story are no longer “hitting the ramp”, so it’s OK to tell the story.

A car dealer we knew as OJ owned a small AM station in Salt Lake in the early ‘70s – KMOR.  The station was a 1KW Class 4 (1230) signal that had struggled to find a format that worked.  It would be assumed OJ tired of the monthly payroll cash calls.

So when a manager of a famous boxer, a man as silky and smooth an operator as you’ve ever seen, came calling, OJ jumped to sell the station.  The buyer played the race card better than Bill Clinton. He offered OJ an absurdly high price – I think more than a $1M for a station worth half that, but he did it on terms.

OJ, smelling the cash as only car dealers can, was now totally taken in by this smooth operator and was only too happy to sell the station to this smooth talker.   However, OJ  failed to secure the stock.  He mistakenly assumed his collateral was the license. But as we know the license is unencumberible – it can’t be security for a transaction or sale – a fact OJ seems to have not understood.

The new buyer came in – sucked as much cash out of the station as he could over the next year and walked away when there wasn’t any cash left.  For myself and a partner it was perfect.  We bought the stock controlling the license for $15,000, built new studios in an old pharmacy (even used the fountain counter as a control room desk and stools for guest seats) and relaunched.

Of course OJ sued everyone, but both the FCC and the Federal Courts upheld the premise that the license can’t be secured for a debt and we retained ownership of the station.  In hindsight it was a good deal that cost a lot of time, legal money and frustration AND we still had to rebuild the station.

A few years later, we sold the station and in hindsight, we got out just in time and broke about even.  Lots of fun…lots of learning.


So Different. So the Same.


Jerry 2

Jerry Del Calliano

Along with good friend Bill Wolfenbarger of Jodesha Broadcasting in Aberdeen, I just returned from Jerry Del Calliano’s New Media workshop in Philadelphia.  The focus was on those rascals, the Millennials.
Let me distill what millennials are looking for down to what I took away from eight hours of pretty intense conversation.  And unlike most seminars this one was small and intimate with lots of audience participation.

  1. Authenticity – just look at their response to Bernie Sanders.  He’s the most authentic candidate in the field.
  2. Quit saying.  Just be. – They don’t like hype though that’s like not liking commercials. What else would they say?  “I love hype!!”  Not likely.
  3. Build consensus NOT confrontation – millennials will not likely to be as ‘in-your-face’ though this may not be the case in parts of New Jersey or New York.
  4. Dreams – they have more purposeful dreams – more socially tied to good deeds than the financial dreams of Gen Xers and Boomers.
  5. Fun!  – They want to be the ones that are fun to be with.

Let’s see…how different is that from what the boomers or GenX would have said?   I’d argue –  not much.   Every generation is idealistic and wants to change things (and few love listening to commercials)…and they do change things.  Millennials will be no different.

Radio is challenged to serve these young millennials.


Ten Tactics for Cumulus Survival

Lew is out.  John is out.  McVay has been moved.  All the bogie men at Cumulus have been moved off the table.  Now what?  MaryCumulusPower Berner, the new CEO is challenged.  And it raises the question…What would YOU do to fix a billion dollar a year radio company?

  • Restructure –  Cumulus needs to be in control of their cash and restructuring is the only way for that to happen.  It doesn’t have to be banko…but Cumulus has no chance unless the pressure to service their debt is reduced.  Speculation is a 70% haircut with the junior debt would put the valuation in line with what the group is really worth.  So get it over with.
  • Patience – make sure the remaining stake holders are patent. This is a business with inertia in BOTH ways.  When I took over KJR in the 80s the previous year the station had done almost $3M and the year I arrived billing topped out at $750,000.  The reputation and legacy of a station only lasts so long…and the rebuilding ramp is slower than it once was because buyers have so many other media options.

This is a 3 to 5 year rebuild process.  Look at Marissa Meyers at Yahoo…she’s almost 4 years into her turnaround and          she’s in the sexy hot digital media space. It will take time.

  • Leadership – Mary Berner has to remember that leaders only have one asset.  FOLLOWERS.   To rebuild faith she needs followers from a staff that has been terrified, beat up, intimidated and run out of the building.  She needs to develop a passionate articulated vision. Emerson said,  “ I need someone to make me do what I am capable of…”   Berner needs to be that person…
  • Clean House – Let’s face it…no one has really voluntarily chosen to work for Cumulus in a long time. The current staff is 80% people who needed a job no matter what, 10% are hanging on and staying under the radar and 10% are really good and passionate and optimistic about the future. With thousands of employees cleaning house is tough.  But here’s what’s going to happen…when Mary creates a vision of passion and focus, good radio people will come out of the woodwork and be ready to replace the dead wood.  Be ready to take advantage of that emerging resource.
  • Last year I was talking to one of Cumulus’ major program directors and asking about commercial loads in the industry. He suddenly turned to me and said, “Our core Cumulus station inventory is just the start!  Then corporate adds on barter, network, and JV spots!  We have no control over inventory at all!”  Listening to any Cumulus station will verify that…

So as hard as it is – clean up the spot load on all the stations and stop thinking of your news/talk stations as dumping          grounds for spots.

  • Core Value – understand that Cumulus’ core value is their local relationships with local retailers and ad agencies in each market. Turning those relationships into money with radio, digital and other NTR is the core job of the company…not just being a radio company.
  • Forget the AM’s. Sad as it is for those of us who love the great stations – WLS, WABC, KABC and KGO these stations have been destroyed and have NO chance of coming back.  To paraphrase a local client “(Insert call letters here)  – everyone knows you; but no one listens anymore…”

Name one AM station that has been turnaround in the past decade.  Just one.  I can’t.  The audience levels,             perception and capital requirements are so poor that maintenance is all you can do right now even with those legendary calls.

  • Don’t ignore digital – focus on how your digital assets can complement broadcast stations – something I’m sure Cumulus is already doing. And I’m totally confused on what they did to Rdio.  The past couple of years they generated millions in revenue (though it’s unclear how profitable that was) but Cumulus has abandon their deal with them though their 10K said they continue to have a ‘relationship’.  Is that like your ex-wife…?
  • Rebrand – Cumulus carries too much baggage.  There isn’t enough lipstick in the world to make Cumulus attractive to anyone who knows the history.  Return to Citadel or rebrand as Westwood One. If Gannet can do it…oh, wait.  Tegna Company was NOT an improvement…but you get the idea…
  • Apologize – apologize for being a company that was based on the wrong metrics. A company that valued data over people…stock price over good local radio…and thin staffing with no passion.  Apologize with NO caveats…don’t throw the Dickey’s under the bus.  They got there themselves.  Just say you are so sorry to the stakeholders…to the employees…to the industry and to the ad community.  But only do it if you are sincere.

The radio business is troubled…and the two largest operators are against the wall.  iHeart has been much better run…and agree or not with their strategy, they have been innovative…and good for radio.  Cumulus has been an unmitigated disaster…and everyone has seen this train wreck coming for several years.

And finally – what are you doing at your station that is identical to Cumulus’ errors?  What hubris…what arrogance…what assumptions are you operating under that will lead to disaster in your business…?  I’m checking under my bed…

Will Trump Kill Political Advertising?

The Donald is leading in the Republican primary….but I’m not here to talk about that.  Except that he leads without spending ONE dollar in media.  His fame and previous media exposure got him to this point.

Should he win the nomination, is it possible he won’t do any political advertising…?  Is it possible that the anticipated hundreds of millions of dollars that TV stations count on will evaporate?

As a buddy of mine – who has a small political ad agency has opined…2016 is the last year for the massive wealth shift to broadcast TV.  He and others have said the reason the money continues to flow even now  is “…pure inertia”

Say it ain't so Donald

Say it ain’t so Donald

The politicos who run these campaigns simply have always done it that way and know nothing else.  Sound familiar…?

Right now the management of Sinclair, CBS, Gray and all the other big TV groups are praying Trump quickly fades. It’s not a policy or political stance.  It’s just that should he become the Republican nominee  it could spell disaster for their stations.

Frankly – we’ve often thought the entire broadcast TV business is whistling past the graveyard…this could just speed up that process…


Time to Come Home..?


An acquaintance of mine is involved in a home merchandise group…about 150 stores around the country.  In 2013 they had a drop of about 250,000 customer visits.  A decline they attributed to bad weather, poor holiday timing and some questionable merchandise mixes. Those rational made everyone comfortable until they saw a 600,000 customer visit decline in 2014.

That’s anecdotal, true…but it’s no secret retail is struggling.  The Gap closes 150 stores.  Radio Shack is gone.  Nordstrom records same store traffic declines again this year.  Best Buy is hanging on by downsizing.  JC Penny is…well those were self inflicted, but you get the idea.  Retail as we’ve known it is in trouble.

It took just four years but The Wall Street Journal reports that November/December store traffic declined from 40 billion to 17.6 billion between 2010 and  2013.  Shopping patterns have changed in dramatic ways – and the power of retailers, large malls and even established brands are in deep dive.

The reasons – online shopping, changing demographics and even satiated consumers are secondary to my point here.

It’s time for radio and retail to be reunited.  WHY?

1)  Radio delivers customers at the last possible minute.

Abandon mall

Coming soon to a retailer near you…?

2)  Radio can effectively sell the ‘experience’ of shopping retail…still a compelling story.

3)  Radio uniquely can create demand where none exists.  That’s why it’s become so important for event promotion.  Using radio creates demand among consumers who didn’t know about a product or service previously.

4)  Radio is intrusive.  Spots, endorsements, live events, and drop-ins all create awareness intrusively.

5)  Radio still has the reach – 90%+ according to Nielsen every week listen.

I’m certain that the Radio Advertising Bureau is on this nationally – but it’s also time for local radio to get in front of local retail management.   Even the big box retailers and franchises listen to their local management – well, the smart one’s do.

Radio created consumer brands in the 30s.  Radio sold a bonanza to retailers in the 60s and 70s.  It’s time for retail to come home to radio.

I Mean…How could this be fun…?

This is total throwback…nothing digital.  A complete retro post if there ever was one.


Ron Obrien about to have FUN on the radio (KTLK – Denver)

I stumbled on this video that Art Vuolo produced that really shows how much fun we had as disc jockeys on the radio in the 60s and 70s.  You don’t have to watch more than the first few minutes…but you’ll get the idea…FUN!  (Click the image for video)

WTF is Digital to Radio?


What does ‘digital’ mean?

Make it stop!

All we hear is radio has to be digital. Our analog signal is dead – or dying rapidly and we have to make the transition to digital.

But what does that mean?

Streaming? HD radio? Banner ads on our websites? Social media interaction?

These are thoughts…

1) Radio has a long tail and will continue to develop revenue and results. The growth won’t be there but radio isn’t in a death spiral.

2) Local clients will be buying digital display and video advertising programmatically and if your radio station isn’t selling them you are not doing yourself or your clients a favor.

3) Radio has been in the content development business. So far no one has developed a very viable local model for this – streaming costs, staffing and creative development all is too expensive for small/medium markets. Maybe it’s time to rethink that process – get out of the content business on digital platforms and see #2 above. Your clients only care about getting results and reaching their customers.

4) Get used to tighter profit margins – digital is more like traditional retail. Lucky if you get 50% and 30% is more likely.

5) Number 4 above is the reason radio doesn’t do more effective digital sales – but they miss the opportunity to sell digital out-of-market (tourist boards for example), be relevant to their clients and develop cross platform marketing.

Just like newspapers put radio stations on the air early in the 20s and radio put TV stations on in the late 40s we’ve all been there on the leading edge of digital media. Now we just have to define what it means to our stations and how to best serve our clients and communities with these new products.