Wednesday, August 8, 2007

Radio's Fox Hunt

You can’t put the toothpaste back in the tube.

Pre-deregulation?

Carly was right. Those were the good old days. These aren’t.

But it’s never going back to the way it was. Never. Get over it.

Clear Channel is bailing stations en route to privatization and CBS radio’s dumping out of unprofitable markets.

It confirmed what many of us knew already. The radio industry was never supposed to be that large and with so few players.

Actually, the radio industry had the wrong few players.

Of those running radio chains, some believe themselves to be gods – and demand that the programming, marketing, and managing of their stations must be created in their own image.

English novelist John Galsworthy once said, “Idealism increases in direct proportion to one's distance from the problem."

Let’s scan the past decade. The only post-deregulation winners were smaller chains and the mom and pops that sold their stations to Chancellor/AMFM, Clear Channel, Radio One, and CBS for mind-boggling multiples. They were in such a buying frenzy to acquire properties that they neglected to notice that real estate wasn’t part of the deal. Often, the seller kept the transmitter real estate or sold to a third party. Buy the house, rent the yard and driveway.

Their business plan? Buy ‘em now and figure out what to do with ‘em later.

Problem: They never figured it out.

When the time is right, I want Rupert Murdoch’s News Corp. to buy radio stations. Lots of them.

Murdoch knows efficient programming, marketing, and the importance of innovation far better than most running radio today. You program what’s best for your audience – not the shareholders. They’ll come to love you when you hire the best people and let them do their jobs, and – surprise – show profit.

Many brains are more effective than one.

I know a lot of people that work for Fox. They don’t complain about their jobs. They’re encouraged to be creative, take chances, and maximize opportunities.

At work, they smile.

So what if he owns a sizeable portion of the world’s media from books and magazines to cable and Internet?

Wikipedia his name and the list of media-related businesses he owns worldwide will go on forever.

Big business isn’t the problem. Poorly run big business is.

Rupert gets it. He hires the right people in the right positions – and provides them with support – not fear, which has become radio’s m.o.

When faced with a quandry – as he did with the Fox network a couple of seasons back when ratings tanked for a season – he didn’t order a St. Valentine’s Day massacre. He he had his team identify the problems and correct them.

Take MyNetwork TV, which was cobbled together in just a few of months to fill the void for UHFs that found themselves networkless when the WB and UPN merged. They experimented with telenovas – inexpensive prime time soap operas, starring controversial actresses of yesterday-year like Bo Derek and Tatum O’Neal.

It bombed. But, unlike what you’d expect from most radio chains, fingers weren’t pointed, heads didn’t roll, and sacrificial lambs weren’t slaughtered.

Instead, net affiliates were told, “We’ll try something else.” That buys confidence.

There are no sacred cows. There are no fall guys.

I’m not implying that no one ever gets fired at Fox. It’s just that there’s a lot less of “firing your own mistakes” over there.

Murdoch gets grief for owning the Sunday News of the World and the daily Sun – both sensationalistic tabloids – but he also owns the London Times. I have no problem with that.

Who says you can’t own more than one format?

If there’s one person with the ability to reinvent radio and marry it to new media, it’s Murdoch. He beat his competition to MySpace. Try as they may to sue him for copyright infringement, arson, and anything else they can hang on him, it’s obvious that his competitors are frightened, jealous, and furious with themselves for not doing it first.

Viacom unceremoniously kicked its split-division CEO and President Tom Freston to the curb for trying to resusciate the eMpTV networks while Murdoch snatched up new media, including the aforementioned king of all social networks.

Fox already dominates cable with regional and national sports channels, movie channels, racing, action sports, and it’ll launch its Fox Business Network in October. That’ll be a good fit with Dow Jones, which he’ll also be assuming control of shortly. Expect CNBC’s current deal with DJ not to be renewed.

Question number one: How long will it take for Fox Business to pass CNBC?

Question two: How many CNBC anchors, hosts, and reporters will make the jump to Fox when their current deals are up?

Let’s channel poet and philosopher George Santayana who once said, "Those who cannot remember the past are condemned to repeat it."

Three words: Cable News Network.

Murdoch has had his problems. There’s the L.A. Dodgers, TV Guide, the Boston Herald. I’m sure there are a few more. I think. Oh, yeah – the New York Post. Or does that deal have everything to do with intellectual property?

No one ever accused Murdoch of not taking risks. That’s how he made his fortune.

There are those that believe he was late to television, cable, print, sports, and new media.

Wrong! He was right on time.

Rules number one, two, and three for the world’s most successful companies:

1. If it ain’t broke, break it, and fix it better.

2. Timing is everything.

3. Never believe your own hype.

You can’t always pinpoint him politically. He’s leaned G.O.P. – and backed Bush in both elections – but now he’s rumored to in Hillary’s camp. Oh, the dichotomy!

Murdoch and radio? It’s just my opinion. We could use a rising tide.

I don’t have a clue as to Murdoch’s assessment of the radio industry – but what does it say to Wall Street if he – and other respected media moguls who are currently on the sidelines - choose not to get involved?

13 comments:

Mike Dane said...

I have thrown my share of brick bats
at John before, but this one is
wonderfully penned home run.
I wish the consultants and corporate
suits would read this. But they won't, and even if they did they
wouldn't get it. Too bad.

Stedzo said...

John, I don't always agree with you but this one is right on the money. I would also like to see the owners/operators that made radio "show business" like Pyramid's Ritchie Balsbaugh (KISS 108) and Malrite/Omni America's Carl Hirsch. (Z100, WMMS) Pyramid and Malrite were corporate and cool.

D.O.M. said...

Before I add my own comment I have to agree with "Stedzo". I do not know Carl Hirsch but I know about him and he is well respected in the real radio circles.
I do know and worked for Ritchie Balsbaugh and the man is a genius. He had that show business flair and encouraged his staff to creativity. He radiated power and performance.

Anonymous said...

I agree Murdoch is a heck of a business man, but to have all of that power in one place is not good in the long run. The business may run better, but is it in the best interest of the country? Competition breeds creativity.If the only news we get is Fox News, why bother having news at all? Big business is not good, that is why there is the Sherman anti-trust act. What was that quote about those who don't remember the past?

Babs said...

Gorman: When I started reading this I thought you sold out. When I finished I realized that it was about buying in. I would rather work for the News Corp. and given the support and independence than work for a Clear Channel or CBS with their dictatorship like control and master lists of 'can't play' music and 'can't discuss' topics.

Anonymous said...

I have to agree with John. The radio industry will never return to what it once was. If the right opperators (not CC,CBS,R1& others) bought stations maybe they would regionalize them. Its not rocket science. If radio wants to win up against new competition like IPods & satellite they have to be live & tuned in with their region of license.
Rupert Murdoch scares me. He could become too powerful. Then again could anything be worse than the current radio chains doing national banned song & topics lists?

Anonymous said...

If the RIAA gets their way on terrestrial and internet royalties Murdoch will be one of the few able to afford to pay them.

I am convinced that internet radio will be dominant within the next five years and terrestrial radio will be something only those who can't afford computers and broadband.

Neely said...

If he had the opportunity Ritchie Balsbaugh would be back in the radio business. He is an owner of Saint, one of the premiere upscale clubs in Boston. There was also a story in the papers a few months back about Ritchie doing something to do with a station serving Logan Airport. I know Ritchie would love to be back in the business and Boston would love to have him. Anyone that lived in Boston between the late 70's and the 90's remembers the Wicked WXKS Kiss 108.

Sam Kninblack said...

"Bad big business is". How right you are. Major corporations like Metromedia used to own radio stations right along side mom and pop stations and sometimes the locally owned station won (WIXY owned by Norman Wain v. WKYC owned by NBC, WHK owned by Metromedia). The problem today is there are only major corporations and it is a sign of the times. That is still no excuse for the way Clear Channel, Salem, Greater Media and other companies underserve and cut corners in their markets. If Murdoch owning radio is the catalyst to return some of the best radio owners back in the game then I am all for it.

Anonymous said...

I strongly disagree that our answer to big business taking over our media is to turn it over to even bigger business, i.e. the News Corp. The radio and television "airwaves" are supposed to belong to U.S. citizens and only leased and not owned by these companies although you would never know it with the relaxed rules.
Unless we return to the 12 AM 12 FM 12 TV station rules per owner media in this country will continue to have a podium to support whomever is in power in the White House.

SAVIN said...

John, I am going to pay attention to what you are saying. Today's New York Times has a piece on internet radio and reviews some available models. If you are the same John Gorman that had the Radio Crow web site you are many years ahead of your time. If not you are still ahead of your time by promoting internet radio.
If Rupnert Murdoch decides that radio is a good investment I will be convinced that you can see the future. If Murdoch does not invest in radio that means terrestrial radio as we know it is over.

Anonymous said...
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Anonymous said...

Sorry I did not mean to include an expletive in my last post. My entire radio career is post-degregulation & all I hear about are the good old days. If they were that good they would have stayed that way. I think too much emphasis is put on the past. Like you said about putting toothpaste back in the tube. I do not see anyone coming up with better ideas. From what I hear from the old timers the good old days were not all that good either.