Monday, April 28, 2008

Radio Heard Fear



I’m a little late weighing in on the ludicrous Radio Heard Here campaign.

Please answer this question. Does NAB ringmaster David “Fumbles” Rehr have ears or is his ego really that large?

Did you read the press release? How full of it can one organization be?

Did you read the fact sheet? Find any facts in it?

Fumbles took a tumble with this one.

Here’s its problem. If it takes more than a minute to explain what Radio Heard Here means – the spot’s not going to work in sixty seconds.

The NAB calls Radio Heard Here “a comprehensive, multidimensional, multiyear initiative made possible by a partnership among the National Association of Broadcasters (NAB), Radio Advertising Bureau (RAB) and HD Digital Radio Alliance.”

Please.

There is no softer job in this industry than the one Fumbles has running the NAB.

Running it where? That’s another story for another time.

I like Jeff Haley, the CEO of the RAB but I wonder about his judgment when he’s quoted as saying, “We are seeing a renaissance in radio with respect to programming – programming that has become more versatile, more experimental and of a higher quality than ever before. This is an industry that is being bold, taking risks and engaging audiences in a variety of creative ways. And listeners are taking note. More than 90 percent of Americans say that radio continues to play an important role in their lives. Radio is not standing still, nor resting on our laurels. "

How's Jeff going to reply when someone says to him,"prove it?”

Since Radio Heard Here was announced amid chuckles and groans at the NAB convention, it’s been critiqued as one of the worst marketing slogans since, well, the HD Radio Alliance’s “it’s time to upgrade” un-catchphrase a couple of weeks earlier.

That’s the deregulatory radio way of thinking. There’s nothing wrong with radio that a slogan’s run can’t solve. Riiight!

And this is no ordinary slogan. It has to be the lamest slogan the radio industry’s ever come up with.

To think that the RAB, which is partially responsible for this lame Radio Heard Here shibboleth once made creative content like this one from the fifties with Sarah Vaughn singing “Who Listens to Radio.” But I digress. Creativity meant something back then.

In fact, I think the only great campaign ever created for radio was Stan Freberg’s – but, alas, we can’t use that one anymore since it was selling creative production techniques to play upon one’s imagination.

Radio doesn’t hire creative production directors anymore. They’ve been replaced by output specialists. How fast can you cut how many spots?

I pretty much agree with others who expressed concern and disgust over the Radio Heard Here campaign.

One item I will add is the slogan’s use of the word radio.

Before the NAB chose this slogan did they research anyone under forty?

I doubt it.

Had they, it would’ve been obvious that radio has become a negative word that grows more negative as the demographics get younger.

Don’t take my word for it. Ask your kids.

Go into any store that sells radios – Best Buy, for example, and ask the clerk what stations he or she listens to.

Go to a beach or a park or any other place you find young people gathered in groups. Where’s the radio?

The perception of radio is bad. That's what has to be turned around first - and you do that by improving the product. Repackaged you-know-what is still you-know-what.

This is the end result of delivering poor product to young people for over a decade.

Radio used to be a soundtrack to popular culture. Today, radio, especially formats appealing to the young, aren’t even close.

There are those researchers and consultants that claim radio’s problems stem from formats not being niche enough. Yet, look at any young person’s iPod playlist. See any niche?

True, there’s the occasional Goth that’ll only listen to a specific genre of music. Is that an exception – or the rule?

Research can be manipulated to say anything you want it to.

I got a chuckle out of brand strategist Kelly O’Keefe telling the Clear Channel-owned Inside Radio that his group “…tested more than 30 logos and had a very strong positive response to (the one they are using).” He claimed that 74 percent of respondents in his focus group found the logo “energetic.”

Energetic?

When was the last time you hear someone under fifty use that word?
O’Keefe continues, “The next highest reaction words were “alive,” “bold” and “fresh.”

Who was he interviewing? Music of Your Life listeners?

I’m over fifty. Well over fifty – and those words don’t speak to me.

You got some 17 year old to say radio is “bold?”

I’m supposed believe you, right?

It wasn’t a total loss. O’Keefe did have one direct hit in his research.

“When we pushed it too edgy, we lost the young audiences. They said that’s not what radio is.”

But before you think he was starting to get it, he added, “We need to take it one rung of the ladder at a time. You can’t just jump to the top or you lose consumers.”

Lose consumers? Kelly, my boy, you’re supposed to be trying to find them.

Think about it. If you’ve been in this business long enough, you’ve probably worked with a research company that asked you, “What are you hoping the research will tell you?”

And wouldn’t you know it? That company's told you exactly what you wanted to hear.

I’ve dealt with the best and worst in research companies. There are those that tell you what you want to hear and those that tell you what you really need to know. I respect the latter, I abhor the former.

You should, too.

One of my favorites was “Detroit-Philadelphia? Same lunch-bucket market.” That’s to say that the music and lifestyle influences in Detroit were identical to Philadelphia’s. An over-his-head manager hoping to earn brownie points with his new superior by claiming he could save research costs by pilfering information from another market was the reasoning behind that statement.
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Since then that station has gone through four format changes.

Keep in mind that research and its mathematical formulae determine results by looking backward while life is lived forward. You’d better know where you want to go, have the right people in place to take you there, and use research as a map to guide you in the right direction. 100 percent ground zero research rarely achieves results.

I’ve suggested to Internet stations I've worked with to drop the word radio, if possible, and increase the use of the word streaming, especially when programming content appeals to young demos.

If radio wants to sell itself – and it should since you can’t prove you can sell anything unless you can sell yourself – yank those hideous HD Radio promos off the air right this minute.

If I sold against radio, I’d show that the HD Radio Alliance was radio’s heaviest advertiser – and in spite of its tonnage – couldn't sell HD radios. That's according to real research, as opposed to Critical Mess, er Mass. Only 24 percent know about HD Radio – and that’s down two percentage points from last year.

I was reading the Boston Herald this morning and came upon this quote from actor Ricky Gervais. He’s shooting a movie, This Side of the Truth, in Lowell, and was joking about his acting. The Herald quoted from his blog, “I am turning in some very shoddy work. This won’t even go straight to DVD. This is going straight to radio.”

That’s a joke, son.

Found! The lost "Wrath of the Buzzard II"

Wednesday, April 23, 2008

Radio: Hypocritical Deceiver



I pose this question to the HD Radio Digital Alliance and iBiquity.

Why lie?

Liars lose credibility.

Liars forget what lies they told and to whom.

Even those who want to believe these clowns aren’t.

The only radio industry proponents for HD Radio are those who are getting paid to be through the Alliance and others stuck in a situation where voicing their opinions would cost them their job. And that’s the truth.

Couldn’t you HDiciples at least have the gumption to add the line – We are compensated for our endorsement of HD Radio?

It’s bush league not to.

Ever hear of full disclosure?

Ever hear of a fool on a fool’s errand?

They must’ve enlarged their monthly spif to the Coot. He has more strings being pulled by HD Radio Digital Alliance head Peter “Sgt. Bilk-o” Ferrara than Howdy Doody ever had from Buffalo Bob.

Here’s a guy that turned his alt-rock stations in a format that appeals to only those who can be described as chemical garbage pails. Put it in front of them and they’ll drink it, snort it, shoot it, or smoke it.

Let’s see. The Ford Edsel, New Coke, Blue Pepsi, toothpaste in an aerosol can…and HD Radio. I wouldn’t include the Betamax or 8-tracks. At least some people bought those.

Admit it. You had to love the HD Digital Radio Alliance’s “study” done by the Clear Channel-owned Critical Mass Media (pause for laughter) on the “awareness” and “consumer adoption” of (get this play on words) “the new HD technology.”

Does that mean the lead question was “How familiar are you with the term HD?” Oh, did we negelect to mention the word “radio?”

Minor point.

This one was rolled out just in time for the latest Fumbles Folly – the NAB Show 2008 in Las Vegas.

According to the Critical Mass study (pause for laughter), which was released on April fool’s Day, awareness of HD Radio is at 77 percent among radio listeners.

The HD Radio Alliance compared those results to a study from a year earlier by Mark Kassof and Company, which showed HD radio awareness at 38 percent. So, by combining two divergent research studies, Sgt. Bilk-o’s HD Radio Alliance now claim a product awareness increase at just 39 percent in one year.

Karl Marx once said, “history repeats itself, the first time as a tragedy, the second as a farce.” Ol’ Karl never was right about much – but he was right on with that assessment.

That was enough for the HD Digital Radio Alliance to launch their new promotional tagline "HD: It's Time to Upgrade," (pause for laughter), which shifts their campaign from raising awareness to persuading consumers to buy HD radios. Riiiight!

I paid my eleventh monthly visit to Best Buy and Wal-Mart this past week. They still don’t know what I’m talking about when I ask if they have any HD Radios in stock.

But then along came a research study on HD Radio from the reputable (as opposed to questionable) Edison Media and Arbitron. It found that HD Radio consumer awareness actually dropped from 26 percent to 24 percent! The American Media Services report, which was based on a national telephone survey conducted Edison and Arbitron, revealed that just 35 percent of U.S. adults know of HD Radio while the remaining 65 percent never heard of it.

Do we even have to ask the question about who’s the liar here?

I wonder why no one talked about SESAC’s plans to increase its fees an additional 10% for the HD primary channel, and another extra 10% for the HD-2 channel. For starters, that performance rights organization has Bob Dylan and Neil Diamond amongst its songwriters. If you want to play their music on HD, be prepared to pay the freight.

You have to feel for the small operators that bought into this scheme and paid the exorbitant fees to build digital studios that serve only iBiquity.

Researcher Kurt Hanson, whose RAIN has been critical but patient about HD Radio’s shortcomings, held a summit at the NAB titled, “What to do about HD?”

Edison Media’s Tom Webster moderated. Partaking were Don Kelly, director of broadcast marketing for iBiquity Digital; John Gehron, GM of Oprah Winfrey’s Harpo Radio – and a former broadcast executive with CBS and Clear Channel; Dan Halyburton, who manages Emmis Broadcasting’s New York stations, including the new WRXP; webcaster Rusty Hodge of SomaFM’s Internet stations, some of which provide programming for NPR’s HD Radio stations, and Jeff Vidler, who runs Solutions Research Group of Toronto, and was there to impart the Canadian perspective, which he summed up in four words: “mend it or end it.”

Kelly looked like someone who’s used to spending large amounts of other people’s money – but the longer he spent at the podium the more he looked like a badger trying to back into its hole. It’s too bad that the video’s not in HD – HDTV, that is. That way you could count the drops of sweat on his face that proliferated with every passing lie.

Rusty Hodge is an interesting character, too. Initially, he was somewhat of an activist, protesting the RIAA’s interpretation of the Digital Millinnium Copyright Act – which calls for Internet Radio stations to pay royalties to the organization for the privilege of playing music on that medium. It was later learned that Hodge had a partner, Elise Nordling, who may be in
conflict of interest since she – coincidentally -works for the Independent Online Distribution Agency (IODA), which promotes independent artists and labels to terrestrial, Internet, and satellite radio. IODA distributes MP3s from indie bands that signed up – and can afford – the service. And inquiring minds want to know if Hodge cut a backdoor royalty deal with RIAA, which, in effect, could turn his service into a pay-for-play operation.

Rather than review the panel, I’ll leave it up to you. Click here for the video and see and hear it in all its glory.

If you do want my truncated opinion – here’s the spoiler: The HD Radio proponents talked about their promotional and marketing problems while evading the deficiencies of HD Radio. But no one said that there is zero consumer interest, no need for the product, it’s never going to work, and to continue this ruse is a waste of time and money.

It’s too bad they didn’t have a camera on the crowd. A friend who was there told me that everyone gave Kelly a “what – I’m an idiot?” look.

I was surprised that the panelists didn’t end the discussion by singing the first chorus of “Kumbaya.”

Since this crowd is in love with its slogans, I think you can sum up trying to sell consumers on HD Radio with this one: It doesn’t take a genius to tell the difference between chicken salad and chicken sh!t.

And that’s why consumers are wise enough to stay clear of HD Radio.
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Monday, April 21, 2008

Radio: Satellite of Gov


Why is radio so scared of a merged XM and Sirius?

You’d think that the industry would be more concerned with the Microsoft-Yahoo merger or who’s next in line to get gobbled by Google.

Here’s another case of radio criticizing what it can’t understand.

Show me how it is going to take money away from radio? Or listeners? You can’t.

Terrestrial radio derives revenue from advertising. Satellite gets theirs from subscribers – and some paltry national business and a fair share of p.i.’s.

Just let the merger happen.

A combined XM-Sirius would have roughly 17.3 million subscribers, based on current estimates. A done deal would have each share of XM stock replaced by 4.6 shares of Sirius – and stockholders would retain approximately fifty percent of the merged company.

Sirius CEO Mel Karmazin and XM Chairman Gary Parsons would retain their titles with the merged company.

Memo to Fumbles and the NAB: The FCC shouldn’t play into your losing game any longer. You’ve spent enough membership money on pricey lobbyists and other special interest ploys with this lost cause. I ask you - just how many bottles of Screaming Eagle wine does the Boy need to show off at his dinner parties?

You have a better chance of hitting a Sirius or XM satellite with a slingshot.

Fumbles, you’ve far important fish to fry. Start with the fact that the chain that benefitted the most from radio deregulation couldn’t afford to send any of its people to your convention this year.

That, and “Radio Heard Here,” a campaign that’s certain to repel the iPod generation…but we’ll save that one for another time.

You know as well as I do that FCC Chairman Boy Kevin Martin’s rubber stamp is inked and ready. He’s just stalling for strokes.

There’s an old saying, “every job corrupts a little.” With Boy Kevin, it’s a lot.

The Boy has combined the veracity of his wife’s employer, Dick Cheney with the dexterous accounting of Henry Paulson.

We know the business reasons why the companies want the merger. Just pull a page out of Mergers for Dummies: trimming the herd, debt service, efficiencies of scale, shareholder benefit…need I continue?
*
Have you no empathy for the plight of the poor shareholders and the surviving executives of the merged companies?

Terrestrial radio, must I question thy patriotism? How many companies were merged or bought out to create behemoth broadcast chains like Clear Channel, CBS, Citadel, Cumulus, and others?

Never let the facts get in the way of a good story.

I know the merger benefits only subscribers that prefer that all pro sports be on the same system. Otherwise, they’ll be fewer choices on just about everything else.
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Have you listened to XM or Sirius lately? Does it sound like some of the stations have tightened the playlists? Even the comedy channels. Punch lines get a little stale when you’ve heard them for the fourth of fifth time in just a couple of weeks.

There are already signs of things to come following the proposed merger. You don’t have Lee Abrams to kick around anymore, for example.

It’s actually a worst case scenario for terrestrial radio if the merger doesn’t happen. XM and Sirius will not go under. Even if they file for bankruptcy – they will not go away. They’ll up the promotion and marketing on their battle against terrestrial radio and cut deals for automotive placement that HD Radio hand puppet Peter “Sgt. Bilk-o” Ferrara can only fantasize about.

And forget the argument that satellite radio doesn’t do live or local. How many terrestrial stations are left that do?

Just to make it look like Boy Kevin’s doing his job for the FCC – or as it’s known by those in the business – the Federal Communications Hackmission; the new combined satrad company may have to turn over a few channels to independent contractors. They’ll firm-up their a la cart offerings – knowing that it’ll be revised many times over. Remember the number of channels you used to receive on “basic cable” – the lowest tier? Satellite radio? Same thing. You want the good stuff? You better be prepared to pay.

When you’re the only game in town, you call the shots.

Anyone who’s worked for CBS/Infinity knows what’ll happen when it becomes a one satellite radio universe. They’ll never see another dime in upgrades. You’ll never see more than a three percent increase in salaries.

Name me one company whose product improved when its competition was eliminated?
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Then there are those who, for whatever reason, just don’t like Mel Karmazin.
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Come on. He’s not going to be around forever.
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When is Howard’s deal up?
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Same time as Mel’s?
*
Coincidence?


Tuesday, April 15, 2008

Radio: Rehr-ended in Las Vegas - A translation



Here's National Association of Broadcasters President and CEO David K. "Fumbles" Rehr's opening keynote address from yesterday's 2008 NAB Show in Las Vegas This is a translated transcript of his remarks, which confirms that what was said in Vegas should've stayed in Vegas.

He begins -

I'm delighted to see everyone.

Translation: I’m delighted that a few of you still have money in your budget to blow on…er…go to these events.

I hope you are enjoying the NAB Show - this year it seems we have more to see than ever before.

Translation: We have more of the same – just a lot more of the same.

Some people might think that, as head of the National Association of Broadcasters, I might not like that upstart YouTube. The truth is - I am intrigued by YouTube. It's funny. It's offbeat. It's free. I mean, where else would you find things like this?

Translation: This newfangled Internet stuff is all so new to me.

I think we can all agree, what you find on YouTube is a different world - It certainly is a different world for me. And it raises this question for radio and TV broadcasting. Because of YouTube, because of the internet, because of cell phones and iPods …is our model broken.

Translation: It’s not our fault, it’s theirs.

Has technology and cultural change made us no longer relevant?

Translation: Always blame something else for our problems.

Look at this. If you go to YouTube's Web site, it says, "YouTube-Broadcast Yourself."
They use the word "broadcast."

Translation: They still use old media terminology. See, we’re still relevant!

They obviously don't think the word is outdated… or tired… or irrelevant. But the question is, do we? We know that the world has changed. Consumers have more options than ever before. The media landscape is rapidly changing. We're being buffeted by forces larger than our industry. Some in the business are a bit disoriented. Some are overwhelmed by the changes taking place. Frankly, some are not optimistic about broadcasting's future.

Translation: The word isn’t outdated. We are.

I can tell you, serving as president of the NAB is the most exciting job I've ever had. I love it.

Translation: I don’t have to drink on the job. Do you know how many F.O.P. cards I went through when I was working for the booze hounds? On the other hand, this job is driving me back to drink.

Every morning there is a new challenge and a new opportunity ahead. But broadcasters… and you know this; broadcasters can be a bit of a cynical bunch. And I'm afraid, that some people in this business have been staring so long at the door that's closing, they haven't seen the new door that's opening. The digital door.

Translation: Yes, we’re still pushing HD Radio. My dear friend Peter "Sgt. Bilk-o"Ferrara tells me that we’re getting closer to our saturation point. Any day now.

If we don't believe in ourselves, how do we promote our future? How do we promote our business and our valuable content?

Translation: It’s pretty bad when we don’t believe in the business we’re in.

Let me start today by talking about what is happening in the radio business. This article appeared in Business Week earlier this year by an interesting writer and blogger named Jon Fine.

The headline reads "Requiem for Old-Time Radio." He quotes a media analyst who bluntly says, "The model is broken." With almost bittersweet regret, Mr. Fine writes, "You loved radio for opening up a world; you hated it for falling behind what was actually going on."

He recalls radio with fondness. He says, "I recall huddling with it long past bedtime, the volume set low, hoping to hear something I loved…

You're in bed with the lights out, the music and the DJ's voice going straight into your brain, the images created are yours alone."

Translation: There is nothing more soothing than the sound of a DJ saying, “and now we kick off another ten in a row…” or “less talk, more music,” or “today’s best music,” or “more music, more variety,” or “your number one hit music station,” or……even better - dead air - when the Prophet goes out of whack and your engineer is across town at one of your other stations that crapped out.

Ladies and gentlemen, that is romance... that's longing... that is a connection. Listeners still want what they've always wanted. Technology hasn't changed that- it has just changed the devices of delivery. This is not to diminish the challenges or uncertainty of the radio business. In fact, I think one thing that's changed is that many in the industry have been so worn down by the battles and buffeting, that they themselves have forgotten the magic of radio. But we have not forgotten.

Translation: Those slogans sound even better in HD.

Last year, NAB commissioned a branding study on radio. And this began with a very thorough research project. We talked to everyone. We fielded a dozen consumer focus groups and interviewed over 5,000 Americans - young and old, all across the country. And what we learned was fascinating and inspiring. Some of it is no surprise, at least to most of us. Radio remains relevant.

Translation: In our branding study we said to our respondents, “Repeat after me. Radio remains relevant.” They did. See? They said it, not us.

The first thing we learned: nearly everyone said they rely heavily on radio for the information and entertainment they want or need every day.

Remember this from the movie, Sleepless in Seattle?

(Roll Video)

(Did Rehr just violate the Digital Millennium Copyright Act with an unauthorized use of a digital video clip? Just asking.)

Translation: Now, don’t confuse me with the facts. Sleepless in Seattle was released in 1993 – three years before the Telecommunications Act’s radio revisions were signed into law. You know and I know that if Nora Ephron wrote this today they’d lose the radio. There hasn’t been a movie done in the past decade that has had a positive spin on radio. Hey, don’t blame me. It was either this or a WKRP in Cincinnati clip.

That is the magic of radio. For years, we've been saying local, local, local. And that's true, but we have a new wrinkle. We also learned from these consumers that being local, in and of itself (sic), is (sic) not what defines radio's value. It's the accessibility and the connection with radio personalities. And it's being everywhere and available to everyone. A radio is not a jukebox.
If you're listening to radio, you want to hear a human voice sharing that same moment in time that you are. There is power in that personal bond. A CD doesn't have that connection. An iPod doesn't have it. No, our model is not broken.

Translation: I didn’t say it has to be a live human voice.

In fact, when you look at Arbitron data, what you find is that in a world of ever-growing choices, radio continues to add millions of listeners each year. Last March, it was estimated that 232 million people listen to radio in a given week. This March that estimation is up 3 million people …to 235 million. No, radio's business model is NOT broken.

Translation: Yes, I know that many of those 232 million might have been in a place where a radio was on – but – reminding you of N.A.B. rule number one - don’t confuse me with the facts. In this case, it’s that hearing a radio on and listening to a radio are two different experiences.

But, we do have challenges and we have to address them. We learned from our research that many listeners acknowledge that they take radio for granted precisely because it's so pervasive. The public's love of radio is still there, they just need to be reminded of it. We need to reignite that passion.

Translation: Who wrote this? This sounds like Dr. Phil talking about relationships.

In anticipation of radio's centennial, we launched a major effort at the NAB Radio Show last fall to reignite the public's passion with radio. The initiative is called Radio 2020 - 2020 being the centennial celebration of radio, and also representing the clear vision we have for our future. NAB, working with our industry partners, intends to reposition radio in the public's mind.

Translation: By 2020 we’ll be retired and it’ll be someone else’s problem.

First, technology. We are going to make sure that radio is incorporated on every new gadget, everywhere-especially mobile, hand-held devices.

Translation: From can openers to ketchup bottles – we want radio on everything. Now, we just have to figure out how to get people to turn the radio part on.

Second, the survey found that people want new, unique content. They want niche channels.

Translation: I was going to say people are sick of the same old….but 'niche' is such a cool word.

This brings me to the great possibilities of HD Radio. There are those who said HD Radio would never make it-too expensive, too few stations, too this, too that. That attitude is changing. Ford, Mercedes, Volvo and BMW are just a few automakers that have made major announcements about offering HD Radio in their vehicles. And radio stations are stepping up to offer the programming to support new multicast channels of HD Radio. We still have a lot of work to do on this, but we are certainly headed in the right direction.

Translation: We know that in this case the naysayers are absolutely right about HD Radio…but never forget N.A.B. rule number one: Don’t confuse our listeners, our clients, and the press with the facts.

Third, we have to build for our future. Armed with what we learned from consumers in this survey - and with what we know about our business and the changing landscape - we have to act now to ensure radio prospers well into the next century.

Translation: Well, I know we’re already in the next century – it’s just that radio hasn’t caught up with it yet. So we're still partyin' like it's 1999.

Fourth, we must reignite our consumers. We need to remind them why they love radio.

Translation: I know he is now a traitor after recording “Radio Nowhere,” but as Bruce Springsteen once sang, long before his music was banned by Clear Channel, “you can’t start a fire without a spark."

With Radio 2020, we are reminding people:

  • That radio is accessible and everywhere they are. Translation: Of course that doesn’t mean they’re turned on and being listened to.

  • That it's simple and convenient to use- there is no CD to change, nothing to download, nothing to subscribe to, no playlist to build and nothing to recharge. Translation: There’s nothing – period.

  • That it's available to everyone, regardless of their education or economic status. Radio is a great equalizer, a great unifier. Translation: Most stations are equally bad regardless of format.

  • It reaches out to you no matter what your status or station in life. Translation: Unless it’s the HD Radio signal, then you’ll be lucky to get any kind of signal reach.

  • Ladies and gentlemen, as aggressive local broadcasters we are going to make radio new again. We will be reinvigorated. We will remind our listeners, and ourselves, of the value of this great medium. The campaign is called 'Radio Heard Here' and you'll hear more about it at the Radio Luncheon tomorrow. And it's going to be great. Translation: ‘Heard’ is past tense – when radio used to be great.

(We’ll skip the television portion of the speech and move quickly to the end….)

Today, I have chosen to talk to you about the future of broadcasting, but I don't want to ignore the aggressive advocacy efforts taking place on your behalf in Washington, D.C. As you know, we have a team of government relations advocates and legal professionals that are addressing more issues than ever on Capitol Hill and at the FCC. We have a board of directors that is more engaged than ever.

Translation: You should see the bills we're getting from our lobbyists!

Let me give you just the highlights from Washington.

Performance Tax - Nearly 200 members of Congress are standing with us against a performance tax on local radio. Translation: That is until the RIAA opens their war chest….

XM - Sirius Merger - Twelve state attorneys general and more than 80 members of Congress have written the FCC that the XM - Sirius merger is not in the public interest. The Justice Department's notion that the two companies do not compete is simply absurd. If combined, these two companies will control more spectrum than the entire FM dial.... Think about that for a minute... Translation: I know that the best thing that could happen to radio is the XM-Sirius merger. We already know what lack of competition has done for radio (pause for laughter)….but we need something to blame our declining ratings, revenue and time spent listening on.

Localism - More than 1,000 broadcasters and their public service partners have written to the FCC to showcase station's localism efforts. We're working to make sure that the Commission does not place unnecessary requirements on broadcasters that would actually hamper stations' efforts to serve their local communities. Translation: And we will also start our new campaign to make sure that voice trackers from distant cities can adequately replicate local accents.

Rest assured, we are advocating on your behalf, and we have the will and perseverance to succeed. But in truth, we could win every battle in Washington and it wouldn't make a bit of difference if we - you, me and fellow broadcasters - don't believe in our own future.

Translation: What’s that saying about winning the battles but losing the war?

We must believe in it. We must act upon it. We must celebrate it. As some of you know, I have four young children. And my youngest son, who is 5, is fascinated by space travel; in fact, he dresses up like a Star Wars storm trooper nearly every day... But recently this made me think - when astronauts leave our atmosphere they are knocked around by tremendous G-forces before they enter space. That is sort of what broadcasting is feeling right now. We are between the realms. Not quite out of one realm and not quite into the other. And that can be an uncertain, bone-rattling, teeth-jarring ride. But I have no doubt that we will pass through the turbulence.

Translation: And just like space flight, we've increased the number of un-manned radio studios.

We can not let up on the throttle. We can not doubt. Because to truly reap the benefits of the digital age, we must move forward without looking back. This is an opportunity to reinvent our business. But we can't accomplish change without hope and a renewed spirit. We must embrace our digital future and all the possibilities that come with it. We must aggressively promote this great broadcast medium of the future.

Translation: Let’s not look back at all the HD Radio campaigns that have failed. Let’s just keep coming up with more of them. Even a blind squirrel….you know what I mean.

And if we believe in broadcasting...if we believe in ourselves...and if we believe in our future…then we will prosper in the new digital era.

Translation: Cher, an artist that was broken by radio (I know it was back in 1965 – but…) once sang, “If you believe…” Now, let’s sing a long.

Thank you. God bless you and God bless America.

Translation: Thank God that’s over! I need a friggin’ drink.

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The Buzard turns 34

Friday, April 11, 2008

Radio: Clear Channel hops to it



Kangaroos are not indigenous to San Antonio.

But Kangaroo Courts are.

And Mark Mays has his troop of kangaroos all lined up.

On Friday, a Texas state court in Bexar County did exactly what we all knew it would do.
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It hurriedly issued three rulings in favor of Clear Channel.

You were expecting what? Justice?

Kangaroo court justice denied the banks’ request to dismiss litigation against them in the dubious sale of this shell of a company to private equity carnivores BainCapital and Thomas H. Lee.

Betcha didn't you know that the kangaroo court was invented in Texas. The term was first used in the mid 1800’s in the Lone Star state to reference courts that sided with local claim jumpers.

What’s changed? Not much when your initials are C.C.

The kangaroo court decision gives Clear Channel rights to hop to and pursue charges that the six banks involved in the deal – (Citigroup, Morgan Stanley, Credit Suisse, Royal Bank of Scotland, Deutsche Bank, and Wachovia), wrongly interfered with its closing by backing out of their $19.5 billion financing commitment.

The court also granted Clear Channel and Bain/Lee’s extra bounce request for expedited trial scheduled for June 2.

What Stonehenge was to the Druids, Bexar Court is to Mark Mays.

The banks argue that they had not reached agreement on a number of financing issues when Clear Channel and Bain/Lee filed suit, which “exemplifies the reason why New York courts will not specifically enforce a contract to lend money," the filing read.
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New York translation: How can you have a deal if there is no deal?

Bain/Lee seeks "specific performance" of a commitment letter that details the plans to fund the deal.

Specific performance means one party gets a judge to order the other party to stick to a contract.
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Bexar translation: You have a deal even if you don’t have a deal.

Let’s hear what Clear Channel has to say about the decision.

“We are grateful the court saw through the banks' latest attempt to escape responsibility for the enormous damage they have caused our company. We look forward to taking this case to a Texas jury on June 2."
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And what’s on the minds of the lending institutions involved? Step up to the mic, please.

“The Banks stand by their obligations under the Commitment Letter and now look forward to the opportunity to be heard in court. We were actively negotiating the many important open items in the credit agreements when the sponsors launched this litigation, constraining further discussions.”

While the banks and Clear Channel swapped statements, the shiver of lawyers involved gloated over the imminent billable hours.

That’s what lawyers love about the legal system. The more money you pony up, the more your rights get protected.

Now, here come the judge. Another one. Next Friday, there’ll be a hearing in San Antonio court before Judge Joe Francis Brown, Jr.

This one will deal with the tortuous interference of contract claim. The banks filed a motion to dismiss, arguing that Bain/Lee should be dismissed from the action under the forum selection clause in the debt commitment letter.

Since we’re dealing with a marsupial court, expect this Judge to schedule a preliminary injunction hearing or some reasonable facsimile just to screw with the New York court.
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What part of a judge being required to exercise good judgment do you not understand?
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I looked up “kangaroo court” in Wikipedia. It said, “Kangaroo courts are judicial proceedings that deny due process in the name of expediency.
The outcome of such a trial is essentially made in advance, usually for the purpose of providing a conviction, either by going through the motions of manipulated procedure or by allowing no defense at all.”

If it hops like a kangaroo, talks like a kangaroo, you can be reasonably sure it’s a kangaroo.
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Murray Saul's first public appearance in thirty years

Thursday, April 10, 2008

Radio: Clear Channel v. The Texas Strangers


Let’s recap the recent events and set the stage for tomorrow’s legal sitcom in Bexar (“that’s pronounced ‘bear,’ boy”) County.

First there was that odd temporary restraining order by Texas Judge John Gabriel against the six banks trying to back out of the $19.5 billion buyout of that bureaucratic morass known as Clear Channel by private equity firms BainCapital and Thomas H. Lee. As a rule, judges rarely issue a restraining order prior to holding a hearing to discuss the case.

But we’re talkin’ the Mays family/Clear Channel adaptation of justice here.

Dickum, Drownum, and Screwum.

The restraining order was followed by a decision from U.S. District Judge Orlando Garcia to turn the banks down and send the case back to give Clear Channel home field advantage.

Failing to get Clear Channel made a party to the New York lawsuit next week will put a staid squeeze on the banks to do the deal rather than risk a long and costly trial in the hostile-to-outsiders Texas state courts.

That’s the way the Mays boys like it - one huge cluster- beep, filled with blame shifting, finger pointing, and misinformation – and it’s all on their home turf.

Given the state’s record on comparable lawsuits, chances are somewhere between slim and none for the decision to go to the banks’ favor.

True, the six banks involved can certainly afford the best lawyers money can buy to represent them– and in almost any other court the Clear Channel-Bain/Lee deal of doom would get undone.

But even a Great White – the world's largest predatory shark –removed from its salt water ocean element and placed in one of the fresh water lakes surrounding landlocked San Antonio would die a painful death.

That’s the Mays’ game plan. Get the lawyers out of their comfort zones and into unfamiliar and hostile territory.
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How hostile? You’re in a state where a business school is named after the Mays family patriarch.

Now, let’s take a moment to judge the judges.

Shall we begin with Judge John Gabriel? We know that he and the Mays family are what one would politely call “close.” But everyone knows everyone else in Bexar county. Siding with Clear Channel? A mere coincidence, wouldn’t you say?

Though locked and loaded in tight with the Grand Old Party – all the way to Pennsylvania Ave. – the Mays family is non-partisan when calling in political chits.

Just ask Judge Orlando Garcia.

It starts with a call to Vernon Jordan.

You may know Vernon as a former aide to President Bill Clinton. You may, however, not know that he also sat on Clear Channel’s board of directors until 2003 – the result of being part of a deal that brought the former Chancellor Broadcasting – renamed AMFM – into the Clear Channel fold. That one happened during the go-go catch and swallow days that followed the 1996 Telecommunications Bill’s radio revisions being signed into law by – you guessed it – Bill Clinton. It might’ve been Bob Dole’s “midnight rider” – but it was Vernon Jordan who handed Clinton the pen to sign it into law.

Vernon was called into action to reach Clinton since Judge Orlando was his appointee and Mays needed a swing in his direction.

And it was done.

As an added bonus, the good Judge's web site bio was removed from the Internet late yesterday. *
We’re talking high stakes in a game that lacks written rules.
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And, coincidentally, it was another high stakes game that postponed Tuesday’s initial legal showdown.

Jayhawks-Tigers. The final game of the Final Four.

There were no hotel rooms available in San Antonio – at least in the √©lan the Bain/Lee principals and the bank’s lawyers are accustomed to.

The day in court was put on hold until tomorrow by “mutual agreement.”

Are they going to sweep the rooms for bugs? Not accusin', just askin'.

Clear Channel and Bain/Lee will push to make permanent the temporary restraining order.

The Mays family dropped another bombshell, which made the banks realize they’ll have to do a lot more than just bare their fangs to get through this one.

They hired notorious Joe Jamail as its lead lawyer.

Never heard of Joe? His web site says, “He’s been called a savior, a good ol’boy, and a S.O.B.” Some say he has an abscess where his heart should be.

He has over $12 billion in jury verdicts and over $13 billion in verdicts and settlements notched on his belt.

The case Clear Channel loves to reference is the $10 billion verdict Jamail won for Pennzoil in a tortuous interference suit against Texaco back in ‘84. Pennzoil had a deal in place to buy Getty Oil – but Texaco swept in and bought the company. Jamail took it to court and forced Texaco into bankruptcy.

In the end, Pennzoil got a mere $3 billion after Carl C. Icahn, Texaco's largest shareholder, settled with Jamail. The New York Times reported the settlement was the result of a “…. fight punctuated by thousands of hours of fruitless negotiations, legal wranglings, dashed hopes and charges by executives of both companies accusing the other side of greed, arrogance and duplicity.”
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Save that line. We may need to recycle it.

But let’s not judge all lawyers bythe way Jamail does legal. After all, it’s that 99 percent that give the other one percent a bad name.

Monday, April 7, 2008

Radio: The more things change....


I take a week off and what happens?

Not much.

We have the Mays family calling in chits and making threats to get the Clear Channel/ BainCapital-Thomas H. Lee buyout deal done.

So far, the only ones getting rich off this deal are those that wrote it and the lawyers trying to save it. My guess is that the lawyers will have everyone’s money by the time this dumb deal dies.

The banks that stand to lose billions if forced to complete the deal are getting a quick lesson on the Mays family’s rock-solid connections with decision makers in the legal system – and beyond.

On the other hand, no one ever went broke underestimating the ability of Clear Channel to screw up. When betting the over – under on how many days it’ll take for Clear Channel to dead end another deal, take the under.

There are two problems with this Clear Channel-Bain/Lee deal. The first problem is that they could lose. The second is, they could win.

From what I hear Clear Channel did luck out on one thing. No one at their 200 E. Basse Rd., San Antonio headquarters got trampled to death by - and you knew this was coming - the mass exodus of the former Jacor boys bailing from that sinking ship to rejoin their lord and master Randy Michaels at Tribune Corp. in Chicago.

The Clear Channel expatriates plan to do to television and newspapers what they did to radio.
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Then there was the HD Digitial Radio Alliance's Idea Summit in Orlando at the end of last month.

My invitation must’ve gotten lost in the mail.

One – ahem – research study had consumer awareness of HD Radio at 77 percent.

That one’s courtesy of Critical Mass Media, a division of Clear Channel, which is located at 200 E. Basse Rd. in San Antonio.

Come to think of it, the HD Radio Alliance headquarters are housed at 200 E. Basse Rd. in San Antonio, too.

That’s like a study conducted by the Mafia claiming there's no such thing as organized crime.

HD Alliance head crony Peter “Sgt. Bilk-o” Ferrara called for “fresh thinking and innovative strategies for growing and converting consumer awareness into sales.”

He claimed that the “broadcasting in HD” announcements lead the “average listeners” to believe they’re already getting stations in HD.

Of course that doesn’t explain the millions of dollars spent in previous campaigns, which played on the fact that HD Radio has side channels. Maybe the "average listeners" weren’t looking for them? Maybe the "average listeners" just don’t care?

They even have a new campaign: HD Radio: It’s time to upgrade! Upgrade from what?

The $100 million – plus already spent by radio chains for upgrading stations for a digital signal no one's listening to?

The $600 million – plus in air time participating radio stations contributed to promote and market HD Radio?

The fact that no one is buying HD Radios because retailers aren’t stocking them?

Or that the one chain that did went bankrupt?

The slogan the HD Radio Alliance should use is: Full speed behind.
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It was also announced at the Idea Summit that CBS was launching a new HD Radio station in a number of markets called Psychic OnAir.
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I'll say it again. You can't make these things up.
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If this is truly for real, it will feature a 24 hour line-up of name-brand psychics. I’m not sure if Miss Cleo is among them. Is she out of jail?
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Whatever the case, it's doubtful that CBS Radio will employ real psychics – because those who truly can see into the future already know that HD Radio doesn’t have one.
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Another classic Buzzard TV spot here