Radio In Denial? - The XM Sirius Merger
Friday, March 28th, 2008The people that brought you the 8090 docket (I owned some) and nearly doubled the number of radio stations with HD Radio (I like the quality) are now up in arms about the XM Sirius merger. Why? Anti-competitive behavior? Mixed-up Priorities? Lack of belief that local IS better?
Here’s the bigger question: What will radio do when the Internet is available in all cars and there are thousands of stations playing Fergie records? Will we finally wake-up then and start re-investing in our content and communities? Will it be too late?
Oh, I know, everybody has content “deals” so they can have the content for their audience. The same content available in a ton of other places. I’ve always admired Saga Communications for standing up and dropping winning shows like the Sean Hannity program because it was also going to be offered on satellite. The powers that be will tell you to grow-up;  we can’t stop it. True enough. What they don’t say is that value diminishes as repeated exposure of the same content increases fatigue and burn-out.
Forget the politics from the 11 state Attorneys General about caring about the public good. Eliot Spitzer was an Attorney General. Two of their three points about mandates for a common radio and a la carte pricing speak to its “suck-up-ness.”. Work on a common reciever has been going on for years. Anyone attending the Consumer Electronics Show can tell you that. Mel brought up the a la carte pricing. So, the final point they want is to force the combined satellite service to give up one of its spectrum spaces.  If the new XM Sirius only has the bandwidth of one service, Radio has effectively cut the number of satellite channels in half. If the merger is blocked, one if not both, could fail or become something less competitive. Either way the unbelievable “head in the sand” mentality of our industry prevails.  XM and Sirius are radio. People listening to them are radio listeners. They don’t have the iPod or CD plugged-in. We are now more likely to lose a listener than gain one with every new birth. We need those listeners liking something about radio.Â
Clear Channel is asking for stricter enforcement of decency standards be applied to satellite radio. It wants the FCC to force HD Radio into all new combo satellite receivers, wants part of the satellite radio spectrum opened up for a possible commercial competitor, and five percent of the spectrum be set aside for public interest uses. I like the HD Radio idea. But, I wonder how the FCC will view the statements about public interest programming as it considers “re-regulation” to force more local programming. If a station were required to give up 5% of its air time for public interest programming - that’s 8.4 hours, 64+ spots per week per station. I do like the idea of a committment to serving the public interest.
Competition is good. It makes Radio better. This merger is just the latest attempt to mask radio’s real problem. Listening is dropping at an alarming rate because we’re not giving them a reason to listen.  There’s a growing number of people that view radio as just a commodity or music service. We’re not creating an emotional attachment to the radio station.
Radio is in denial about its lack of compelling, creative content. You can blame iPods, satellite radio, the Internet, or whatever you want. All worth being acknowledged. But, a Country Radio Broadcasters study has shown country listeners with iPods actually spent more time listening to radio. Marketing 101 - its easier to get chocolate lovers to eat more chocolate than eat vanilla. Sure, all those things occupy time. But, if your stuff is better than their stuff, you win. That’s how its worked since the beginning of time. If you don’t give people a reason to listen they won’t. Nobody gets hurt if they don’t turn on the radio. Nobody but us.
The XM Sirius obsession is another symptom of denial. Go back and look at the trades when radio guys were critical of satellite saying all their great content came from terrestrial radio. Does that mean the well’s run dry? No, it means today’s Wall Street over Main Street mentality makes decisions from the inside out. No way to develop listener driven programming. It takes time and money to develop concepts and talent. There is some experimentation going on like Clear Channel’s Lonestar 92.5 in Dallas. Its moving more mainstream to boost ratings but I applaud Clear Channel for trying some different things. These stations are far and few between.
I subscribe to both Sirius and XM. I do it for competitive reasons. To be honest, I’m also a pretty big Howard Stern fan and I can’t get blues and jazz on the radio. I like Maxim, Frank’s Place, Ethel, and some of the speciality stuff on both services. My wife has spoken to Martha Stewart three times. This was exciting for her and her chops are heavy in TV and movies. People get excited about radio when there’s something to get excited about.
We’re thinking about the wrong things these days.  The XM/Sirius combo could be bad for our business. The FCC might force us to do a better job of serving the public, is that bad programming? Stock prices are dropping and we’re no longer the media darling.  Why aren’t we thinking about why radio listening is dropping like a hot potato?
We need to focus on our first customer, the listener and this will take care of our advertisers and shareholders.  This means creating great content. That is more than just playing the right records and saying some off the shelf radio line about “12 in a row.” The listeners already know that 12 songs in a row means 12 spots in a row. They know because we’ve trained them.
Its time to realize we created almost every problem we allegedly have. Stop the blame game. The buck stops here. Local Radio stations in local markets are where it’s at. We’ve lived through a lot of competition and gotten stronger for it. But this is different. Television, eight-tracks, cassettes, and CDs were all going to kill radio. They all took time to have impact. We had time to catch up.
Technology no longer affords radio the luxury of time. Internet years are like dog years. If its not satellite it will be something else. We must expand radio station brands across as many platforms as possible. At the most basic level it increases our opportunity for more time with the listener. You can’t deny that’s a good thing.