Death Of Radio Greatly Exaggerated

Michael Hedges October 31, 2011 Follow on Twitter

Adapted from a presentation to the REC Radiocentrum Brave New Radio conference, Brussels, October 27, 2011

I’m a radio fan. I’ve always been one. Part of it is the medium’s playfulness and the magic of voices. There have been times, though, when I’ve worried that radio might be doomed.

I’m surprised to see so many of you today. You’ve obviously not been listening to the new media gurus who have concluded that radio is a dead medium. Radio is dead because radio is old, not cool and not new media.

But wait, in virtually every audience survey in Europe radio listening is up. Not simply up, but at record levels. What’s that all about? With all the buzz about three-screens and new media dreams radio seems to have an edge, at least in the world of real people.

Radio has now been around for nearly a hundred years, three generations. Commercial radio in most of Europe has been around for about 30 years, roughly one generation. Most of the new media darlings are still infants; think baby food, diapers, whining, learning a language.

In the last 30 years we’ve seen an absolute explosion of radio channels and stations. Within the 44 countries in the UN definition of Europe – from Portugal to Russia and Iceland to Turkey – there are roughly 15 thousand broadcast radio outlets, about one for every 50 thousand people. Ten years ago there were half as many. What this has created is an enormous talent pool of radio professionals.

When I talk to colleagues in newspaper publishing about the sad state of their business I mention that 90% of the major European newspapers have been major newspapers for 50 years, some more than 100 years. New newspaper titles are rare. Notwithstanding a change in type-face or adding color here and there, publishers can’t hear the message from their readers.

Radio people don’t have this problem. Aside from talking a lot, we’re quite good at listening. And we’ve trained the listeners to tell us what they think. Telephone hotlines enabling direct listener contact were common at radio stations a generation ago. It’s no surprise that radio broadcasters were early adopters of social media as a means of further connecting with listeners.

There are, of course, legacy radio brands in every country. But the NRJ of 20 years ago, for example, is certainly not the NRJ of today. Radio programmers are constantly hitting that refresh button.

The DNA that has kept radio the most widely used medium have, indeed, mutated over the last hundred years. There are, to my mind, four primary strands making up that DNA: technology, programming, marketing and management. The interaction of these strands has contributed to radio’s strength as a medium of choice and, equally important, as a core media sector. But when one strand dominates the others radio suffers.

Technology, of course, invented radio. Transmitters, towers, microphones, audio tape, FM, stereo, audio processing, digital recording and playback and hundreds of other things I can’t even remember made radio what it is today.

Programming, of course, invented radio. “Theater of the mind” was created by radio writers, directors and actors. DJs and show hosts invented the intimate interaction with listeners. Radio journalists invented breaking news.

CNN changed the writing style of its news programs, years ago, when they discovered that more often people were listening and not watching the channel. So long as the Nielsen meter was whirring away they didn’t really care if people were sitting in front of the television set. The solution was bringing in people with radio news experience.

Marketing, of course, invented radio. Without revenue streams radio would have remained on the inventor’s workbenches. Just as important, radio broadcasters have used their sales skills to promote their stations and channels.

And management, absolutely, invented radio. Where would we be without all those accountants, HR people, consultants and boards of directors?

When commercial radio arrived in Europe the programming strand was, quite logically, firmly in control. The whole radio broadcasting brand category had a boost of energy from new stations arriving on the commercial side and, to a great extent, public sector broadcasters taking their radio channels more seriously. That competitive vitality produced a brand strength for radio that endures to this day.

New European broadcasters in those days, largely from the commercial sector, were very keen to learn about radio in the US. They’d visit stations, absorbing everything. In truth, the European radio people were asking very hard, very insightful questions that challenged many of the American radio broadcasters. And, too, for several years the American broadcasters association NAB held annual radio conferences in Europe. In time, that knowledge transfer reached its tipping point and European broadcasters were producing radio adapted for their own markets, inventing their own radio brands.

Perhaps the biggest gift American broadcasters gave Europeans was the marketing strand. By the time American radio programming reached its apogee in the early 1980’s the marketing strand there was monetizing each and every second of airtime. The first thousand dollar spot was sold in 1982 by Dallas station KVIL. Radio advertising sales – the vast majority local rather than national - brought in vast sums from non-traditional sources, merchandising and product promotion.

The marketing strand of radio DNA in Europe has developed slowest. One of my first radio projects in Europe was in Germany, owned by a major newspaper group, which is significant. The staff and studios were world-class, the news area looked like CNN. No expense was spared, almost.

Where’s the sale team, I asked. Oh, those people were in the basement of a building in a different part of the city. I decided to visit.

Yes, there in the basement were 12 guys sitting around a big table waiting for the telephones to ring, throwing pencils at each other. Stacked to the ceiling were very attractive sales brochures, thousands of them. The owner was, of course, in the newspaper business. When I suggested that we might take a few arm-loads and make personal visits to ad agencies and major advertisers, 7 guys quit on the spot. On the day when we were to actually hit the street only 2 showed up.

I suggested that the sales team move to the studio location. Perhaps they’d find a little inspiration being around all the on-air action. The station manager said there was no room. The station closed within a year.

Radio has an ad sales problem. If we break down the advertising business into two parts – creative and media buying – the dilemma for radio makes the job even harder. The creative side of the ad business has one primary motivation – bigger budgets for easily hyped sectors. Media buyers want the biggest possible reach for the lowest cost.

Advertising creatives have loved television for decades as they’ve tolerated print media. Nothing excites an ad agency creative director more than spending 6 or 8 million on a television campaign, preferably shot at an exotic location with a high priced director and higher priced talent. Bringing the client to the shoot is always in the budget.

With a few notable exceptions, ad agencies relegate radio campaigns to the least senior copywriters. One of the reasons the big radio award winners at the annual Cannes advertising festival are very often from agencies and producers from the southern hemisphere – South Africa, South America and Australia – is that television is where the junk ads are dumped, 18 minutes an hour or more, and newspapers have little credibility.

Yes, it has certainly improved over those days but radio ad sales in many European markets still suffers.  The solution will come from broadcasters. And that’s always been the case in the radio sector. 

The technology strand has taken dominion over the radio DNA, over and over. There was the great digital conversion in the 1990’s. Engineers had everybody’s full attention. Studios and transmitters were no longer purely analogue. Digital systems profoundly changed radio operations, from music playback and microphones to studio design

There was an EBU radio conference a few years ago where every speaker had more to tell about the latest and greatest digital thing. The EBU’s head of radio Raina Konstantinova whispered to me at one point, “God save us from the engineers.” That technology cycle seems to be waning.

Internet radio is certainly on the rise but it’s not driven entirely by the technology strand. The technology necessary for internet radio has existed for a couple of decades. All that’s necessary is bandwidth. Internet radio has, as they say, a million fathers; part marketing, part programming and part management. The biggest driver of internet radio is completely external, radio listeners discovering a new level of interactivity, which was promised by DAB, now an orphan.

Radio owes a lot to Steve Jobs and Apple. When the iPod and iTunes changed the way people consumed music radio broadcasters were finally released from the bondage of the music industry. In the last five years radio broadcasters have put more stock in performance and communication with people. The arrival of social media portals – Twitter, Facebook and others – has only enhanced the intimacy radio broadcasters share with their listeners.

I’m a fan of Italian radio and Italian broadcasters have integrated radio and social media in amazing ways. Entire programs are constructed in real-time around listener interaction. Obviously, there are standing advantages; smartphone penetration is high, Italians love their radio and love to interact. I’d quote audience figures but they’ve had no audience surveys in two years, which might be another Italian advantage. Also, the radio share of advertising revenue in Italy is the highest in Europe. 

The technology strand of radio DNA has been wildly influential. The great digital radio platform debate – certainly more than the reality – has opened a new, exceedingly important concept; platform neutrality. Radio is no longer a rabble of channels on AM, FM, internet, DAB, DVB-T, smartphones or WiFi. It’s all of that.

As we know, DNA is very sensitive to external factors. Smoking too much weed or exposure to radiation cause mutations. Radio DNA is also sensitive.

The music industry attempts, from time to time, to affect their agenda on radio broadcasting. Certainly they like to extract money. Music quotas are one example of the music industry pushing radio off track. But, at the current moment, the music people are still trying to kill the internet.

In the broader context, the most worrying external factor is the uncertainty created by politically driven policies. Right now, public radio is under great threat. I believe the dual public-private system in Europe only creates brand strength for radio broadcasting. The sum is truly greater than the parts. In some cases, without doubt, public broadcasting has abused its privileged status. On the other hand, public broadcasters can be great competitors, raising the performance level of radio and providing unique services.

Private sector radio is under different but similar threats. Music, news and advertising quotas do not allow markets to work efficiently, listeners and advertisers are simply chased away. Ownership restrictions are becoming more and more common. We’ve seen license renewals denied in several countries not on merit but for political reasons. I say this to make my case for strong national broadcaster associations that are prepared to fight.

I presume everybody in this room has read or heard about new biography of Steve Jobs, co-founder and guiding force behind Apple. It was written by Walter Isaacson. Apparently it’s already this years biggest selling printed book. The out-takes have been interesting. I wonder how many newspaper people are looking for inspiration by planning an LSD weekend.

All criticism of Steve Jobs aside, the man has been an inspiring figure in consumer marketing. His attention to detail is legendary. But I want to draw attention, so very soon after his death, to something he said at the Stanford University commencement in 2005.

“Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma – which is living with the results of other people's thinking. Don't let the noise of others' opinions drown out your own inner voice. And, most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”

Radio people have lots of heart and great intuition. Please use both. And “stay hungry.”

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