Radio's local renaissance

 

by Mike Kroll

 

If you follow the news you could easily become convinced that local radio is an endangered species. First, you have the huge corporate conglomerates owning hundreds or even thousands of radio stations and programming them from afar. Then you have the two satellite radio options of XM and Sirius offering a wide variety of music, news, sports and entertainment programming for a monthly fee. Third, you have the growing popularity of Internet music streaming and podcasting. And finally, you have the most personal “narrow-casting” of the MP3 or iPod. Just where does the traditional small local radio station fit in? According to Roger Lundeen, general manager of Galesburg Broadcasting, the stand-alone small local radio station is already an endangered species but local radio just might be staging a renaissance of sorts.

“Local radio is coming back, despite the competition you mention. Ironically, it is in the major radio markets that local radio is anything but local. In small and medium markets local radio is returning as corporate owners like Clear Channel are selling off hundreds of stations that don't earn enough to please Wall Street. The economics of radio today make it almost impossible to profitably operate a single stand-alone radio station even in a large market. Instead what you find are groups of commonly owned stations that share expenses and resources but deliver audiences to mostly local advertisers.”

Lundeen works for John Pritchard of Galesburg who owns both Galesburg Broadcasting and Pritchard Broadcasting (Burlington, Iowa) and together controls two groups of four local radio stations each. Lundeen oversees the four Galesburg stations, WGIL-AM, WAAG-AM, WKAY-FM and WLSR-FM while Pritchard focuses on daily operation of the four Burlington stations. This mini-mogul role comes naturally to a man whose grandfather, Omer Custer, almost literally owned or controlled every business of note in Galesburg during his lifetime including WGIL, the Register-Mail, the local telephone company and the largest local bank. Pritchard himself had been publisher of the Register-Mail before a prolonged family squabble among the heirs and that famous bank caused the disassembly of business interests. Pritchard wound up buying the two Galesburg radio stations the family owned at the time and later starting WKAY and buying WLSR from the owners of WAIK. He used his own business acumen to form Pritchard Broadcasting and purchase the four Burlington stations.

WAIK was and still is owned by a competitor but today WAIK's ownership is no longer local. Meanwhile, in Burlington, Pritchard Broadcasting faces that 800-pound gorilla of radio, Clear Channel Communications, as the competitor and, apparently, holds its own. “The interesting thing is that where you once had two or three community radio stations competing for listeners today you might have 8 or 10 stations competing for their share of a smaller listener-base,” noted Lundeen. “The markets have been segmented intentionally by format so each station can target specific listener groups and sell that targeted listenership to their advertisers.”

To grab and hold that shrinking pool of radio listeners, Lundeen believes stations like his have a very real advantage by maintaining their local identity and status, even if that is done in ways you wouldn't at first consider. “Around here I recognize that if there isn't something special about my radio stations I am going to lose listeners to the competition and that competition isn't always terrestrial radio. Truly being local helps set our stations apart and you will find many other small groups of radio stations have discovered the same thing in their market. The two keys to this are first, a commitment to local news and sports; and second, local ads.  Our number one goal here has been to create and play the best locally produced ads for our clients. For many listeners the presence of good, well produced local ads is what makes a radio station local and separates us from a corporate station with mostly national ads. On the other hand, playing really bad ads is a very good way to kill listenership so the quality of those ads is critical to us.”

“People like to hear ads that affect their lives and in many cases it is the local personality of the business that makes an ad successful. I want us to use local business people in their ads because it works and makes a better ad even if they don't sound like radio professionals, sometimes because they don't sound like radio professionals. Our revenues are almost all local. Ninety percent of our ads are local, probably even more. I believe people chose to listen to us in large part because of those local ads. It makes us more comfortable than a national broadcast because we are there hometown radio.”

Another issue that some attribute to the “demise” of local radio is the growing importance of syndicated programming. Nearly all radio stations now use at least some syndicated programming including Lundeen's. Outside of the morning with Terry Cavanaugh, local news breaks, local high school sports and, of course, those those above mentioned commercials most of the programming on WGIL is syndicated.

“The day of local live radio is just about over even in the large markets. Chains like Clear Channel are essentially equivalent to syndicated programming all-day long and even locally produced programming is seldom done live anymore. We audio track most of our music shows and that allows us to produce a much better and more consistent product, although less spontaneous. Yes, that does mean that we can save money as well but the option in today's radio marketplace is to expense yourself out of profitability. We can produce a better radio product economically by consolidating talent and other resources such as engineering and marketing. Almost no one could afford to run four stations the old way today and they couldn't survive as stand-alone stations either.”

Audio tracking is part of the automation commonly found in even the smallest radio station today. Computer allow music, commercials, and nearly all the content of the station to reside on a large hard disk that can be programmed to present the recorded material at the specified times. Without automation it would be technically almost impossible to transition back and forth between various syndicated and locally produced programming without embarrassing glitches. Audio tracking means that a show host has a list of scheduled times within his or her show that must be recorded to precisely fit the allotted time. Each segment is individually pre-recorded and the computer puts it into the streaming mix as scheduled. A four-hour radio show can be recorded in less than a fourth of that time in one compressed time period. Thus releasing that talent to do other necessary chores such as record commercials or host another prerecorded show, perhaps on a totally different but related radio station. This means a group of radio stations can today be operated with a much smaller staff and still program locally.

“The downside to this development is that there are far fewer opportunities to gain an entry-level position in radio today because of the smaller staffs. Lots of people in radio today began as part-time flunkies at radio stations like WGIL running a late-night or week-end shift or engineering ball games. Those late-night shifts are easily handled by the automation today and while ball games still require a live person due to unpredictability that can be covered with the existing staff or at least fewer part timers. The upside is that the opportunity to advance in radio has never been better, once you get in the door and provided you are talented. There is so much competition that it is easier to hire talented people today and that means a better product.”

Regardless of how the stock market may be trending today, even in broadcasting stocks, Roger Lundeen is bullish on the prospects of local radio.

 

3/8/07