[BC] Does a Glut of New Signals Mean More Revenue?

[Rich Wood]

------ At 04:39 PM 8/25/2006, Robert Orban wrote: -------

>It seems to me that the main business purpose of the HD2 channels is 
>to keep people listening to radio (as opposed to abandoning it to 
>iPods/streams/whathaveyou) by giving them more choice of program 
>material. The argument about diluting the revenue stream ignores the 
>big picture -- broadcasters *hope* that making radio more compelling 
>for listeners, it helps retain (or maybe even increases) the number 
>of "people who listen to the radio." The pool of advertising dollars 
>is variable and will shrink if radio's total audience declines.

 From what I've heard on the secondaries there's no "wow factor." 
They're mostly voicetracked jukeboxes. If you've been associated with 
this business over the past decade or so you will have heard many 
complaints about Docket 80-90 where a limited number of additional 
stations were added. Existing stations complained that there wasn't 
enough revenue available to support more competition. Now we're going 
to nearly double the competition.

Rich Russo of JL Media probably handles more ad revenues than anyone 
on the planet. He was interviewed in one of the trades and made it 
clear there's no additional money, especially for mediocre 
programming. Broadcasters can hope all they want. There simply isn't 
an additional $1.6 billion in ad money out there primarily because 
there isn't much showbiz out there.

As part of my Polk and BA listening I spent time with the 
secondaries. They were a step down from unexciting analog. What 
amazed me was WTIC, Hartford with a monster 50Kw signal that travels 
hundreds of miles filling space on their FM's secondary that goes 
about 30 miles. A cynical person of my acquaintance suggested it was 
because it didn't cost anything. The real question is whether or not 
this uninspiring programming is going to entice consumers to spend 
several hundred dollars to hear Rush Limbaugh when he can be heard 
all the way home on an analog AM. Part way home on a secondary.

The assumption that radio's total audience will decline is false, 
especially when AM IBUZ is likely to kill off more stations than any 
iPod ever could.

Rich