In one of the more interesting stories to break this year, Google has pulled out of its radio foray, and analysts are left to wonder what happened. And whether this is good or bad for radio.
Well, it may be all of those things, and none of those things. But it sure isn't surprising. Supposedly smart people have misunderestimated (sorry, there are elements of George Bush that I truly miss) radio for decades.
Way back in the '70s, I was part of Frank N. Magid's original Radio Division. Frank is the true genius who essentially created "Eyewitness News," and the basic news format you've come to know and love/hate since you can remember watching local news. Using basic audience research, Frank made a fortune by swooping into a local market, conducting a study, and then using that info (along with his formula) to elevate the #3 local news show into the top dog position in short order. Many of these lowly rated stations were of the ABC variety back then, and Frank and his company rapidly became heroes – and very wealthy at the same time.
Many of the guys who owned these TV stations also owned an AM and FM, too, so the obvious question was: "Frank, why couldn't you perform the same ratings magic with my radio stations?"
To which Frank replied: "Of course I can. In fact, radio should be even easier."
So, in we marched – an entire team of smart researchers and consultants with the task of elevating mediocre and also-rans stations into dominant positions. And by and large, the program was a failure.
Why? Because at its root, fixing local TV news was simple. There were essentially three players in town all doing pretty much the same thing, and the variables were simply news, weather, and sports. You got those right (OK, maybe you installed an Action Reporter, too), and you were golden.
But radio proved to be considerably more complicated. There were lots of stations, a rainbow of formats, DJs, news, weather, traffic, music, dayparting, contests, and many, many moving parts. Like format changes. TV news shows don't change formats – they change sets, and people, and ties, but they continue to produce the same product ad nauseum. In radio, when it doesn't work, we flip to Classic Rock. Or Country. Or Hot AC. Or whatever the new flavor of the month happens to be.
Bottom line? Radio was a lot more complicated and nuanced than it looked. And because our research often took months to turn around, by the time we showed up with our gilded hard-cover tomes of data, market conditions had often changed.
Precisely what discouraged Google is anyone's guess. Commoditizing radio sales was probably part of it, because as much as the industry's consolidators have tried to aggregate, glom, and add it all up, radio is still a very local, eye-to-eye business. Better than perhaps any other medium, it puts butts in seats, grabs your attention, and drives you to websites. And at its heart, radio is a local, relationship business that connects communities like no other.
This morning, WCSX's Deminski & Doyle are raising money for Children's Leukemia Foundation in a "Camp Out For Kids" promotion. The Eagle in Sacramento (along with other Entercom stations in that cluster) is doing a Radiothon for the UC Davis Children's Hospital. 97Rock in Buffalo is covering the crash of the Continental flight in their town. And WMMR's Pierre Robert is doing his coat drive for Project HOME.
On the programming side, we get it. If you give us a local staff and the budget to have some live DJs, we can make connections and build relationships better than your newspaper, your TV station – or your search engine. Give us Ryan Seacrest and no jocks, and you've created a station that has no local roots whatsoever.
It's the same deal on the sales end, if broadcasters could just figure it out. Google did. Selling radio by the pound doesn't get results. It might achieve spreadsheet goals, but it doesn't move product, serve advertisers, and it has nothing to do with local communities.
The fact that some of the smartest folks on the planet (OK, Silicon Valley) couldn't get radio sales right should tell us something. Street smarts, local relationships, and on-the-ground contact is what got us to this dance to begin with.
Jacobs Media has consistently walked the walk in the digital space, providing insights and guidance through its well-read national Techsurveys.
In 2008, jacapps was launched - a mobile apps company that has designed and built more than 1,300 apps for both the Apple and Android platforms. In 2013, the DASH Conference was created - a mashup of radio and automotive, designed to foster better understanding of the "connected car" and its impact.
Along with providing the creative and intellectual direction for the company, Fred consults many of Jacobs Media's commercial and public radio clients, in addition to media brands looking to thrive in the rapidly changing tech environment.
Fred was inducted into the Radio Hall of Fame in 2018.
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Radio fills the important community between galactic Google and the personal world of MySpace. It’s valuable for merchants and personal for listeners. Try to be Google or MySpace and fail. Be radio and succeed.
That’s the best radio article I’ve ever read.
Couple of articles popped up recently that shed light on some of this.
From the NY Times – an article about how Google decides to bail on a project.
Bottom line:
“All of the shuttered projects failed several of Google’s key tests for continued incubation: They were not especially popular with customers; they had difficulty attracting Google employees to develop them; they didn’t solve a big enough problem; or they failed to achieve internal performance targets known as “objectives and key results.””
Read the whole thing here:
https://www.nytimes.com/2009/02/15/business/15ping.html?_r=1&em
And from Business Week – how Google. after bailing on Radio & Newspapers is staying in the game with TV ad buy program
From the article:
“Given the coming convergence of TV and the Internet as well as advertisers’ hunger for Web-style measurements for their TV commercials, chances are good that Google will stay the course. But it faces a tough slog. A range of companies are also developing technologies that do a better job of allowing advertisers to target TV viewers. Then there is traditional media’s deep-rooted suspicion of Google. “They’re the pretty new girl in high school,” says a senior ad sales executive. “We hate them for that.”
I appreciate the point you make Fred, in reminding radio people that what we do isn’t as simple as it may appear. We could all use a boost of self-esteem.
But what I find most interesting in all this is the difference in postures taken by Radio, and by Google.
For the last 2 years, Google has been taking on the risk of learning new things, experimenting, trying things that have never been done, and looking for new ways to do what it already does.
In those same 2 years – the Radio industry has done none of those things.
If I were asked to summarize the most important difference between new media and old media – that would be it.
It’s cultural.
Bill/Jeff, thanks for the comments. Jeff, you’ve nailed a point we’ve talked about extensively in past posts. Companies like Google, Amazon, & Apple are always asking “Why not?” They aren’t afraid to try new things & to fail. In radio, we’ve playing defense at a time when consumers relish new things. Innovation, unfortunately, is not valued, which is why we sound essentially the same.