Jim Cramer, the renegade stock picker from CNBC and TheStreet.com, features a video on his site that totally trashes broadcast radio, and its industry leaders. It’s a tough video to sit through, but important to realize that his well-respected opinion (in some circles) is now "out there." Clearly, the Wall Street "futures" on radio are weakening, and commentaries like this one will only reinforce the negativity. But when you watch it, notice that Cramer talks about the end of radio as we know it. Mark Ramsey picked up on this in his blog over the weekend, and it caught my attention, too.
If you go back 18 months to Summit 12 in Dallas, Jason Calacanis essentially said the same thing (in a nicer way) when he suggested that "radio surrender." After the room stopped gasping, Calacanis went on to paint a creative picture about how radio could reinvent itself. One of his premises was that radio stations have core competencies that could be retrofitted for the digital age. He talked about creating podcasts, noting that radio has the cume, the production skills, and the sales arms that could make this a great business model. In many ways, NPR is proving that with its podcast successes.
If you haven’t seen Calacanis’ video, I suggest you watch it, because it both scares and inspires. Even if you were in the audience that day or you’ve already seen it on our site, take the 40 minutes and watch it again. >>CLICK HERE TO WATCH<<
This is just one idea about how radio can creatively problem solve, but we will need to go much farther if we’re going to get out of this soup. It’s not just about creating the next Jack, programming to PPM, or changing formats. That’s just "shuffling the deck chairs" on a ship that is increasingly finding itself in very rough waters. Notably, Cramer didn’t mention HD Radio. Yet, there are possibilities with that technology that remain untapped because radio has not addressed its potential with an ounce of creativity or enthusiasm. Slashing expenses and laying off hunks of the workforce may mollify Wall Street for a few days or even a quarter or two, but it won’t solve the greater problems that face the business. Not the least of which is the perception that the business "as we know it" is in trouble.
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Fred was inducted into the Radio Hall of Fame in 2018.
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Thanks for blogging the Cramer rant but the link back to Calacanis is stunningly on target. 18-months since Calacanis delivered an on target assessment and steps to rebuilding radio. Has anybody made any successful moves?
Fred,
It’s “out there” alright. Will the “truth” set us free? I hope so. Radio needs to evolve just like it has in years gone by. Opportunities await! We’ll only be able to take advantage of them if we don’t allow “the street” to keep holding us back.
BigRadio has a digital jones, courtesy of 90s cynics who pimped off digital as universal panacea.
But listeners don’t. That’s why HD is finished. So, BigRadio wheedles more undue favor from FCC to skew things for digital, and against the listeners it’s supposed to serve.
People love computers, Blackberries, and cellphones. Do they care, they run on digital, analog, or wood shavings? Doesn’t BigRadio get it? Isn’t that why BigRadio’s HD obsession costs it both listeners and investors? Listeners like content.
When BigRadio gets clean of its digital jones and rehires talent, BigRadio will again enjoy good times.
Radio’s future isn’t digital. It’s future is content. An unintended consequence of sly, incremental HD jamming was that listeners fled BigRadio even faster.
Who wants their ears blasted by busted steam-pipe shrieking from some HD station, when tuning in a favorite program? No one.
Enter iPods, WiMax, those tape and CD books you ‘read’ while driving – and exit HD. AM/FM/Shortwave radios are becoming popular again. Who needs HD? No one.
The 90s gang condescendingly exhorted us to follow Europe’s example. OK, consider this. As BigRadio’s gasses off about HD, digital is on the ropes in the UK. It was supposed to be the Big Thing. Nope.
Germany junked digital radio after decades of trying to entice listeners. Australia shunned it.
LeAM and FM aren’t the problem. Content, or lack thereof, is. Fix that, and BigRadio stocks might regain their previous allure.
Paul Vincent Zecchino
Manasota Key, Florida
11 February, 2008
Fred,
Let’s keep things in context. JC talked down radio stocks and was speaking of those heading the traded groups. It’s not that he’s down on the business of radio rather he’s down on putting money into any radio securities. He’s right. Radio securities suck. My sense is radio remains a good business – ask Jerry Lee or any of the other good operators that run good stations (ones they also bought right).
While I certainly agree with you that radio has an urgent need for reinvention, my sense is too many of radio’s best operating practice is now well beyond the best used by date.
The first tribe of wireless needs to get focused on getting different, getting better ain’t going to do it. It’s understanding the solution is to change the denominator.