How I See Radio’s Digital Future

Imagine not having to tune in to a terrestrial radio show from 5 to 10 am but still hear the things about radio you used to love.

Instead -- a personality or team of personalities making content available on mobile devices like the iPod, iPad, iPhone, smartphones, car entertainment centers and whatever other technology may surface in the months and years ahead.

This terrestrial show does not exist on-the-air. Just as a cornucopia of features for your favorite mobile Internet device.

You’re a listener.

You choose from a menu of “bits” or “features” all variably timed. But you have the option to mash them up in a menu that, say, allows you to start with the “Kim Kardashian” bit and ends with Lady Gaga.

Or sample today’s content a la carte.

For now, the content is likely to be just talk because record labels have made it too expensive for Internet and mobile content providers to include music in these new media offerings.

But -- no worries.

There are plenty of places to get your fill of music once you’ve been entertained by "radio" personalities in the digital future.

And, at any time, you can take a break and choose an app that will give you the latest live, local newscast.

If you’re watching and not just listening, you can view the content -- see the pictures, videos.

Want to learn more, you can dig deeper and read – or save text for perusal later.

You can respond instantly through the traditional social networking tools or you could respond through a special, closed group of listeners known as “your fans”. These people can interact with each other. You can provide additional content and yes, you will be required to spend time interacting with your fans. In the future this will be seen as a benefit not a mass marketing tool.

While each segment may be sponsored in traditional ways with live-read commercials from your favorite personalities, produced commercials, unless they are very creative, would probably be a non-starter in the digital morning show of the future.

Of course, you could see visual ads on the phones and mobile devices.

But the greatest and largest source of revenue will come from event-based deployment of your fans – that is, on a regular (maybe even monthly basis), you invite fans to local venues to participate in live happenings that are sponsored by companies looking to have direct access to your fans.

A Wango Tango for niche groups, if you will – referring to the annual Clear Channel event developed by Roy Laughlin and still going strong today.

Parts of what I have just described are already available and some are under development.

But to bring it all together, radio companies have the inside advantage over other content companies in informing and entertaining digitally. Their biggest disadvantage is a dim view of the digital future.

Many of you are aware that I use my business as a “lab” to develop things such as paid models for content and the next iteration of social networking beyond Twitter and Facebook. I often first try what I ultimately recommend.

By the time I convene my next Media Solutions Lab in Scottsdale (January 27, 2011), I will share the latest successes and challenges with content providers in and out of the broadcasting space. We plan to spend some time on how to effectively transition to the digital future.

What is exciting is that the tower and transmitter is being replaced by the mobile Internet through intuitive and entertaining devices that fans carry with them – meaning you no longer have to wait for a car radio to be turned on or a clock radio to go off in the morning to connect with your fans.

These fans in the digital space are always connected – to you!

And you see I have used the term “fans” and not “P1s” because we need to humanize the audience. Ask me about the people who read my work every day and I can go on for a half hour. There are between 175,000 and 200,000 visits per month, passionate, well-informed people curiously looking to the future and trying to comprehend present media trends.

That's just the beginning in the era of social networking.

If I tell you that I communicate with up to 300 “fans” a day who write to me personally and actually know them from previous emails, circumstances, likes and dislikes, you'd begin to see that my view of the digital future is not to create new age excuses to do mass marketing but personalized contact to promote social networking.

Social networking is two-way communication -- not today's direct mail.

One third of all the topics I write about are suggested by “fans” – and most support my independence from undue advertiser influence.

The lines are blurred – and it’s a good thing.

Radio can be the provider of content – written, spoken, and viewed.

You and I can as well. You’ll hear me, see me (God forbid) and continue to interact.

But there are new rules.

One, all content must be unique.

Copycats may have worked in format radio but it will lay an egg here.

Two, what you present must be compelling – that is, will you start your day with it?

Will you end your day with it? Will you use it all day? Or just check in two, three, four times a day the way we used to encourage them to use news radio.

There will be no more traditional morning rush.

Each individual with access to mobile Internet will determine their own prime hours. Maybe they listen to Pandora on the way to work and listen to a favorite personality (sans music) at night or in their spare time.

And three, content must be addictive to succeed.

With an infinite number of streams, apps and ways to reach audiences, what you do must be so addicting that your fans will look forward to coming back for more.

Terrestrial radio will not die. There will still be an audience for 24/7 programming – but not repeater radio which is not unique, compelling or addictive. And terrestrial radio will likely never again be a growth industry as long as consumers want to be the PD of their mobile devices.

I see the digital future as an aggressive growth business which is being held back currently by music industry royalty impediments, radio companies in denial that 24/7 broadcasting is not how consumers want their content and the failure of many of us to embrace the unknown.

All it will take to buy a ticket of admission to the digital future, is an open mind.

And those tickets have been hard to come by in a media industry obsessed with the past.

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.

Bigger Recoveries for Radio Groups That Laid Off the Least

If we’ve learned anything from watching radio’s consolidators try, try again to reinvent the industry, it is that the radio listener has by and large become collateral damage to refinancing.

Even as I write this, a blatant move is afoot that would allow Citadel to push through a pre-arranged bankruptcy that will enable the emerging owner/lenders to either sell or grow their company by acquisition.

That is, one moment you’re broke and then, through the magic of pre-arranged bankruptcy, you suddenly become an acquirer.

All this doesn’t seem fair in light of the fact that thousands of radio jobs have been eliminated by consolidators under the guise of financial pressure due to the recession. While the recession had a real impact, it turned out to be cover for their real move that was to downsize the assets so that they could put them in play again.

Jobs lost.

Talent expended.

Digital and mobile competition disregarded even as a new generation starts to embrace options other than broadcasting.

All of this would be unthinkable in the world of Apple -- the company that built shareholder value all along during the same recession broadcasters hit behind.

CEO Steve Jobs, not only the master marketer but, the Zenmaster of all generations.

Don’t get me wrong, Jobs is a money guy. But he approaches making money by building products and services that consumers want even if they are not sure at first that they do want them (think iPad).

Jobs snookered the major record labels back when he invented the iPod.

You may recall that MP3s existed before the iPod but they didn’t really take off. Record labels as usual were part of the problem. Jobs went in and pitched the self-serving label execs on a new way to stop music piracy because Napster had reared its head at the time and the labels were fearful.

Bingo.

Jobs played to the fears and egos of record execs and they allowed him to make their music available for the iPod. But Jobs outsmarted them in other significant ways as well. He got them to let him set the price of music downloads at 99 cents per song and that standard, until recently, was the only price for a "tune".

What’s more -- Jobs started the tide away from purchasing albums to cherry-picking songs at 99 cents. The labels have never been able to put this genie back in the bottle again, but consumers instantly liked not having to buy an entire album when all they wanted was a song or two.

You can see what happens when smart people appeal to the arrogance of industry execs who think about how they want their industries to look instead of the way consumers want it to be.

Jobs is still keeping consumers foremost in his marketing mind.

Buy an iPad 3G model and you get to decide on the $15 minimum mobile charge on a month-to-month basis. Forcing the despised AT&T to employ monthly pricing and no contracts is taking care of Apple by taking care of the consumer.

Consumers don’t want another two-year relationship with phone companies. This generation wants as little commitment as possible and Jobs, the more powerful he gets, has been able to deliver it on the new iPad.

Now let’s look to radio.

Thousands and thousands of good radio people were forced out of their jobs when Lew Dickey, John Hogan, Fagreed Suleman and their followers thought they knew how to reinvent radio.

The problem is -- listeners didn’t want their radio diminished into repeater formats, voice tracking and non-local content. The pure gold of radio -- local personalities -- were sent packing. I know of deals where some of your major consolidators are paying multi-year contracts to personalities (and we’re talking well in excess of $500,000 a year) to not be on-the-air.

Let me be clear.

They are still paying every penny not to have popular personalities on their air.

You may think they are nuts, but they think you’re nuts because in some cases these radio corporations are able to report better financial results to shareholders by employing this tactic.

So as Apple is guided by the thought that they must super serve their consumers, radio companies are obsessed with financial shenanigans that allow them to reduce the quality of the product and still charge advertisers the same money. If Apple offered consumers half an iTunes download for 99 cents, their customers would leave them.

Same thing in radio -- give listeners less and they’ll go elsewhere.

Except there are plenty of “elsewheres” to which they can now escape. I can see me spending more time on my new iPad and my time has to come from somewhere. Since moving to the Phoenix area, I first turned to satellite radio, then to auto hard drives. That time had to come from radio.

It’s not all bad news, but there’s not enough good news. When your big companies that set the trends and own the big market stations are seeing bankruptcy as a profit center it makes things hard on the people who actually know how to serve listeners.

Small and some medium market owners.

They have to be linked to the needs and wants of their audience or there literally is no reason to exist.

If a radio group called me in to show them the future, I’d point to learning what their target audience wants and needs. And if that is a 20-minute portable morning show with a big personality and no music -- done. That’s called a podcast.

Then, build 100 of them per city and market them not using commercials but events. But owners know better. Just keep cranking out 24/7 radio even though by the time Apple sells 20 million iPads (probably at the end of 2012 or sooner), even more radio listeners will defect.

Keep attacking Pandora and see what you get.

Trouble.

Pandora is beloved because it responds to -- you guessed it, the genomes of its fan base.

Radio could do this, but not by gimmicky services that force on-air listening.

It certainly isn’t the world of the next generation which is mobile, on-demand and interactive.

The worst time to stop listening to listeners is when you’ve forced them to tune you out.

In a recent and noteworthy Wall Street Journal article, Scott Thurm writes big layoffs decimate a company's chance for a robust recovery. He cited Honeywell as an example.

Ten years earlier, when sales fell, Honeywell laid off fully one-fourth of its workforce, scrubbed plans for new products and global expansion. Sounds like radio in a way, doesn't it?

During this past recession, Honeywell used furloughs and benefit cuts to limit layoffs to keep the workforce in tact -- ready for the recovery which has finally arrived. Only five percent of its workforce was actually let go in comparison to the earlier bloodbath.

Because Honeywell had its workforce at the ready this time, it introduced 600 new products and now sales are up and the outlook is excellent for the year ahead.

To quote the excellent article:

"That's no accident, according to some analysts and students of corporate behavior. They say companies that take a limited and more-targeted approach to layoffs tend to do better in economic recoveries than those that slash employment sharply and across the board.
Enjoy your bankruptcies".

The article is full of examples of companies that approached the recession by going for big cuts when the going got tough and as it points out -- in the months ahead the theory that lesser cuts during hard times means a bigger recovery.

Too often we see radio discussed as the business that it has become. Infrequently do we hear companies concerned with listeners, their likes and their favorite personalities or for that matter the services they expect from a local radio station.

Forgetting listeners is what is bad for business.

And as far as profits without programming, forget that as well.

Over the months and years ahead, radio companies that continued to value its talent and struggle through the recession with a concern for their listeners will likely be robust companies again -- especially if they start spending money developing the separate mobile media business.

For the smartypants who cut their best salespeople, managers, talent and programmers, you may not be surprised that when it comes to profitability -- they have cut off their nose to spite their face.

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.

Lala Means Apple Loves Streaming

I got a kick out of some of the radio industry comment that Apple was shuttering recently acquired Palo Alto-based Lala – a company it purchased less than six months ago for $80 million.

The presumption being that Apple was not going to be offering a streaming music service that was thought to be another competitor to terrestrial radio.

What is really happening – to borrow a phrase from the great Delfonics Philly soul song “La La Means I Love You” is that Apple loves streaming from the “cloud” so much it is shutting down the failed Lala site in favor of redeploying Lala's streaming technology.

Lala was founded in 2006 and never really made it as a purveyor of free streaming music and access to cuts for only ten cents a song. Apparently iPod usage and traditional online filesharing was more attractive than letting users upload their libraries to a cloud.

Apple knows this.

Apple watchers who risk life and limb when they try to guess what Steve Jobs is up to next have been chattering about Apple’s presumed plan to allow iTunes users the ability to keep their music libraries and videos on Apple servers so that they can access them via any Internet or mobile Internet device anywhere – anytime.

Unlike radio companies, Apple was looking to buy people and technology not necessarily a failed company – thus the expenditure to buy Lala.

Steve Jobs has been teasing the Apple faithful that he has many more cool products to offer this year. (Full disclosure: I have been and am currently an Apple stockholder).

This new cloud-based subscription service from Apple may become more than just speculation within the next few months – that’s what I’m thinking.

Interesting that Wired.com is reporting that current Lala subscribers will get a refund worth one-tenth of the amount of music in iTunes that their money paid for on Lala.

So Lala will soon be dead but we can safely presume Apple didn’t buy the company to waste money.

Right now Apple is rolling through the media content business the way General Patton rolled through some battles in World War II.

There are going to be issues of great concern to media people of an Apple monopoly over electronic devices and content and I share those concerns although not enough to try to thwart the consumer revolution toward mobile Internet.

Apple is building a stranglehold on media delivery systems.

Fair to say it has the record labels by the balls.

In a few short years, Apple has become a major player in the cell phone business even with the unpopular AT&T as a mobile connect partner. And perhaps you noticed a significant strategic step Jobs took when he introduced the 3G iPad featuring a month-by-month option – no contracts – for the required AT&T service. Apple is that big and persuasive.

Now, publishers have mixed feelings about the bookstore that is becoming so popular on iPads. Publishers like that, unlike Amazon, Apple is letting publishers employ variable pricing, but other publishing houses fear that once Apple dominates the book market they will be at Steve Jobs’ mercy.

And that could very well be.

An ominous sign is that the variable price publishing option is only guaranteed for the first year -- at this point, anyway.

Radio owners know what happens when Jobs doesn’t like radio for his devices – they can’t get a chip built into popular mobile devices like iPods, iPhones or iPads – with the exception of the Nano. And that plus another few million listeners would not even make a difference for radio interests.

I think that Jobs wants to be Pandora.

There. I've said it.

Radio is not cool with Apple's young-targeted consumer base. And frankly, it’s hard to see an iPhone or iPod as a radio in the sense that the industry once saw the Walkman as a radio device.

If Jobs indeed wants to be Pandora, he could get started by offering a streaming service to his almost 150 million registered iTunes customers.

Keep in mind that’s 150 million active credit cards on file ready to buy things which could include subscriptions.

The thing with Steve Jobs is that when he says something publicly, he can be playing with the public. Jobs often disses that which he is eventually going to do at Apple.

The iPad would be a recent example.

In a sense, Jobs voted against it before he voted for it.

So Apple often says they are in it to sell electronics and the rest is just to help sell iPods, iPads, iPhones and computers.

Well, with all due respect to the most fascinating genius I have observed in a long time, I think Jobs is playing with us again. He is heading right into dominating the music business, publishing, newspapers, video and movie businesses and, yes, radio.

But not the radio industry its leaders still think has a chance with the next generation.

A new “radio” – streams of music and content that iTunes subscribers could sign up for and enjoy as an alternative to free music. That, in and of itself is incredible. Since when is free less desirable than paid?

That’s what is happening as large corporations figure out the Internet.

While television, radio, print, film and even gaming interests were out plying their trades, Apple was focusing on the changemakers – the young people that traditional media usually tend to ignore.

And now the threat exists that publishers will have to pay whatever Apple wants for inclusion in its mobile Internet empire or leave money on the table.

Yes, Apple is in it to sell electronics but with media executives asleep at the helm, you are now witnessing the first palpable signs that Steve Jobs is leading a frontal attack on these sleepy media businesses that let him bypass them and go directly to the consumer.

The critical difference is …

Jobs knows what he is doing.

Media executives know how to pander to Wall Street.

Think of the ramifications.

In five years, if everyone is accessing information and content on mobile Internet devices like the kind Apple sells – and that 150 million iTunes customer base just doubles – even the best over-the-air radio will be playing to deaf ears.

My message.

Tune into the consumer and let them drive innovation.

Build your content for Apple platforms no matter what the entry price.

Then learn to think like Steve Jobs and pray that some smart alternatives can compete with Apple someday.

Until then, watch the master at work as he eats traditional media executives alive in their own backyards.

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.

What My iPad Is Teaching Me

My wife and I waited by the door for the FedEx delivery late last week.

We were expecting our 3G iPads. Birthdays seem to come so quickly but iPads seem to take forever. That’s how we felt.

Of course, I played with WiFi versions of the iPad at the Apple store but never took them home.

Now, I've got one to explore.

I know many of my friends who read me every day are interested in the convergence of technology with sociology so I’d like to share some thoughts prompted by actual iPad use.

And, what the iPad could mean in a year or two.

It was easy for me to set up because I handed it to my wife and she did it. But she told me it was easy.

The Mobile Me part worked fine. No glitches. The device itself was a pleasure to use. As the days went on I began to discover the full potential of the iPad.

Nonetheless, I am beginning to see things that need our attention if we plan to be part of the mobile Internet.

One of my neighbors, Taylor, an extremely bright eight-year old girl has already mastered my iPhone. When she visits, I hand her the phone. She scrolls through the screen and prepares our favorite little game – air hockey (Go Flyers!). Whereas older people tend to carefully move from click to scroll, young people have no fear and whip through it.

She chooses the “insane” option and gets a game of air hockey so wild you have to be fit mentally and physically. I won't be answering the question you're thinking which is -- has an eight-year old ever beaten you in air hockey?

When I was showing her Microsoft Word on my Mac one day, she learned it by capitalizing on the intuitive nature of Apple-based software. I mention an eight-year old for a reason – they will be in college in ten years or less and in the work force quickly.

Keep this market in mind.

I always do.

Using the iPad tells me that web designers and content creators are going to have to do more than just customizing apps to run their sites and programs.

The iPad is a different mindset.

So different in fact, I am changing the redesign of my website that is due to become a paid site this summer in ways I could not have previously predicted.

For example, had I not spent time with the iPad, I would have been inclined to build a real nice looking website for InsideMusicMedia.com – slick and colorful, easy to read and attractive.

But ...

But I contacted the designer and said, “we have to build this site optimized for the iPad – more visual, more intuitive, less cluttered, with the ten-inch screen in mind”.

In other words, simply redesigning a website for the computer is to miss the market that is developing. It’s like radio trying to cram terrestrial audio onto a stream and expect that consumers will listen to it the way we used to listen to a radio.

That brings me to music.

The current software – soon to change – on iPad does not allow for multitasking. Therefore, I wanted to play Pandora in the background while I was doing some mindless tasks and surfing the web, but currently, as with the iPhone, that is not possible.

Before the year is out, consumers will be able to enjoy music while they work and as good as this news seems for radio owners, it comes with new-age challenges.

For example:

1. Commercials in the background will either distract or at the very best be ignored as iPad users pour their attention into other things.

2. Content in the future will have to be designed to be used on-demand by consumers. That is, they will have to say, I want to enjoy this and will pay attention to it – somewhat like YouTube. I don’t put YouTube on in the background. I pay attention.

3. Shorter content will be warranted although not always mandated.

My friend Dick Carr whose Big Bands Ballads and Blues will one day be available to mobile Internet users (I hope!) will now be what I call destination listening.

And that’s going to be a big field.

Dave & Geri, the Grand Rapids morning team that recaptured their audience after they were set free by their radio employers, are also destination listening.

That’s good.

Very good.

It means they are compelling enough that local fans will want to choose to spend some of their valuable time with Dave & Geri.

But there’s more.

The iPad can and will do for radio content providers what the bookstore feature will do for reading. Digital publishers will offer print that is enhanced by video, pictures, links and even connections to other readers. Making only the text of books on this device is to leave out great multimedia potential.

Same for radio content providers.

And let me mention that when I say radio content providers I am not talking about anyone I know in this industry – yet.

However, I remain hopeful.

Repurposing talent or terrestrial content for mobile use is a lame game. It is not up to the exciting potential of a device such as the iPad.

Therefore, when radio people finally get into the mobile Internet, they will have to enhance their podcasts with video. Have content available with pictures or links. Have social networking access built in.

Maybe because I am launching my new project soon all of this hits me as a sobering message.

Study the iPad before making content decisions. Apple sold a million iPads in the first month that they were available. Rupert Murdoch said yesterday the iPad will lead to a revolution in media content -- read more here.

I know, I am an Apple shareholder and they certainly don’t need me to drum up business. But hold this thing in your hands. See why a calendar or to-do list is fun and addictive on an iPad where it can be mundane on a computer. See why over-the-air radio has to be rebuilt as on-demand content.

Fall asleep listening to audio or reading the next morning’s New York Times. Do it all – stay connected, be informed, get organized and be entertained on one device.

Radio can’t be radio on an iPad. It has to be more.

In spite of what industry executives would like to think -- mobile devices like iPads, iPhones, iPods and smartphones are not radios in the sense of a Walkman.

More context, more information, more links.

More ability of the user to become "the program director" and choose content.

Shorter content. Richer content.

Compelling and addictive.

We used to think radio got great ratings when it played more music.

Now, radio is going to have to play more media to attract attention.

If you’re interested, I’ll share observations I am learning along the way but one thing is for sure – the iPad is the first of its genre that will force content providers to rethink their visual, contextual and social approach to information and entertainment.

The great media convergence everyone predicted fifteen years ago never happened.

We got consolidation instead -- and that sure wasn't convergence.

What we’re seeing now in devices like the iPad – is the convergence of technology and sociology. The melding of the human condition and the mothers of invention, so to speak.

The old Apple motto that launched the MacIntosh into the consumers mindset was Think Different.

I am suggesting, with the iPad and mobile Internet revolution developing that phrase should become Rethink Different.

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.

Regent Reborn

So, if we are to believe the announcement yesterday, Regent CEO Bill Stakelin and CFO Tony Vasconcellos have been shown the door.

Don't get me wrong -- it was all nicey nice. "They have chosen this moment to move on" is what the new owners said.

Regent emerged from bankruptcy with a group of investment capitalists running the show. After all, they traded debt for equity and became the owners -- a familiar scenario in radio these days.

Steven Price (industry veteran Bob Price's son) is the new CEO and chairman.

Stuart Rosenstein the new CFO.

Thus, Oaktree Capital has installed its own management with the supposedly reassuring thought that both Price and Rosenstein "intend to make a significant equity investment".

Both are being touted as seasoned industry executives.

In addition to being Bob's Price's son, Steven had been a managing director at Centerbridge Partners and Spectrum Equity Investors. Price even worked at the Pentagon as Deputy Assistant Secretary of Defense.

Sounds like good background to run a local radio group, right?

Price and his new CFO Stuart Rosenstein worked together at PriCellular. Rosenstein, the owner and managing principal at AMG Financial.

Maybe you can see where this is heading.

Then there is the matter of the name change from Regent which means administrator to Townsquare Media, too cute by a mile for me.

In a letter to vendors yesterday, the newly-crowned prince -- I mean, Price said, "the name change is consistent with the vision brought by new management and the Company's controlling shareholders to build the country's preeminent local media company, operating across multiple platforms and focused on mid-sized markets".

Wasn't Regent supposed to be a local company before the name change? Did I miss something?

Maybe this is just hitting me on the day that I discovered I will probably be paying more to fly from Phoenix to Newark soon as a result of the United/Continental merger.

Look at what Price is saying.

Multiple platforms -- boy, if he means it he'd better get hiring because his investor buddies are clueless on that one.

New management the way Price is talking about could be translated into meaning a new broom sweeps clean, yet how easily we forget.

Little, tiny matters such as the fact that Stakelin and Vasconcellos somehow got the board to extend their contracts and give them a raise while they were upside down. The two guys who would have to share some responsibility in the demise of Regent, wouldn't you think?

Yet Oaktree must have swallowed its tongue. It looks like the fix was on since the nicest thing that Oaktree could say about Stakelin and Vasconcellos in their press release was "their leadership over the last year in connection with the Company's restructuring has been exemplary".

In other words, mission accomplished -- Stakelin and Vasconcellos got their money -- thanks for your service to the Company (note how they actually capitalized the "C" when they mention the company like we do when write the word "God"? Must be some new local radio thing to endear yourself to the local community.)

And in case you forgot, let me refresh your memory.

December 31, 2009 – Regent doesn’t make its loan payments. Period.

December 31, 2009 – The Regent board finds it fit to rehire their two top guns. Period.

Money cures everything.

Stakelin and Vasconcellos will show up somewhere else in this business -- richer for their efforts at Regent.

Price and Rosenstein get to play with a 62-station company in 13 markets.

Welcome to the future of radio.

Every once in a while someone will write to me and say, "My God, this is such a depressing picture of the future of radio" to which I reply, "It's not the way real operators would run local radio stations".

A CEO with financial and Pentagon experience.

Wow! That's impressive.

I guess that's better than being a dj who worked his way up to music director, then PD then maybe general manager -- you know, simple things like knowing how an actual radio station really runs.

Even some of the CEOs who have participated in the hit CBS TV show "Undercover Boss" have commented on how little they actually knew about running their companies. That the reality show was a wakeup call for some of them.

Citadel may very well be like Regent when their pre-packaged bankruptcy finally wins approval whether or not Fagreed Suleman stays on. (And don't worry, Fagreed's got a contract extension pre-packaged for himself just in case).

The moral of the story seems to be it's not nice to miss debt payments and when you do the big bad wolf comes after you and blows the door down.

What is scary is that the big bad wolf is also staying to operate the local stations.

It doesn't matter what the name of the company is -- Townsquare or the more appropriate Times Square.

So let me offer some unwanted advice to the new owners and operators of Regent:

1. Hire back the talented people you fired, you'll need them.

2. Steven, step down as CEO after the second day on the job and hire a radio person who has earned the right to be making operational decisions by virtue of the fact that they learned radio from the ground up. Remember, it's your money on the line. Do you really want to risk it by having you run the company?

3. Get some live, local morning shows on-the-air. Hint: morning shows well done can bring in 50% of your stations revenues.

4. Don't dare try to think about multiple platforms when the platform you are taking over is suited for a hanging. Learn about new media and the next generation, about sociology as it pertains to technology -- not financing or taking over a new media company, but running one.

5. Make up to your vendors the raw deal they got from Regent on the way to bankruptcy.

6. Sell some of your stations to local operators -- that's the best way for you to maximize your profits. If you run these stations, even a wild recovery won't last long enough to cover up mistakes Wall Street bankers are likely to make playing radio station manager.

It's a dirty deal for listeners, too.

Over the years -- in the name of financial prudence -- they have lost their favorite air personalities and live, local formats.

Raw deal for advertisers who are getting less for their investment than ever.

But there is good news.

Really.

If you operate in a market with some of these newborn pre-packaged bankruptcy babies, go get them. They know not what they do.

1. Cut off your voice tracking.
2. Put live, local personalities and programming on-the-air.
3. Hire the many local talented salespeople who can help you triple your billing.
4. Start a separate division to provide new content for fast-growing mobile media devices.

The end game for investment banks is to take care of good old number one -- and that wouldn't be listeners or employees.

I'd like Townsquare to prove me wrong.

I've listed four standards by which they can be judged.

Mark my words, investment bankers running hands on radio stations will make you wish you had your original incompetent radio CEOs back again.

You know, the ones who are actually good broadcasters who sold out for quick bucks and contract extensions and owe their souls to the company store.

As Tennessee Ernie Ford sang in "Sixteen Tons":

You load sixteen tons, what do you get
Another day older and deeper in debt
Saint Peter don't you call me 'cause I can't go
I owe my soul to the company store

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.

Rhythm People

Time was in jazz when 3/4 seemed exotic.......... It’s not that long ago since jazz musicians didn’t play in 3/4 at all, or rarely. Charlie Parker never played (or at least never recorded) in 3/4 for example. Now, to quote my compatriot W.B. Yeats, ‘All is changed, changed utterly – a terrible beauty is born’.

I think when the jazz history that covers the last twenty years is written, two things will loom large – possibly larger than anything else, at least as far as the evolution of the music is concerned – the vast expansion of the rhythmic language of jazz and the invasion of ‘world music’ (for want of a better phrase – though if you think about it, aren’t all other musics part of this world.......?) techniques into jazz. The two developments are of course linked, since so many rhythmic techniques from outside of jazz – from Balkan music, African music, Indian music, Arabic music etc. - have been seized upon by contemporary improvising musicians hungry for new ways to play old things.

The developments in the rhythmic language of jazz – and by that I mean the expansion of rhythmic techniques available to and used by jazz musicians – have been enormous over the past twenty years. I remember demonstrating the playing of ‘All the Things You Are’ in 7/4 in the early 90s at various jazz schools and getting reactions that ranged from surprise to complete incredulity. Now such things are commonplace – no longer exotic, 7/4 is indeed the new 3/4, at least among young musicians – it’s that ‘other’ time signature you go to when you need a break from 4/4. And that’s just the tip of the iceberg, something that’s considered pretty mainstream these days – in addition to that you have a plethora of techniques used by various musicians ranging from the additive rhythms of the Balkans, to metric modulation techniques (derived from Indian music, or the Miles 60s rhythm section, or even the work of composers such as Elliot Carter), to playing in odd metres. And of course many musicians use many different aspects of these things in various combinations, exploring a bewildering array of rhythmic approaches and techniques.

There are various reactions among musicians to all this new activity ranging from enthusiasm and excitement, to fear and dismissal. Where musicians are positioned in this reaction range usually depends on their age and experience. For younger musicians this new rhythmic landscape is what they’ve come to expect, to older musicians it’s often a scary place to be, depriving them of the rhythmic underpinning that they’ve based their entire musical lives on. But like it or loathe it, the genie is out of the bottle as far as this development is concerned – complex rhythms and much wider variety or rhythmic techniques are here to stay.


(Rudresh Mahanthappa)

Though the spread of these new rhythmic ideas encompasses the entire world of jazz I think it’s definitely caught hold in Europe more than in the US. Not that there aren’t groups and musicians exploring the new rhythmic possibilities in the US – Rudresh Mahanthappa, Vijay Iyer, Fieldwork etc. - all of these have utilised the new language to great musical effect. And of course Steve Coleman, one of the major architects of the new language, is an American. But in general as far as I can see most American musicians hold on to the more traditional rhythmic values in their music – and quite understandably since they are living in the land of the original source material and that language is bound to have a stronger hold there than in Europe where a different rhythmic tradition (or traditions) has held sway in the indigenous music of the various countries or evolved in recent years.

I think another reason why the new rhythmic language has captured the imagination of European musicians so much is because the gigantic impact of World Music on western European music over the past 15 years or so. Many World Music acts have had incredible commercial success in Europe over recent years and Europe also has very big immigrant populations from India, the Middle East, and North and Sub-Saharan Africa. Of course America has huge immigrant populations too, but somehow I don’t think the music of these populations (with the possible exception of the Latino populations) has entered the popular consciousness, and by extension the jazz consciousness the way it has in Europe

I remember going to the IASJ annual meeting a couple of years ago, a meeting where most of the students were from Europe, and remarking on how during the final concerts only one swing piece was played in 6 different concerts by the student ensembles. In the same year I went to the IAJE in NY and virtually all the student ensembles I heard were very much from the spang-spang-a-lang school of rhythmic approach. It seemed to me indicative of the different rhythmic priorities of high level young musicians from different continents.


(Karim Ziad)

Europe is awash with groups and musicians who are using a bewildering array of rhythmic approaches, and combining all kinds of influences. For example the French drummer Franck Vaillant has incorporated Korean music into a kind of M-Base influenced outlook to great effect, Stéphane Payen has done a similar thing with Senegalese music, AKA Moon have quite a rock sensibility, Karim Ziad uses the music of his native Algeria, Nils Wogram often uses typically Balkan additive rhythms, while Kartet are definitely influenced by contemporary classical compositions in their music. These are just a few of the multitude of approaches and concepts being used in Europe at the moment and of course there’s much interesting rhythmic work being done in the US and Brazil, Australia and Canada etc. etc. The new rhythmic language – or languages are here to stay.

A couple of years ago myself and my brother Conor had a chat with the Brazilian composer and saxophonist Marcelo Coelho at a cafe in Siena in which we talked about the fact that there’s so much different rhythmic work being done all over the world yet most people doing this work are often not aware of what others working in the same musical field are doing. From that conversation emerged the idea of forming a kind of association that would allow practitioners to be in touch with each other and enable them to share ideas and concepts. This grew into the International Rhythmic Studies Association (IRSA) and we had our first meeting in Sao Paulo in Brazil in 2008. Though we started small it was a great success in terms of setting out to put people with rhythmic ideas in touch with each other. We followed that up with the 2nd meeting in 2009 in the same place, and this year for the first time the meeting will move across the Atlantic to Dublin, where we’ll hold the 3rd IRSA meeting in July.

This is proving to be the best attended meeting yet with nearly 30 participants from 12 different countries. The structure of these meetings is very simple – in the mornings the players get together and play, there is no set format, people bring ideas and everyone gets to try them out. In the afternoons formal lectures are presented and this year, to give you an idea of the range of interests out there, topics covered in the lectures will include:

Odd Metre Clave
Afro-Brazilian Rhythms
Layered Subdivision
Compositional Process based on the Rhythmic Line Approach and Ron Miller´s jazz modal harmony
Global Tala
Paris, Bruxelles, London – the Rhythmic Triangle
Rhythmic Contemporary Piano Music
Irish Traditional Music

These topics give some idea of the breadth of interest in all things rhythmic that’s out there at the moment. For some it’s a brave new world, for others a barren landscape – but now that it’s been discovered there’s no going back. For young musicians it’s an exciting prospect to be able to explore these areas, but of course it’s also yet ANOTHER thing a young musician is supposed to be able to deal with in their professional life – starting off as a young jazz musician these days is not for the musically faint-hearted..............

As an example of the type of thing being explored by musicians from both sides of the Atlantic, here’s a clip of a trio I’m inolved with – MSG – with Rudresh Mahanthappa and the Dutch drummer Chander Sardjoe, playing Rudresh’s ‘Enhanced Performance’. For those curious about the rhythmic structure, it’s built on two leasures of 5 followed by a measure of 9, and this is then gradually speeded up through metric modulation, using the 8th note triplet as a subdivision – so there! For the rest of you – hope you enjoy it regardless of the structure.

Cumulus Buying Salem or Radio One or Going Private

So what is Lew Dickey up to?

Get the feeling that there is an end game going on and the industry, shareholders and Wall Street are being distracted?

Try this one on for size.

That new Cumulus Investment Partners, the currently unfunded, publicly touted new venture with Crestview, is a smokescreen for eventually retiring Cumulus debt and taking the company private.

Private is in -- Jeff Smulyan finally worked a deal with investors and shareholders last week. But more on Emmis in a moment.

Dickey, who has earned the nickname "Tricky" Dickey, looks around at buying Salem and/or Radio One with play money -- the new unfunded $1 billion investment partnership.

One insider telling us:

"I heard through the Atlanta grapevine that Cumulus made an offer for both Salem and Radio One a couple of weeks ago and was turned down by both. They offered 3x cash flow".

If Dickey offered 3 times cash flow, he'd be pushing the benchmark for purchasing radio properties to a new low. It would be a severe blow to the industry in which he operates.

From what I can gather, Salem and Radio One are not for sale -- at least not as of today. Dickey is famous for having loose lips about how he's going to buy Citadel and Regent -- you can probably name the company -- at least that's what some of his employees claim.

The worst kept secret in the world is not that Cumulus is going to buy a competitor.

It's that they are always bragging that they are buying someone.

It seemed strange that Cumulus, which owes more debt than it can repay next year, made a big public announcement recently that Cumulus and the investors who helped them buy Susquehanna, Crestview, were recently reunited and it feels so good.

Crestview never said it was putting any money into the billion dollar jumping jackpot for use in purchasing other companies or more stations.

Cumulus, upside down on its own debt, couldn't dare say it was going to ante up money for this cockamamie investment partnership -- not while it can't repay its current debt.

So, here's what I think.

Dickey and Cumulus posture that they are shopping for radio stations to grow their empire but in reality they have another plan in mind.

Raise money to take Cumulus private.

Dickey is speaking up now because radio stocks are beginning to rebound from record lows and it behooves him to buy back the company (with help from investor friends) while the value is at its lowest.

CMLS traded at $4.88 a share when it closed Friday. It has been under $3 in the past year.

The price is right.

The timing -- perfect.

The Citadel, Regent, Lincoln Financial rumors are just plants.

Why wouldn't Lew Dickey want to go private?

He's wrecked the public model of a local radio company. He could play all day and all night with a private company where financial figures would not have to be disclosed and the number one priority would be The Dickeys.

Far fetched?

Maybe not.

The current trend is to take radio groups private -- the public experiment having failed. No new deregulation is likely, cash flow should pick up with the economy so the only other major reason for borrowing money is to pay off debt.

Citadel seems to love the pre-packaged bankruptcy plan it is close to culminating -- the original investors give back most of the company and the creditors take over but the same management gets new employment contracts. Now, what's not to like?

Same with Regent.

And with other upside down companies that will not be able to pay for the debt they accrued in the past.

But the Cumulus plan is death with dignity in a way.

The company fails -- acts like it is in acquisition mode (itself kind of hilarious) then decides that the best use of investors money is to pay down debt and go private.

No one sees it coming.

This works for many reasons.

No more humiliation for the failed Dickey boys. They can withdraw and declare victory.

Later, if the industry comes back sufficiently beyond a short-term advertising bubble, Cumulus can buy other investors out and the Dickeys can even expand their personal stake.

Without the need to buy another company, who needs more capital?

Without someone to save the company from running up against their loan covenant next year, they are the ones who need to raise more capital. If Cumulus and Crestview actually said that to prospective investor, it would likely go over like a lead balloon. Better to talk about buying a competitor or two while raising money.

You and I know that the radio industry will have to redeploy its talent, content creating ability and marketing expertise to the mobile Internet or radio's growth days are over.

Meanwhile, 3x cash flow -- which is at the low end of what the standard will be in my view (3-5 times) is a death knell for deals.

Why sell unless you're upside down?

Why buy when you're already saddled with debt?

Emmis CEO Jeff Smulyan wanted to take his company private before it was fashionable, but greedy shareholders prevented it. Emmis was not ever going to be a major player and the public funds they used to expand a little bit were costing them too much. Now, Emmis can go private. Smulyan can keep a few stations -- sell the others like it's 1999.

So keep your radar aimed at some of the odd things that will be shaping the future of the radio industry the rest of this year.

• Privatization.
• Low multiples discouraging the sale of existing stations (other than fire sales).
• No plan at all from any broadcaster to become part of the digital future.

It's insane, but it's happening in a radio market near you.

It doesn't take a genius to see that the future of content is on mobile media so conversely I guess that means that radio is run by a bunch of geniuses because they're looking in the wrong place when it is so apparent that the consumer revolution is driving the growth of the mobile Internet.

The recession didn't kill radio.

The debt radio groups piled up really didn't do it, either.

But the industry's stubborn determination to buy and sell instead of build and run will leave it a bystander in the biggest entertainment growth industry since, well -- broadcasting itself.

For those of you who would prefer to get Jerry's daily posts by email for FREE, please click here. Then look for a verifying email from FeedBurner to start service.

Thanks for forwarding my pieces to your friends and linking to your websites and boards.