When consolodation happened a Biblical reference came to my mind. I said radio could not serve two masters. Either serving the community or serving the stockholder had to win. With hindsight, I still think this is true but I think we know that superior product generally delivers the greatest income potential, so for a while, in a perfect radio world, both masters can be served. My question is what happens when you peak. Once you're at the top where do you go? When you're on the top floor, the elevator doesn't go any higher. The shareholders will always want a piece so once you reach the top how do you continue to squeeze out more cash? Owning stock is about increasing your dollars, not the same pay-out. So, once you're there, what master is served?
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MARK DAVIS LEAVING WBAP
- Thread starter longtimelistener
- Start date
BTurner....
Regarding "two masters"....I have to respectfully disagree.
Successful Radio serves only the Listener....You said it yourself here when you quoted the great Gordon McClendon:
"....I think Gordon McClendon said if you put the very best product possible on the air, the sales will take care of itself."--BTurner, April 12, 2011
Updating that quote to the current Cumulus Radio model might read like this:
"....I think Lew Dickey said if you put the very cheapest product possible on the air, the stock price will take care of itself."
J-D
TWR
Regarding "two masters"....I have to respectfully disagree.
Successful Radio serves only the Listener....You said it yourself here when you quoted the great Gordon McClendon:
"....I think Gordon McClendon said if you put the very best product possible on the air, the sales will take care of itself."--BTurner, April 12, 2011
Updating that quote to the current Cumulus Radio model might read like this:
"....I think Lew Dickey said if you put the very cheapest product possible on the air, the stock price will take care of itself."
J-D
TWR
C
chrisdanger
Guest
A) Awesome to see the voice himself (Jon David Wells) getting into the conversation. I read the post in his smooth baritone cadence. ;D
B) I'll say it again, Cumulus is everything thats wrong w/ the modern radio business. Sure, clear channel, CBS and others have done their fair share of carnage to the modern radio game, but Cumulus takes the cake IMHO. They remind me of a small market operation that engages in roughshod brother in law operations. Like I said previously: The future of this business is on sat, online and mobile. Those who embrace that will survive into the 21st century and beyond. Those, like Cumulus, whom keep acting like this is Amarillo or Ashland KY circa 1978, change formats at a whim and fire great onair personalities will realize that their best laid plans will fall apart..
B) I'll say it again, Cumulus is everything thats wrong w/ the modern radio business. Sure, clear channel, CBS and others have done their fair share of carnage to the modern radio game, but Cumulus takes the cake IMHO. They remind me of a small market operation that engages in roughshod brother in law operations. Like I said previously: The future of this business is on sat, online and mobile. Those who embrace that will survive into the 21st century and beyond. Those, like Cumulus, whom keep acting like this is Amarillo or Ashland KY circa 1978, change formats at a whim and fire great onair personalities will realize that their best laid plans will fall apart..
Thanks Chris....That was very nice.
Miked....With Mark Davis, as successful as he has been for the last 18 years in Talent, Performance, Ratings, and Revenue, being summarily dispatched with a craven, "We're going in a different direction..." why would any of the at least as expensive On-Air Pros on The Ticket be safe?
Like I said....
When Talent, Performance, Ratings, and Revenue are immaterial....There is no path to success within Cumulus for On-Air Radio Broadcasters.
J-D
TWR
Miked....With Mark Davis, as successful as he has been for the last 18 years in Talent, Performance, Ratings, and Revenue, being summarily dispatched with a craven, "We're going in a different direction..." why would any of the at least as expensive On-Air Pros on The Ticket be safe?
Like I said....
When Talent, Performance, Ratings, and Revenue are immaterial....There is no path to success within Cumulus for On-Air Radio Broadcasters.
J-D
TWR
M
MikeShannon914
Guest
I haven't really weighed in on this, and I'll leave speculation out of the mix, but wanted to say that Mark was a great guy to work with for those four years I did his traffic reports. I didn't care much for his politics, but he was a master of the talk show format: Working the subject matter, making the callers "shine" and seem relevant (even when they were way off base,) and being well informed and well read AND well prepared. Mark sent me the kindest email when I got laid off in June, 2009, and I'll never forget that. I wish him all the best. As someone else who got replaced by a cheaper, lower-quality product, I certainly understand how he must feel. Unfortunately, that's the current business model, and I see it only getting worse. :'(
That being said, repeat after me: "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON."
NOT McClendon, MacClendon, McLinden, McClenden, McClinton, etc etc etc. No offense, JDW, but after the zillionth time of seeing The Master's name butchered by countless others over the years, I had to get that out of my system! (Perhaps in the day when McLendon's name was plastered across most of the theater signs in town, it didn't happen as often.) :-\
That being said, repeat after me: "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON." "Gordon Mc LENDON."
NOT McClendon, MacClendon, McLinden, McClenden, McClinton, etc etc etc. No offense, JDW, but after the zillionth time of seeing The Master's name butchered by countless others over the years, I had to get that out of my system! (Perhaps in the day when McLendon's name was plastered across most of the theater signs in town, it didn't happen as often.) :-\
jondavidvox said:
Actually, I am pretty much in agreement with your disregard for Cumulus. I did state in one of my postings yesterday that I do not have a high opinion of that particular organization - Maybe I should have made the point more clearly. In no way should anything I said be taken as a defense of Cumulus - only of their right to run their business as they see fit. It is like defending free speech: in order to defend your own free speech, you must necessarily stand up for the free speech of others including those who are sleazy (such as ponographers) or repugnant (such as racists, nazis, totalitarians, etc.)
Why do you think investors will recoup their money if/when the thing eventually collapses? If they are forced to sell the stations, it will be the creditors who hold the billions of dollars of debt who will be first in line for any proceeds. Investors/stockholders are last in line and get paid only if there is anything left over after secured and then unsecured creditors are paid. For enough to be left over for them to recoup their money - let alone make a profit - it would imply that Cumulus somehow managed to enhance the value of their properties in a very significant way. I don't seem them doing that - do you?
As for the stations being sold off - for many of the stations, that perhaps might be the best thing in the world to happen, especially if they end up in the hands of capable operators who are not as burdened by such massive amounts of debt.
chrisdanger said:
Actually, one of the things I wonder is if a potential threat to Cumulus, at least in terms of terrestrial radio competition, is much smaller broadcasters.
Sure, there are advantages that come with size - especially the economies of scale. But beyond a certain point, size can also be a disadvantage. When an organization becomes too large, it becomes bureaucratic and inflexible - especially if the management in charge tends to disregard or ignores any insights the rank and file might have about the current state of the business. From everything I have read, Cumulus seems to be a top down organization with little interest in learning why and how highly respected and successful stations they take over became that way in the first place.
Terrestrial stations do not compete nationally - the compete within their own local markets. To the degree decisions are micromanaged out of Atlanta, I would think a station is at risk of losing touch with its own market - which provides an opportunity for rivals to take advantage of.
And there is one effect of Cumulus' race to the bottom in terms of cost and quality that may come back to haunt it: my strong guess is one can pick up very talented radio people for a lot less money now than one could a few years back. Mark Davis is presumably and example of that. If so, then that would mean that smaller broadcasters could potentially afford staff and talent today that they could not even dream of having a few years ago.
A smaller company that is financially stable, has, in some respects certain advantages over Cumulus. It is not burdened with having to fork over large amounts of its revenue in order to service billions of dollars of debt. It does not have a huge corporate bureaucracy and multi million dollar executive salaries to have to feed. Being a smaller organization, it is much more likely to have a better feel and respect for the peculiarities of its individual markets and be able to adjust its programing accordingly. And if it can pick up knowledgeable and talented Cumulus cast offs at a bargain price that will give its stations listeners and a prestige in the local market that would have been difficult for them to pick up a few years ago. If so, and if such former also-ran stations suddenly become successful, Cumulus is going to be forced to counter and defend its turf. But to do so means that Cumulus will have to spend extra money - which its business model doesn't allow. And, by that time, anybody within the organization with the know-how necessary to successfully counter such a challenge may very well have already been cut or chased off.
And if Cumulus does implode, is anybody is going to even want to borrow enormous amounts of money to buy the whole thing intact - especially after having watched Citadel and then Cumulus? Is it possible that a financial collapse of Cumulus would result in the stations being split up and sold to a number of different companies and that such a large number of stations up for sale all at once will cause the market value of individual stations to go through the floor? If so, to that degree, the barriers of entry for talented would-be broadcasters to enter the industry will have been lowered. And if a station does not cost so much money to buy, that potentially frees up capital to spend on actual operations.
Could it be that, beyond a certain point, consolidation simply does not make good business sense? Could it be that Cumulus and Clear Channel are the dead end of a certain sort of "radio acquisition bubble" that was pumped up by ten years plus of Fed policies of artificially cheap credit which made it possible to borrow lots of money for all sorts of things that, in more sane times, would have been given a no-go? Is it possible that market forces are going to drive the pendulum back somewhat in the other direction?
I think Cumulus and others in the radio business are destined to fail as they chase off listeners and revenue in pusuit of lower costs. The problem now is that people like Davis have the ability to come back in another location, whether on a competing radio station or some other media, and continue to do the one thing these conglomerations will never understand: serve the needs of the listener.
There are more options out there today to do a show than there were even 5 years ago. If there's a demand for the kind of quality show Mark did, then there are plenty of ways for him to meet that demand and make a living at it. Down the road, those alternatives will take away enough business from the likes of Cumulus that their business model will simply not work.
There are more options out there today to do a show than there were even 5 years ago. If there's a demand for the kind of quality show Mark did, then there are plenty of ways for him to meet that demand and make a living at it. Down the road, those alternatives will take away enough business from the likes of Cumulus that their business model will simply not work.
Mike....Believe it or not, I actually did a Google search to get the spelling of Mr. McLendon's name....
....and STILL got it wrong.
Dismuke....a few things....
There are far fewer On-Air Broadcasting opportunities than there has ever been. As I write this, based on past gross management misconduct on the part of every one of the C Corps....I can see no viable option for me to work for any other Radio Company in DFW....A market with 37 rated signals, half of which are owned by the Big C's.
Also, as we have seen, Oaktree Capitol is quite adept at reforming its foreclosed on Radio Companies....Remember, they took Regent Broadcasting and GAP Broadcast and forced them together as Townsquare Media. Townsquare now acquires small radio groups as they become available.
So after the big crunch at the end of Dickey Brothers Stock/Mergers gravy train, Bain Capital, The Blackstone Group, and Thomas H. Lee Partners will gladly split up the 570 Radio Stations they foreclose on. In fact, it's the only thing that makes sense. In fact, I'm sure it's part of the entire (unspoken) plan....Why else would best investors in the world provide the billions in credit necessary to allow a couple of Georgia nouveau-riche hayseeds to acquire these stations in the first place, if they weren't sure they would profit on the back end?
Finally Dis....You have written 144 paragraphs in this thread. You have succeeded yourself with 2 posts in a row 5 times.
Brevity is the soul of wit, my friend....
J-D
TWR
....and STILL got it wrong.
Dismuke....a few things....
There are far fewer On-Air Broadcasting opportunities than there has ever been. As I write this, based on past gross management misconduct on the part of every one of the C Corps....I can see no viable option for me to work for any other Radio Company in DFW....A market with 37 rated signals, half of which are owned by the Big C's.
Also, as we have seen, Oaktree Capitol is quite adept at reforming its foreclosed on Radio Companies....Remember, they took Regent Broadcasting and GAP Broadcast and forced them together as Townsquare Media. Townsquare now acquires small radio groups as they become available.
So after the big crunch at the end of Dickey Brothers Stock/Mergers gravy train, Bain Capital, The Blackstone Group, and Thomas H. Lee Partners will gladly split up the 570 Radio Stations they foreclose on. In fact, it's the only thing that makes sense. In fact, I'm sure it's part of the entire (unspoken) plan....Why else would best investors in the world provide the billions in credit necessary to allow a couple of Georgia nouveau-riche hayseeds to acquire these stations in the first place, if they weren't sure they would profit on the back end?
Finally Dis....You have written 144 paragraphs in this thread. You have succeeded yourself with 2 posts in a row 5 times.
Brevity is the soul of wit, my friend....
J-D
TWR
jondavidvox said:
But the the outfits you mention - Bain, Thomas Lee, Blackston, etc. - didn't provide credit and they can't foreclose on the stations. They purchased an ownership interest in the company. See: http://finance.yahoo.com/q/mh?s=CMLS+Major+Holders If Cumulus implodes, the shares that they own in it will either lose significant value or become worthless. Either way, they are going to be near the back of the line in terms of getting any of their money out of it.
Proceeds from any sort of foreclosure or forced sale would go first to the company's creditors. You can view a list of the company's first lien and second lien holders at http://agreements.realdealdocs.com/Dickstein-Shapiro-Morin-Oshinsky-law-firm/ The list mostly consists of assorted banks including J.P.Morgan, Royal Bank of Canada, UBS and others. If you know how to read legal gobbledygook better than I do and have the patience to sort through it all and follow the links on that page, my guess is it will tell you in gory detail what would happen if Cumulus defaulted.
Now it is, of course, true that those banks lent the money on the premise that there are assets such as radio stations to back things up. But the banks have no desire to find themselves having to own, run and dispose of a bunch of radio stations any more than they have a desire to own a bunch of foreclosed upon houses. All they want is the loan to be paid off with interest.
As to why Bain, Blackstone, Crestview and others bought into the company - beats me.
Gee....and wow! You actually counted.
Lol ;D Let's just call it "stream of consciousness" writing. I happen to have a bit more time on my hands right now than I usually do - which is why I am able to follow threads and post in the first place. But it is not enough time for me to want to spend much of it editing things down. So I just type out what occurs to me as one would utter words in a conversation. It takes me much longer to condense and edit my thoughts down than it does to simply type them out - and I am pretty horrible at editing my own writing unless I have an opportunity to come back and look at it after the passage of a few hours which is not practical for message board postings. So for me, it is usually a choice of blurting out a posting "stream of consciousness" style at the risk of sounding long-winded or not posting it at all.
C
chrisdanger
Guest
Dismuke is a decent enough guy, a long writer though, I respect that in a way, people don't write long orations much anymore..
I don't know Mark Davis personally. I have heard he is a good guy. I like him on the air. Agree with him about some things, disagree about others. Such is life.
But what I have felt in the times I have heard him is a certain "excuse making" for corporations.
I have found that most of the time thinking that if you are just a good soldier, work hard, be popular, don't cause trouble, get results and earn money for your company (and I think there is no doubt Davis does that), that you will be taken care of because the company does not want to lose you, to lose such a talented person.
Now it seems that is over and Cumulus is choosing to be a low cost provider. Cheap product, produced cheaply and sold cheaply.
A true free market cannot work because FM and AM radio is a limited entry business. There aren't that many of them (Billboards in many US regions is another limited entry business, taxicabs that work with a limited amount of licences is another). A limited entry business means that the choices for a terminated employee are, indeed, limited.
For this reason, I would support a ton of more controls on the industry just like they have in most European countries.
Have a nice day and good luck to all.
But what I have felt in the times I have heard him is a certain "excuse making" for corporations.
I have found that most of the time thinking that if you are just a good soldier, work hard, be popular, don't cause trouble, get results and earn money for your company (and I think there is no doubt Davis does that), that you will be taken care of because the company does not want to lose you, to lose such a talented person.
Now it seems that is over and Cumulus is choosing to be a low cost provider. Cheap product, produced cheaply and sold cheaply.
A true free market cannot work because FM and AM radio is a limited entry business. There aren't that many of them (Billboards in many US regions is another limited entry business, taxicabs that work with a limited amount of licences is another). A limited entry business means that the choices for a terminated employee are, indeed, limited.
For this reason, I would support a ton of more controls on the industry just like they have in most European countries.
Have a nice day and good luck to all.
tubetop1 said:
All I can suggest is if, after a very quick glance, you don't see enough of sufficient interest to justify the time it takes to read a long posting, just skip over the thing and move on to something else. You don't have to read it. I occasionally hang out in forums where lengthy postings tend to be the norm. If a posting is extremely long, I might spend five to ten seconds to determine whether I wish to read it or not. In some cases, if the posting is by a certain author I do not care for, I will skip it immediately - and you are certainly welcome to do that with my postings. On the other hand, I have read many lengthy postings that I found extremely interesting, informative and thought provoking - and it would have been a detriment if they had been gutted merely because someone else might not wish to invest the time it takes to read.
As to whether I am an expert on Dallas radio - I most definitely am not nor have I ever pretended to be. I am someone who has had a lifelong fascination with certain aspects of the industry and with its history. Again, you are completely free to simply ignore my postings. In fact, some message boards have an "ignore user" option which will make any postings by a given user completely invisible to you. Not sure if this board has it or not - but you might want to check the user options menu to find out.
radioray said:
Really? And what do you call all of the many things on the Internet - online-only radio stations, Pandora, websites, blogs, YouTube, Facebook, etc. - that have been siphoning away audiences from traditional "limited entry" businesses such as radio and television and high cost of entry businesses such as newspapers, magazines, cable tv, etc.? Are you suggesting that this audience shift is not an example of the free market at work?
And when the terminated employees of Borders Books lost their jobs, their choices for future employment in the bookselling industry were also very limited. Should, therefore, the government come in and compel people to purchase books or perhaps outlaw the Kindle and ebooks in order to protect those jobs? The potential choices open to the terminated Borders employees suddenly became much less limited the very moment they gave consideration to working in a different industry or changing careers. And I can give you countless examples of the exact same thing happening in other industries. And I have personally found myself in a similar boat. So why should employees of radio stations somehow be exempt from the potential pitfalls that employees of every other industry have to be prepared for?
For what it is worth, I read every word and was impressed with the thought, detail and civil tone. I can understand having a full plate and not being able to read a long post as I frequently have a full plate but too often I find many posts so short and lacking that it takes someone to write a longer post to fill in the blanks. Might we encourage both.
OKCRadioGuy said:
And apparently clueless. I listened to Mark Davis, carefully, yesterday when he filled in for Rush. What could Cumulus have been thinking to let him go? <rhetorical>. I'm sure a station with the objective is making a profit instead of making a mess of things will scarf him up really quickly.
Ok here's how you get Davis back on WBAP:
1) He creates a company and hires good commission based sales people to sell ads for his show. Lock them down into good contracts and keep it going. Offer spots, remotes and promotions.
2) Get ahold of a hungry sales guy at Cumulus and ask him how much to buy three hours in his old slot. Make a helluva deal. Fold in advertising and billboards and GET IT IN WRITING! And make !@#$! SURE the guy understands he works for YOU and not the other way around! Hold that bastard's feet to the fire!
3) Repeat each quarter!
Once he does this he'll have all the sales guys fawning all over him to be the one who gets that easy quarterly cheque!
That's what they understand in radio now! ;D
-BGH
1) He creates a company and hires good commission based sales people to sell ads for his show. Lock them down into good contracts and keep it going. Offer spots, remotes and promotions.
2) Get ahold of a hungry sales guy at Cumulus and ask him how much to buy three hours in his old slot. Make a helluva deal. Fold in advertising and billboards and GET IT IN WRITING! And make !@#$! SURE the guy understands he works for YOU and not the other way around! Hold that bastard's feet to the fire!
3) Repeat each quarter!
Once he does this he'll have all the sales guys fawning all over him to be the one who gets that easy quarterly cheque!
That's what they understand in radio now! ;D
-BGH
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