Is Pandora Killing Local Radio? If not now… when?

I grew up with radio.  It was how I heard the newest records.  Yes, I’m “old.”  Just ask my kids.  But being a baby-boomer  doesn’t mean I have given up my love for music discovery.  It’s the reason I do The Colorado Sound – it’s that insane sense of discovering new music, and new artists from here in Colorado.  I’m very happy that there are five terrestrial radio signals in the state that broadcast my show today … and as far as internet goes?  It’s still too expensive for me to launch – royalties and all you know.

The past decade I’ve touted the internet as the new radio – one that opens up the playbook and has allowed us all to discover music that many in radio just “knew” would have people turning the dial away from new and onto nostalgia.  That’s how radio got safe.

Research dictated that the older a person became the more likely they would stick with the music of their high school and college days – music that recalled what it felt like to be young .. music that gave us an escape from the pressures of responsible adulthood.  And for the most part the research is true.

As I sit watching the audiences at the live shows I do sound for – I recognize that nostalgia pays off.  Funk bands playing the hits of Parliament and/or the Funkadelics get people from 21-60+ on the dance-floor.  Classic (pre 1980) country bands today appeal to those longing for a return to the past, as well as those searching for the purity / the origins of more modern sounding music.

But, is radio dead or dying as some would believe?  All the current research shows that 86% of people still get connected to new music via broadcast radio. Local public radio stations like KRFC Fort Collins and Colorado Public Radio’s “Open Air 1340” have made strong statements supporting locally and regionally produced music.  Or, is the internet destroying local radio, as my friend Pete Simon expresses in this view?

WHY PANDORA IS KILLING RADIO
Just throwing out this question:  Across the stretches of the Front Range, and through mountain hamlets — some with a community radio station nearby —  isn’t there SOMETHING about “localism” that will save the day for radio in Colorado?

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Pandora has been hit with a lot bad news lately, but I can cheer them up.

The radio industry never misses an opportunity to denigrate a competitor that goes on to kick their ass.

Terrestrial radio did it with satellite radio.

They are doing it with the mobile Internet that the next generation loves and radio thinks is an add-on.

And radio is doing it again right now to Pandora.

Look, any company that attracts over a 100 million subscribers – the vast majority of whom absolutely love the service is a better business than radio which is no longer local and run by a bunch of Wall Street thieves.

Yes, I am a Pandora shareholder. I always like to tell you that so you can take what I say with a grain of salt.  And I have lost half the value of my Pandora stock and I’m holding it just in case you don’t want to take what I have to say with a grain of salt.

Pandora is going to kill local radio.

Even in spite of the draconian music royalty fees they must pay the record labels to use music.

Even in spite of the fact that they don’t have a tower and transmitter in every city. Of course, radio consolidators do and they are falling all over themselves to do remote radio far away from the local market.

Radio’s Pandora problem is going to bite the industry in the butt.

Let me tell you the ways:

1. More and more former radio listeners are opting for Pandora and their many competitors like Spotify to give them a more customized experience. Pandora gets bigger every month and their listeners think it is cool. Radio gets smaller every month bolstered only by drive-by PPM ratings that aren’t real.

2. Even as I write this, Pandora is aggressively hiring great radio people away from the top broadcast groups. Three stolen from Clear Channel in New York and one big seller from another operator in Detroit within the past few weeks. The arrogance of consolidators to think their best sales people will continue to put up with poor treatment. Consolidators are making it easier to hire away their people as they do less local programming. Pandora is poaching your best assets! Ignore this at your own peril.

3. Pandora is coming up with a better ratings system. Radio has Arbitron’s PPM and Edison is doing some great and credible radio-type research for Pandora. While Clear Channel and a few other consolidators prop up their custom ratings company, Pandora is inventing a better way to show its growing reach. Radio has never been an industry to want competition in ratings so they are in Arbitron’s hands all the way down.

4. Pandora will not die from this disease called record industry greed because if Pandora goes under, the record industry loses its number one source of music royalty income stream. So the labels will have to relent over time and give Pandora more reasonable rates. Radio on the other hand is facing a new performance royalty that their own NAB CEO is pushing so while Pandora is likely to get royalty relief down the road, radio is about to get saddled with more royalty fees. Bet on it.

5. Pandora has picked up on the music discovery passion former radio listeners have even as radio stations continue to offer bland, corporate playlists. And radio has fired the personalities and music experts who curated local music for listeners. No wonder Pandora is so popular. Pandora is about music discovery and radio is about repetition.

There is an air of arrogance in the radio industry again perhaps fueled by the moneylenders who think they are such a big deal.

But as I always say, follow the consumer and you will never go wrong.

Consumers prefer Pandora-type customizable music discovery “radio” over the real deal because ironically enough radio is no longer the “real deal”.

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NEW STATION for The Colorado Sound

Just got off the phone … welcome Classic rocker KFVR The Fever in Pueblo, Colorado City, Beulah CO (home of Michael Martin Murphy) to the Network… they will be airing The Colorado Sound on Friday nights from 8PM-10PM on 94.7FM.

CORPORATE PAYOLA: MADONNA AND THE BAIN CAPITAL/CLEAR CHANNEL SUPER BOWL

I’ve been reading Jerry’s emails for years.  He’s got some suggestions worth considering for local radio.

CORPORATE PAYOLA: MADONNA AND THE BAIN CAPITAL/CLEAR CHANNEL SUPER BOWL

Monday, February 6, 2012

By Jerry Del Colliano

Used to be that music started from the ground up and found its way to local radio stations.

Then, when regional stations could show results, major market stations would pick up the song.

Once a new song or artist broke in one region of the country, the others would be tracking it.

Did the song get its bullet in Billboard or did it lose momentum.

That system served the record industry and radio well prior to consolidation and the arrival of peer-to-peer file sharing.

Once consolidation came along – and we tend to forget this now – the major consolidators like Cumulus, Clear Channel and a handful of others tried to pull highway robbery on the record industry by charging them for access to their program directors – yes, they had program directors back in the ancient days of 1998.

They also told the labels that they would give them a several hour advance notice before the music trades were notified about which songs corporate radio would be adding – wink/wink.

That’s what I call corporate payola.

The labels didn’t like it and I don’t blame them.

Old-fashioned payola was better.

The jocks paid money to play songs or the PDs got favors or the stations got free albums to give away.

When Bain Capital arrived on the scene all that changed.

It took then New York Attorney General Eliot Spitzer to scare the sh#t out of the labels and some radio groups for the practice of giving labels useless information and access in return for money.

Believe it or not, things have gotten worse for radio and records.

Take that Super Bowl performance of Madonna yesterday.

Madonna, the aging icon of materialism, is ready for her third reincarnation. You can’t blame her for trying.

She already got a lucrative deal with Live Nation for touring and a not so lucrative deal to distribute her new single “Give Me All Your Luvin” at $1 million per album.

The video of the Madonna single debuted at the Super Bowl is all too footballish – what a coincidence!

I’m an ex-program director and maybe I’ve developed a tin ear but I sure would like to see how this song plays in Allentown, Bethlehem, Easton and Reading first if I am programming a station in Philadelphia.

Or see how it is playing with peer groups online.

Maybe “Give Me All Your Luvin” is a hit.

Or maybe it’s just the latest in corporate rape of the music industry.

A custom-made football video before a major football game.

Madonna’s name sprinkled in the song almost as much as the world “luvin’”.

And Clear Channel with its pre-eminent MTV Zen Master Bob Pittman is guaranteeing airplay on 60 Clear Channel stations even if Madonna’s song turns out to be a stiff.

Again, time will tell and that’s not the point.

The point is – what the hell is Pittman and Madonna and even the NFL doing to the music industry?

Now that Clear Channel Media + Entertainment is going to leverage (excuse the word) every last aspect of Clear Channel’s existence for promotional consideration and/or money, you have to feel that the dying music industry will join the dying radio industry sooner rather than later.

Because Bob Pitchman has his global view of Bain Capital and it’s his party and he will sellout if he wants to.

Meanwhile, I’d love to be a competitor of Clear Channel right now.

Here’s how I’d wipe Clear Channel all over the floor as they think they’ve reinvented music and entertainment:

1. No corporate playlists. None. Every song is added by a local PD and that means I’d need to have a local program director, which I would. Radio is nothing without a local PD. And if the local PD wanted to add some local acts, do it. Music lovers love discovery.

2. Wake up America, the music buying (and stealing) public doesn’t look to radio or even The Super Bowl to figure out its musical tastes. They look to each other. They share files and share what is cool and new. The NFL’s choice of Madonna was for the old folks at half-time but if it had been Bruno Mars instead, the corporization (if there is such a word, and if not there should be) of music falls on its face because it is driven by corporate partnerships, needs and profits and not true musical tastes. So, I’d start a local social media network and feed it with new local artists and empower the people who turn away from corporate music to determine their tastes.

3. While Clear Channel is forcing local stations to promote its iHeartRadio app more than anything else locally, I’d have my station exploit it with a local concert that isn’t in Vegas and doesn’t have Lady Gaga performing. I’d look for the next local Gaga and bask in local music.

4. Every night at 12 midnight I would play 3 or 4 new songs and artists in my format genre (including local or regional) to get exposure. They may not remain on the playlist but I’ll bet you’ll get more input from music discovery than one more rotating of your top 25.

5. Do a Bain Capital promotion. Make the audience a $10,000 Mitt Romney bet that they can’t find the next hot artist in your genre. Imagine in a social media age what would happen if you put out a call to the radio and cyberspace audience to find the next big act.

Of course, I would have been fired right after I tried step 1.

And maybe the People Meter wouldn’t like 3-4 new songs at midnight. We know PPM loves the same hit music over and over.

But I’d win the hearts of music lovers.

I’d be the go to place for music discovery in my market.

I’d own that brand.

Or, sit back and wait for the next innocuous Bob Pittman corporate partnership, which shows the former hip MTV creator is as out of touch with the common person as pundits say the original Bain Capital man Mitt Romney is.

Radio and music thrives from the street up not the skyscraper down.

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