Charlie Cook On Air

Evolution.

I was having a conversation this morning about the technological changes taking place in radio. Being able to re-broadcast an AM station on an FM translator is a huge jump forward for increased access to the listener. Without question any form of programming that requires high fidelity is challenged on the AM band. So allowing the programming to be heard on FM is a real advantage for the station.

When I was young, AM radio dominated the ratings. I grew up in Detroit and CKLW, WXYZ and WKNR were the popular stations among my peers. We had no problem listening to these stations (WKNR was a little tougher as its signal was on the Downriver side of town). Generally their signals covered the metro area. The fidelity was good enough for my transistor and car radio.

Today the extraneous sound from things like street lights, neon signs, computers and monitors, florescent lights, microwave ovens, cell phones and many more everyday sources cause problems with AM radio reception.

Who knew that George Martin was such a genius listening to the Beatles on AM radio?   Who knew that Motown was as fabulous instrumentally as it is lyrically listening to AM radio?

Today CKLW, as important a station in the Midwest as WCFL, WLS and WOWO, is referred to as the Information Station. WXYZ, now known as WXYT is Talk and Sports and WKNR is now Keener13.com and not a terrestrial signal.

That is your tour down memory lane with Charlie. Normally, I would charge you a nickel for that but there is nothing you can do with a nickel these days.

This is not a discussion of music moving to FM. This is more a discussion of evolving and using your strengths to keep viable.

Would we all agree that Rush Limbaugh has kept AM radio viable? Certainly sports have helped, as most Major League Baseball teams and NFL teams remain on AM. The AM station operators were smart enough to see that they were not going to compete on a level playing field with FM stations when it comes to Taylor, Toby and The Band Perry.

If AM radio has figured out where they can play on a more level playing field, has FM radio? Yes and no.

Some stations and companies have chosen to engage the Internet on a very large level. Clear Channel has bet big with iHeartRadio. CBS has Radio.com. This may be a great business model if you have hundreds of stations across the entire country.

But other smart FM broadcasters have decided that not only is the model iffy but the expense is huge and going up.

The self-proclaimed king of the Internet music scene does not look like it will turn a profit until the 3rd quarter of 2013, at the earliest. Apparently Pandora can live a few years underwater.

Many and more radio stations are deciding that they already have the best distribution system and it does not cost $15 a month or $50 a month and is delivered over devices already in place.

These FM stations are already playing fees to publishers for the terrestrial rights. I know that there may someday be a fee tacked on to stations that stream music, on top of the fees already paid for this service. Then many are going to decide that there is no business model and we’ll see music stations stop streaming.

Believe me, that will not be the end of radio. It is not like the physical radio is going away. Why not own a distribution system instead of paying additional fees to fight dedicated music services, personal music libraries and national platforms that provide out of market radio?

Broadcasters are asking where are the benefits for a radio station in Ashtabula, Ohio having someone in Ashwood, OR streaming the station all day. Those fees add up.

Had AM radio sat still and tried to force mono music programming on a stereo world, there would be a lot of foreign language radio stations up and down the dial.

Will the failure to move assets to the Internet spell doom for FM broadcasters? Or will the financial burden of doing something that puts you in an arena stacked against you stifle your primary business?

Definition of evolution: The gradual development of something, esp. from a simple form to a more complex form.

Definition of a bad business model: the inability to get customers to follow you from one brand to the next. If your brand is abstract and scattered and your secondary brand fails to your meet competitor’s strengths, that is a bad business model.

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