Cumulus Consolidation LogoWhen I heard about the lat­est Cumu­lus blood­bath in San Fran­cis­co, I had to make this logo. About 20 staff were fired at KFOG and KGO. The finan­cial press often ignores the real rea­son for these mass fir­ings. The lay­offs are part of the plan and not a freak result of a com­pet­i­tive mar­ket.  Quite the con­trary, con­sol­i­da­tion occurs because com­pe­ti­tion is gone.  It won’t mat­ter to Cumu­lus if they fire their star tal­ent because they also own the com­pe­ti­tion (who might have oth­er­wise Their original logobeat­en them). Con­sol­ida­tors fire staff so that they may run a skele­ton busi­ness and claim an increased prof­it through few­er expens­es. It’s that simple.

Com­pe­ti­tion is actu­al­ly what we need to end this radio night­mare. Busi­ness­es oper­ate at the speed of com­pe­ti­tion, not at the speed of the con­sumer.  When sta­tions have to com­pete for the con­sumer, that’s when great pro­gram­ming occurs.  How­ev­er, cor­po­rate radio has pushed the gov­ern­ment to cre­ate this alter­nate real­i­ty where com­pe­ti­tion is not allowed.  Com­pe­ti­tion is bought out and con­sol­i­dat­ed.  Rival con­sol­ida­tors now divide entire cities for monop­oly con­trol.  In the past, many small­er broad­cast­ers act­ed as dis­rupters and sent our cul­ture into new, excit­ing places.  Break­ing up the con­sol­ida­tors would act as a stim­u­lant to the econ­o­my through more local jobs and would also jump start the cul­ture through more local pro­gram­ming.  Music move­ments begin with faith and that is some­thing that con­sol­ida­tors see as a neg­a­tive on a bal­ance sheet. It takes a human being who feels the music and knows one’s audi­ence to make radio work.  That is some­thing that con­sol­i­da­tion, by its very nature, destroys for quick gain.





Jim Lad­d’s book Radio Waves, is part mem­oir, part his­tor­i­cal nar­ra­tive about the rise and fall of freeform FM radio. If you don’t know what freeform radio is, you will cer­tain­ly rec­og­nize it in this book, as the very soul of radio. It’s the abil­i­ty of a local DJ to pick music that they love, play it and speak as they like on the air for their entire show. Such free­dom is now gone with tight­ly restrict­ed cor­po­rate playlists and cur­tailed speak­ing times. Ladd shows with deli­cious detail how FM once gar­nered huge audi­ences through the sim­ple force of sin­cer­i­ty and local­ism. The book may be a requiem for FM com­mer­cial radio, but is is also an unset­tling reminder that good radio is just one deci­sion away. But as long as cor­po­rate boss­es and finance tycoons run radio, the “safe” choice of pushed pro­gram­ming will always win.Radio Waves by Jim Ladd

The final chap­ters of Lad­d’s book read like a greek tragedy about the impend­ing mur­der of the liv­ing LA rock sta­tion Radio KAOS.  Out-of-town own­ers, moti­vat­ed by ever-increas­ing appetites for cash, turn sole­ly to accoun­tants and research to deter­mine pro­gram­ming.  The result is a mish­mash of medi­oc­rity that tanks the sta­tion.  The only per­son who learns a les­son from this is the read­er, as the same cat­a­stro­phe is played out over and over again as man­age­ment moves up and DJs and lis­ten­ers are moved out.

Radio Waves is an engag­ing read that is sprin­kled with the author’s per­son­able encoun­ters with rock­’s great­est leg­ends. In the end, I was left won­der­ing if all of us know that good radio requires local­ism and a tal­ent­ed staff;  how long will it be till we reim­pose the local­ism rules that were ditched by the gov­ern­ment?  The move is cer­tain­ly ripe.

Radio Waves

Jim Ladd

306 pages, St. Mar­t­in’s Press

High finance is secret­ly get­ting rich off of Radio while ordi­nary investors (and the tax pay­ers) are stuck with the bill. Pri­vate-equi­ty firms load tons of debt onto radio while hand-pick­ing the man­age­ment and skat­ing with fees.  It is no won­der that com­mer­cial radio is dying.  Those in charge are not radio peo­ple.  The film CORPORATE FM shows a way out of this.

Cumulus Stock in the Dumps


Radio (like the Unit­ed States) is the most rel­e­vant and vibrant when it is of the peo­ple, by the peo­ple and for the peo­ple.   The out-of-town own­ers have no per­son­al stake to make it live again. Lin­coln might say…

For more

Radio, the experts say “call it media”.  Those experts are wrong and this is why it matters.

Many well-mean­ing radio con­sul­tants are afraid that emerg­ing tech­nol­o­gy will destroy radio.  These con­sul­tants even swayed the for­mer head of NPR “Nation­al Pub­lic Media?”.  Ask any­one on the street what it is; they call it Radio.  Even at pledge-time the mul­ti­tude of vol­un­teers call it radio.  These con­sul­tants believe that to save radio, it must become more like the inter­net.  We already have an inter­net.  If it were the 1950’s would we be telling radio to call itself TV?   Radio sur­vives because it is…radio first.

Chang­ing from “Radio” to “Media” is wrong for 4 reasons.


1. It turns it’s back on 40 years of brand­ing (for NPR).   Who would tell Coke change its name from Coke?  There are plen­ty of new pop­u­lar ener­gy drinks and eso­teric teas are gain­ing mar­ket-share.  It could make sense if you went only by the num­bers.  And that is exact­ly why the con­sul­tants get it wrong about radio repeat­ed­ly.   Coke is Coke and Radio is Radio.   [con­tin­ue reading…]

Michael Copps, Kevin McKinney, Jill McKeever NPCThe cen­tu­ry old Nation­al Press Club is a cou­ple blocks from the White House.  It refers to itself as “The Place Where News Hap­pens”.  After a crazy sub­way ride in rush hour DC, Jill and I emerged in the “Edward R Mur­row” room of the epi­cen­ter of estab­lish­ment-jour­nal­ism.   We were in DC to show the film at the DC Inde­pen­dent Film Fes­ti­val.  The press club was ask­ing about pos­si­ble new rules for yet more con­sol­i­da­tion.  I had some­thing to say to them.  [con­tin­ue reading…]

Walt Bodine

Walt Bod­ine knew his audience.

A good talk-show host will…

  • Show that they are per­son­al­ly inter­est­ed in what the lis­ten­er has to say (or many will not call in).
  • Make the guest feel comfortable.
  • Love their lis­ten­ers and community.
  • Be com­fort­able with the con­ver­sa­tion going in direc­tions that they did not pre-plan.

Walt Bod­ine was one such indi­vid­ual.  He passed away today.  I had the plea­sure of shoot­ing his last live show for B‑roll for the film.  This 18 sec­ond clip shows his per­son­al­i­ty.  He was a giant among talk-show hosts who learned his craft on the night shift many years ago.  See video below. [con­tin­ue reading…]

What is Pri­vate Equi­ty?  How do they make their mon­ey?  The answer to this mir­rors the answer to “Why does com­mer­cial radio suck?”picture: Private Equity Guy

The way a firm makes prof­it can say much about how it behaves. For instance, Pri­vate Equi­ty makes mon­ey off of fees tak­en from investors and from main­te­nance fees from the com­pa­nies that they own. They can make sub­stan­tial com­mis­sions if they can sell the com­pa­nies they own for a prof­it.  This means that short-term prof­its that make the com­pa­ny appear attrac­tive to a buy­er are more impor­tant than cost­ly long-term busi­ness infra­struc­ture improve­ments that might not pay off for 10 years.  This lack of long-term moti­va­tion has hurt Clearchan­nel as they have stopped invest­ing in their employ­ees (and you the lis­ten­er) in favor of short-term prof­its by cut­ting as much staff as pos­si­ble.  Pri­vate Equi­ty also makes mon­ey by shift­ing debt onto oth­ers.  The debt is shift­ed onto the sta­tion.  This maneu­ver is called an LBO or “Lever­aged Buy­out”.  See video below.  [con­tin­ue reading…]

Star newspaper guilty of abusing monopoly power

In 1955, the gov­ern­ment con­vict­ed the Kansas City Star (news­pa­per com­pa­ny) with monop­oly charges. The Star had abused their pow­er with the own­er­ship of two news­pa­pers, a TV sta­tion (WDAF TV) and a radio sta­tion (WDAF radio).  They forced adver­tis­ers to buy ads for all 4 prop­er­ties, and also pun­ished adver­tis­ers for uti­liz­ing oth­er media by plac­ing their ads in unfa­vor­able places and times. The Star was guilty of restraint of trade.  Because the abuse of monop­oly pow­er was so tempt­ing, the FCC ruled “cross-own­er­ship” of sev­er­al media forms with­in the same city illegal. 

Since that time, high finance has entered the ring.  The “Merg­ers and Acqui­si­tions” lob­by­ists are con­stant­ly urg­ing the FCC to allow for more merg­ers and more short-term prof­its via staff lay­offs. [con­tin­ue reading…]

The pod­cast “Sound Track of the Week” (SOTW) has announced that they are start­ing “Radio Diver­si­ty Day” to take place on Decem­ber 5th 2012.  They say they were inspired by the movie Cor­po­rate FM.  The idea was born dur­ing an hour long inter­view that they did with Jill and me late one evening.

Sound Track of The Week Crew plus Corporate FM Crew

The Sound-Track of the Week crew and us.

On Radio Diver­si­ty Day, lis­ten­ers are encour­aged to call up their local radio sta­tions and elect­ed offi­cials and demand more diver­si­ty in pro­gram­ming.  Urge them to play more local music and hire more live local tal­ent to inter­act with and deliv­er to the com­mu­ni­ty authen­tic radio pro­gram­ming.  SOTW has cre­at­ed a web page for the event here.

We are pro­vid­ing these addi­tion­al ref­er­ences to help lis­ten­ers. [con­tin­ue reading…]

 Levereged buy-out means more employees will have to be fired.They lump debt on the station but do not share in the risk.

I find myself explain­ing Pri­vate Equi­ty this way. Many ask “How is this even legal?”  The con­se­quences are hid­den from the finan­cial reporters (who often report the merg­ers as a good thing) because the fir­ings hap­pen over time as the debt matures and refi­nanc­ing and/or reselling become imma­nent. The more debt there is from the cor­po­rate buy­out, the more employ­ees that will have to be fired so their for­mer salaries can go toward pay­ing off that debt.  For more infor­ma­tion watch a short video expert  here.

Prometheus Radio project

Prometheus radio project has made this possible.

A pos­si­ble new radio sta­tion called “Fayet­teville Com­mu­ni­ty Radio” held a screen­ing of Cor­po­rate FM to moti­vate sup­port­ers behind the ven­ture.  The sta­tion is pos­si­ble because new low pow­er FM fre­quen­cies (LPFM) were legal­ized by bill in con­gress in 2010.  “It fired them up” said orga­niz­er Joe New­man about the film. “It was a very good pre­sen­ta­tion for what we are fight­ing for. It inspired peo­ple to take that extra step”.  That evening sev­er­al audi­ence mem­bers, who had left com­mer­cial radio, vol­un­teered to help com­mu­ni­ty radio become a real­i­ty in Fayet­teville Arkansas. [con­tin­ue reading…]

Con­sol­i­da­tion has dis­placed so many DJs from serv­ing their com­mu­ni­ties.  When SHORTY AND THE BOYZ worked at the Cumu­lus owned VIBE they were pro­hib­it­ed from play­ing local music or using speech that sound­ed too “urban” (a code word for black).  Now gone from Cumu­lus, they have begun their own ven­ture.  Their inter­net show does not get broad­cast over the entire city, but we can stream it to see that the light of tal­ent burns bright out­side the halls of cor­po­rate radio.  See the video they produced.…Shortyandboys

[con­tin­ue reading…]

Radio Suicide

Radio Sui­cide or Radio Murder?

Radio used to make mon­ey through adver­tis­ing. Radio sta­tions had a motive to engage the pub­lic in order to sell their rat­ings to the adver­tis­ers.  “We sold the adver­tis­er [an] audi­ence,” says vet­er­an broad­cast­er Dick Father­ley.  Here cap­i­tal­ism works because the sta­tion makes mon­ey by being rel­e­vant to the audi­ence.

Nowa­days radio, like many oth­er indus­tries, makes its mon­ey through high finance games­man­ship.  Mon­ey is made by buy­ing and sell­ing the com­pa­ny rather than what the com­pa­ny pro­duces.  In this mod­el it makes sense to cheap­en the prod­uct for short term finan­cial gains.  In oth­er words a sta­tion can fire an entire staff and then post the reduced over­head as if it were a prof­it.  This works for a short while till the lis­ten­er gets sick of auto­mat­ed radio.  It works per­pet­u­al­ly when they can do it to the entire spec­trum because the con­sol­ida­tor does not have to face their biggest fear: com­pe­ti­tion.  The los­er is the lis­ten­er, the com­mu­ni­ty and the radio sta­tion employees.

Pri­vate Equi­ty firms are not afraid to [con­tin­ue reading…]

No.  This is why it is impor­tant not to just hate com­mer­cial radio and hope for the best.  I got an email from a lis­ten­er who was hap­py that Cor­po­rate radio was dying.  He thought that we should “starve the beast”, imply­ing that if it went bank­rupt, the rats would jump off a sink­ing ship and some­one who cared about their com­mu­ni­ty would buy the sta­tion back.  I wish that were the case.  The way high finance man­ages radio sta­tions, allows them to keep them in a zom­bie state rather than killing them. Even if the sta­tion does go bank­rupt, the same firm that sucked all the life out of the com­pa­ny can man­age to keep the com­pa­ny after bank­rupt­cy.  This is called a “pre-pack­aged bank­rupt­cy”. In such an arrange­ment, they con­vince a judge that they are the best ones to man­age it, because they obvi­ous­ly know whats wrong now and they promise to pay a per­cent­age back to debtors.  The cred­i­tors may get 90% of the new com­pa­ny.  Who’s com­plain­ing?  The lis­ten­er would if they knew about it.

art by paulorocker

Imag­ine you were a DJ at Citadel (a radio con­sol­ida­tor) where you watched all your friends get fired and the qual­i­ty of the pro­gram­ming drop thus dri­ving lis­ten­ers away.   The com­pa­ny is huge,  thanks to debt financ­ing and merg­ers spurred by a pri­vate equi­ty firm (Forstman Lit­tle and Com­pa­ny).  In 2009 when the com­pa­ny is head­ing for chap­ter 11 you may think, at long last the CEO Farid Sule­man is going to get his come­up­pance.  Banks keep radio for them­selves to trade