Radio stations spurning local talent

Reliance on national programs a risky trend, some say

January 26, 2009
Radio stations are moving away from live, local talent to cut costs, a move critics say could be a fatal blow in an era when traditional radio is fighting to hold onto an audience seduced by such things as the iPod, Internet and satellite radio.

Stations squeezed by double-digit revenue decreases and a gloomy 2009 economic forecast are increasingly looking at airing syndicated or other national fare in favor of locally generated shows. The trend has been escalating on talk stations for more than a decade, but it is just starting to take root on music stations.

"This trend is very dangerous for an industry already struggling to maintain audience attention," said Tom Severino, vice president/general manager of Emmis Communications Corp.'s Indianapolis radio cluster.

But times are becoming desperate, as the combined revenue of this market's top 15 radio stations has declined from about $95 million in 2004 to $77 million in 2008, according to BIA Financial Network, a Virginia-based financial and strategic consultancy for the radio and television industries. On Jan. 20, San Antonio-based Clear Channel, which owns three stations here, announced plans to lay off 1,850 employees—or about 9 percent of its staff—nationwide.

"The economic situation for some stations is getting to the point that they feel they have to do something," said Doug Ferber, a Dallas-based national media broker. "Some of these initiatives—laying off local on-air talent, relying too heavily on syndicated shows and other technological short-cuts—would fall under the category of burning the furniture. It's very bad."

Clear Channel has about 50 employees locally, and while Rick Green, the company's local market manager, said he isn't sure how the move will affect local stations, industry insiders expect five to 10 people to get laid off locally. Clear Channel's two local music stations—WFBQ-FM 94.7 and WRZX-FM 103.3—currently don't use national or syndicated shows. Clear Channel's other local station, sports talk specialist WNDE-AM 1260, does air syndicated programming.

Clear Channel, Green said, is increasingly looking to use "talent within the company across markets," and that includes on-air talent for music stations.

Radio business experts said a station can save 60 percent to 80 percent of the cost of putting on a program by playing nationally piped-in content in favor of live, local talent. While some of the most popular national acts charge cash, most trade programming for advertising spots or are compensated through a combination of cash and ad time.

If a station is using talent from another station within the same company, it usually pays a reduced amount to the other station or parent company—primarily for accounting purposes or to cover the syndication agreement with the disc jockey.

"National shows do help save the cash, that's for sure," said Chuck Williams, Radio One's local general manager. "And right now, many broadcasters are just trying to survive."

The moves in the Indianapolis market are part of a national trend, Ferber said. "When you see the CBS affiliate in a market like Dallas lay off all of its local midday talent, you know it's serious," he said.

Local operators insist cost savings isn't the only reason for using national talent.

"It allows you to bring major-market talent into markets that can't support that cost alone," Williams said.

Radio One airs national talent locally on WHHH-FM 96.3, WTLC-FM 106.7 and WTLC-AM 1310.

Entercom Communications Corp. recently began using some nationally syndicated shows on its WZPL-FM 99.5 station in the afternoons and evenings. But Entercom's local market manager, Phil Hoover, said the move was not made primarily for cost savings.

"The first question we ask is not is it more or less expensive, it's what's the best content," Hoover said.

Emmis' Severino isn't convinced.

"Frankly, syndicated programming is nothing more than free satellite radio," Severino said. "It does nothing to differentiate your station. If you can get the same content anywhere, it's just a commodity."

WZPL launched some of its national programming when local afternoon host Kelly McKay went on personal leave. Hoover declined to say when McKay might return, but said some form of national show likely would continue after 6 p.m. even if McKay returns to take over drive-time duties.

Atlanta-based Cumulus Media Partners is another radio group that has imported national talent, with the recent addition of John Tesh from 9 a.m. to 2 p.m. on WRWM-FM 93.9.

But Cumulus also has done the reverse, opting in 2006 to kill its Jack format on WJJK-FM 104.5, which relied heavily on automated voice overs and/or national talent, with little to no local disc jockey involvement.

"What we found is that people craved the connection with a personality on the air," said Bob Richards, Cumulus' local operations manager. "That's what makes radio great."

Now, Richards said, the station airs local, live content around the clock. "It's more than adding talent. We added local news, weather and traffic," he said.

Another strategy is to mix local and national content using technology.

When the desire to give listeners local content clashed with the need to cut costs, it gave rise to new production methods that some in the business think is nothing more than high-tech trickery.

New technology is used to seamlessly weave local elements into national shows, said Tom Taylor, executive news editor of Radio-Info.comand a longtime radio industry expert.

"Voice tracking," Taylor said, is another relatively new method. It uses computer software to allow a local disc jockey to record his hours-long show well before the show is aired. Music and other sound bites are added later. In this way, a four-hour show can be produced in about 20 minutes. Sometimes those shows can be produced days or weeks in advance, sapping a local show of its timeliness.

"The Federal Communications Commission is very interested in stations that are pulling the wool over people's eyes," Taylor said. "Intentionally acting live or local when you're not is frowned upon by the FCC, and can result in fines and other penalties."

Radio may have a more immediate concern.

"Radio revenue for 2009 is already projected to be down 6 [percent] to 15 percent," Ferber said. "I think this trend toward bringing in vanilla-flavored national shows could make matters worse.

"You can say what you want about national talent, but it can't go into the neighborhoods, it can't put on local events, and it can't raise money for local charities. Simply put, nothing has the power to connect with a local audience like local talent. That's what's going to sustain radio."
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