Are Radio CEOs 'In Denial'?
August 20, 2008 at 5:24 AM (PT)
Denial ain't just a river in EGYPT. Well, CL KING & ASSOCIATES analyst JIM BOYLE didn't write that, but he did say yesterday in an update to clients that WALL STREET projections for a 4% decline in JULY for radio would more likely be reported by the RAB to be a 6 or 7% percent revenue decline. It would be the 15th straight month of down revenue for radio.
In JULY data BOYLE has seen, the average large market was down 7%, mid-sized markets were off 5%, but small markets were up 2%.
"Radio has entered and seems stuck in a new, discouraging territory with the combined challenges of a secular slide and cyclical recessionary times," wrote BOYLE, continuing that the "gap has remained very wide" between small and large market radio, with smaller markets consistently outperforming their larger brethren. "What are radio leaders doing to change direction? Not much, it seems to us. The industry's larger groups do not appear ready to institute revolutionary changes yet in sales, programming, promotion or station clusters. There is a notable sense of denial of how harsh the prospects have been and continue to be for radio."
What are radio leaders doing to change direction? Not much, it seems to us.
"The classic CEO reply is [that] radio is not bleeding as badly as newspapers, continued BOYLE. "We concede there is too little radio ad demand, but there is also too little rate card integrity and too little investment in radio's product and people for the long term. It very much looks to us as all rear-guard counterpunching."