talkers 2008 article

ith turmoil on Wall Street andmassive layoffs in the radio mar-ketplace, TALKERS magazine

went to one of the true entrepreneurs in thisindustry, TRN’s CEO Mark Masters, forinsight and analysis. Ever the optimist,Masters believes that there is an advantage toevery disadvantage and that an entrepreneur-ial renaissance in radio is near at hand.

Founded in 1993, Talk Radio Network is ajuggernaut in long-form talk syndication,eclipsing all other syndicators in the launch anddevelopment of successful long-form syndicat-ed radio talk programs –– an accomplishmentdue to what its CEO terms a “fearless entrepre-neurial environment at TRN.”

In April of last year, Bear Stearns issued areport that concluded TRN is the second largestprovider of nationally syndicated radio talkshows nationwide (behind Premiere RadioNetworks), making TRN (according to the BearStearns report) larger than ABC RadioNetworks (ranked third) and then-CBS-con-trolled Westwood One (which was rankedfourth by the same report) for national long-form talk radio programming.

TALKERS magazine recently caught upwith Masters to get an overview of the indus-try and his perspective and what lies ahead.

The TALKERS magazine interview

Talk Radio Network (TRN) CEO

Mark MastersThe TALKERS magazine interview with MarkMasters was conducted by Kevin Casey.

TALKERS: This year is almost over. Whatwould you say is the most significant eventthat has occurred in talk radio?

MM: Although the election dominated ouron-air programming, we –– meaning talkradio — are a business and with all that is hap-pening on Wall Street of late, I would say thefact that there is such a tough market in gener-al for radio has to be considered the most sig-nificant factor facing us this year. And it hasonly just begun.

TALKERS: So what are you doing about it?

MM: TRN has a strong array of revenue-enhancing and cost-saving solutions for sta-tions. We believe thoughtful innovation is thekey in hard times and we are focused on help-ing our customers’ stations to aggressivelyinnovate in finding the opportunities that real-ly do exist in tough times. Bad economic timescan actually be very profitable times for entre-preneurs, and TRN really does help bring thatout-of-the-box entrepreneurial thinking to our

station customers and advertisers. Now, I do believe that 2008 will be known

as the year that powerful syndicated programsbegan saving the jobs of hardworking GMsand PDs, and the year that talk stations in gen-eral found a safe harbor within which to sur-vive through the cash-saving power of bartersyndication.

2008 will also be known as the year thatweak syndicated programs began dying off indroves. This is because most weak, syndicat-ed talk shows are predictable and offer onlyinformation without true analysis or entertain-ment value. In this sense, weak, syndicatedshows are like flesh eating bacteria on theiraffiliated station’s life blood –– ratings andrevenue. This new business environment willnot tolerate those weak shows that have posedas successful syndicated talk shows but arereally more a form of corporate welfare ––shows that are just there because a stationgroup’s CEO or EVP thought he could create asuccessful show by putting it on his own sta-tions and make a star. Unfortunately, as we allnow know, group executives don’t make stars,radio audiences do. I have looked closely atthe top 75 markets, side-by-side, most every

W

Issue 193 November 2008

INTERVIEW

TALKERSMAGAZINE November 2008

book, and there they are — dead syndicatedshows — still on life support from guilty cor-porate parents, who are in denial about theirshow’s lack of viability. Syndication worksonly if a show can create real viral uniqueaudience.

TALKERS: What do you mean by viralunique audience?

MM: Friends actively telling friends to listen.2009 and beyond will only be about showsthat create referral-based audience. That isthe TRN companies’ mission: To continue tobuild on our existing powerhouse lineup andto find and then launch new shows that turnone listener into five listeners in a year. This isthe viral effect of powerful programming andfew shows have the raw emotional and intel-lectual range to do this.

TRN’s Michael Savage, TRN Enterprises’Laura Ingraham, TRN-FM’s Phil Hendrie, TRNEnterprises’ Jerry Doyle, TRN-FM’s Mancow,TRN Entertainment’s Monica Crowley, andTRN’s Rusty Humphries are shows that createratings spikes. These shows turn 1.0 sharedayparts into 3s, 4s, 5s, 6s all the way to dou-ble digit shares –– all through the power of lis-tener referral. With rare exception, many ofour competitors’ shows just don’t have thatkey ability. They don’t do anything but fillspace with noise, and, as I just said, these typesare only there because one or two networkexecutives (who have pull within their radiogroup’s corporate parent), not audiences, aredeciding that they know better than audiences.But this is no longer sustainable. It’s over forthose shows by force of necessity. Merit iswhat wins from this point forward and that iswhat our shows have. TRN doesn’t own sta-tions. Our shows are so good that they arethere because of pure merit. For this reason, Ibelieve, this coming year will be the best yearin the TRN companies’ history.

TALKERS: In these recessionary times forradio in general, how is TRN doing?

MM: Right after the first really bad week onWall Street, we received more calls in thosefive days from groups looking for merit-basedsyndicated programs than in the previous twomonths combined. This is because as radiogroups are finally being faced with having toterminate more of their live-and-local shows,and know they must move to a syndicatedshow, they need “best-in-breed” –– nothingless will do. And, not being owned by a radiogroup, our shows must perform like thor-oughbred race horses –– and they do.

The best example I can give of this realityis simply the fact that since our inception,TRN has launched, developed and re-built

more shows that have made it onto the TALK-ERS magazine top 10 list than our next threecompetitors combined. To add an exclamationto this point, in April of last year, the then #1-ranked analyst for the radio sector on WallStreet (Bear Stearns) conducted an analysis oftalk radio providers. Its conclusion was thatfor longform syndicated talk programming,Talk Radio Network was the second largestprovider of talk programs by market sharenationwide, ahead of ABC (ranked third) andWestwood One (ranked fourth), and secondonly to Premiere. To be sure, that report is apoint of pride. But we recognize it is also theequivalent of being the second tallest “pigmy”because talk syndication is but a sub-niche ofnetwork radio. Still, it speaks to the meritoc-racy at TRN and the true performance of ourprograms.

Merit-based programming provides bothstations and our network a “rocket effect” ontop-end revenue growth. As an example ofthis, if you average it out, the TRN companieshave had an average of 49% top-end revenuegrowth each and every year for five years in arow. There simply is no other radio networkthat can boast of that level of sustainablegrowth. This growth is due to the powerhouseperformance of great talent and the constantimprovements we strive to make to each showevery year.

TALKERS: What about your debt situation?Do you have one?

MM: Unlike many companies that have bor-rowed and borrowed to grow, TRN has hadthe ability to grow and launch shows from ourown cash flow. We have also developed new,innovative companies from our own cash flowsuch as NAC –– National AdvertisementCompany, Inc. , now America’s largest newbusiness development rep firm for nationallysyndicated talk radio programming; TRNSyndications, Inc.; and Digital MediaEntertainment, Inc., a multi-faceted Internetentertainment/content company, among oth-ers. TRN simply can’t afford to launch showsthat don’t work because, beyond the fact thateach show must pay its own freight, there is amore vital issue at stake upon every show

launch: TRN’s brand reputation. If I were to draw a comparison, then I

would have to say we at TRN are as careful inbuilding our brand in our little way as Pixarwas at building its reputation in overtakingDisney’s lock on animation or HBO was in itspioneering record of being a magnet forattracting “best-in-breed” for talent in televi-sion.

TALKERS: So you are actually comparingTRN to Pixar and HBO?

MM: For our four networks, failure is not anoption. We look at the model of Pixar anima-tion studios or HBO and we strive to emulatewhat they have done with their brands, but inour own way, as it can relate to a network oftalk radio companies. This is not an accident,it is by design.

Pixar’s visionary leaders, John Lasseterand Steve Jobs, started with “Toy Story.” Atfirst, people thought they were just lucky.They thought the 3-D animation was the starand they were just a one-hit wonder like somany movie companies. But Jobs andLasseter were underestimated. In truth, “ToyStory’s” 3-D animation was the gimmick. Thetrue power of “Toy Story” was in the writing,the directing and the talent assembled by Jobsand Lasseter. These men brilliantly knew thatthe writing and directing aspect of their talentacquisition strategy would not be credited atfirst. So as Pixar cranked out hit after hit, the3-D animation gimmick of Pixar became syn-onymous with great storytelling.

Jobs and Lasseter recognized that with onegreat movie you are lucky. But when their sec-ond Pixar release –– “A Bug’s Life” –– was ahit also, suddenly Pixar’s success was not seenas a one-shot wonder but a culture of hit cre-ation. By their third hit movie, Pixar started tobe seen as a leader in animation. By the fourthhit Pixar was perceived as the leader and bythe sixth hit, the Pixar reputation was so pow-erful that it was worth more than $7 billion toDisney. Jobs was able to oust Michael Eisnerfrom power and put Lasseter in charge of bothPixar and Disney animation. Not bad for twounderestimated guys who understood thepower of, 1) talent first and, 2) constantlyrolling out hit after hit as a result of getting theright talent to make those hits.

Now, Jobs and Lasseter are busy rejuvenat-ing Disney’s 2-D animation division becausethey know that their 3-D animation wasalways a gimmick –– that the true power ofPixar and Disney is all about brilliant talentwho know how to tell a compelling story withstrong emotional range chock-full of brilliant-ly timed humor. What you get is a hit, regard-less of the animation use, whether it’s 2-D or 3-D.

These same principles apply to radio, and


TRN in particular. Like Pixar, the TRN strate-gy relies on great talent who know how to bebrilliant, unpredictable, funny, compellingand smart –– backlighting absurdity usingabsurdity. They crystallize the fog of theiraudiences’ thinking into jaw-dropping claritythat validates what the listeners always knewbut couldn’t put in words themselves, all thewhile making them laugh. In short, these arethe qualities that, just as Pixar uses to makemovies which create giant referral-basedviewership at the box office, TRN uses to cre-ate referral-based radio listenership thatbrings ratings spikes –– “tent poles” of audi-ences. They, in turn, collateralize the rest ofour affiliated stations’ line-ups with audience.

I will tell you that I believe outside of Rushand a handful of other greats at our competi-tors, TRN’s shows are the ones that have donethis consistently. And it is that consistencythat our station customers stopped bettingagainst after –– like Pixar –– we launched ourthird and fourth hits. We are working on oureighth now.

TALKERS: They say that the present finan-cial crisis is unparalleled –– at least in mod-ern history; as a student of history do you seeany parallels to the current situation fromwhich we can draw insight?

MM: This economic environment is replicat-ing that of the year 1987 –– the year moderntalk syndication was born with Rush and thelast year the stock market collapsed. As in1987, what stations need most now is revenue.With most budgets having already beenslashed to the bone over the last five years, theonly real places left to cut are local talk showhosts, their producers and call screeners.Thus, powerful, syndicated, barter talk pro-grams are the only real solution to filling thevoids left behind at stations due to these nec-essary cuts. And, as in 1987, syndication willthrive on a new, unprecedented level. 2008 is1987 all over again. But for syndication, it willbe twice as good this time around because thistime, talk syndication will save both the AMand FM bands. AMs, by replacing costly localshows and FMs by saving them from the slowdeath that is music radio.

In the last six weeks we have seen a gianteconomic tsunami hit the world markets.Radio groups were already dealing with atough environment before the stock marketdebacle. Now, many radio groups’ stocks areoff 90% to as much as 99.7% from their formerhighs. These groups must now throw off themaximum amount of free cash flow that theycan and they have no choice but to cut yetagain. And in order to do that they are turningto syndication to solve two problems at once:lowering costs while increasing quality. I

believe TRN has merit-based programmingavailable that is strong enough to replaceexpensive, beloved, local shows that probablywill be gone soon.

TALKERS: We’ve noticed that you have beenrunning spots by your hosts promoting localsales for your affiliates. Obviously you aredoing more to help the stations financiallythan just provide good, inexpensive pro-gramming.

MM: First and foremost, our hosts have anunusually strong bond with their audience. Itis this bond that we are actually putting towork for our stations over the next year. Ourhosts will go out and sell their audience on theconcept of that audience buying ads on ouraffiliated stations –– drawing local advertisersto our stations out of the bond of loyalty thatexists between host and listener. This willincrease sales at each affiliate and enhance rev-enues. The audience bond with a beloved hostis where it all begins for the station and it endsin our stations having more local advertisers.

Unless a network cares about the profitmargin of their station affiliates as job #1, net-works will ultimately fail. That is why all theTRN companies’ network hosts are participat-ing in strategic efforts on multiple levels acrossmost every show to activate their loyal audi-ence to advertise locally on each of our stationaffiliates. We call these the TRN companies’tipping point initiatives.

TALKERS: Okay tell us more. This is veryinteresting.

MM: The first step, as I just mentioned, is uti-lizing the powerful bond that our hosts havewith their audience, and then getting the lis-tener involved as part of the process to helpthe station thrive. This is an effort unlike anyother network has attempted. This is bestexemplified by commercials read by our hostsmaking the case that the local station must berewarded for airing the shows they love –– thatfreedom of speech is not free and must be sup-ported with ad dollars. Stations are encour-aged to air these commercials in their localunsold avails as often as they have unsoldinventory. TALKERS magazine readers can lis-ten to 15 different examples of these commer-cials by logging onto www.sponsorthissta-tion.com.

The next step of this is a national call centermanaged through our wholly-owned newbusiness development rep firm, NAC(National Advertisement Company, Inc.),where local advertisers’ leads, desiring toadvertise on our affiliates, are collected,tracked and then processed back to our affiliatedepartment to then be transferred as an adver-

tiser referral to the station free of charge. Thetipping point local advertiser referral initiativeutilizes a series of activation strategies throughwhich our hosts will:

1) activate each affiliate’s loyal listeners byasking their audiences, who own businesses,that are already part of the show’s audience tosupport the local station affiliate throughadvertising on it.

2) help activate their show’s loyal listeners todo business with each local station’s advertis-ers by asking them to do so, and in so doing,rewarding those advertisers for supportingthe shows they love.

3) eliminate advertiser churn because thefolks who respond to the national campaignand toll-free call center are those who arealready most compatible with the station andits shows because they are drawn from theactual audiences of our affiliate’s shows.These advertisers are most likely to be patientand supportive enough to renew. This elimi-nates advertiser churn.

“2008 is 1987 all over again.But for syndication, it will betwice as good this timearound because this time,talk syndication will save boththe AM and FM bands.”

TALKERS: Explain how you are using theterm “churn?”

MM: Churn is a result of replacing test adver-tiser after test advertiser that are initiallyincompatible with the audience and won’tgive an ad campaign enough time to work.Our tipping point effort helps eliminate adver-tiser churn. It helps to solidify our host andentire station’s affinity group into a communi-ty of people who are doing business with eachother and thus, the station not only gets thebest programming, but enhanced revenue aswell.

Now, if you are in business, you know atipping point is the point at which, all thingsbeing equal, there is something that tips you todo business with one guy over the other. Formini-vans, the tipping point 10 years ago wascup holders. Whoever had the most cup hold-ers won. Then it was built-in DVD players.Think about it: A $299 item tipping a $30,000purchasing decision. But each product or serv-ice has to have a slight advantage. That’s the


tipping point.For our affiliates, getting advertisers to

start with their stations and then to renew,begins with the host’s bond with his or heraudience and our hosts using that powerfulemotional bond to get the local advertiser to“tip” in the station’s direction with their addollars. Through strong, consistent repetitionof host spots (among other mentions), ourhosts can penetrate most of the inattention oftheir audience. That requires local sponsors tostep up and reward the station with their addollars for having the courage to carry ourshows and other shows they love on our localaffiliates. Our hosts also drill in the fact thatthe good news is, according to research proj-ects conducted by TALKERS magazine andother reliable sources, talk radio generates twoto three times the response to ads placed inpowerful talk programs than those same dol-lars spent on similar sized music audiences,which are generally passive.

In this way, beloved hosts who have apowerful bond with their audience are active-ly using that bond to help our affiliated sta-tions on the revenue side in these tough times.That bond is the equivalent of the extra cupholders in mini-vans or the DVD player thattipped the auto sale. In our case, we aim toachieve a tipping point effect that moves theaudience on a visceral level to shift their localad budgets from newspapers or from TV toour station affiliates and then stick with it.Because with talk radio, the medium is themessage. And talk radio moves advertiserproducts in a much more powerful way thannewspapers, TV or music radio.

Let me backlight this point even further byreferring to a project I conducted a few yearsback. At that time, in America’s top-20-ratedmarkets, news and news/talk radio stationswere ranked first, second or third in revenuein 16 of the top 20 markets while they aver-aged only eighth through fifteenth in ratingsrank for Persons 25-54. So revenue ranktrumps ratings rank any time –– but especial-ly now. Talk stations can only achieve thishigh level of revenue performance if they aremoving products for their advertisers on apowerful level –– and they are.

TALKERS: We hear stations complainingthat it is hard to find good salespeople.Many out there are not even covering theirdraws. Do you offer any advice or help tolocal stations in this regard?

MM: We try to work with our stations in avariety of innovative ways to increase theirrevenue. One of the biggest items on ouragenda is to help our stations to realize theymust sell hard into a recession. The best wayto accomplish that is through recruiting super-

star salespeople. This might sound like anexpense at first blush, but it is not. Becausegreat salespeople are not only ultimately free,they go on to bring you $9 for every $1 youpay them.

Thus, once a talk station’s weekday line-up is mostly syndicated, there is one key areafor which we suggest our affiliates utilizethose cash savings: the expansion of their localsales force.

At TRN, we advise our GMs and GSMs tospend at least a third to 40% of their timeinterviewing new recruits for their salesdepartment. Beyond actively recruiting fromcompetitors –– local newspapers and TV ––we also suggest targeting four additionalgroups for recruitment: 1) teachers on summerrecess, 2) nurses, 3) former military, 4) off-dutypolice officers. Why these groups? Becauseeach one has something in common. They arenormally good communicators. They canspeak in an authoritative voice when theybelieve in something and they usually havehigh standards of integrity and ethics.

At TRN, we believe the only way to win ina bad economy is to sell into it. This is theequivalent of applying a surge strategy to thesales department –– like General Petraeus hassuccessfully accomplished in Iraq. With thatsurge, the same principles ring true when youbring in top-flight sales people. Perhaps liter-ally doubling the sales department by bring-ing in new recruits constantly and then man-aging their efforts by replacing the weakest25% every 60 to 90 days. The end result of thisis a lot more pressure on rate due to moreinventory being sold because you have twiceas many salespeople working on a finiteamount of inventory. Rates rise as inventorydiminishes, due to the surge.

TALKERS: What about commissions?

MM: Part-timers can be commission only,while full-timers have a short time windowwhere the cash draw against commissiondiminishes to nothing over whatever timeframe that is practical. Truth be told, nation-wide, it is a well-known fact that 20% of thesalespeople sell 80% of the inventory, while80% usually sell only 20% of the inventory. Soif the emphasis can be put on targeted recruit-ing of both existing sales reps from newspa-per, cable, etc., and the four new groups I men-tioned, stations can start to increase their oddsof bringing in superstar salespeople –– or“eagles” –– and this, in turn, allows a GM orGSM to eliminate the non-producers –– the“ducks.” Every hour spent recruiting a deepbench for your sales department of top pro-ducers is equal to 20 hours of managing weaksales people. The motivationally impairedshould fire themselves through losing their

draw at a certain date. Top producers, on theother hand, won’t worry about the time win-dow for the draw, because they believe inthemselves and talk radio.

As time goes by, constantly recruiting newsales people as a process eliminates the needto nurse weak sales people. They will workhard because they know that the GM or GSMis busy finding their replacement every day ifthey don’t. Thus, constant, disciplined recruit-ing really does solve all revenue, managementand retention problems at the same time.Recruiting can slow down to a drip when thesales team consists of only top notch “eagles”that compete to outdo each other for fun andprofit. Eagles fly with eagles, ducks fly withducks. At TRN, we have something called “TRNUniversity.” One of the programs we will beoffering in mid-2009 is how to manage andupgrade your sales force through the use ofstrategies such as these.

TALKERS: Will this educational programfocus exclusively on sales?

MM: No. Other “TRN University” programswill be on coaching new or weekend hosts onthe structural architecture and formatics ofdoing talk radio. “TRN University” will offerprograms for training talk radio producers.Stay tuned for dates for “TRN University”programs.

“Every hour spent recruitinga deep bench for your salesdepartment of top producers isequal to 20 hours of manag-ing weak salespeople.”

TALKERS: To your great credit, TRN hasnever shied away from developing and pro-moting women in political talk –– now withLaura Ingraham and Monica Crowley, is thisa peek at the successful evolution of talk?

MM: We are very proud to have the topwomen issues-oriented talk show hosts in thecountry. The “Palin Effect” has really cata-pulted all four of our top women talkers tonew heights. Just this last month, LauraIngraham added 20 new Monday-through-Friday affiliates –– a great number of whichare the coveted flagship stations of theirgroup; such as Entercom’s WRKO,Boston; Citadel’s WBAP, Dallas which is saidby the Citadel folks to be the most powerfuldaytime AM signal in the U.S. and reachesupwards of 25 states at night; FisherBroadcasting’s flagship talker KVI, Seattle;


Mt. Wilson Broadcasting’s20,000 watt 1260/540 AMsimulcast in L.A.; alongwith 16 other Monday-through-Friday stations,many of which are also theflagship stations of theirgroups.

Monica Crowley like-wise has been catapultedinto weekday syndication as a result of herstellar performance nationwide. Monica’saudiences spoke to PDs and we listened tothem. This is the way stars are made. Monicais now syndicated live, 3:00 pm to 6:00 pm ET,Monday through Friday,and is growing fast as aperfect “tag team” with thelikes of Laura Ingrahamand Tammy Bruce for up tonine hours a day of week-day issues-oriented talk fromAmerica’s most influentialwomen talk radio hosts.Darla Shine is also doingsome impressive things on our weekends.

TALKERS: You used the phrase, the “PalinEffect.” What do you mean by that?

MM: Most of the disposable income inAmerica is controlled by women. With SarahPalin electrifying the base of conservativenews/talk radio and bringing in women lis-teners, stations that have two or three womenin their weekday lineup are in a strong posi-tion to receive the key benefits of the startlinggroundswell among “activated,” and nowmotivated, women. This has become knownas the “Palin Effect.”

One great female talker on a station is agood start, but from an ad agency perspective,two is a culture –– a culture that local agencieslove. With Laura Ingraham as the top femalepolitical talker in the country, and MonicaCrowley live in afternoon drive, stations suchas Red Zebra’s WTNT, 570 AM in Washington,DC are quickly recognizing that women arethe true power behind spending –– both onthe home front as the primary consumers andas buyers at the agency level. Smart stationsare capitalizing on this fact.

Great talk hosts attract massive audiencesbecause of who they are, what they stand for,the sheer gravity of their presence and, ulti-mately, their lovability. With that said, thewomen of the TRN networks are just terrific,rare powerhouse players who truly bringsomething special to the issues-oriented talkgame. We have been blessed to capture thatmagic in a nine-hour block that I believe isunmatched anywhere in national syndication.

Amazingly, Laura Ingraham was on nights

that shifted her world views to what they arenow. Tammy is a true maverick, intellectuallyhonest, secure in the fact “she knows that sheknows,” because she has been down that otherroad and has come back with a deep under-standing that shows in her kind confidence.Tammy is a rare person who can knock out thebiggest bully, then pick him up, dust him offand make him a friend. Tammy Bruce is bril-liant, funny and unpredictable.

So, we woke up one day, and, as it turns out,we had, across the TRN companies, amassed threeof the best female talkers in the business. ThenSarah Palin comes along and electrifies the femalebase of conservative news/talk radio in a way thatis simply stunning.

In composite, across several of our net-works, we now have nine hours a day of thestrongest women issues-oriented talkers in thebusiness –– a women’s network that worksand is powerful. And we didn’t plan it thatway, but there it is.

TALKERS: But what you described is onlygeared to the conservative side of the for-mat…granted, it is the bigger side at themoment. But what about women who arenot hard-line right wingers?

MM: Good point and believe me we are think-ing about it. Without getting ahead of myselfhere, this is also the way we plan to roll out afull slate of progressive talkers, one big hit at atime, until there is an entire lineup.

TALKERS: You mentioned earlier that youforesee talk replacing music on FM in thevery near future. How are you planning totake advantage of that?

MM: More than 75% of America’s radio audi-ence is waiting for talk on the FM dial and thetime is now. TRN-FM was created to focus onthe simple reality that there is little to no futurefor FM radio stations in music. Music is now acommodity available every-where, commercial free, onyour iPod or cell phone. Amusic radio station just can’tcompete with that. So let’sstep back from that truth fora minute, stick a pin in thatpoint and consider theinsanity of the following:Imagine a top 10 market. Ithas five urban music sta-tions, five rock stations and so on. Yet talk sta-tions are statistically the top revenue generatorsin most of the top markets. Besides that, unlikemusic stations, where the group Green Day canbe heard on most all of the five rock stations ––meaning no exclusivity of content –– talk pro-grams grant an FM station exclusivity for talk

on Westwood One when she came to TRNEnterprises. We moved her to mid-mornings,and with our team and Laura’s talent, theshow grew some 20-fold after re-launchingwith us in L.A. and in New York on WABC.Now in 43 of the top 50 markets, and 83 of thetop 100, Laura is the uncontested number oneshow in her daypart nationwide and the fifthlargest show in the U.S. overall. From WABC,New York to WRKO, Boston to WBAP, Dallasand 320 other stations from coast to coast,Laura is a guiding light of smart analysis, hipwit and wisdom. She is a firebrand whoclerked for Supreme Court Judge ClarenceThomas, was a speechwriter in the ReaganWhite House, is a two-time New York Timesbest-selling author, and was named in the top10 most influential conservatives in Americaby the Times of London. Laura is also the desig-nated fill-in for Bill O’Reilly on the Fox NewsChannel and separately appears as a weeklyFox contributor on “The O’Reilly Factor.”

Monica Crowley’s rise in national promi-nence is no less impressive. She worked asPresident Nixon’s foreign policy aide for fouryears in the early 1990s and wrote two best-selling books about her experiences withNixon. Monica holds a Ph.D. from ColumbiaUniversity, has worked as an anchor for sever-al news and opinion shows for NBC and NBC-controlled networks, including NBC’s early“Today Show” for two years, before launchinginto syndication with such affiliations asWABC, New York; WTKK, Boston; KPAM,Portland; WTNT, Washington, DC; along withanother 102 stations under her belt. Monica isalso a permanent panel is t on “TheMcLaughlin Group” and a news analyst for theFox News Channel. Monica’s new Mondaythrough Friday East Coast afternoon drivetime provides a powerful female alternative, tocounterprogram existing talkers in every mar-ket. Monica resonates with common sense ona level that is rare, doing it all in a way that iship, witty, smart and feminine. Monica is bril-liant and has tremendous emotional and intel-lectual range. I predict that Monica will be atrue breakout star in afternoon drive.

Tammy Bruce, once the president ofN.O.W. in L.A., a proud feminist and openlygay, is one of the strongest proponents ofindependent conservatism and defendsreligious conservatives daily from those onthe extreme left who havehijacked both the legitimatefeminist movement andthose on the extreme leftwho purport to representthe gay community. Inher landmark book, TheNew Thought Police, Tammyuncovers what brought herto the startling realizations

LauraIngraham

MonicaCrowley

Tammy Bruce

Erich“Mancow”

Muller


shows. You can’t get the same talk show on fourother places on the dial in the same market likeyou can with music. Then combine that exclu-sivity advantage of talk programming with theaudience bond that comes with what I call the“monopoly of personality” and 30% more com-mercials per hour than a music format provides,and, presto, it becomes very clear that severalFM stations in each market will be forced,through economic circumstances, to go talk dueto talk radio’s sheer income-generating power.Now add two more key elements: First, talkprograms have engaged audiences and, as aresult, talk formats move products –– asMichael Harrison has pointed out over theyears, at two to three times the rate of the samesized music audience. In fact, ads airing in talkprograms have much greater response for theadvertiser’s dollar which means greater returnon investment, which then results in renewalson ad contracts. And the clincher: more than75% of America’s listening audience is alreadyon the FM band and most are a younger, morevaluable demo than that on the AM band. Ifyou stand back from thesetruths, you start to realizethat talk radio has justbegun because it barelyexists on FM now. But ayear from now there will bemore talk stations on the FMband than there will be qual-ity programs available to bedistributed by them. Forthis reason, TRN-FM was created; right nowTRN-FM consists of two of the greatest innova-tive talents in all of radio, Erich “Mancow”Muller and the legendary Phil Hendrie.

TALKERS: The FM talk movement seems tobe starting with morning drive, a trend thatgoes back to Howard Stern…

MM: When analyzing where the bulk of FMstations’ revenue is, it becomes quickly appar-ent that between 40 to 60% of many successfulFM stations’ revenue impact revolves around itsmorning drive show. We looked at around 400FM personalities over five years and the reallytalented ones were usually either brilliant, high-ly unstable, self-destructive nut jobs, or theywere stable milquetoast. But finally we got thebest of both worlds in Erich “Mancow” Muller.Mancow is one of the most talented morningshow hosts to ever grace the airwaves and he isa decent, stable businessman, off the air. He istruly a person you can invest in, believe in andhe won’t let you down. As was the case of JerrySeinfeld, who certain NBC executives stuckwith for 18 long months until he broke outgoing on to become the biggest TV show onNBC, Mancow has evolved to such a point thatI believe he will be the Seinfeld equivalent onradio. His time is now. His personal evolution

from being the Mancow of 19 years ago to Erich“Mancow” Muller of today shows the night-and-day difference. To underscore the point,Citadel’s legendary PD, Jack Swanson of KGOand KSFO, San Francisco, has called Mancowthe “next Rush Limbaugh” and amazingly, justa few days ago, Citadel’s WLS, Chicago presi-dent/GM Mike Fowler independentlyechoed Swanson’s comment. Fowler justhired Mancow for a mid-morning slot on theheritage Chicago station and told the ChicagoTribune, “It’s going to bring a lot of energy tothe station. It’s a younger version of Rush withsome Roe Conn thrown in.” Conn is WLS’ suc-cessful afternoon drive host.

A while back I had finally convinced leg-endary talk consultant Greg Moceri to workwith Mancow. Greg’s reaction was immediateand powerful. He was blown away by whatMancow’s show had evolved into. Greg’s sageadvice has advanced Mancow to the next andfinal level of the best of both worlds: the edgyhumor and pop culture explosion and sensibil-ities of FM, sprinkled with the passionate dis-course of issues-oriented AM talk.

Mancow’s show is the perfect syndicatedpowerhouse replacement for FM stations thatnow must cut their expensive morning shows.In the last decade, Mancow’s morning showhas been the top morning drive performer inhis daypart in three of the top ten markets, inthree different regions of the U.S. –– WestCoast, Midwest, East. Now add to that hisevolution since September 11, 2001 and sta-tions have an entertainment juggernaut inmorning drive as a syndicated option toanchor their day as the morning drive showon a music or a talk station.

TRN-FM’s second show is “The PhilHendrie Show.” Phil Hendrie is an entertain-ment legend. What else can be said? After join-ing TRN last year, team TRN has been able toclear Phil’s show in 17 of the top 25 markets.The beauty of Phil’s show is that FM stationstesting the waters for talk can put their toe inthe water with talk at night with “The PhilHendrie Show” and expand from there. Atfirst, our strategy for music stations was forthem to put Phil on live 10:00 pm to 1:00 amPT, then put a short best of re-feed of Phil inthe middle of the night that backs right up toMancow’s morning drive show. Those folksthat fall asleep listening to the brilliant satireand humor of the very independent libertari-an Phil Hendrie will wake up listening to thehilarious libertarian pop culture explosion ofentertainment and issues with Mancow for aone-two punch of brilliant overnight program-ming leading straight into brilliant morningdrive programming.

In this way, FM music stations can runup to 10 hours per day of talk, 14 hours ofmusic and start the transition to talk as anevolution rather than through a revolution.

For FM stations that want to go full-time 24/7talk, the Hendrie/Mancow overnight/morn-ing drive combo is a rock-solid foundation oftalk superstars that they can build a stationupon –– and we will be there to help.

TALKERS: How is the rest of the TRN stabledoing?

MM: Michael Savage, whether you love himor hate him, is brilliant and hilarious. I docredit Michael Savage for helping me re-launch TRN and independ-ent syndication in 1999after we sold TRN and itssubsidiary, CBC/Art Bell,to Premiere and thenbought it back. After we hit150 stations with Savage,Sean Hannity, a closefriend, called me and kind-ly told me that, perhaps Iwasn’t crazy after all for syndicatingSavage and that in his mind, I had provenindependent syndication could thrive in apost-consolidation world. However, when Iinitially called Sean in 1999 to tell him that Ihad just signed Savage, Sean told me that Ihad made a mistake. He said no one, includ-ing him, would ever be syndicated becauseconsolidation meant the end of independentsyndication. But now he was ready to go withme, if he was allowed to do so. But then-WABC programmer Phil Boyce –– a legendarytalk radio PD who recently joined TRN as pres-ident in charge of programming –– convincedABC to match my offer for Sean, which theydid. But Hannity won in any event, becauseTRN’s breakthrough success with Savagemade the case, both to Sean and obviously toABC, that talk syndication could work in apost-consolidated landscape. I remembertelling Phil Boyce, “Either you syndicate Seanor I must, but don’t let Premiere get him.”Well, ABC matched and after he called me totell me that sad fact, we were both shocked.But I guess ABC did not want me having bothof their major talents, so they courageouslystepped up to the plate.

Hannity was launched by ABC into syndi-cation September 10, 2001 –– the day beforeSeptember 11. God bless him. He’s talented,brilliant and blessed. Hannity is still myfriend and the only one that got away. But heis surely there because Savage provided thecase for him. They might hate hearing this,but every show since owes Savage a certaindebt of gratitude for proving that syndicationstill worked after consolidation changed radioin the late 1990s.

TALKERS: With the nightmare on WallStreet, Jerry Doyle’s time spent working inthe financial sector seems to be serving him

Phil Hendrie

MichaelSavage

well. It seems Jerry was ahead of the curveon this.

MM: Jerry Doyle was right about the WallStreet debacle long before anyone else. He sawwhat was coming and how it would affect pol-itics in a way that no one else has or even coulddo. As far back as November of 2007 I remem-ber getting calls from Jerry’s producers abouthow Jerry was spending more and more timeon an impending nightmare on Wall Street.This producer didn’t see the connection thatWall Street would end up having with politics.

Jerry spent 11 long years on Wall Street atDrexel, Burnham, Lambert, and Prudential asan investment banker, and was spot on in con-necting most all the dotseight months before anyoneelse was even getting awhiff of it publicly. Ibelieve Jerry is a superstarin the making, havingamassed some 230 affiliatestations. This guy was alsoa jet pilot, did 12 years as aTV star including six ofthose on the Emmy Award-winning Sci-Fi TVshow “Babylon 5” –– there are still over165,000 fan websites for him from that time.But despite his Hollywood background,Jerry’s raw intellectual and emotional horse-power allows him to pull share numbers in the3s, 4s, 5s, 6s, 7s and more on air because he isthe real deal. He ran for Congress on his owndime in 2000 and lost. “Outed” as an inde-pendent conservative in Hollywood, hesought out talk radio and has since risen to beranked eighth largest talk show in the U.S.* IfI owned 400 stations I would have him onevery one, but since I own no stations I amhappy with 230 and am watching him growon merit. Not cram down, but merit alone.

TALKERS: Even though foreign policy hastaken a backseat to the economy, it seemsRusty Humphries has done everything thathe can to own the Iran/Iraq/Afghanistanconflicts and Homeland Security. Are yougoing to allow him to continue the level ofrisk that he has taken as of late?

MM: Rusty Humphries is on over 200 stationsnationwide and ranked ninth largest show inthe U.S.* While he is live 6:00 pm to 9:00 pmPT, Rusty is famous for his enormous naturalentertainment ability –– he has drawn crowdsof as many as 7,000 to his events in Reno. Buthe is now most well-known for his literal own-ership of foreign affairs and HomelandSecurity. Almost losing his head to the Al-Aqsa Martyrs Brigade to get an inside inter-view with the top terrorists operating on theWest Bank in Israel is just one of the examples

of courage that sets Humphries apart. Hespent a full week withGeneral Petraeus, has per-sonally been invited to andgone with the SupremeAllied Commander ofNATO to Afghanistan,slept on the ground nightafter night on a special tripto the Sudan to get thetruth about one of thegreatest modern tragedies of this century ––Sudan’s slave trade. He has been to GITMOthree times and Israel more than that. The listgoes on and on but Rusty truly does bring youtomorrow’s news tonight and is the mostpowerful live syndicated show in his daypartnationwide.

TALKERS: In spite of your lineup’s qualityand achievements, I’m sure that many peoplereading this will disagree with you even tothe point of being horrified about stationsbeing better off with syndicated program-ming over local hosts across the board.

MM: The TRN companies’ strategy is to fullyengage our GMs, PDs and GSMs in helpingthem to be as proactive as possible in bothincreasing income and lowering costs at theirstations while increasing programming quali-ty, particularly in this economic environment.Please bear in mind, that what I’m going tosay addresses only eliminating local showsthat are either too costly or not performing.But a station may still be better off with anaffordable local show that is performing ratherthan having a tepidly weak syndicated show.

“In fact, ads airing in talk pro-grams have much greaterresponse for the advertiser’sdollar which means greaterreturn on investment, whichthen results in renewals on adcontracts.”

This is achieved through proactively replacingcostly local shows that are not stellar perform-ers or that are just too costly with “best-in-breed” powerhouse syndicated shows. When Isay this can and should be a proactive process,what is really happening is that the stationGM/PD/GSM team is creating a win-win-winfor themselves, the station and the rate integri-ty of the station’s inventory. Here’s how itworks: In a weak economy –– as existed in 1987and exists today –– perhaps five minutes perhour of a station’s costly local show may be

going unsold or is being bonused away on the“buy two minutes, get one minute free” prem-ise that struggling salespeople often offer. Sowhat we suggest is to take the 33% of thathourly inventory stations are probably not sell-ing or are simply bonusing away and creatingbad habits in the form of expectations of freeminutes from their advertisers, not to mentionbad habits in their sales reps and instead, turnthat inventory into “talent dollars” by tradingaway those minutes to TRN in return for “best-in-breed” talk programming. This has severalimmediate wonderful benefits for the GM, PDand GSM.

By reducing the available amount ofsaleable avails from 15 minutes per hour to 10minutes per hour, all “buy two minutes, getone free” giveaways and bonusing of spots arestopped dead in their tracks and rate integritycan start to be rebuilt on a real supply anddemand basis. After all, too much supply ofinventory means the floor falls out of yourspot rate. Thus, by taking five minutes perhour off the table, the supply of available min-utes decreases and the rate of the remainingminutes correspondingly increases.

Second, after the unsold five minutes havebeen traded to a syndicator (hopefully TRN) forsuperior programming, the underperformingor too costly local show host, producer and callscreener’s costs can be eliminated. This costsaving is far more than you might think at firstglance because our GM/PD/GSM team is pay-ing the local host with dollars net of localagency and station sales commission feeswhich require many more gross dollars to begenerated to pay the local host/producer team.Plus, there are additional savings from theemployer side of expenses of payroll, etcetera.

Third , we then encourage ourGM/PD/GSM teams to use their weekends asa place to start developing new local talk tal-ent in lieu of selling that time in blocks toinfomercials. My strategy has the same orgreater revenue opportunities for stations asselling time to infomercials but I think it ismore strategic.

Going back to recruiting as an answer toall problems on the sales front, PDs can applythis same thinking to their weekends byrecruiting new hosts –– and supplemental rev-enue as a side effect –– from their local com-munity on a revenue-share basis. This is howit works: Local high-profile businesspeople,church leaders, service providers or just plainold highly connected folks are approached bythe PD for an opportunity to do a weekendshow coached by the PD. The deal is there is atime window for the host to get up to snuff andan opportunity to perhaps even go weekdaylocally, someday, if the weekend farm team can-didate can achieve certain milestones like, A)take direction and coaching on how to do


JerryDoyle

RustyHumphries


radio, B) sell all the spots in their show to indi-viduals they know for full rate card at 100%sellout, within 90 days of launch, C) the week-end host then is paid 50% of all the proceedsthey bring in for hosting the show and sellingthe ads. The station retains 50% of the pro-ceeds at full rate-card rates.

This strategy allows our PD, beleagueredby market conditions, into having to fire hiscostly local weekday hosts, to recruit anddevelop an entire local farm team at no costoutside of board ops. He’ll not only have ateam developing on the weekend, but becausethe condition of getting the show is based onthem each finding their own sponsors, theweekend starts to become a huge profit centerthat the PD can get direct credit for.

With this strategy, something else wonder-ful happens. The station’s weekends becometransformed into live and local radio that isvery profitable for the station and includes theactive interest of the sphere of influence ofevery local host recruited. If the weekendhosts are really good at selling their weekendshow, they can also be offered the opportunityto turn that skill on selling the weekday lineupas well under the standard commission struc-ture for weekday salespeople –– but this iscommission only and, once again, costs noth-ing.

TALKERS: What are your plans for thegrowth of the Internet? You mentioned anew division called Digital MediaEntertainment, Inc., what is that all about?

MM: Well, I can say that outside of growingour syndication business, there are two keystrategies we have been focused on that willstart rolling out in the next year. Those are ourseries of web companion initiatives and inno-vative journalism.

“Whatever can bring top-of-mind awareness to a website,either local or national on aconsistent and highly repeti-tious basis, ultimately holdsthe key to a site’s traffic andvalue.”

First, I will stick my neck out and talk aboutour Internet initiatives by saying that we will beproviding our station customers a product lineof syndicated web products that they can actu-ally monetize. TRN is also involved in creat-ing a series of broadband comedy channels,such as, “Laugh at the Left.com” and “Laugh at

the Right.com,” to name but a few. This proba-bly will appear by the end of the first quarter of2009. Within three years, over 50% of what wedo will be creating web content. Specifically, wewill be in the broadband/audio/TV business,but not in the way others are doing it.

TALKERS: As you know, TALKERS maga-zine has been very aggressive in forecastingthe coming emergence of the “media station”as a kind of web-based super platform fortalk radio and its newly acquired assets ofvideo, graphics and text. What do you thinkabout the web, long term?

MM: TRN believes that the true power of theweb does not lie within, but rather outside, theweb. The real power of the web lies within therealm of the web driver, meaning old media.Whatever can bring top-of-mind awareness toa website, either local or national on a consis-tent and highly repetitious basis, ultimatelyholds the key to a site’s traffic and value.Obviously, most web-based companies mustpay a premium for this level of promotion ifthey utilize the reach of television or radio.But what if an audio/visual broadband webmedia company whose aim was to become aworldwide broadband “superstation” wasactually a division of an “old media” radionetwork? An old media web driver carryingthe next generation of broadband TV andaudio within it? Nationally syndicated talkradio programming has the time and power todrive traffic to websites for pennies on the dol-lar compared to TV and print.

TRN, Digital Media Entertainment, and itswebsites will not only capitalize on this princi-ple for its station affiliates’ profitability andthe network’s own advertisers, but moreimportantly will promote its syndicated sta-tion/master site through all of its shows in avariety of ways as a natural side effect of eachgiant show’s design and format. Our plan isto use the power of our networks, with asmany audience-loyal shows as possible, as avehicle to carry and transport a supplementalonline community of listeners and viewers toa global audio/video interactive “supersta-tion.” That will be the dot-com companywithin talkradionetwork.com, Digital MediaEntertainment, Inc., and its subsidiaries.

The radio network and its syndicatedradio shows become a transport vehicle forwhat ultimately will be a worldwide broad-band multi-media giant in the online universe.In such a universe, every radio show can ulti-mately be simulcast as video, and thus becomea TV show –– a TV show that is bathed in aninformation-rich environment that is interac-tive and designed for the broadband universe.All of this ties back into our affiliate stations’participation that is both profitable for them

and adds value to what they are doing. Youwill see this come to full bloom in 2009.

TALKERS: Exactly how do you plan toachieve this?

MM: A radio network’s website and hosts’sites just happen to be the most natural dot-com entities imaginable. Strong host andaudio/visual network websites are almost anecessary by-product of what a syndicatedradio network talk show already does. Robustweb traffic for each show is a cost-free sideeffect of each show’s natural function in theTRN model. From an advertiser’s standpoint,a link inside TRN’s local syndicated website ornational website will be a wonderful addedbenefit of a buy. From a listener’s standpoint,TRN’s website is not only a doorway to theirfavorite radio host’s virtual community, withvisuals of show content being discussed, butalso a place to watch network shows via tele-vised simulcasts or to watch other proprietary,unique video content, blogs and to link to localor network advertisers via links placed in thelocal station’s syndicated site, network showsites or the main network site. TRN’s planconverts the audience loyalty that our hostsenjoy into massive usage of our syndicatedstations’ websites, which is a part of the“superstation.”

As proven previously on many ofAmerica’s largest syndicated shows’ websites,the intimate relationship between talk radiohosts and their audiences drives listeners towebsites on a benefit-to-cost ratio like no othermedium can. Many radio programs utilize acontent-based website to show its audiencevideos, pictures and other information on thesubjects being discussed on the show. When asubject discussed has a visual element, thesevisuals are simply posted on the show’s siteand the listeners’ interests drive them to thesite in massive numbers. Wanting to see thevisuals of show content being discussed is anatural side benefit of talk radio. It also hap-pens to be a free by-product –– a dot-comdream come true.

TALKERS: Does this concept only apply tonews/talk radio?

MM: It matters not whether the host is conser-vative or liberal or believes in the paranormal.It does matter, however, that the host passion-ately believes in something and is sincereabout it. Most of all, the host must be truly tal-ented and understand that talk radio, in theend, is entertainment driven and not agendadriven even though audiences bond with thesincere and passionate beliefs of a host. RushLimbaugh is an excellent example of an enter-tainment-driven host with sincere personal


beliefs. However, he is not agenda driven.Belief, in any form, from a host inspires, fasci-nates, and bonds an audience. People oftenlisten to and bond with talk radio hostsbecause their chosen host expresses and con-firms the listener’s inner thoughts and beliefs.In a sense, listening to someone else voicetheir opinions is a form of release for mostpeople. It is this quality that helps create astrong bond between host and audience. It isthis bond that can be utilized in making a lis-tener go interactive within the broadband“superstation” universe.

In this way, talk radio becomes talk media.The talk media environment carries more thanjust show content. The talk media environ-ment is simulcast as a form of interactive tele-vision. It carries advertisers’ links to our virtu-al mall, host clubs, digital coupons, blog sites,citizen reporter’s posting of video, multi-partinvestigative reports and one-stop shopping inas many easy-access ways as possible. Thisleads me to my next point, TRN’s two-punchapproach to innovation through thoughtfulinvestigative journalism, both on the citizenlevel and for the professional.

TALKERS: Ah! So there’s room for newsand even journalism in your vision of talkradio’s future?

MM: Absolutely! Because of the advance oftechnology in cell phones, most cell phonesare a kind of video camera. The host’s “super-station” site can do its own mini-YouTube citi-zen reporter video and blog (which wouldhave quality control editors, of course) thatwould also become a source of conversation.That, in turn, would drive the “superstation”traffic. In our model, each host would havehis or her own affinity group of citizenreporters –– “mini-Drudges” if you will ––which bring new unpredictable elements tothe “superstation” model.

TALKERS: But what about the investigativejournalism you mentioned?

MM: The true power of any news organiza-tion is its investigative reporters. Ninety-ninepercent of news commentary is a direct resultof the news that a very few investigativereporters break. Over the next 24 months, it isour plan to put under long-term contractsAmerica’s best investigative reporters andthen break news stories on our shows. In thisway, our shows are making and breakingnews while all of our competitors are a daybehind, reporting and communicating onwhat we broke first. For every dollar we putinto an ace investigative unit we may receivehundreds, if not thousands, of dollars of com-petitive edge in the fact that all other media

will source us. In effect, TRN’s investigative news unit,

combined with the right stories and journalis-tic standards broken into 10- to 20-part serial-ized reports, can make some of our shows thatopt for it “America’s Anchormen” and willdrive our “superstation’s” online universe for“the rest of the story.” Best of all, our competi-tors will be reacting to and reporting on thenews stories we break. Our shows would bethe cause and our competitors would becomethe effect. Our reporters would drive the TheNew York Times to become an effect becauseour shows would make and break the news.

“I submit that spoken-wordprogramming will be in 10 ormore niches beyond the oneswith which we are commonlyfamiliar such as sports talk,relationship talk, newsand news you can use.”

Let me add context on this topic. An inde-pendent, investigative news unit could oper-ate under its own brand which would grantradio “first in breaking news” exclusive rightsto our hosts. We consider this a value addedthat gives our shows a competitive advantageon a serialized, multi-part basis. This creates“word-of-mouth, only place you can get it”promotion for our shows of any format ––news/talk, sports talk, entertainment shows,whatever format. The advantage of being ableto break stories in any niche is huge. We arenot talking about muckraking here, but realmulti-sourced journalism from entertainmentreporting to hard news –– such as that of thequality done by Claudia Rosett, who uncov-ered the U.N. - Oil for Food scandal.

I submit that spoken-word programmingwill be in 10 or more niches beyond the oneswith which we are commonly familiar such assports talk, relationship talk, news and newsyou can use. Others that will emerge willinclude entertainment shows that can containmusic artist interviews, as well as some musicitself. In every case, we can own the “pillar”shows in those genres because we would bethe ultimate content entertainment softwarecompany for many, if not all, of the “best-in-breed” AM/FM radio shows. And later, allother new distribution media that wish to dis-tribute our entertainment software.

Once again, I submit that soon distributionwill become commoditized because there willbe so many different ways to distribute pro-gramming and thus it will be the program-

ming “software” that will be king. Because itis the programming that is what all listenersand viewers think of as radio and TV, our goalwould be to own the intellectual propertyrights to that programming before distributionbecomes completely commoditized throughsyndication rights and options for both radioand simulcast on TV.

TALKERS: Since we are on the topic of jour-nalism, opinion and the Internet, what areyour thoughts about rumblings of a possiblereturn of the Fairness Doctrine?

MM: Murdoch bought MySpace for theInternet’s potential and Google boughtYouTube in preparation for the years ahead.Thus, our broadband Internet “superstation”–– our version of the “media station” conceptyou’ve been writing about in TALKERS —does not require any of our host’s listeners toeven go there or use it, but simply know thatit is there. If the Fairness Doctrine ever kicksin or talk radio is messed with in any othervariety of ways, our broadband “supersta-tion” will become the audio listening option ofchoice for all of our shows’ listeners.

Bridge Ratings’ projected growth from 57million weekly Internet listeners today to 150million in three years shows how eventswould work to our advantage. If there is nogovernmental interference –– I don’t thinkthey would be that stupid –– we still win bigas listening devices will continue to morph.Be it broadband audio or radio, we must beclear on this one point: The end user perceiveswhat comes out of the speakers as “radio.”Thus, three years to five years from now, thosespeakers might be connected to twenty differ-ent forms of distribution, AM and FM stationsbeing just two such forms. But for the listener,this distribution issue will be invisible to 99.9%of them. It will still be “radio” because audiocontent is perceived as radio. Spoken word, ortalk, is the “software” that will run across allsuch forms of distribution. This is why I saythat talk radio personalities through TRN canbe the “Microsoft” of talent and that it’s 1982all over again. All spoken-word programmingis indeed “software” because everything isabout to change intra industry. But thosechanges will be somewhat invisible to the lis-tener who just wants to hear his or her favoritehost.

Just as IBM’s computers from 1982 onwardstarted becoming “commodity” distributionoutlets for Microsoft’s software with decreas-ing margins on hardware every year from thelate 1980s on, so will AM/FM operators whowill ultimately become just one form of com-moditized distribution for our shows andother personalities become commoditized dis-tribution, competing with 20 other methods of


distributing our programming “software.”

TALKERS: So what exactly do you see as thefuture of AM and FM?

MM: In the years beyond 2010, will AM/FMstation values drop like a rock as many pre-dict? No, I think not. However all FCClicensees’ values will start a slow declinethrough 2020 and beyond. That value will notvanish. It will re-appear on a slight upward grade,equally as slowly in other places like YouTubeand YouTube’s evolution.

Thus, that value will transfer from FCC-licensed radio and TV stations to our onlinecontent company slowly, quietly and conflictfree because the consumer thinks of radio orTV as content, not as towers or distributors.That’s what TRN’s strategy accomplish-es. A pure content company that providescontent to radio stations very profitably for aslong as they exist and in doing so makes thosestations’ listeners aware that listening andviewing can also be achieved directly from eachof our stations’ syndicated companion web-sites provided by their syndicated program-ming/web content provider…us.

Mark Masters can be e-mailed at [email protected].

* According to TALKERS magazine, Spring2007.

talkers 2008 article

Documents