Only a few short years ago, newspapers had a virtual lock on local news content, sports, lifestyle, classified advertising, and local retail display advertising. Many papers were “early” with local portals. They were also the top billing media entities in most local markets.
Fast forward to today. Many, if not most, papers are losing money. Bankruptcies are rampant. Century old dailies are being shut down. Revenues from most local papers’ Internet efforts are paltry.
Two things happened. Papers failed to control their costs (often by failing to deal effectively with their unions). And they failed to develop and implement effective Internet strategies. Remember when many tried to sell subscriptions to their Internet sites? Many failed to realize the simple truth that Internet content is free; ad supported models were the only way to go. Look what happened when most of the classified advertising migrated to Craigslist; gone, and never to return.
Newspapers had the opportunity to reinvent their sales forces and rethink their strategic direction. It didn’t happen. Are radio and TV broadcasters the next to make the same mistake?
News from the Internet Advertising Bureau points to a 10.6% growth in ‘net revenue last year. $23.4 billion in revenue placed the Internet ahead of radio and cable TV, and rapidly gaining on local TV and newspapers.
Newspapers killed newspapers; the Internet could have been the salvation instead of simply the beneficiary. SNL Kagan predicts Radio/TV revenue declines for at least the next five years in a new report. Broadcasting’s leaders need to coalesce around an industry wide strategy to begin thinking like digital businesses with big, local loudspeakers. How about adding this as an agenda item at the next NAB Board meeting?
Those are my thoughts. What are yours?
George
Showing posts with label broadcasting. Show all posts
Showing posts with label broadcasting. Show all posts
Wednesday, April 1, 2009
When will this (the credit crunch) end?
When will this end?
The credit crunch has virtually stopped station trading. The "When will this end?" question comes up daily. The short answer: When liquidity returns to the credit markets. And clearly, no one, not even the administration, knows the answer.
However, perhaps we can learn something from history. The last major credit freeze took place in the early 1990's. You may remember the "Highly Leveraged Transaction ('HLT')" fiasco. Banks quit lending to broadcasters, and many called their existing loans. Station trading, other than distress sales, ground to a halt. Prices plummeted on those few trades that did occur.
That debacle lasted some 18 months. If you define the "start" of the current freeze at the time banks started pulling back, we have already exceed the 18 months. If you define the "start" as the beginning of the recession (two negative growth GDP quarters), we have a while to go.
But here is a guideline: watch the stock market. Unfortunately, it is best viewed from a rear view mirror. But the market tends to be a leading indicator. Once it appears to have put in a bottom, look for things to improve in the subsequent six months. Market watchers might suggest watching the 200 day moving average of the Dow; once the moving average begins to move north, we could be on our way to recovery.
Those are my thoughts? What are yours?
George
The credit crunch has virtually stopped station trading. The "When will this end?" question comes up daily. The short answer: When liquidity returns to the credit markets. And clearly, no one, not even the administration, knows the answer.
However, perhaps we can learn something from history. The last major credit freeze took place in the early 1990's. You may remember the "Highly Leveraged Transaction ('HLT')" fiasco. Banks quit lending to broadcasters, and many called their existing loans. Station trading, other than distress sales, ground to a halt. Prices plummeted on those few trades that did occur.
That debacle lasted some 18 months. If you define the "start" of the current freeze at the time banks started pulling back, we have already exceed the 18 months. If you define the "start" as the beginning of the recession (two negative growth GDP quarters), we have a while to go.
But here is a guideline: watch the stock market. Unfortunately, it is best viewed from a rear view mirror. But the market tends to be a leading indicator. Once it appears to have put in a bottom, look for things to improve in the subsequent six months. Market watchers might suggest watching the 200 day moving average of the Dow; once the moving average begins to move north, we could be on our way to recovery.
Those are my thoughts? What are yours?
George
Monday, March 30, 2009
Copps to reconsider cross-ownership ban
News headline: "Copps: It May Be Time to Reconsider Cross-Ownership Ban"
Acting FCC Chairman Michael Copps makes headlines as he opines that it may be time to take a fresh look at lifting the FCC ban on newspaper/broadcast cross-ownership. Unfortunately, he's ten years too late. Newspapers are beyond saving, and there is no capital to finance cross-ownership. This antiquated rule should have been deleted once the Internet came onto the scene.
Another case of the regulators being years behind the curve. Great idea, Mr. Copps; it might have worked had someone come up with it during the Clinton years.
George
Acting FCC Chairman Michael Copps makes headlines as he opines that it may be time to take a fresh look at lifting the FCC ban on newspaper/broadcast cross-ownership. Unfortunately, he's ten years too late. Newspapers are beyond saving, and there is no capital to finance cross-ownership. This antiquated rule should have been deleted once the Internet came onto the scene.
Another case of the regulators being years behind the curve. Great idea, Mr. Copps; it might have worked had someone come up with it during the Clinton years.
George
Tuesday, March 17, 2009
Did we already hit the bottom?
Surprise jump in housing starts. Big stock market rally. Is this the first good news that we've heard in months?
Interest rates are fabulous. The Fed has flooded the market with liquidity. How long before the banks start making loans again?
George
Interest rates are fabulous. The Fed has flooded the market with liquidity. How long before the banks start making loans again?
George
Sunday, March 8, 2009
We've Seen This Movie Before
Credit is frozen. Bankruptcies are increasing. Everyone's in workout. Business is horrible. There's genuine fear that the broadcasting business, particularly radio, is over.
1991 - 1992
1991 - 1992
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