Hot Mic with Houston and Hogan
Hot Mic with Houston and Hogan
From AM Pioneers to FM Guardians: Navigating the Waves of Radio's Golden Eras with Houston and Hogan Episode 57
Wondering how the radio industry has transformed over the decades? We promise you'll gain a deep understanding of radio's evolution from the FM radio boom to the influence of the FCC mandating FM radios in cars. Join us, Houston and Hogan, as we share our firsthand experiences transitioning from disc jockeys to managers, navigating the seismic shifts that have defined radio broadcasting. From the explosive growth of FM stations that changed the game for AM radio, to the personal milestones and career-defining moments we've encountered along the way, this episode offers a nostalgic look back at the industry's most pivotal moments.
Explore the consolidation trends of the late 80s with us, as we recount personal anecdotes featuring key industry players like Ken Maness and companies such as Citadel. We'll discuss the significant impact of corporate consolidation on local programming and the personal touch in radio sales, reflecting on how the rise of competitors like streaming services and satellite radio brought new financial challenges. Amidst these changes, we'll also highlight the resilient local stations that have stood the test of time by staying true to their community roots.
Adaptability is key in the ever-evolving radio landscape. In this episode, we delve into the shift from AM to FM translators and market consolidation's repercussions, particularly how major companies like Cumulus and iHeart have reshaped local identities. We'll draw parallels to other industries, emphasizing the importance of adapting to change. Tune in for an episode rich with history, gratitude, and an optimistic glance at the future.
Welcome to Hot Mike with Houston and Hogan. It's another episode that Randy and Dave get together and talk about radio and boy, we're excited about continuing our discussion about broadcasting and some of our trials and tribulations in this business. But we've had fun, haven't we?
Speaker 2:And how broadcasting has changed from the time that you and I and Ken started. We all started. All three of us started as disc jockeys and spinning records. Yeah, and I know Ken and you both branched into management at some point and I didn't have the mental acuity to do that.
Speaker 1:I correct you, I think you were smarter. You had more sense. Dave, I correct you, I think you were smarter, you had more sense, Dave.
Speaker 2:The reason that you guys are sitting a little higher in your chair than me is because of your billfold no no, no, no, no no.
Speaker 2:Oh yeah, now, Ken, when you got into the management part of the business, you got into it at a time when there was some changes, when there was some changes. And one day we heard that you in our previous broadcast we talked about our locally owned radio stations being purchased by Bloomington Broadcasting. You came in as the manager of WJCW, wqut in the Tri-Cities of Tennessee and then you went to a different level of management and Bloomington Broadcasting started expanding. So tell us a little bit about how that came about and the whole business of radio stations being bought and sold around the country.
Speaker 3:Well, as I think we mentioned a little earlier, bloomington Broadcasting was one of those portfolios of stations that actually started out of a newspaper organization and one family chose to stay in the newspaper business. Another family chose to go toward broadcasting. That was the Tim Ives side of the family and I was fortunate enough to join them. I'd met them when I was in Chattanooga and when they bought the stations here they invited me to come up, join their team and become the market manager for Tri-Cities, which I was absolutely delighted to do.
Speaker 3:As we grew in Tri-Cities and as we learned that we could acquire, through the changes in the Federal Communications Act, acquire more stations, we started looking around for opportune markets.
Speaker 3:We found Columbia, south Carolina, and acquired that one. They had already acquired prior to my having joined them Grand Rapids, michigan. So we were not unlike other broadcast organizations that had begun to create a consolidated play in the broadcast in the radio broadcast space. The belief was and it was probably an appropriate belief at the time is that through consolidation you could leverage the systems of the organization and the management of the organization across more than one market and actually create higher margins, and also you could help level out your revenues over time, by acquiring markets that may have been counter cyclical to the ones you were in, or perhaps, from a programming standpoint, you could acquire a big platform that was maybe based on country music when one of your other stations was based more in rock. So it was a methodology to be able to consolidate and to diversify ownership or revenues that would come into that ownership, and we started to pursue it pretty aggressively at Bloomington.
Speaker 1:And correct me if I'm wrong. Ken, this was in the late 80s, Is that right?
Speaker 3:It was. It was mid to late 80s, that's exactly when it was.
Speaker 2:I want to back up just a little bit, ken. And speaking of the 80s 80s and some of us got caught with our britches down when the FM explosion took place. Maybe not the right word, but suddenly we found out that the stations on the AM dial, where I was working at the time, the ratings started dropping and the ratings of the FM stations in the market started rising. Talk about that a little bit, ken.
Speaker 3:For a lot of the early years. I think FM radio was actually deployed and invented in 1948 or somewhere thereabouts the late 40s, early 50s and for years and years a big, powerful, strong, robust radio stations that were on the AM dial actually acquired an FM license, basically as a way to hedge their future. I think the one that Dave, you and I were most familiar with, wqt, which was formerly WJHL-FM and then it became JCW-FM and then it transitioned over to WQT. Fm, was slow to take off in a big way. For years it was used as a placeholder in the market. They often played automated what we called elevator music, just a way to create a background music source for people who wanted that.
Speaker 3:But not much thought was given to actually creating a primary music offering on FM for a long, long time. But then when it took off, it took off with a bang because it was quickly determined that from a music standpoint the fidelity was greater on FM. The coverage was not as good, but where the coverage was good it was very robust. So FM was either a you got it and it sounds pretty good, or you just don't have it. So the FM original coverage was fairly limited in comparison to where it is today, as the auto manufacturers and other manufacturers started making better FM radios and at some point, if I could interrupt.
Speaker 2:The FCC required FM radios to be put in automobiles.
Speaker 3:I think that's right. I think that's right.
Speaker 2:Okay, continue with your thoughts.
Speaker 3:So, as that happened, a lot of the perceived problems of AM the staticky sound when you got to the fringes and the lack of stereo it caused people to focus more on FM for musical purposes and FM really did take off. A lot of early rock and roll uh, I'm not early rock and roll, but early top 40 started to occur, as did a lot of album rock. That's where qut was uh positioned just to play a lot of the alternative and album rock music. Dave, I guess you were there at the time the midnight rambler.
Speaker 1:Oh, we love the Midnight Rambler.
Speaker 3:So bottom line is that FM then really began to position itself as a big time player in the arena of music and AM wisely began to focus more on news talk, on sports and other things that weren't as tied to the fidelity of the music as was the FM. So each found a home, but certainly FM came out of nowhere to achieve great prominence in the market.
Speaker 2:Now, when I worked for Bloomington Broadcasting and from Bloomington Broadcasting it became Citadel. How did that come about? When we found out that the Bloomington company was selling to Citadel or merging with Citadel, how did that come about?
Speaker 3:It came about because it was at that time we were in the high growth mode. We became a consolidator. We became one of those companies whose mission was to consolidate multiple broadcast platforms across diverse geographic areas under one umbrella. We did it Primarily. We leveraged the company to do it, we used a venture capital and we went into a fairly rapid fire acquisition strategy and picked up, I think, ultimately 26 stations in seven or eight markets.
Speaker 1:Wow.
Speaker 3:Citadel was ahead of us. I had met Larry Wilson, who was the CEO of Citadel, at a radio conference in Dallas where we were on a panel talking about what was known as local market agreements, which was an early way for radio stations to have extra stations in the market without actually owning them. You would go into an agreement with the owner of the license and you would operate it for them, give them some of the profits, keep some yourself, and we were very early in doing that. In fact that's the way we ultimately acquired the Kingsport stations. But Larry was on the same panel. We became friends and when I was afforded the opportunity to purchase Bloomington Broadcasting, larry was from the Ives family and the Stevenson family. Larry was also interested At the time. He said Ken, you guys are doing well in your consolidation. I'm going to stand aside, but if you ever determine it's time to sell it to another owner, I would certainly be delighted to be that person if you'd honor me. So we did buy it and we kept it for two or three years, continued to grow, but it didn't take us long to start bumping up against our lending limits, and Larry Wilson and Citadel were certainly farther along and had a lot more money to spend than we did.
Speaker 3:So I approached Larry and ultimately we sold Bloomington Broadcasting's assets. It was called a merger day, but honestly it was a sale. We sold them to Larry, I joined his team for a while and we continued as Citadel, ultimately Citadel. It was about the time that the financial landscape began to shift a little bit. Interest rates changed, other things occurred and Citadel was ultimately bought out by a venture capital firm out of New York, and so they were just part of that incremental consolidation. That occurred level after level. Early consolidators like us were acquired by medium consolidators like Larry, who were ultimately acquired by people like iHeartRadio today and folks like that. So it was an orderly, somewhat orderly and methodical consolidation of an industry that had always been locally owned, locally operated, which very quickly, through the consolidation, became very corporate minded.
Speaker 2:Well, I'm talking about my career, now my memories. We went from local owner Jim Wilson to Bloomington, then Citadel and then Cumulus Broadcasting. Now how many stations does Cumulus have right now around the country?
Speaker 3:I've kind of lost touch. They certainly have a large number, as does, iheart, 200, 300, how many Approximately? Just to give our listeners an idea? I wouldn't even be able to guess, but I would think it might be, dave. More than 300.
Speaker 2:So you have one company that owns that many radio stations and let's talk about how that affected local programming, because that's where I was when somebody in Atlanta, georgia, or somebody in New York City or somebody in California made up the music playlist. They expected us to play in the mountains, in the Tri-Cities or Asheville, north Carolina. Talk about that a little bit.
Speaker 3:Well, you put your fingers exactly on the reason that I decided to leave the industry, and I didn't do it out of any kind of protest. It's just that I didn't understand the dynamics. What happened is radio began to be run purely as a financial play, and a lot of the people in the upper echelons of the major owners weren't even broadcast folks. They were financial people, they were efficiency experts, they were lawyers, they were accountants and they truly failed to understand what makes a radio station great and what causes a radio station to be a very integral part of its community. That you could find some bright programming mind and let that one programming mind, based in, let's just say, Delaware, dictate the musical tastes of communities that they'd never even visited. It just doesn't work. So at the same time that was happening, something else was going on On the other side, on the sales side of the business. They failed to realize that most successful radio sellers are able to be successful because they integrate themselves as an unpaid asset to the advertisers they serve. They believed and this was particularly true with the people, the Cumulus people that ended up being the successor to Citadel is they really thought it would be cost effective to just hire marketing students coming out of college and give them a telephone and let them call people and sell radio over the phone or take orders from people who were calling a radio station to buy advertising. They did not realize the value value people who were out actually creating business for the station. So they they began to slash commission rates, they began to consolidate sales lists. They began to eliminate highly paid sellers who were very successful. They just thought it would continue, I guess ad infinitum, and frankly it didn't.
Speaker 3:So several of us Larry Wilson was one, I was one, I can name you a bunch more saw the handwriting on the wall and saw that this ship we were sailing on was going to have a really bad crash, and it did. Most of the broadcast companies, iHeart being an exception, have actually been through multiple bankruptcies where they couldn't meet their debt obligations and they had to default on their debt and kind of, from a financial standpoint, start all over again and kind of, from a financial standpoint, start all over again. Now let me say this In all fairness there were a lot of things changing at the same time. You started having streaming become a product. You started having XM and Sirius Radio to become a competitor for the ears, not so much for the pocketbook but for the ears of the listeners.
Speaker 3:So a lot of things occurred at the same time and the aggregate of all that was it really put a dagger in the heart of the radio that we knew, of the way of the radio that we knew. Now, fortunately, there are a lot of radio stations that didn't get consolidated, that remain local, that still understand how to involve themselves in the community and have a Dave Hogan on the radio in the morning and have a Chip Kessler doing sports and have you know talk shows and things of the nature, and they have stayed successful Not as successful as they were prior to the consolidation, but there are a lot of good local radio stations still doing business every day in America.
Speaker 2:Well, when Randy left management and went back to being a disc jockey, he does that now, Ken. He works in Hendersonville.
Speaker 1:I work for the guy who owns the station, but at the same time I also keep my foot in the door at the station. You mentioned earlier WWNC and an iHeart property and so I'm kind of dipping my toe into both situations. But I got to say that I much prefer working for the guy who owns the place. It's very, very reminiscent of what we all started in the business as.
Speaker 2:Well, I know that listeners started calling the radio station and saying why can't you play me a request anymore?
Speaker 3:Right.
Speaker 2:You can still call Randy at the radio station he works for.
Speaker 3:And he'll play you a request.
Speaker 2:And he'll play a request station he works for and he'll play you a request. And he'll play a request and also one of the. You mentioned, fm, and correct me if I'm wrong, because you guys are more schooled on the technical end of the business, but the AM signal travels via the ground, the contour of the earth. Yeah, the FM signal is line of sight. Am I right, right?
Speaker 3:That's exactly right.
Speaker 2:Okay, translators came along and that helped the FM, Like our FM station in Asheville might have a translator up on top of Spivey Mountain or one of the mountains in the area, which would help that signal, that broadcast signal that the listener on the particular side of the mountain that couldn't get the FM station could suddenly get it via that translator, could suddenly get it via that translator. Now also translator stations entered the AM market. Tell us about that.
Speaker 3:That has all occurred since my involvement in the business. So, randy, you'd be a much better person to speak to that than I. Okay, I know they're there. I'm not exactly sure how they're deployed and how they have been received.
Speaker 1:Okay, they've been received very well. Ken and Dave, I work for one. Now, what transpired there was that AMs low-power AMs were given the opportunity to put on the air an FM translator a low power FM translator and what the signal strength was determined to be was that we will give you an FM signal that will fill in any of the blanks that you have in your AM signal, such as nighttime. Yes, this FM low power translator operates 24-7 at that same power, so at night when we lose some listeners and we all know AM does the skip thing at night so you had to reduce your power. Now that FM translator, that's not an issue anymore and it really has been a godsend to the low-power AM transmitters.
Speaker 1:Another thing that you guys were talking about, that occurred during that time was the relocation of a lot of those FMs. Okay, the Cumuluses and the Citadel's and the iHeart's came into the market and they went out to the burbs and picked out an FM that was way out in the country out there and said let's move that into our building and into our cluster here A lot of communities, ie Waynesville, north Carolina, your stations.
Speaker 1:You lost your. Exactly, yeah, it's in Asheville now.
Speaker 2:Well, I remember that Waynesville, when I first got into the business and for probably two or three decades after that, a radio station in Waynesville, 1,400 on the dial, 1,000 watts, 250 at night was a very successful, vibrant radio station. Now I guarantee you that you can go down the street or house to house. Right now in Waynesville and surrounding area they won't even know that radio station is there. It is now owned by iHeart and they simulcast in Waynesville the same programming that they have in Asheville. The only exception to that is they do carry local sports. That's the only. They've hired a friend of mine who does a play-by-play and that's the only local broadcast that AM 1400 in Waynesville has. Like I said, most people don't even know the station is there unless they follow sports.
Speaker 1:The sales force, the management force, the people in the community, that all left, that all left, so did the recognition of that station. That's what we old-time us three old-timers here are talking about. We miss the days when we got in the business, don't we? We sure?
Speaker 3:do I do? I told somebody I've been out of the business now for 20, 22 years. Has it been that long? Wow, it has been that long, but you got into the banking business after radio.
Speaker 3:Yeah, what I've told many people is you know, do you miss the radio business? I sure as heck miss the radio business, as I knew it, as I knew it, as I knew it. Good way to put it right acumen, to be able to be in it today and be successful. Because, honestly, I just don't understand this, this mass consolidation model. It just it doesn't feel right to me. It's not the kind of business that I grew up in and and I, if I were still in the business, I would miss it dearly I'm a dinosaur.
Speaker 1:in the iHeart studios anymore they talk stuff about a guy sitting at a console in Asheville, North Carolina, and voice tracking an afternoon drive show in Dallas, Texas. I don't get that. Isn't that the?
Speaker 3:craziest thing. I mean. I understand the technology that allows it to happen and it's powerful technology, there's no doubt about it. And this is happening, guys. It's happening on every. You ought to talk. If you guys know any radiologists or pathologists, go have a cup of coffee with your good buddy who's a radiologist or your good buddy who's a pathologist. Not only has that the first thing that happened a lot of the reading of x-rays moved to the other side of the globe because it was daytime there when it was nighttime here and the ERs learned they could send this high resolution image to Australia and some guy could, or New Zealand. Some guy could read it and send it back and he would be fresh as a daisy. Well, you know exactly that happened.
Speaker 2:That happened to me exactly as you described it. It turned out to be a kidney stone. I didn't know at the time what it was. So I went to the emergency room and went through the process of x-rays etc. And the guy said well, we're waiting on the results to come back from Australia.
Speaker 3:Yeah, they're reading them right now. It's the middle of the night, but it's daytime there.
Speaker 2:Right.
Speaker 3:And now they're getting a double whack, because now AI, artificial intelligence, is now analyzing pathology and radiology and giving you answers without any apparent human intervention, and that's I mean. I'm not saying it's bad. Maybe a computer can read it better than a human eye, I don't know but I'm saying it's a major change. And so if you talk to a lot of people in the medical field, they're seeing it in spades too. But you know, the bottom line is things do change. Transitions do occur, as I've said, in investments and banking markets tend to perfect. Investments in banking markets tend to perfect. What that means is markets will find a way to seek the lower cost resolution. It isn't always good, but markets do tend to find efficiencies that they work into themselves. And it's often very disruptive, as it has been for broadcast, but TV too and it's often very disruptive, as it has been for broadcast for radio.
Speaker 3:But TV too. Tv too Exactly.
Speaker 1:That was about what I was going to bring up.
Speaker 2:It's not just in radio.
Speaker 1:It's happening in funeral homes.
Speaker 3:It's happening in grocery stores and banks, and on and on.
Speaker 1:Yes.
Speaker 3:Markets tend to perfect.
Speaker 2:Well, if you survive. I read something interesting just recently, if I can remember the line exactly it's not the strongest or even the most intelligent that survives. It's the people who can adapt, who are willing to change.
Speaker 1:Who can adapt?
Speaker 3:That's absolutely true. It is, that is absolutely true, it is, that is absolutely true. I mean, if you're not willing to change, you're going to end up, you know, not being viable. And I just, you know, for me, as I say, I didn't get out of the radio business out of any kind of protest. I just felt like that, my mindset, my energies didn't understand the business anymore, didn't understand where it was going and, frankly, I just didn't want to seat on the ship.
Speaker 2:Well, I went into an antique store one day and they wouldn't let me leave, so I figured it was time for me to retire.
Speaker 3:That's a good one. That's a good one.
Speaker 1:Boys. I wish we could talk about this stuff for another two hours, and I feel like we really, really could, but we're out of time. Ken gosh, man, it's so good to meet you. I've heard so many great things about you from Dave. I was copied on an email from him the other day to you and he started off and he said Boss. And I looked at that email and I said, well damn, he's calling him boss. He used to call me boss.
Speaker 3:Let me tell you about my relationship with Dave and all the other great team members out there at Tri-Cities Radio. I told them about the second day I was there, got them all together and I said, folks, you got a big job here and your job is to make sure you don't let me mess this up. I mean because I'm liable to, I'm subject to, so when you see me heading the wrong direction, grab me by the coattail and drag me back. And you know, to my great fortune, they were all willing to do that.
Speaker 2:Well, Ken, that's a very generous, an overly generous comment.
Speaker 3:You know it's the truth, Dave. You saw it.
Speaker 2:But you know, off the air, we had some great times. Oh my goodness.
Speaker 3:We were standing on the corner in Winslow, arizona, and she slowed down to take a look at you. It's such a fine sight to see. It was not a girl, my lord in a flatbed storm turning around to take a look at us. It was a big old snowstorm, wasn't it Dave? It was.
Speaker 2:And I was reading a story yesterday about the Perthian meteor showers. And I was thinking, boy, I'd like to be out there in the Zion National Park. Zion yes, sir, where we watched Haley's Comet or saw Haley's Comet way back when, and the nighttime sky out there is just fabulous. We had some great experiences and traveled all over the West and argued politics most of the way.
Speaker 1:And then you talk about under the sky. Then you came to Asheville, north Carolina, in 1993. And I'd grown up listening to Dave on the radio. I was just always in awe of him at WSKY. And then I took over as manager of WISE and WTZQ and the owner brought me a letter from this guy named Dave Hogan who was interested in coming back to Asheville and I said we want that guy, we want that guy and I met him and I met my radio hero and I got to work with him and we've been the best of friends ever since and I just can't tell you how much I've learned from Dave Hogan. And I continue to learn all the time. After being in this business over 50 years. I still learn from Dave Hogan, ken, how much of a pleasure has it been.
Speaker 3:Guys, let's make a pledge to get together, eyeball to eyeball, and tell some tall tales and enjoy some good sips of coffee, that would be fabulous.
Speaker 1:I'd love to Thank you, ken.
Speaker 3:Thank you so much. Thank you guys, Thank you very much.
Speaker 1:Dave, we'll meet again on the radio on Hot Mike with Houston and Hogan. Thank you so much. Be sure to click the subscribe button for another episode of Hot Mike with Randy Houston and Dave Hogan.