AM, Losing Its Grip on Reality
by Scott Taylor, 01.06.2010
The handwriting appears to be on the wall regarding the slow but steady decline of terrestrial radio as it now exists, and this appears to be especially true for small-market AM radio.
With all the new technologies, especially those from the Internet, mom-and-pop operators are bombarded with challenges and competition that in many cases are becoming insurmountable. Many of these stations have been limping along for years; and because the owners have so much of their life and assets invested and limited transferable skills to another occupation, they plod along keeping their stations together with baling wire, spare parts, outdated equipment, limited funds and a whole lot of wishing and hoping that things will improve.
I work for a contract engineer and have had a close-up look at many small-market AM facilities. The outlook is bleak.
On a recent visit to a small station, I found the owner/operator walking around the transmitter site with a scrap metal dealer, evaluating how much money he could get for the tower, ground radials and feed lines. To me, this was unnerving.
Over a recent three-month period I had conversations with three owner/operators who were seriously considering letting their licenses expire or just handing them in because the properties were worth more as real estate.
Outdated and worn-out equipment is a serious issue at many of these facilities. I am no longer surprised at how many small AMs continue to use old Gates Yard boards, Realistic/Radio Shack audio mixers and DJ equipment, cassette recorder/players, very old turntables and, yes, reel-to-reel equipment … and of course old cart machines. New digital technologies, automation and even the thought of HD Radio appear to be only “pipe dreams” to some owners.
Shack radio
Awhile back, I went to a small community AM station to evaluate a problem. What I saw would not have been believed had I not seen it myself.
The owner stated that he had lost ownership of the tower and studio building a few years back to the FM operator on the same stick, to get money to pay off his house before foreclosure. The day I arrived at the FM studio I was directed around back to a plywood outbuilding — a shack — measuring about 12 by 16 feet. This was the AM station.
Inside I met the owner, sitting at a makeshift plywood table supported by 2-by-4 legs. On the table was a three-channel Radio Shack audio mixer. The owner was using a Radio Shack microphone and a portable Sony handheld CD player (“top-of-the-line $50 unit,” I recall him saying) as the audio feed of his “oldies show.” From the mixer, a line ran to a dbx compressor/limiter that sat on a piece of plywood placed across the open top of a galvanized trash can. The output fed an old BE transmitter.
The owner said other engineers had told him the situation was bordering on hopeless or required serious updating and lots of money. He wanted another opinion.
As tactfully as I could, I had to say I agreed and that although his station was in fact functioning and on the air, the situation was dire. Except for a few small immediate improvements and suggestions, I could not offer much.
While there I asked the owner how much he thought he could get for his station if he were ever to sell. With a straight face he said, “Four hundred to five hundred thousand, for sure.”
As I walked toward my car, I could not help but feel that the station’s days were numbered.
Terrestrial AM radio clearly is losing its grip on reality. The downward spiral is picking up as the “big boys” continue to liquidate and sell off unprofitable operations, as mom and pops give way to apartment and townhome complexes and a way of life passes on. Lean and mean is now the order of the day. Long-term continuous employment in today’s radio is questionable at best as more and more pink slips are being handed out. Unless immediate changes are made and action taken quickly to counter the onslaught of new and fierce competition, it’s going to be “game over” for a good number of small-market AMs.
As I sat in my car and prepared to drive away from that station, I thought about the owner’s estimate of the value of his station. I could think of only one word for him and similar small-market AM operators: Delusional.
Comment on this or any article. Write to radioworld@nbmedia.com.
| COMMENTS (13) | | Anonymous - 01/13/2010 | | We're a small market AM that plays in a market surrounded by the conglomerates and the truth is we don't command Arbitron ratings, but we get results for our clients with relevant live and local programming. You have to know your community and then you have to serve it. When the weather becomes violent or a news story breaks the locals come to our station, whether they think they're AM listeners or not. Some owners have just grown old with their format and thrown in the towel. If you're a burnout, then sell your AM for a fair market price and give someone else with the energy and desire to build it back into a relevant community station the opportunity. Satellite and internet radio will never deliver local like a terrestrial station can. When people's homes are being washed away by floods or picked up by tornados satellite, internet and television become unavailable. That's the core element that keeps AM alive in the hearts of its listeners. |
| | Chuck - 01/12/2010 | | I am one of those small market AM stations that just pulled the plug and went dark. In our case we had the latest technology and sounded as good as any station in the nation small, medium or large. The problem is small market stations depend upon local businesses for 99% of their ad revenues. Mass merchants like Wal-Mart, Target, Home Depot, Lowe's or major grocery chains do not spend money on small market stations, but these mass merchants now dominate retail and the few small businesses left usually do not even have a marketing budget. You can be as "local" in your programming as you want, but media is too fragmented today for small market radio to remian a viable business. |
| | Anonymous - 01/10/2010 | | Radio is no different than anything else: It takes money to make money. If you run your radio station like the guy in Scott's article, it doesn't matter how live & local you are. You're small time, and everyone knows it. The AM stations that get audience and make money are those that spend money on what they do. And that's why you need big companies owning radio. Unfortunately, as big as companies like the four Cs are, they simply aren't diversified enough to survive tough economic times. If your only income stream is from radio, and radio revenues are down, then you're in trouble. But in the last 20 years, we've seen diversified companies like Nationwide Insurance, Disney, and GE getting out of radio, leaving it to radio-only companies. That's why radio is in the state it's in now. A diversified company would see that radio's future is in other platforms, while a radio-only company is wedded to its towers and transmitters. |
| | Anonymous - 01/09/2010 | | Just from reading some stories about the death of AM, I feel AM is necessary to all communities. Maybe, it just some of the bigger players wanting to clear out the AM Band so that their digital signals have no interference. I like the idea where you split the band so the blow torches take half and the locals take the other half, maybe that could work although how would you manage the swapping of frequencies in order to achieve this. I think a good look at how all this can be managed may be the key for AM's future apart from what programming is relevant for an audience to tune in. |
| | Anonymous - 01/09/2010 | | You can place the decline of all radio at the hands of the FCC when they killed it with deregulation. |
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