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The industry I earn my living from is doing just fine, thank you:
| Sound Off: Small Radio Stations Are Thriving |
| by Erik Sass, Monday, May 12, 2008 8:00 AM ET |
 As with the newspaper business, the focus on falling revenues at big radio broadcasters threatens to cover up a bright spot: the continued success of the medium in smaller markets. Like their newspaper cousins, small radio stations are often enjoying revenue growth, despite the economic downturn, because of their ability to connect local advertisers to local audiences. A survey of March revenues by Jim Boyle, a radio analyst with CL King, showed that revenues increased in 60% of small radio markets, while all the big markets fell. On average, small radio markets increased 3%, while the big markets tumbled 10%. When combined with small and mid-sized markets, the big markets dragged down total industry revenues by 8%. Boyle added that the size of radio markets is now a better indicator of their performance than regional (geographic) factors. In short, a radio station in a small town will often fare better than a station located in a bigger city not far away, although both are part of the same region. Size is also a better indicator than ownership by a particular group, as all the radio groups are reporting good results at smaller stations and bad results from bigger ones. Like newspapers, radio stations in small markets seem to be benefiting from sustained spending by local advertisers, which like their ability to reach the local audience. According to Boyle, they also enjoy other advantages. Unlike larger markets, they are usually not divided up between a few "giant radio platforms pricing for share"--the cutthroat competition for ad dollars that drove average ad rates down for most big metropolitan broadcasters over the last decade. |
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