A friend who left the broadcast sales industry this week became the third person to share this article with me from The Athletic. It details the shutdown of TSN radio stations in Winnipeg, Vancouver and Hamilton earlier this year along with the layoffs that followed.
The pandemic has accelerated underlying trends. Last year, the Canadian Association of Broadcasters — an industry advocacy group — issued a stark warning that the pandemic could force 200 radio stations to close. Advertising revenue has plummeted. Sports fans who would normally tune in from their car are instead working from home.
Household names have been cut, then swept out the door. Meanwhile, other platforms such as podcasts and streams — and others, such as Twitch — are offering new options, including for those who have been underrepresented in the traditional mainstream.
“I have a hard time — as someone who’s focused on the business, who’s focused on buying media — to recommend to advertisers that radio’s a platform you should be investing in to grow your audience,” said Adam Seaborn, director of sales and media operations with Kingstar Media, in Toronto.
The Athletic, March 29, 2021
My default reaction when reading things like “the sales department didn’t know how to sell sports radio” is to assume incompetence, particularly since the article intimates the Edmonton station is still operational because the afternoon drive host sells his own ads. In this case I’m willing to give Bell Media a pass.
AM radio is a dying medium. I don’t think anyone would be surprised or upset if automotive OEMS decided to stop installing radios in cars. Waze gives you custom real-time directions that make traffic reports obsolete, while podcasts, Spotify and pretty much anything that emits sound off your phone is more compelling than local callers. Filling large amounts of airtime any other way is prohibitively expensive.
Long commutes and live sports used to drive profits on AM radio. Now Rogers Communications has decided it will lose less money by simulcasting a TV show during afternoon drive in Toronto. Rogers is also simulcasting the worst baseball TV commentary in the sport across its national radio network, rather than pay for a dedicated announcer for the team that it owns.
That doesn’t mean radio is a lost cause, just that it’s too hard for Canada’s telecommunications conglomerates. Corus, Stingray and a few others more focused on the industry seem to avoid the mistakes, and accompanying mass layoffs, that consistently plague radio ops at Bell and Rogers. Corporate radio worked 20 years ago because it was easy. The stations generated cash, had engaged owners (Ted Rogers/Allan Waters/Allan Slaight) and didn’t require dynamic leadership. Most importantly they didn’t require much CapEx: there are probably stations in Northern Ontario still using reel-to-reel machines and transmitters that are largely untouched in the last 60 years.
Now radio is hard. The effort, capital and innovative thinking required to capture more of a shrinking pie isn’t worth the effort for BCE or Rogers. The radio stations that survive in the digital age will put in a lot of work and spend a lot of money to build deeper connections with listeners (meetups and live events are the bare minimum). Even if they had the will, Bell and Rogers no longer employ the skill. I saw this first hand in 2008-2009 when radio sales execs who had gotten used to taking orders accepted buyouts rather than start cold-calling for ad dollars again.
Newspapers are the original subscription business. It’s easy to see how others will follow the New York Times or Washington Post and transition into successful SaaS products. There’s no blueprint to follow for terrestrial radio and brand equity seems to have no value. Bell and Rogers should get on with the business of selling cellphones and leave the problem of solving radio to someone who has more invested in coming up with the right answer.
