Analyst: Radio CEOs In Denial

Re-Blogging Radio Ink

NEW YORK -- August 19, 2008: CL King & Associates analyst Jim Boyle says the RAB is likely to report a 6 percent-7 percent revenue decline for July - worse than Wall Street projections for a 4 percent decline. It would be the 15th straight month of down revenue for radio.

Boyle writes, "Radio has entered and seems stuck in a new, discouraging territory with the combined challenges of a secular slide and cyclical recessionary times."

Boyle notes that the "gap has remained very wide" between small-market and larger-market radio, with smaller markets consistently outperforming. In the July data he's seen, he says the average big market was down 7 percent and mid-markets were off 5 percent while the average small market was up by 2 percent.

"What are radio leaders doing to change direction?" Boyle writes. "Not much, it seems to us. The industry's larger groups do not appear ready to institute revolutionary changes yet in sales, programming, promotion, or station clusters. There is a notable sense of denial of how harsh the prospects have been and continue to be for radio."

He continues, "The classic CEO reply is [that] radio is not bleeding as badly as newspapers. We concede there is too little radio ad demand, but there is also too little rate card integrity and too little investment in radio's product and people for the long term. It very much looks to us as all rear-guard counterpunching."

Yup, he's correct.