Radio 2016: What We’ll Be Talking About

Lance's Line RadioInsight Blog

2016 Radio Industry Predictions Expectations As we enter the new year the list of stories that will dominate the talk of the radio industry in 2016 is already filling up. Sure there will be format changes, layoffs, and sales that fill up the daily news, a few topics will overshadow everything in 2016.

The B Word

Will this be the year Cumulus or iHeartMedia finally break and file for Chapter 11 Bankruptcy protection? New Cumulus CEO Mary Berner continues to claim that they won’t need to file for bankruptcy but with $2.5 million in debt due in a couple years and the stock price stuck around 33 cents a share and being threatened with delisting is there any alternative?

iHeart’s debt is around $21 billion. The company’s stock dropped over the past year from a high of $8 to it’s current 90 cent value. They sold many tower sites in 2015 to produce some cash, but outside of selling broadcasting assets what value can they produce to stave off the notes upcoming over the next few years?

That leads to…

Group Sales

Who if anybody is in a position to buy stations? Alpha Media has been the biggest buyer over the past two years, however its deal to purchase Digity Media may have been too much. The deal has seen its scheduled closing date postponed on multiple dates already and now may not close until February if at all. CBS Radio has claimed for two years its plans to sell-off non-core assets, but outside of the October 2014 swap with Beasley it has not made a deal.

Entercom and Hubbard have both grown in recent years, but are usually very calculated in their choices. Who else is really in a position to acquire large market clusters?

If anything this could lead to more LMA’s like what Bloomberg did with CBS for 99.1 WNEW Washington. Group operators will lose necessity to staff and manage a station and just take the flat fee and guaranteed profit from leasing the station.

The Election Year & Where Does Rush Limbaugh Go

The 2016 Presidential campaign could be the last salvo for AM Talk Radio. Will stations that have relied on poltical advertising get as much this time around or will campaigns make the move to younger skewing stations on FM as well?

The king of political talk will see his eight year/$400 million contract with iHeart’s Premiere Radio Networks expire at the end of 2016. With all of the controversies endured and declining ratings and revenue there’s no way Rush Limbaugh will see a deal anywhere close to those numbers this time around. And how much longer does Limbaugh, who will turn 65 next week, want to continue? If he does what are the likely options for him? Limbaugh had a long feud with former Cumulus CEO Lew Dickey, but eventually agreed to an extension to remain on his Cumulus affiliates outside of New York through the end of this year. None of the smaller syndicators could likely afford Limbaugh’s asking price and his demographics would be a hard sell for a podcasting company. That leaves a return to Premiere with a loss of many strong affiliates or SiriusXM as potentially his only options.

Translator Waivers

The FCC has set the dates for the two upcoming 250 mile waiver windows to allow AM stations to gain FM translators. Many have already been sold, but there will be many markets where AM stations will be fighting for one or two available frequencies. Will these translators do much to “revitalize” the FM band as the FCC and AM operators believe or just lead to the same band congestion on FM?

Small Streamers

The new Copyright Royalty Board ruling on music licensing is going to force a number of small webcasters and hobbyists to shut their doors. Sites such as Rick O’Dell’s and Jack-FM founder Bob Perry’s Modern Standards “The Penthouse” have already pulled the plug and baring a miracle investment streaming host Live365 will shut down. The cause is the expiration of the provision in the Webcaster Settlement Act of 2009 that allowed low-revenue streamers to pay a lower music licensing rate in the new fee structure.

While this will have little effect on broadcast radio it will limit options for listeners looking for niche products, for talent to develop new ideas or simply to “stay in the game”. Even if a station is lucky to get 100 listeners that is still 100 listeners seeking out a programmed radio service in some form rather than a playlist algorithm.

A few notes about RadioInsight

2015 was an immense success for RadioInsight. I thank all of you for your continued patronage and reading what I have to say. The number of page views we had and the amount of people who have subscribed to our site fully exceeded expectations. Quite frankly it is VERY flattering to see our competitors rewrite our posts instead of going out and doing the work for themselves.

For 2016 we’re planning on further expanding our brand. We soft launched PodcastingInsight on Twitter and will be debuting the full site in a few weeks. We will begin seeking contributors for both that site and this shortly. We also have some new things in the works for our Premium members and Community contributors.

We’re also looking for sales professionals to sell advertising for our network of sites. Experience in selling digital advertising is a must and knowledge of the radio industry helpful. More information is available here.

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  1. mposeymil says

    I doubt Terrestrial radio is out of the woods yet. With iHeart and the Cloud ripe for bankruptcy, I won’t be surprised if the music industry does an “revenge move” on terrestrial radio next, even with the lower royalty rates from station streaming, so I bet things will change within this year. Too bad, with what’s happening the corporate companies will take down the small guys (and the entire industry) with them when they fall.

  2. Dan says

    Hope to be talking about these LPFM radio start ups, fixing to happen. They might be the saviors of the radio dial and breathe new life into those places where they’re being built. I, for one, hope to be on sometime this year. Ready to give my hometown something exciting, fresh and different to listen to.

    To everyone reading, hope you’ll have a happy 2016. I hope to have one.

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