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Thursday, June 16, 2011

Jerry Lee...The Lightning Rod

by Ed Ryan

Monday's story highlighting Jerry Lee's opinion that streaming is a "bad business model" and will eventually "fade away" ranked in our top three as far as most reader comments received. We received so much feedback from across the industry it's clear you are all very passionate about the issue of streaming. It's also clear that there is no consensus on what to do.


The Lee story even prompted a comment from "The Wizard of Ads" himself Roy Williams who posted "I believe Jerry is right. And I appreciate that he had the courage to say it." Many more readers were less supportive of Lee, harkening back to the same old tune of how Radio people have their heads in the sand - or elsewhere - and how Pandora and Slacker and all the others are stealing radio's listeners. How radio people are blind and cheap and have lost all of their creativity. It's the same old stuff from the same old playbook. It just never really pans out for you radio haters now does it? We know. We know. This time will be different. Blah Blah blah.

Rob Green, the CEO of Abacast, logged on and got himself involved in the Lee story making some excellent points. " Jerry Lee?s comments are right on the money--if it was still 2009. However, it?s 2011 and streaming growth and revenues are exploding. In 2009 all media markets were depressed, including Radio which was down 15%, and streaming radio was still maturing as a viable market. Jerry also mentions the cost of bandwidth. This cost alone has dropped over 80% since 2008. In fact bandwidth is rapidly trending down to zero and is now at best a minor gating issue. Jerry is correct about Sound Exchange. It is really expensive and that?s a shame because it is inhibiting streaming growth. Streaming royalties are something that the radio industry as a whole needs to get together on, to apply pressure to reduce these fees."

Kevin Neathery is General Sales Manager of the Jonesboro Radio Group. He also chimed in on the Lee piece. "The most powerful message in this article is buried in the final paragraph. It has nothing to do with streaming and everything to do with what's wrong in the radio industry today! The interactive revenue stream is a pipe dream. And the longer we search for it, the farther we stray from the REVENUE RIVER! Jerry is right and we should all take his advice."

The funny thing about Jerry Lee is that he's laughing all the way to the bank. If Lee is number one in revenue and a consistent leader in the Philadelphia market in the ratings why would he listen to any of you people who say he doesn't know what he's talking about? Why should he change his business model because a few people, not doing what he's doing, think streaming is the next big revenue thing? Why would he pull his sellers off the street, train them to train their advertisers to go online and disrupt a business model that works? And for those of you who disrespect Lee in favor of business models that are very cool but have generated zero profit, that seems slightly arrogant, don't you think?  Feedback me at edryan@radioink.com or leave your comments below. If you post a comment do not be afraid to leave your e-mail address. We respond to ALL letters.

(6/14/2011 6:03:47 AM)
Ed:

What bothers me about your comments on the respondents to Jerry Lee's article are your words - "It just never really pans out for you radio haters now does it?"

Is it possible to consider that those who you define as "radio haters" are every bit as passionate about the radio industry as the people Radio Ink has to appease (your subscribers)? The difference being they want to push radio into the future, and you want to hang onto the past.

I'm not against Jerry Lee and believe, in his situation, streaming may not be the right move. But radio industry groups better start making a move towards the accountability that new media brings, or it's going to find itself deeper in the hole than it is today.

Keep in mind that the current slip in radio's stature was predicted years ago by your "radio haters."

This explain my take on this topic - "Radio's Online Success Not Simply Streaming" - http://www.audiographics.com/agd/061311-1.htm


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