Posted by Bud on December 13, 2009 at 07:08:27:
In this weekend's Sunday Chicago Sun-Times, Lewis Lazare has a look back at the last 12 months of Chicago Radio: the changes caused by PPM, the personalities who have left the airwaves, the end of the million dollar contracts, the advertising decline and more.
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Radio's biggest talents feeling industry's decline
Huge advertising decline, new ratings technology break sound barrier
December 12, 2009
BY LEWIS LAZARE
In little more than 12 months' time, the Chicago radio landscape has changed dramatically. Listeners who are no longer able to tune in their favorite on-air talent know it has changed. And executives at the helm of just about every radio outlet in Chicago are intimately familiar with just how wrenching the change in the radio business has been.
The recent upheaval has left some listeners furious and many disoriented because their favorite talents, and even their music format, have vanished so suddenly.
In situations where radio formats and talent lineups haven't been revamped, many have been tweaked in an effort to attract more listeners and improve the all-important Arbitron ratings -- which are of paramount importance because of their significant role in determining what stations can charge advertisers.
Just how much has Chicago radio changed? In June 2008, the Sun-Times named nine Chicago radio hosts who were believed to be making around $1 million a year -- the so-called "million-dollar mouths." Just 18 months later, six of those mouths are off the radio airwaves: WGN-AM's (720) Spike O'Dell, who retired at age 55; WJMK-FM's (104.3) Steve Dahl; sports talker Mike North of WSCR-AM (670), who is now on TV; WBBM-AM's (96.3) Eddie Volkman and Joe Bohannon, and, most recently, WLUP-FM's (97.9) Jonathon Brandmeier. And it is unclear whether any of them will be heard again in the Chicago radio market.
Of the three who have hung on to their jobs and their million-dollar status because their bosses believe their personalities are a good fit with the formats they work in, and their strong ratings continue to justify the salaries: Eric Ferguson, half of the consistently No. 1-rated morning drive team at Bonneville International's hot adult contemporary WTMX-FM (101.9); Kevin ("Drex") Buchar at Top 40-formatted WKSC-FM (103.5) and news/talk WLS-AM (890) afternoon drive host Roe Conn.
Conn's role could be in jeopardy if he can't rebound soon from his abysmally low 26th ranking among adults 25 to 54 in the just-released November Arbitron ratings book. That is unless he opts to sign a new contract for significantly less than he is paid now. Only Ferguson currently ranks in the top 10 for his time slot in the 25-to-54 demo. And Buchar remains a top performer in the 18- to 34-year-old demo that his show primarily targets.
So what has driven this quick disappearance of so many stars from the Chicago airwaves in recent months? Sources in the radio industry tell us two key factors have caused the sudden demise of so many million-dollar mouths: the debut of Arbitron's Portable People Meter (PPM) technology in Chicago in June 2008 and a sharp plummet in advertising revenue over the last year that has forced radio station general managers to quickly adjust their overhead to match plummeting revenues.
One could say Arbitron's People Meter, which took more than $100 million to develop, has been something of a blessing and a curse for both radio talent and station managers. Because the PPM data are all electronically collected, they have provided much faster and more precise information about radio listening habits than was ever possible via the diaries Arbitron previously used. Those antiquated diaries had to be filled in by hand, and radio stations managers long suspected the Arbitron diary entries didn't always match what people in the Arbitron sample were actually listening too or how long they were listening.
The more precise PPM data quickly helped knock the legendary Dahl from his million-dollar perch a year ago. Though he was seemingly known to millions who follow Chicago radio, the PPM data showed only a small fraction of those people were actually tuning in to his show. "PPM really revealed him to be a niche talent," said one local radio executive.
Blogs Dahl: "Someone ought to check into the validity of that thing. I can't imagine that it's really reflecting what's going on in the radio listening world these days."
Dahl was shown the door.
PPM was not kind to Volkman and Bohannon at WBBM-FM, either. "The first month of PPM data cut our rating in half in our core 18 to 34-year-old demo, and that suddenly made our salaries really out of whack," remembered Bohannon, who was a high-profile fixture on WBBM-FM for more than 20 years. The WBBM-FM executives who signed both Volkman and Bohannon to new, multimillion-dollar, seven-year contracts way back in 2002 had counted on ad revenue climbing by 5 percent to 10 percent a year to justify the duo's million-buck salaries.
Though PPM contributed to the disappearance of Bohannon and Volkman, WTMX's Eric Ferguson's popularity and his million-dollar price tag have been upheld by Arbitron's PPM data, which have consistently ranked him and his co-host Kathy Hart at the top of the morning drive heap. And Ferguson recently signed a fat new contract with WTMX parent Bonneville International.
But the arrival of the PPM alone isn't responsible for the demise of so many well-known and well-paid radio jocks in Chicago. A dire advertising revenue situation in the Chicago radio market -- precipitated by a deep economic downturn -- has been an equally important factor, according to many local radio executives.
One source estimated that Chicago radio ad revenue for 2009 will about equal what the local radio market took in a full decade ago -- a grim reality that has forced radio general managers and program directors to take a hard look at what they can afford right now, given the huge inflation in talent salaries and other overhead over the last 10 years.
So radio station managers have begun to look more closely at Arbitron PPM ratings and the hefty salaries of star talent. If salaries and ratings aren't in sync, managers have not been reluctant to cast off high-priced talent.
Though she wasn't pulling in a million dollars a year at adult contemporary WLIT-FM (93.9), Melissa Forman and her comfortable salary were cut from the station last summer because her bosses wanted a show and a talent that would consistently rank among the top 10 morning drive shows in the Chicago market. Forman was doing no better than 18th place in the rankings among adults 25 to 54 when she was let go, though her numbers tended briefly to soar high into the Top 10 whenever WLIT switched to its hugely popular holiday music format.
Dahl, writing on his dahl.com site, says the People Meters have "everybody jumping through hoops to do the same thing every day at the same time, and not for more than 6:00 minutes at a time. They're programming radio like it's TV. Quite frankly, I'm glad I'm out. ..."
Will Chicago radio ever see a return to a galaxy of star radio jocks with salaries to match? Some of the best minds in the local radio business say it is, inevitably, a cyclical business. Right now, without question, Chicago radio is in a down cycle. But local radio executives also think that when the economy rebounds and gives radio station managers a stronger footing from which to effect change, they will once again start signing up talent that can attract a large following.
Whatever new wave of radio personalities surfaces in Chicago in the future likely will have to work harder to hold on to and grow their listener base, as the iPod and other technologies yet to be revealed grab the attention of more young people and potentially shrink the radio listener base substantially.
But many radio executives still say the right radio music format, coupled with compelling talent, can help differentiate a radio station from its competitors and give it a better chance of success. And as the current radio rankings indicate, music-oriented stations in Chicago still are popular.
"For a radio station to succeed in Chicago, it has to clearly stand for something," noted one source. "I've seen this cycle before, and I believe personalities will come back," added Bohannon.
But will tomorrow's radio jock stars --whether they are new or returning stars -- be million-dollar mouths?
"Those days are gone forever," insisted one local radio executive who has watched the market's flux and flow for a long time. "Contracts will be written with lesser salaries and plenty of outs that allow stations to jettison talent quickly and at will."
Even Bohannon, who said he has been talking to local radio executives about a possible comeback, said he would be willing to return for less than he was making at WBBM-FM.
"In hindsight, I think we probably made more money than we should have," Bohannon said.
"I'm not ready to retire either," said Bohannon's longtime radio partner, Eddie Volkman, who also indicated he'd be happy to come back to a radio job for less than $1million a year.
Welcome to the new -- and dramatically changed -- world of Chicago radio.