Radio Overview

Radio

HISTORY

Early Radio Milestones

1873:  James Maxwell of Scotland suggests an electromagnetic signal could be sent through

space without using wires

1887:  Heinrich Hertz, of Germany, verifies Maxwell's theory in a series of experiments by

sending and detecting radio waves

1896:  Guglielmo Marconi sends wireless signal two miles in Morse Code (letters encoded by

a system of dots and dashes); sees promise of "wireless" (radio's first name) as a

ship-to-shore or ship communication medium; starts wireless telegraph company

1906: Reginald Fessenden, with the help of G.E., makes first high-speed continuous-wave

generator that can broadcast the human voice and music; makes first "broadcast" of

music to ships in New York Harbor on Christmas Eve

1908:  American Lee de Forest, inventor of vacuum tube which made it much easier to receive

audio waves, broadcasts a classical phonograph concert from the Eiffel Tower

Patent wars between inventors severely hampers early radio’s development; but when the US Navy assumes responsibility for all relevant patents at the outbreak of World War I, the log jam is broken and great technical strides take place.

The Evolution of Radio as a Mass Medium

Big Business

While radio development before World War I had been characterized by individual inventions, during the postwar years it would be characterized by corporate maneuvers.  In 1919 the Marconi Company sells its radio rights to General Electric (GE) who, in turn, created the Radio Corporation of America (RCA) to house the new division.  Stock would be jointly held by GE, the American Telephone and Telegraph Company (AT&T), and Westinghouse Electric.  David Sarnoff, an RCA  mid-manager but soon-to-be president of RCA, suggests radio would be a household appliance.

Mass Audience

Shortly before 1920 Frank Conrad, a Westinghouse engineer, begins broadcasting a potpourri of sports scores and music from his garage.  A local department store promotes the broadcasts by offering $10 discounts on their ready-built wireless sets.  Westinghouse sees opportunity and initiates the first radio station, KDKA of Pittsburgh, on November 20, 1920.  RCA begins broadcasting in 1921 and GE in 1922.  By 1926 there are over two million sets in operation and climbing rapidly.  By discovering that an audience existed for broadcast programs intended for the general public, radio had found the role it was to play for the foreseeable future.

Better Receivers

Early radios were bulky, filled with tubes and batteries, and required lots of patience from users in order to find—and keep—the desired radio signal for which they were looking.  In 1925 Gimbel's Department Store displays a bulky radio set in their window ($99, a huge sum in the 20s); that same day they sell 5,300 sets.  Radio receivers quickly evolve from a bulky, battery-dependent, one-listener hobby kit into a major piece of fashionable furniture running on household current that everyone could listen to at once.  Living room family radio had arrived.  Between 1925-1930, some 17 million sets are sold at an average price of $80.

Radio Goes Commercial

Station operating and equipment costs rose steadily along with personnel expenses.  Radio needed a steady revenue source to meet expenses.  AT&T's radio station begins charging a "toll" to anyone who wished to broadcast a message, and the most logical customers for that service were businesses who had services or products to sell.  Almost overnight, advertising becomes the new answer to how stations would make money.

Networks

The fifth element of radio's evolution came about when stations saw they could drastically cut their production costs by sharing program content; this inter-station agreement came to be known as a network.  Additionally, if enough stations were networked, an advertiser could reach a much larger audience yet deal with only one network broker.  The first network was the National Broadcasting Company (NBC) who went on the air in 1926; actually, NBC opened with two separate networks, one made up of solely owned RCA stations, and another made up of stations originally owned by AT&T.

By 1937 NBC had 111 affiliates and CBS had 105.  It wasn’t long before advertisers were spending more than $27 million annually on network advertising.

Government Regulation

As more radio stations came online in the 1920s, interference became a major problem.  In response, Congress passes the Radio Act of 1927 and creates the Federal Radio Commission to curtail practices that were causing massive interference problems by using non-authorized frequencies and power levels.  The FRC defines the AM band, standardizes channel designations, and abolishes portable stations.  Thus by the end of the 1920s the framework for modern radio was in place.  It would be a commercially supported medium dominated by networks and regulated by an agency of the federal government.

The Depression 1930-1940

Unlike other industries, radio fared fairly well in the Depression years.  Radio revenues tripled and  radio’s audience did the same (by 1940, radio was in 81 percent of US homes).  But there were also other significant evolutionary events for radio during this period.

            .  Federal Communications Commission (FCC) formed in 1934. President Roosevelt creates a new agency in charge of regulating all types of electronic communications; this seven-

member, appointed-for-life commission remains intact today and generally follows its original mandate

Birth of FM

In the mid-1930s Edwin Howard Armstrong, a noted inventor, demonstrated frequency modulated radio, or FM.  Despite FM's obvious superior quality over AM radio, Armstrong's audience, RCA, is not interested, opting instead to concentrate on developing TV as an emerging technology.  Though a few companies buy licenses from Armstrong to develop sets, WW II curtails FM's development.

Radio Programs

The gloom of the Depression years meant more people turned to radio for free entertainment, thus popular radio programs of this era reflected a need for diversion and escape.  Dramatic programs, such as The Lone Ranger, Gangbusters, The Shadow, Dick Tracy, and Buck Rogers flourished. Then radio created an entirely new dramatic genre, the soap opera; by 1940 there were some 40 different soaps on the air such as Helen Trent, Our Gal Sunday, Backstage Wife, and Clara, Lu 'n' Em.

The 1930s saw network news grow into a serious and highly respected field.  News commentator Edward R. Murrow with CBS news quickly becomes one of America's most respected news personalities (another first for radio).  President Franklin Roosevelt also finds a new and controversial role for radio, political speeches, with his famous Depression era "Fireside chats."

World War II

Radio thrives during WW II era.  Ad revenues double from 1940-1945, outpacing newspapers as the top national advertising vehicle in 1943.  In that same year, the Supreme Court forever alters the broadcast landscape by forcing NBC to divest itself of one of its two networks.  The new network that emerges, ABC, ends the war years with 195 affiliates, making it a full-fledged competitor with NBC and CBS.

Innovation and Change: 1945-1954

In the nine years following WW II, the growth of television forced radio to abandon its role as a dramatic entertainer and switch instead to a reliance on playing pre-recorded music.  The public’s focus on television as the nation’s new entertainment medium also helped delay the widespread acceptance of FM radio.

FM

Although FM sounded better than AM, was static free, and could reproduce a wider range of sound frequencies, a number of pieces of bad fortune hampered FM’s quick development.  Initially, of course, World War II froze FM development, but later these problems added to FM’s woes:

.            FM was trying to develop simultaneously with television’s evolution

.            FM and TV shared nearly the same electromagnetic wave area; in 1945 the FCC gave TV FM’s former bandwidths, moving FM into the 88-108-MHz band where it remains today.

Television

The emergence of TV meant changes in the contents, economics, and functions of radio.  Although TV did not have a negative effect on individual station revenues, it did drastically affect network radio.  Network affiliations were nearly cut in half; but despite a brief drop in revenues, radio profits continued to steadily increase.  To do that, radio stations turned less to network-based advertising and more to local advertisers for support.  Local stations created new formats (music, talk and news) to help fill the now vacated network program airtime.

Specialized Formats

More than anything these changes allowed local radio to adopt specialized formats, sounds that had distinctive appeal to a certain segment of the audience.  One highly successful format, the Top-40, soon became indistinguishable from any other Top-40 station—until, that is, the advent of the radio DJ, a home-grown personality in his own right that gave a station a distinctive edge over any other competition.  The clock hour, a program scheduling tool that specified every element of a station’s programming within a given time frame, soon emerged as a way to keep order within a program.

Growth and Stabilization: 1955-1990

Radio stations more than doubled during this period, and the Top-40 format became popular enough to tempt record promoters to bribe DJs to play selected music (an illegal practice known as payola). The idea that prompted payola was that the more a record was played on air, the more that record would sell.  Format specialization continued to grow even into the network level.  ABC, which was imitated by the other networks, soon splintered into four different formats for its 1300 affiliate stations.

The most significant development to radio, however, happened in 1970 with the final emergence of FM as a mass medium.  FM licenses were easier to get than AM, and in 1965 the FCC passed the nonduplication rule, which prevented AM-FM sister stations from duplicating more than 50 percent of the AM content to its sister FM station.  Faced with these factors, and the fact that FM had  a much better sound quality, FM stations became an attractive commodity.  By 1990, FM had captured over 70 percent of the national radio audience.

Country music became the most popular radio format, followed by adult contemporary, while AM became the home to news-talk, oldies, and religious stations.  National Public Radio (NPR) went on the air in the early 1970s as the country’s first non-commercial network; by 1980 it had over 160 affiliates and was reaching five million people weekly.  Its two most successful offerings are its daily news programs, “Morning Edition” and “All Things Considered.”

The Volatile 1990s

An unprecedented era of station consolidation began in 1994 when an FCC ruling upped the number of stations a company could own to 20 AM and 20 FM stations, and also allowing holdings of up to four stations in a single market.  Congress later passed the Telecommunications Act of 1996 which completely eliminated the number of stations a company could own and also upped the number of allowable single-owned stations within a single market to eight.

The overall philosophy that first guided the development of radio was localism.  Radio stations were, in principle, licensed primarily to serve the public interest of those within the listening area of the station.  Today, however, continuing station mergers and acquisitions by large corporations has greatly diminished the localist philosophy.  A corporatist view now commands center stage, which essentially advocates the idea that the public interest is whatever interests the public the most.

DEFINING FEATURES OF RADIO    

portable – small and convenient enough to go anywhere, anytime

supplemental – most listening occurs while doing something else: driving, working, studying

universal --  most homes have six radios with one in almost every car; 75% of us listen daily

selective – radio is a niche medium, with specialized formats attracting narrowly defined audiences; only 2 or 3 % of the available audience is usually sufficient to generate a profit

ORGANIZATION OF THE RADIO INDUSTRY

There are about 12,500 radio stations in the United States, many of which use network programming (wherein all affiliates carry the same program at the same time) and/or syndication services (stations decide themselves when to use program content); in practice, however, most radio stations broadcast whatever content they get whenever it suits them best.

Local Stations, Nets, and Syndicators

Network radio, a dominant force in the 1930-42, has greatly diminished in its role as a content provider.  Today the leading networks (ABC, Westwood, and Premiere) generally limit what they offer to news and public affairs programming, and, of course, limited national advertising.

By contrast, syndicated shows now enjoy an all-time demand, such as the programs based on “stars” such as Rush Limbaugh, John Tesh, Ryan Seacrest, Zac Sang and the Gang, Dr. Laura Schlessinger, Glenn Beck, etc.  Other, more specialized, syndicated shows also enjoy a niche market such as the Comedy Network and NASCAR.

AM and FM Stations

Everything being equal, AM (amplitude modulation) signals travel further than FM (frequency modulation) signals, especially at night.  With AM listenership on decline, FM radio commands about 75 percent of the total audience.

AM radio has three channel classifications:

. clear -- a single dominant station designed to provide service over a wide area, almost

always urban, and broadcasting with 50,000 watts of power

.  regional -- a channel shared by many stations that serve fairly large areas

.  local -- a channel designed to be shared by a large number of stations that broadcast only

to their local communities

FM, though not as powerful as AM, does have these significant technical advantages:

            .  superior sound quality

            .  less likely to be affected by outside interferences (storms)

Like AM, FM stations are also organized by classes in a descending order of output power--

an FM class “C” station (100,000 watts), for example, has more power than a class “B” or “A” station.

Station Formats

Perhaps the best way to categorize a station is by its format, a type of consistent programming designed to appeal to a certain segment of the audience.  This gives the station a distinctive type of personality that attracts a certain audience, which in turn attracts advertisers seeking to connect with that type of audience.  There are three basic categories: music, ethnic, and news/talk.

. The Music Format The largest category with many subdivisions and variations; the two most listened to music formats by 2014: 

Adult Contemporary (with four distinct subgroups with 15% of the audience), and

Country, (two subgroups with 11%).

News/Talk Format   

Most popular on AM, news/talk accounts for some 17% of all radio

listening time and attracts primarily a male audience in the 25-54-year-old category.  The talk show format attracts a similar audience, using such format variations as call-ins, advice shows, interviews, and the occasional abrasive and/or opinionated host. These shows are often blended in with hard news, sports, weather, and traffic reports.

Format Homogenization

Many radio stations sound alike wherever they are because of a number of factors:

            .  many group-owned stations assume that what works well in one city should work well in another city

            .  satellite-delivered music services are becoming more common and thus delivering standardized music throughout the countInbo.  Programming decisions are often   based on recommendations of program consultants and audience research firms that compile playlists based on audience surveys and focus groups, recommendations tend to be the same from station to station

Noncommercial Radio

In 1945 the FCC set aside several FM frequencies for educational broadcasting.  By 2000 there were about 1,900 noncommercial radio stations on the air (operated and supported mostly by universities and private foundations).  Programming for these stations is largely supplied by two networks:

.            National Public Radio  (NPR, founded in 1970, serves about 530 affiliates.  Stations pay NPR a programming fee based on audience size and annual budget).  The public radio stations that help support NPR receive financial support from the Corporation  for Public Broadcasting (CPB), a private non-profit organization funded by Congress. 

.            Public Radio International (PRI), formerly American Public Radio, is a network that acquires and distributes programming from station-based, independent, and international producers.  Unlike NPR, PRI does not produce any of its programming but does finance program production at member stations.

A noncommercial station can be an affiliate of either or both NPR and PRI.

OWNERSHIP IN THE RADIO INDUSTRY

The Telecommunications Act of 1996 spawned a flurry of major multi-billion dollar station mergers and acquisitions, among them a $23.5 billion merger between Clear Channel Communications and AMFM Incorporated, which resulted in the largest radio company in history; also of note is the $4.9 billion merger between Westinghouse/CBS and Infinity Broadcasting which now boasts a 163-station empire of multiple stations in top markets. (You'll find an updated list of radio station ownership in a different post). 

PRODUCING RADIO PROGRAMS

Departments and Staff

Though departmental radio organization varies by station size, most organizations feature the same two top positions:

.  general manager  enforces station policies, maintains contact with the community, and

   monitors program content, ratings, and sales information

.  program director  responsible for the station’s sound, plus hiring/firing on air personalities

Most stations are also divided into four departments:

sales                                                                                                                           news

programming                                                                                                             engineering

Putting Together a Program

Music Format

When the staff of a station puts together a program, the first step is generally to lay out a format wheel (a.k.a. format clock), a pie chart of an hour divided into segments representing different program elements and the times they’re scheduled to be aired.

Talk Format

Produced by the local staff, talk show topics are geared to the interests of the local audience listening in at a particular time.  Producing a talk show requires more equipment and technical expertise than a DJ program, such as a delay time (used to censor anything unseemly from a caller) and a call screener (someone who ranks waiting calls for importance and probable interest).

All-News Format

Similar to a music format programming wheel, an all-news format schedules in specific spots for news, weather, sports, business reports, and commercials.  The cycle (the time that elapses before the program order is repeated) generally starts at the top and/or bottom of the hour.  This is the most difficult and costly program format because of the large staff required to produce the programming.

ECONOMICS

Sources of Revenue

Radio stations earn money by selling advertising time, the amount for which is generally included in the station’s rate card.  Revenue for on air commercials comes from three sources (average percentage of station revenue follows):

            .            national ads (usually on network programs to national advertisers)   5 %

            .            regional ads or national spot ads (less market coverage than national, more than local)  16 %

            .            local ads (purchased generally by local business or organizations)   79 %

General Expenses

Expenses in radio are divided into five areas:

            .            technical-- engineering staff payroll plus technical repairs and maintenance

            .            programming-- covers talent salaries, tape and record costs, music fees

            .            selling-- sales staff salaries and sales-related expenses

            .            administration--management and business staff salaries, building expenses, supplies

            .            news-- news source fees

FEEDBACK

Radio program ratings are conducted by professional research organizations, the largest in the industry being Arbitron, which surveys radio listening in about 262 markets across the country.  Some 3,000-4,000 listeners are chosen at random in a given market, and those who agree to do the survey fill in a daily diary noting which stations they listen to and when (only 45-50 percent of the diaries returned are in useable form).  Measurements of audience patterns are made and then sent to the participating stations.  The results take two forms:

            .            ratings-- ratio of listeners to a station relative to all the people in that market

Example:   100,000 people in the market with 20,000 listening to station WXYZ

ratings = 20,000/100,000 or a 20 percent rating

audience-- ratio of listeners to a station relative to the total number of people in the market

share-- actually listening to radio at the same time

Example: 80,000 people are listening to radio with 20,000 tuned in to WXYZ

audience share = 20,000/80,000 or a 25 percent audience share

Ratings and audience share figures are important because they determine how much a station should charge for on-air advertising time.

Radio Audience Profiles

            . 550 million radio sets in the US (about two per person), one third of which are in cars

            .  on a typical day three-fourths of all adults will listen to some radio

            .   the average person will have the radio on for about three hours daily

            .   most people listen to radio during the twice daily rush-hour drive times (6-10 am and 4-7 pm)

           

            .    as a person ages, he or she tends to evolve out of one radio format and go into another