Reality Bites

We’ve got the teeth marks to prove it.

Despite what Radio CEOs expect, despite what Bain Capital finance monkeys demand, nothing grows forever.

If you need to think about the science behind that truth, just click HERE.

When I speak with GMs at client stations, they tell me the downside to producing 35% more revenue than was budgeted is that this year, they’ll have to hit even higher profit numbers, 12% or 15% or 20% higher than in 2011.

I was not a math major, though my brother-in-law has had a long, and successful, career in finance. But I don’t need him, or advanced math, to understand Radio’s relentless numbers game cannot go on forever.

Nothing grows forever.

It’s not possible.

It has nothing to do with you, or your team, or your ratings, or your ownership.

It has to do with the laws of physics that govern everything in the universe.

That’s why housing prices eventually crashed. It’s why national economies all eventually crash or stall.

And unless radio owners and operators begin to accept this fundamental law, they will continue to try to push growth by cutting expense, by paying less for content, for talent, for production, and by heaping more and more work on fewer and fewer people.

Almost every owner, CEO and GM claim content is important, but I know of only one right now willing to take a bit less profit to improve the content on the radio station. No, I won’t tell you his/her name, nor the company. But it gives me hope.

Radio has been one of the biggest free cash flow machines ever invented, but the time has come for us to re-invest in our product, to accept less, as a natural consequence of the physical laws that govern life on our planet.

If we don’t do that, as reality continues to bite, harder and harder, there will be no way to hide the wounds.