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Rehr: 'Negativity' Threatens The Radio Business
AUSTIN -- September 17, 2008: NAB President/CEO David Rehr began his "State of the Industry" speech at the NAB Radio Show today by saying, "We all know that radio broadcasting is at a very critical juncture."
Rehr continued, "Never before has our business faced so many challenges -- a rapidly changing media landscape that makes us feel unsure and unbalanced, turbulent economic conditions that impact our bottom lines, and regulatory and legislative hurdles that threaten the way we conduct our business."
Though he said it's a "tough world" for radio, Rehr said there's a "greater issue" that he finds more troubling. He continued, "In fact, I believe it's something that could possibly jeopardize the future of the entire business. I'm talking abou the negativity that's pervading the radio business and threatens to paralyze us."
Rehr said the pessimism isn't surprising, but said, "It's like a dark cloud hanging over our heads. And we feel bombarded by negative -- and often false -- messages about radio that reinforce these feelings."
Those messages, he said, are that radio is obsolete and not adapting to the digital age, and that listenership and revenues are down. But, Rehr added, "What we're not hearing enough are the stories of radio's successes."
He pointed to the 235 million listeners radio reaches every week, up 3 million from last year, then, after playing a clip of The Buggles' 1979 "Video Killed the Radio Star," noted that the end of radio has been predicted with eight-track tapes, cassettes, videos, and CDs.
Rehr said, "Millions of people listen to the radio every single day. People spend more time with radio than on the Internet and reading newspapers. There is an exciting world of opportunity before us. It is the beginning of a new era for radio."
But, he said, "Many of you have already started to embrace the possibilities. But in order for us to move forward and build a successful future, we cannot continue to operate as we have in the past. We must stop listening to the negativity and false messages, many of which come from our own people. And we must commit to spreading the positive news about radio."
Rehr told attendees that "the stagnation of the industry and the devaluing of your business" are the result of the negativity around radio.
"Right now," he said, "radio needs people who believe. And I hope everyone in this room is a believer. We need people who are bold and who will take charge of leading us into the future."
Rehr went on to talk about technological innovation that is "opening exciting doors" for radio, including HD Radio and the move to get FM radio receivers into cellphone handsets. He cited the HD Digital Radio Alliance's and NAB's efforts to educate the public and automakers about HD Radio, and the growth of Internet streaming for radio -- along with the NAB's fight against the "outrageous" Copyright Royalty Board increase in performance royalties.
Rehr continued, "A recent study shows that Web revenues barely account for 2 percent of total-company revenues for most radio stations. And yet, all media local online revenues are growing at a phenomenal rate of 50 percent this year. And radio should get its fair share." He cited the NAB's FASTROAD tech advocacy program, which looks to accelerate the adoption of new broadcast technologies.
Rehr said the "Radio Heard Here" campaign is "another reason to be excited" about radio, along with the Radio 2020 initiative. He noted that "Radio Heard Here" includes a broad-based advertising, radio, and print campaign; a public relations effort; outreach to industry and trade partners; and a media campaign on YouTube and other outlets.
Moving on to the current NAB effort to fight a performance royalty on broadcast radio, Rehr said, "Momentum is on our side," with 226 members of the House on record as supporting the anti-royalties Local Radio Freedom Act, but added, "We must keep the pressure on and continue to mobilize on this issue. This will be a multi-year effort by the record labels."
Rehr also talked about what he called "the FCC's misguided attempt at imposing so-called localism regulations on us." He cited coverage of recent tropical storms and hurricanes by local broadcasters and specifically applauded Texas broadcasters for their commitment to covering Hurricane Ike. Rehr said, "Witnessing all that broadcasters do shows how localism requirements are unnecessary, oppressive, and built on an outdated regulatory mindset."
Rehr concluded, "Let us fight back the temptation to look to the past and doubt what's new. Let us instead look forward with optimism. Let us stand together in the arena. With courage, conviction, and belief we will create an unstoppable tomorrow."
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