A Rehr Opportunity: New NAB Head David Rehr: Broadcasters' Best Days Still Lie Ahead (04/24/06)
Tackling a new job is always challenging, but when David Rehr took over as president/CEO of the National Association of Broadcasters on Dec. 5, 2005, he assumed not only a leadership role in an unfamiliar business, but accepted a post that had been held for 26 years by Eddie Fritts, arguably among the broadcast industry's most beloved figures.
While the intricacies of the broadcasting business are new to Rehr, the machinations of the Washington political process are as familiar as a favorite pair of jeans. Prior to joining NAB, Rehr spent 14 years at NBWA, initially as head of the legislative affairs division, and the last five as the group's president/CEO. Still, he notes that the lobbying process has changed since he first started roaming the halls of the Capitol building.
“Washington has changed since I arrived 25 years ago,” he says. “To be successful, you must anticipate, and you must stay on the offensive. You must shape the future, not just react when a bill is introduced. NAB culture will change from one that is on the defensive to one that is on the offensive. We owe it to our members, because the very future of our industry is at stake.”
Radio Ink caught up with Rehr to learn what tops his list of priorities in his new role, as well as his thoughts on FCC indecency
INK: Tell me about your first-year plan. What do you hope to accomplish?
REHR: During the next year, I plan to focus on four areas that will help us improve our position before Congress, the FCC and, most important, in the marketplace.
First, we need to increase the value proposition to our members. Each NAB member is asked to increase its value for customers. We must do the same. We will soon ask every member to provide feedback on NAB programs in our first-ever NAB member comprehensive survey. It will give us a baseline. It will tell us what we do well, where we need to improve, and what we should abandon. My goal is to increase services and programs annually - to build maximum value to our dues-paying members.
Second, NAB and our member stations must embrace new technologies. We must take the best of the past and apply it toward the future. Many of our competitors say we are dinosaurs. They're dead wrong. Each week, over 260 million people listen to free radio - but we can't rest on our laurels. We must work to ensure our broadcast signal is in every device or gadget brought to market. We must embrace technology and help shape the future. All of our efforts should complement our commitment to free, over-the-air broadcasting.
Third, we need to be more vigilant in explaining how we matter. We face enormous challenges, and we must take it upon ourselves to be our own industry salesmen and -women. Our neighbors, business associates, employees, friends, members of our church or synagogue need to understand how important and vibrant broadcasting is in America. I like to talk about being “evangelical,” about the important role we play in every town and community. It is something we should be very proud of. We simply cannot be taken for granted. Localism is the lifeblood of our business. It's not only in our business plan - it is our business plan.
Fourth, we need to build on our political influence. NAB has a good reputation and is influential in Washington, but our competitors are beefing up their lobbying, consultants, lawyers, and grass-roots efforts. We must work with our state association partners in expanding our reach to Congress and those who regulate us, and make those relationships deeper. We must become advocates instead of just lobbyists, and we must take the offensive.
RI: What are your top priorities?
DR: I also want NAB to work toward a seamless transition to digital broadcasting for both TV viewers and radio listeners. This is a top priority.
On the radio front, NAB is working with Congress, the FCC, and other industry players to ensure a rapid and smooth deployment of digital radio. HD Radio is going to revolutionize free radio, with not only crystal-clear audio, but also expanded programming options through HD2 multi-casting. As we move forward, NAB will continue playing a major role in promoting this new technology before policymakers.
In talking with our members, I know we are facing revenue challenges. We need to acknowledge this, focus on its cause, and assess what we can do, both individually and collectively through NAB, to help our members. I don't want to over-promise that NAB will change the climate, and there are other fine organizations addressing these challenges, but perhaps NAB can help influence the direction of our industry for the better. We cannot simply ignore the fact that broadcasters are being challenged like never before; we need to find our place in helping meet that challenge.
Washington has changed since I arrived 25 years ago. To be successful, you must anticipate, and you must stay on the offensive. You must shape the future, not just react when a bill is introduced. NAB culture will change from one that is on the defensive to one that is on the offensive. We owe it to our members, because the very future of our industry is at stake.
RI: What changes do you feel need to be made at NAB?
DR: NAB is known inside the Beltway as one of Washington's most effective lobbying associations, but we want to make it better. We want to take the best from the past and apply it to the future. That means proactively enhancing our visibility on Capitol Hill and at the FCC. We must also increase our value proposition to member stations. I am confident that as I continue to meet broadcasters, attend state association meetings, and see results of our membership survey, NAB will evolve into an even better organization. We have a very diverse board that will be more involved, and we have a strategic plan that gives us direction. We'll also be seeking guidance from our grass roots, which is our greatest strength. I've learned so much about the business and our members in my first few months. I have tried to reach out aggressively to broadcasters large and small, radio and television, family-owned and publicly held, to learn firsthand what NAB should be doing to help our members increase the value of their operations.
RI: Some feel that your not being a broadcaster is a disadvantage because you may not see an issue from a broadcaster's position. How will you address those concerns?
DR: Here are my strengths: I know how to run a successful, aggressive trade association that advocates on behalf of its members. I have spent more than 25 years in Washington building relationships on Capitol Hill, in the administration, and through my involvement with associations and grass-roots efforts. I earned a Ph.D. in economics from George Mason University at night while I worked full time. I understand how to build an organization that reflects its membership and is accountable to its board. I am a builder. I also ensure that staff will utilize every possible tool available to succeed for its membership. I focus on how to move the ball down the field to score as many victories as possible for dues-paying members.
Since I joined NAB, I have literally worked day and night and traveled around the country meeting with broadcasters from New York City to Carthage, Texas, and from California to Wisconsin to fully understand issues that are important to our members. In Washington, I've met with congressional members who serve on committees that oversee broadcasting, many of whom I have known throughout my career. And I've advocated our message at the FCC as well, meeting with Chairman Martin, every commissioner, and their respective staffs. I am committed to understanding broadcasters' needs, and aggressively advocating on behalf of this industry.
When I joined NAB, I knew it was going to be exciting - but it's 400 times more exciting than I anticipated. Broadcasters are at the center of their local communities, and they are the first to help a worthy cause or those in need. It is an honor to be representing broadcasters in the nation's capital.
RI: How willing are you to tell us, the radio broadcasters, what we do not want to hear? What do we need to hear?
DR: I am not afraid of challenging assumptions or embracing change. And neither are those broadcasters who are most successful. In preparing to take on the job here at NAB, I heard the naysayers who have written off the business of broadcasting. Well, I have a message for our critics: Underestimate our industry's ability to adapt at your own peril. New technologies should not be viewed as threats, but rather opportunities. With so many new gadgets out there in need of localized content, who better to provide it than broadcasters? I accepted this job knowing full well that broadcasters' best days still lie ahead - I wouldn't have taken this job otherwise - and that's a message no one should be afraid to deliver.
RI: Indecency is a burning issue on Capitol Hill. Do you feel that the FCC's broadcast indecency rules should be expanded to include subscription services like satellite radio?
DR: There can't be two sets of rules. XM and Sirius have become a haven for banished free-radio talent, and they are simply trying to have it both ways on the indecency front. On one hand, they claim protection from content regulation through their status as a subscription service. We cannot allow them to get off with that explanation. You could easily argue that the most offensive comments heard today are on satellite radio. Howard Stern is there, where I understand there are “phone sex” conversations. Society is not served well by this, and the FCC should do something to end it.
Satellite radio also uses marketing tools like free subscription services to garner new audiences. You'd be hard-pressed to make the argument that FCC indecency rules should not apply to satellite radio when it is provided free in rental cars, unbeknownst to families with small children.
RI: The FCC's indecency enforcement has created a chilled climate for broadcasters. What will the NAB do to protect broadcasters' First Amendment rights, and how will you work to defuse the charged political environment?
DR: It's all about empowering parents. NAB is taking a lead role in an unprecedented effort to empower parents in making informed choices about media content entering the home. I'll grant you that parents believe some programming is unsuitable for children. Yet those same parents overwhelmingly reject the notion that government should play the role of programming police. NAB has joined the TV networks, along with Hollywood studios, cable operators and programmers, and TV and radio manufacturers in what will amount to a $300 million public-service ad campaign to educate parents on how they can screen out objectionable programming. We've enlisted the Ad Council to create these spots on both TV and radio. It's something that's never been done before, and it demonstrates our commitment to this issue while meeting parents' overwhelming desire for a market-based solution.
Having said that, the NAB must be a strong advocate for the First Amendment. I think you'll see us more involved in supporting things like reporter shield laws and free-speech initiatives. Freedom of speech is the founding principle of our society, and the cornerstone of what makes America the greatest nation in the world. NAB has an obligation to our member stations to advocate and educate policymakers on its relevance and significance.
RI: Talk about the congressional efforts currently under way that are aimed at prohibiting satellite radio companies from inserting local content regionally through their terrestrial repeater networks. Do you think that lawmakers will pass legislation mandating that the services remain national-only?
DR: I think this goes back to satellite radio's disingenuous attempt to operate as a national-only service. The fact is that both XM and Sirius continue to aggressively skirt the intent of their FCC licenses as a national-only service. These two companies had combined revenue losses of nearly $1 billion last year, and have failed as a national service. Now, they're looking to get into localism to rescue a struggling business model. NAB is working to pass legislation to hold them accountable to their FCC licenses as national-only services. HR998 now has over 115 House co-sponsors. A Senate bill was introduced last month. These two bills are critically important. Right now, XM and Sirius will continue to demonstrate their absolute disregard for their national-only licenses.
RI: Some say that NAB is standing on the sidelines when it comes to promoting HD Radio. Why hasn't the group been a more vocal advocate for this technology?
DR: I don't agree with the premise of the question. NAB has indeed been involved in the HD Radio effort. The right question is, “What is the NAB doing to help with the HD Radio rollout effort?” There is no organization in America more supportive of HD Radio than NAB. The first major news conference I attended as president and CEO of NAB was the HD Digital Radio Alliance announcement in New York. That was not by accident. I wanted to send a strong and clear message that NAB strongly embraces new technology - and that we will work with our partners to embrace the future. We invited HD Digital Radio Alliance CEO Peter Ferrara to speak at our Radio Fly-In in February so he could update all the group heads on the work of the alliance. Peter also provided a status report to the Radio Board of Directors in March. In addition, the NAB legal department is working with the FCC to finalize rules governing the HD Radio rollout. We're confident we'll be successful in shepherding oversight of this process in the regulatory arena.
RI: What are the biggest congressional threats to radio broadcasters?
DR: Indifference - toward our industry's needs, and to broadcasters' commitment to serving local communities. We need to ensure that Congress has a full understanding of and appreciation for the role local broadcasters play in towns and cities across America.
One thing that continues to impress me is the vital and timely lifeline provided by local broadcasters during times of crises. Hurricane Katrina was a prime example of how broadcasters are so uniquely positioned to disseminate important and often lifesaving information during a disaster. Before, during, and after the storm, we heard stories of broadcasters wading through snake- and alligator-infested waters to re-power their generators and stay on the air. It's unfortunate that sometimes it takes a disaster of this magnitude to demonstrate the invaluable role served by local broadcasters every day.
RI: Should NAB change its name to the National Association of Terrestrial Broadcasters? Or should you welcome XM and Sirius as members?
DR: There is tremendous value in the NAB brand. To change our name and deviate from our mission of advocacy on behalf of this great industry would make no sense. The NAB is a solid brand name that stands for local commitment and diversity of views. I hope during my tenure at the NAB, that brand will only grow. We are a voluntary association and always welcome supporters. We would welcome into membership anyone who believes in free, local, over-the-air broadcasting.
RI: Some people believe that broadcast consolidation should be extended to its industry organizations through a merger of NAB and RAB. Is this as a possibility?
DR: To my knowledge, that has never been considered by the NAB Joint Board of Directors, because each organization serves a distinct purpose. NAB's function is primarily government representation; RAB focuses on advertising and sales issues. I do think we will look to build on each other's success, but NAB needs to focus on building member value, and to serve as the advocate for radio before Congress, the FCC, and the courts. That doesn't mean I won't jawbone business leaders to advertise on radio. It's one of the best investments a company can make in building its brand, selling its product, and expanding its business.
RI: What leadership will the NAB provide to help digital broadcasters test new economic models as analog broadcasters attempt to be relevant and profitable in the untested digital multi-channel world?
DR: New technologies provide not only an opportunity for expanded choice to consumers, but also provide additional platforms for compelling local content offered by broadcasters. NAB is committed to ensuring broadcast programming is on every single new technology out there. In this multi-channel world, our opportunities are limited only by our lack of imagination.
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