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December 20, 2014

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2/19/01 Patience Is More Than A Virtue
Imagine owning a powerful FM signal in the city of Chicago and giving it back to the FCC. Why would anyone do it? Yet that is just what Tribune Broadcasting did in the late 1960s. In fact, hundreds of FM station owners returned their licenses to the FCC because they were an unnecessary weight on their operations.
When General Armstrong invented FM Radio, the promise of FM was alluring to broadcasters. Not only was it static-free (unlike AM), it was high fidelity, and it offered stereo. Broadcast conferences were littered with speeches about the day when FM would overtake AM Radio. While most broadcasters booed, many with vision began to apply for FM licenses. Most were programmed with “elevator music” formats and were left alone in a basement. But the big promise of FM never came. Few people had FM Radios. Other than a few audiophiles with hi-fi systems, there were no listeners — and no advertisers or revenues. The cost of running FM stations was not paying for itself, so stations began returning them to the FCC in droves. You could not give them away. Speeches at conventions said, “FM is a dog; it can never succeed.” Of course many years later, driven by content (FM Rock), unique advantage (fewer commercials and “hipper” presentation) as well as the availability of FM Radios in cars, the great migration occurred. Millions moved from AM stations to FM stations. The rest is history.
Every now and then, something comes along, touted by a few people gifted with vision. They get a few others excited and make a lot of change-resistant people angry. Eventually, people jump on the bandwagon, but they bail out at the first sign that the new thing isn’t catching on. Sometimes these visions get traction; sometimes they don’t. But rarely do things happen as quickly as people hope. Change often takes time. My father had a car phone in 1966, yet the mass-adoption of cell phones did not happen until 30 years later.
A year ago, we Radio people were hot on the Internet and on Webcasting. Today, after so much negative dot-com press, many in Radio have cooled on the need for Websites and online broadcasting. Conference speakers now say that the revolution they thought was coming will never come. Companies embraced a year ago are filing for bankruptcy or struggling to stay alive. Radio is getting back to the business of running Radio stations.
Those who are patient will not be so quick to judge and will find a new landscape down the road. Patience will prevail when some companies outlast 50 other companies in the space — companies that never should have been funded in the first place. Consumers will continue to embrace the Internet, and the press will begin to see that it is not that the Internet cannot succeed and that consumers do not want to conduct commerce on the Net. It’s just that it’s not practical to have 300 pet food stores in the same shopping center. The same is true for Radio. Consumers will continue to embrace online listening as it becomes easier and as the experience becomes equal to or better than Radio stations they listen to now. Compelling content and better technology will drive their embrace. Good things come to those who wait.
— B. Eric Rhoads

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