Fallout: The Financial Crisis

Commercial radio seeks your donations

Janet Babin Apr 20, 2009
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Fallout: The Financial Crisis

Commercial radio seeks your donations

Janet Babin Apr 20, 2009
HTML EMBED:
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TEXT OF STORY

Kai Ryssdal: Like just about every other business that depends on advertising, commercial radio is getting pummeled in this economy. Ad revenues were down 9 percent last year. So some commercial broadcasters are fine-tuning their business models. They’re trying a strategy that would sound familiar to our listeners. Marketplace’s Janet Babin reports from North Carolina Public Radio.


JANET BABIN: Used to be you could tell you were at the low end of the radio spectrum when you heard people on the air asking for money. But public radio is getting some company from stations like:

KSCO AD: On KSCO Radio.

Talk radio KSCO in Santa Cruz is a launching a plan to ask listeners on its Web site to give. KSCO Owner Michael Zwerling does the asking.

Michael Zwerling: We’re not getting rich off it, but you know, I’m not proud, and we’re making more than if we didn’t do it.

The Wall Street Journal reports that other commercial stations are considering asking listeners to pitch in. Radio and Records editor Mike Stern says in exchange, listeners get premium content.

Mike Stern: It’s a matter of taking the content that the network has available and maximizing it and making it available directly to listeners for a subscription fee.

Marketing experts say the idea makes sense. Radio was struggling before the recession hit. But Arthur Cohen, with the Public Radio Program Directors Association, cautions commercial stations to take it slow. He says as nonprofits, public stations use the model because they have to.

Arthur Cohen: Public radio’s been spending years trying to figure out alternative models, because it drives away listeners and is an interruption to the programming that we are trying to do.

But the old one has worked pretty well in a bad economy. While public radio’s underwriting has been down, Cohen says many pledge drives have been breaking records.

I’m Janet Babin for Marketplace.

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