Martin Atkins

"It's not a problem if 20,000 people 'illegally' download your music. It's a problem if they don't."

"There are no airbags in the music industry. When it goes wrong YOUR head is going through the windshield."

"Technical proficiency is a dead-end. There will always be someone better. Instead focus on diversifying your skill set."

All three of our quotes today are from Martin Atkins. Martin, an accomplished entrepreneur, is a celebrated musician, author and teacher that we can all learn something from. As it happens, you can download his most recent book for free, here (offer expires October 31, 2011). Let me also encourage you to read Greg Kot's article SXSW 2011: Martin Atkins throws blueberry muffins at music industry via Chicago Tribune, here.

What's new about news: Michael Rosenblum offers his latest post on what's not happening in the 6:30 news wars. Why TV News is so VERY TERRIBLE (and why ratings keep dropping), here.

Good read: Insights with Sir Martin Sorrell by Simon Rogers. From Google's latest Think Quarterly, The Innovation issue - here - other good reads also in this issue, worth the jump.

Bravos: GMail team, very clever and a solid initiative to prompt Google account signups. Email intervention.

Google+ tumblr and Spotify are three of this summer's biggest hits. You may find me on g+ via my Google Profile link (in the left column of this page). NEW: started a blog about Google+, here.

Bonus: Kevin Kelly is suggesting the future of the internet can be reduced to six verbs.

Screening

Interacting

Sharing

Flowing

Accessing

Generating

My sense is Kevin's thesis is spot-on and simply brilliant. The following video of Kevin's NExTWORK talk about those six verbs is well worth your bandwidth. Bravos to kk.

Where ever attention flows

money will follow

"A brand is ultimately a promise...it is something that is not ownable by a corporation any more." Nick Brien

"The marketing plan of tomorrow has to manage an enormous number of touch points...has to have search, it has to have site design and build, it has to have on- and offline, analytics and multicultural, electronic and out of home." David Verklin

"We are not seats or eyeballs or end users or consumers. We are human beings and our reach exceeds your grasp. Deal with it." Chris Locke

Today's image: Yellow Tree Reflection by dawn perry. Beautiful. Thank you!

Vision > Execution > Accountability
Hope > Optimism > Opportunity
Competence

Involved in creating the second draft of our 2008 ad spend forecast. In this process we look back at the last ten years of data. We look for patterns. What is happening? What is not happening? It brings to mind a writing by Kurtz and Snowden and the issue of "pattern entrainment" to wit:

"The issue in decision-making is to know when to run and when to stand still. A choice must be made between allowing the entrained patterns of past experience to facilitate fast and effective pattern application and gaining a new perspective because the old patterns may no longer apply." (The new dynamics of strategy: Sense-making in a complex and complicated world via IBM Systems Journal here)

Looking ahead for radio, my sense is the first tribe of wireless is in for yet another difficult year. 2008 is shaping up to be the year macroeconomic pressures impact consumer-discretionary spending (at least in the first six months). Gas prices, housing-market weakness and financial-market problems play roles that are not insignificant. It is possible that the present economic slowdown assisted by a credit crisis could lead to another 1991 style ad recession. To frame this, in 1991 default rates on real-estate loans ran at 7.5%, today the run rate is about 2.0% and if you caught the most recent comments of our Fed chairman the housing-market has yet to bottom. Things will get ugly before they get better. Stay tuned.

Random observations: Value stocks are now more expensive than growth stocks (on a cash-flow basis). Small-cap is out. Large-cap is in. Large-cap growth coming back into vogue. (These factors and the lack of growth will continue to work against public-held radio equity) This year GDP will likely post 2.15%, next year we project 2.10% (2008 CPI at 2.5%, S&P 500 profit growth north of 4.5%). We do forecast a return to more normal perceptions of risk. Consumer cyclicals and financials will continue to struggle with little or no improvement. Large-cap tech will be a winner and we continue to like Microsoft (16x earnings, free-cash-flow margin around 30%). In the ad space Google continues to lead, Microsoft a strong second. Yahoo! the sleeper. We see energy doing well, especially natural gas. Gold stands at $800 an ounce, a 28 year high (best to consult best man Ron Fell on what this really means). E-commerce will continue to show solid growth and please keep in mind it is still very early, e-commerce sales as a percentage of total US retail is only 4% (Amazon represents about 17% of all US e-commerce). Google is on track to generate $15 Bil in 2007 rev. By 12/31 internet advertising will surpass total radio advertising for the first full calendar year, this will serve to confirm an ongoing trend. Radio becomes the first of traditional media to be eclipsed by online. TV gets a good year with Olympics and political, (easy comps).

A lesson from a buyer: Sir Martin Sorrell is in the process of reinventing WPP. His strategy: reduce traditional advertising from about 50% of his annual billings to one third. Trevor Kaufman may, in fact, be the single most important WPP player responsible for landing the $2 Bil AT&T account. Every radio outfit needs to hire a Trevor Kaufman. The internet channel has been ignored too long by radio. 2008 must be the year radio begins to play serious catch up. 2008 must be the year radio begins to think a bit more like Sir Martin and way more like Trevor.

It's the denominator, stupid: (Apologies to James Carville) Radio must take game-changing, innovative action in order to survive and grow. First up, develop a meaningful approach, a go forward without the present life or death reliance on, the potentially dangerous addiction to, getting better at the traditional, optimizing the transactional. It's time for radio to muster the courage and change the denominator, stop wasting precious bandwidth on the now end stage game of playing around with the numerator. What's needed is an urgent and genuine obsession with driving the top lines of ratings and revenue. It's not at all about getting better, it's all about getting different. Vision > Execution > Accountability. Today, what radio needs is that vision thing.

To know and not to do, is not to know

Habitaquo

"Industry, Intelligence, Integrity, Initiative" Clive Davis

Those are Clive Davis' "Four Is." The advice he once gave to me when asked "What are the secrets to success? What is most important?" Excellent counsel from a great gentleman and genius. We can all learn something from Clive.

"Until your conversion rate is 100%, there's always room for improvement" so says Google product manager Tony Leung. Tony's team has rolled out Website Optimizer a tool designed to help site owners test different landing pages. Brilliant! Tobi Elkin has the story Google Bows Website Optimization Tool via OMD here. Congrats to Tony and his crew!

Free, still the best value proposition: To the surprise of no one more than three quarters of consumers who listen to audio content via their cell or other mobile device prefer free ad-supported content to subscription or fee based services. This according to a study by Arbitron and Telephia. More from Erik Sass Mobile Audio Study Favors Ad-Supported Model via MDN here. Erik also offers up a good writing on what's happening with radio revenues. He interviews our favorite economist, BIA's Mark Fratrik. Erik quotes Mark "To really grow beyond the low single digits, it's going to take other things...the internet, podcasting or events." Exactly. Kudos to Mark and thanks to Erik! Read the article Radio Turnaround Seen For '07 here. Seems like only yesterday that we were talking about events ;) Before I get any emails from N Street allow me to add - my second favorite economist remains David K. Rehr.

Microsoft v Google: The battle for DoubleClick is instructive. Readers know I heart Google, however, Microsoft is right where they need to be. And where is Yahoo? My sense is Yahoo has become the fast follower. It seems more and more of a two horse race. Meanwhile DoubleClick moves forward with their new product; Louise Story details the new next product via NYT coverage of the DoubleClick "NASDAQ-like" exchange. Smart, very smart. The indications are '07 will be a monster year for M&A in the interactive space. (Closed circuit to broadcasters: What is your Redmond strategy? Your Mountain View strategy? You do have one, right?)

Sir Martin Sorrell, WPP CE, says "Start experimenting with mobile, test, refine, repeat." Speaking at a mobile entertainment summit he says 50% of his agency spend is traditional media while the other half is spent on outdoor, new media, market research and PR. He goes on to say the dead tree guys are most in danger by new media followed by radio and TV. "Probably the least affected is outdoor and cinema" More by Enid Burns via ClickZ news here. I would agree with Sir Martin on outdoor. The migration to digital art refreshes outdoor media making it a killer app all over again.

Say what?: Way back when, Episode single digit something of Diggnation to be exact, I sent a heads up email to two broadcast network honchos suggesting they look into what these lads were doing. I thought it fresh and engaging. Lots of possibilities. Got back the Blackberry "thanks" reply from both, nothing more. Then yesterday I get an email from one of them to wit: "Have you heard of digg? What is it? Any ideas?" Well, now that you mention it. (LATER: We enjoyed a good laugh about this, after I found and forwarded the original email w/reply. Stay tuned.)

Thanks for the emails! A bunch of response on yesterday's comments about remotes. Many from folks working outside the largest markets about the reality of med/sm market sales. My sense is there is still a better way to execute. I understand the differences between New York and New London, got the Louisville is not LA message. Will scribble something on this later this week. Again, thanks for the feedback - it's appreciated.