"I have to be wrong a certain number of times in order to be right a certain number of times. However, in order to be either, I must first make a decision." Frank N. Giampietro

"You have not done enough, you have never done enough, so long as it is still possible that you have something to contribute." Dag Hammarskjold

"A trifle is often pregnant with high importance; the prudent man neglects no circumstance." Sophocles

Today's image: untitled by Hanna L. Wonderful. Thank you for sharing.

Doing the homework for an upcoming talk and noticed more than one canard needing attention. Allow me to take this opportunity to disabuse you of three patently false notions. With apologies to Adam and Jamie let's get on to some myth busting...

1. The youth no longer listens to radio (alternatively, youth listening is in serious and irreversible decline).

Busted. Not supported by the facts. One example. Radio programming ace Brian Kelly has gained reach among Milwaukee youth improving his 12-17 cume persons rating book after book. The most recent numbers, Fall 2008, show Brian's 103.7 KISS FM posting an increase in teen cume rating of over 36% compared to the earlier Spring numbers. Further, Brian's team continued to deliver exceptional adult numbers. #1 Adults 18-34, Adults 18-49, Women 18-34, Women 18-49 and Women 25-54. This is only part of the story. 103.7 KISS FM captured the highest share of Women 18-34 of any station in the nation delivering an incredible 25.6 share. Those Gen X and Gen Y women are obviously tuned in and happy. But it's the combined performance of 103.7 KISS FM and sister station 99.1 WMYX that is truly amazing. Brian Kelly has built much more than two successful radio stations, he's built and leads a team and they're on a mission to create killer radio from scratch every single day. Clearly, it's working. Word to the wise: take notes.

2. College students have no interest in or involvement with creating radio.

Busted. Facts counter the argument. Exhibit A: WSUM FM, the student radio station at the University of Wisconsin in Madison. Hundreds of students are seriously engaged and involved in playing radio. In fact, there's a waiting list to participate. Best of all, the station sounds great. Don't take my word for it, listen in, they're streaming, here.

3. CBS is making a major strategic error in LA. The abandonment of talk on FM and the debut of a new Top 40 music format.

Since I was not invited to be a party to the discussions concerning the business objectives of CBS Radio in LA please permit me to speculate. Having given this matter considerable thought, Dan Mason and his team have come to believe that they have a better than even chance to win, to be in a better economic position because of the changes.

But wait, there's more. Some experts are suggesting talk is the single best long-term strategy for winning on FM and some LA market watchers are claiming that KISS FM is practically invincible. In their view CBS is walking away from the future of FM and taking on a fool's errand. Let's take these down in separate responses.

Busted. While the "all music formats on radio are dead" meme is said by advocates to be stuff born of pure critical thinking, it ain't necessarily so. Please see #1 above. Music radio is very much alive and well and profitable. The gang that's pushing to get music off of FM stations, those calling spoken word programming the only true salvation securing radio's future are promoting a thesis that's too clever by half. Among pubcasters this flawed notion is taking on the authority of a pragmatic sanction (i.e., industry consultants and thought leaders supported by the research demanded we do it). Music isn't what's getting radio into trouble or putting it in harm's way. My sense remains that responsibility is one of leadership and a massive failure of imagination.

Busted. Incumbency is irrelevant. One need only recall the events of 1986. KISS enjoyed a 10 share and unprecedented success. Emmis launched Power 106 becoming the new market leader in less than one year. The sheer idiocy here is calling the new CBS music format a loser or a failed strategy when it has not yet been heard (as of this writing). Let's agree to follow the counsel of my longtime friend Rick Sklar and give the CBS gang the benefit of being on the air for a month before beginning to listen critically. Let's also agree to let the audience and advertisers weigh in before making any declaration.

Thanks for stopping by. Have a great weekend. See you next week in a brand new show.

"Every man is a quotation from all his ancestors." Ralph Waldo Emerson

"Do not wait for extraordinary circumstances to do good action; try to use ordinary situations." Jean Paul Richter

"The wrong way is endless." Bert Hellinger

Today's image: The Land of Ghosts by peter bowers. Fabulous. Thanks for sharing.

Welcome to the first quarter we were all warned about. Earlier this week the Association of National Advertisers released findings from a recent study indicating 77% of marketers plan to reduce their advertising media budgets. 72% said they plan to reduce advertising-campaign production budgets. Marissa Miley provides more detail via Ad Age - Most Marketers Cutting Budgets, Renegotiating With Agencies - here.

Meanwhile, back at the ranch, media consumption remains in good shape. The Grammys pulled in 19 mil viewers, up 14% from last year. Not Idol numbers but respectable. The continuing economic problems with broadcast are related to leadership, a massive failure of imagination and, as has been said many times in this space, sales issues that have turned into a full blown sales crisis. While the state of the nation's economy provides a good cover story for media CEOs, the weak economy has simply exacerbated ongoing fundamental business problems. The real task at hand is getting serious about industry reinvention, especially sales, and making something happen. Execution not excuses.

My sense is the wacky crazy death meme will continue cause it's so much fun (e.g., newspapers are dead, radio is dead, TV is dead, agencies are dead, advertising is dead). Seems to me the media darlings of 2009 will be social media led by Facebook. The most recent valuations for FB alone pegs it at $3.7B. The buzz on Twitter has those boys clocking in around $250mil. Stay tuned. Let me add that mobile will remain near the top of every media CEO's agenda this year and it deserves to be. Local, local, local. One other thought for media CEOs - How large is your developer community? Each property should establish, nurture, support, encourage, recognize and reward a developer community. Seems to be working out well for Google.

Bravos: WSUM General Manager Dave Black leads the Madtown student radio station to a new home. Deborah Ziff has the story via Wisconsin State Journal - New digs for University of Wisconsin-Madison's student radio station - here. [Thanks to Tom Teuber for the tip]

Congrats & cheers: Carrie Bugbee (for her exceptional ongoing performance as that incredible doll we've come to know as @PeggyOlson) and all the winners of The Shorty Awards. Related: Check out the Supporting Characters gang that supported the Mad Men Twitter campaign, here.

Bonus: Bill Figenshu writes If There Was Ever a Time via RBR, here. Kudos, Fig. Well said.

"Luck is an accident that happens to the competent." Albert M. Greenfield

"No man will be found in whose mind airy notions do not sometimes tyrannize him and thus force him to hope or fear beyond the limits of sober probability." Samuel Johnson

"True effort, in fact, as of a captive struggling to free himself: That is thought." Thomas Carlyle

Today's image: Surfacing by Catherine Jamieson. Beautiful. Thank you for sharing.

Are we "overretailed"?
2008 ending soft, nobody is making their numbers
2009 looking tougher

Nancy Lazar, chairwoman and economist at Manhattan's ISI Group tells Barron's "It's the consumer's turn to go through a restructuring." [9/22 Bailout or Not, Credit Will Be Crunched by Sandra Ward]. Ms Lazar suggests the US is "overretailed" and "internationally oversupplied." To put this into perspective, consumer spending represents two-thirds of the US economy. In our experience retail sales is a key indicator in forecasting ad spend. While imperfectly correlated, ad spend exhibits a tendency to chase retail sales. Recent events in the financial markets suggest we are witness to the beginning of a deleveraging process. Larry Jeddeloh, founder and chief investment officer of TIS Group is also quoted in the same Barron's piece, "This is not the end of the credit crunch -- the credit crunch is just beginning." He goes on to say "Saving, and reducing debt and value shopping are the new trends." Kudos to Sandra Ward on a well written overview. Our thoughts this morning...

1. Deal flow will remain stagnant until sellers of media properties embrace the new reality of single digit multiples. Moreover, creative financing including seller paper will likely be needed to drive and close deals for cash/credit short buyers. Supply clearly exceeds demand.
   
2. Characterizing the US economy as one in recession, or not, has become an academic exercise. No matter the term of art used there is an abundance of evidence suggesting a slowdown in consumer spending. When retail gets a cold, ad-supported measured media goes into the hospital.
   
3. Competition for ad dollars will remain intense, increasingly an extreme sport. Failure to develop new business, at levels sufficient to be material, will exacerbate the consequences of an accelerated attrition in key account categories (e.g., durable goods, automotive).
4. Pricing of broadcast inventories, especially those subject to traditions common in the transactional bid-ask, must reflect a new, more coherent value proposition. As a practical matter, broadcast operators need to be more mindful of what the dead tree guys are doing. Fighting for their survival print media are attempting to re-order how the ad-supported media game is played. [Hint: PPM provides radio with a robust reach story]
   
5. Discretionary purchasing power will decline. As households tighten spending, accounts in the discretionary space will revisit and in the majority of cases will pull back on ad spend.
6. Those with the courage and audacity to shift focus from market share to market creation will gain competitive and strategic advantage in the days ahead.
   

Congrats & cheers: Legendary radio star Fred Winston sounded great on WGN this past Saturday. WSUM, UW Madison student radio, continues to surprise and entertain. Station chief Dave Black and team are doing a simply exceptional job. The Isthmus and Rich Albertoni on a well done piece about WSUM, School of rock, here. MTVN on backchannel, very nice.

Pig on the runway: A scarcity of bank capital combined with a continuing poor state of economy seems likely to keep the pay radio pig from getting off the ground. The Mel Karmazin led XM/Sirius combo faced serious multiple challenges before last week's series of problems in the financial markets and now faces what may prove to be the most challenging task of all: Raising the capital needed to manage/refinance debt obligations while keeping the doors open long enough to reinvent the venture. The big issue appears to be the current pay radio business model. Will it support and sustain the enterprise following the realization of Mel's proposed $400+ mil in economies? My sense is the odds are 6 to 5 against the pay radio pig taking flight in 2009. The question being heard around midtown and downtown is will Mel attempt a reorg under protection of bankruptcy? [Related - Robert Holmes provides a very good review of the bidding @ TheStreet.com, Sirius XM Up to Its Ears in Debt, here]

Bonus: Chumby adds Pandora. Very cool. More info here.

Have an amazing week. Make something happen.

"Whose cruel idea was it for the word 'lisp' to have an 's' in it." George Carlin

"The 'silly question' is the first intimation of some totally new development." Alfred North Whitehead

"Silence is one of the hardest arguments to refute." Josh Billings

Today's image: Keukenhof by prophead. Awesome. Thanks for sharing.

Change involves deciding. You can decide to embrace change making the best of it, to fight change working to preserve some version of the status quo or to ignore change. No matter how you decide, change - to some degree - will happen. So, how does one decide? My suggestion is you need to make an informed decision. You need to do your homework.

Here's an example. In the last century Arbitron proposed a series of major changes to advance radio ratings. One of the most controversial was the introduction of monthly data, Arbitrends. Industry opinion was mixed. Some saw "trends" as mere escalation in an ongoing ratings war, an answer to the already established Birch Monthly. Some predicted "trends" would fall into the hands of buyers and disrupt market pricing. Many were concerned with the statistical validity of the data. All objected to paying more to get the new data. "Didn't we already pay for that data? Now, we have to pay for it again?" being typical of the comments.

We did our homework and became the first major market group to sign an Arbitrends contract. Hearing of this signing the majority of our peers said we had made an evil pact, a Faustian bargain. Emotions ran high. We had done something that would only encourage Arbitron. Surely, "trends" would cause irrefutable harm in unimaginable ways. We had sold out, taken the wrong side.

In those early days of Arbitrends the product was not without problems. We made it through the changes by working with Arbitron. Things were made better.

Which brings me to PPM. Radio needs electronic measurement. It's time. We can and should work with Arbitron and any other firms that care to take on that challenge. We need to keep in mind that three years from now media measurement will be as different from today as today is from twenty years ago. Let's be a part of that process. One more quote...

"If you don't like change, you're going to like irrelevance even less" General Eric Shenseki

Congrats & cheers: Bruce Ravid on yesterday's very cool radio Raveathon on Madison student radio station WSUM. During the broadcast Bruce featured a rich mix of music, conversation and a special announcement. Chancellor John Wiley announced a donation will be made made to assist WSUM in moving to new studios this summer.

"Playing 'bop' is like playing scrabble with all the vowels missing." Duke Ellington

"Foolproof systems do not take into account the ingenuity of fools." Gene Brown

"Without music, life would be a mistake." Nietzsche

Today's image: Ode to Ansel Adams by Thomas Hawk. Beautiful. Thanks for sharing.

Confusing activity with progress

The temptation is to be seduced by activity, seduced into believing that activity is progress. It's not.

Activity and progress should be related, accepting the imperfect correlation; progress being measurable movement toward the objective, the productive outcome of that activity which proves effective.

The key is measurement and coming to terms with measure as the arbiter.

Establish a solid feedback loop and act on the findings. Understand what's working, what's not working and constantly change up the game to improve the result.

Inertia and incrementalism are the enemies. As discussed here previously, it's the strategy trap of focusing exclusively on the numerator. The real leverage is in changing the denominator.

One needs to come to grasp the new reality and to get a deep understanding of the developing sea change - the rock n roll of this generation is interactive media. The digital natives are not playing by our rule sets, they're choosing to do what we once did, they're making it up from scratch. This does ensure one new practice to be the safe and conservative best bet - the smart guys are putting their five year operating plan on a magic slate.

To get some perspective, let's look at some big numbers.

The US measured media ad spend in 2007 was about $149 billion [TNS]. The direct marketing spend in 2007 was about $173 billion [DMA]. The subtotal being $322 billion ($1.8 b FSI dollars duplicated in the TNS data).

RAB put US radio in 2007 at $21.3 billion (RAB measures are significantly different than TNS for radio). TVB using TNS data placed 2007 US broadcast TV at $46.5 billion. IAB posted 2007 online revenues at $21.2 billion. The subtotal being $89 billion.

Then there are all those other guys. Let's take one.

The promotional products industry captured more than $18.8 billion in 2006 expenditures [PPAI]. That's a bunch of money to promote products, services and companies one coffee mug, mouse pad or free sample at a time.

Get this - there are more than 20,000 promotional consultant firms in the US alone and that's 2007 data. Compare that to the 17,412 radio and television stations now on the air. Dividing broadcast by two, as a very rough estimate, equals a ground game of 8,706 vs 20,000. PPAI, the promotional products trade association, is older than broadcasting, they celebrated their 100th anniversary in 2003.

We won't even get into product placement, restroom ads or gaming. The point is, by any measure, there's an incredible amount of money in play. Why think small in a space this big.

My suggestion is radio teams should be playing for more than their share of $21.3 billion, TV staffs should be fighting for more than their piece of the $46.5 billion.

The real opportunities, the big money and growth are outside the silo, it's supplemental by nature, it's real off the rez biz dev stuff. That's where you'll discover progress. Inside the silo, it's all activity. Growth vs stasis and entropy. Denominator vs numerator. Why spend time and valuable resources getting better at a game that is being played less and less. Change the game.

Every platform counts, no single one being more important than the other in share of mind or agenda. It's not about radio or TV. It's about audio, video and all things interactive. My notion is no professionals are better positioned to reinvent audio and video, to reimagine wireless than broadcasters, the first and second tribes of wireless. In the emerging worlds of pro-am development incredible opportunities abound. It's a leadership issue, we need to get serious and compete for the future. Incumbency is increasingly irrelevant, we need to employ the remaining leverage we have and do it now. Use it or lose it may sound like high drama but you may wish to think again about that before dismissing the potential window of opportunity now present.

No, it's not the job you signed up for but it's the one at hand. What's needed now is imagination and game-changing innovation. The great news is the bigger than you can possibly imagine payoff is prospectively available for the taking and it's right here - outside your silo. See ya there.

Getting the band back together: WLS, The Big 89 Rewind. Kudos to radio programming ace Kipper McGee.

Don't miss it, if you can: Impresario Bruce Ravid rides into MadTown tomorrow and takes temporary control of transmission at radio station WSUM. Certain to be more memorable moments of Madison media madness, join the famous '74 grad as he kicks off the 7-hour Raveathon beginning at 1pm tomorrow. To ensure the high standards WSUM listeners have come to expect (and for Bruce's own personal safety), students and station staff will be on hand to observe and participate. For locals it's 91.7 FM, while the world tunes in via stream here. My thanks to radio programming ace Tom Teuber for the advanced warning.

Congrats & cheers: Advertising ace David Verklin signed to lead Project Canoe, the cable tv industry initiative tasked with creating new approaches to targeted sales. Expect the announcement next month. Caroline Marks signs on as GM of the yet to launch IAC news aggregator site headed by the uber-cool Tina Brown. Tom Taylor celebrates one year of posts at Radio-Info.

"Every tool carries with it the spirit by which it has been created." Werner Heisenberg

"The unlike is joined together, and from differences results the most beautiful harmony." Heraclitus

"The prerequisite of originality is the art of forgetting, at the proper moment, what we know." Arthur Koestler

Today's image: Singel at dusk by Mor (bcnbits). Wonderful. Thanks for sharing!

Tom Peters writes a great deal of relevant stuff. Late in 2004 he created a list and titled it CEOs Are Idiots! (Project05, 240-page PDF, free download here). Here are six from Tom's list.

CEOs are idiots because they...

1. UNDERestimate the Threat to their Existence; OVERestimate their Resilience

2. Fail to spend Hyper-aggressively on IS/IT...fail to exploit fully the web

5. Recruit mostly from Conventional Sources; have a Low Tolerance for RiskTakers - Freaks

6. [Are] Less than 24/7 "TalentFanatics"

7. Favor "MarketShare" over MarketCreation

8. Believe that "Process" beats "Passion," "Analysis" beats "Action"

Bonus: Listen to adults having their way with a student radio station. Bruce Ravid hosts today's take over at WSUM in Madison. Check it out here.



Image: Techcrunch. Duncan Riley live blogging the SJ keynote from Macworld here.

700Mhz: Google is on the list along with Cox, Advance/Newhouse, Bresnan. John Eggerton has the story at B&C here.