FMQB's annual year-end review is out this week and Joint Communications' CEO John Parikhal leads the forward view to media trends in 2007:
In 2006, the Internet continued to dominate media headlines. Google paid nearly $1.5 billion for YouTube. MySpace was the talk of the town -- costing Tom Freston his job at Viacom and making Rupert Murdoch half a billion dollars richer when he spun its ad inventory to Google.For John's trend review and 2006 predictions printed a year ago, click here.
Internet radio grew. Some radio companies surfed the online wave while others are still waxing their boards and hoping they don't have to go in the water. JCC research shows that office listening is shifting slowly to online -- and its not just local radio.
In 2006, radio leadership focused on HD ("dead on arrival" according to many) and the idea that radio is "free" (while billions of songs were downloaded "free" on Limewire and others). Bad ideas. But, by 2006 there was no one left in the ranks with the courage or the willingness to challenge the view from the top.
Clear Channel rounded up the tire kickers to see if they could get close to $40 a share for stock that was touted as a $100 certainty only a few years ago. It's clear evidence that the promises of consolidation were broken in the back rooms of Wall Street.
I'm concerned that 2007 could be a watershed year for radio. If the focus stays on cost cutting and top down management (especially with the Clear Channel buyout), radio will run out of fresh ideas and continue generating initiatives that are out of sync with today's consumer.
If the focus moves towards attracting, developing and managing good people, there's a lot to cheer about.
For a while, radio will still have huge audiences and make money, no matter what they do. It has made margins above 40% for years and spits off a lot of cash. But, it hardly re-invests any of the money it makes into an improved customer experience.
In 2007, there's no evidence that things will change much. Which means that radio won't be attractive to the brightest, creative young people looking to start or advance a career. And, radio needs them desperately.
Next year, radio executives might want to consider the words of super-successful Jack Welch, who said, "the role of the leader is to express a vision, get buy-in, and implement it. That calls for open, caring relations with every employee, and face-to-face communication".
For more views on media in 2007, click here.
posted by Chris Kennedy @ Friday, December 01, 2006,