WHAT'S WRONG WITH RADIO

With corporate ownership and a new form of payola strangling playlists, listeners are tuning out.

By Greg Kot, Rolling Stone Magazine

At a time when a handful of radio corporations are making more money than ever, dissatisfaction with the quality of music programming has reached a breaking point. People are listening to radio less, and the reason is simple: The days of local radio breaking new records, taking chances on unknown acts and responding to it's audience's interests have all but disappeared. National playlists are in the hands of corporate programmers, who are influenced by big-label money funneled into the stations by independent radio promoters. "The airwaves are in a public trust, but we have given that up and let one small group of people heist all the country's programming decisions," charges Miles Copeland III, former manager of the Police and current chairman of the independent Ark 21 label.

The focus of his ire is the Telecommunications Act of 1996, which deregulated radio and set off an unprecedented wave of media mergers. That action "made radio more corporate, more homogeneous, and rounded out the rough edges that make music interesting, " says Copeland.

Though more than 30,000 CDs are released annually, national radio playlists are becoming tighter than ever. In one recent week, the forty top modern-rock stations added a total of sixteen new songs, and the biggest forty-five Top Forty stations added a total of twenty. "Most of the country is based on the lowest-common-denominator programming: Play the fewest songs that appeal to the most people," says Alexandra Inzer, program director for WMPS, a Memphis adult alternative station that is one of the few independent commercial broadcasters left in a major metropolitan market.

Access to the airwaves has narrowed even more in recent years as a powerful network of independent radio promoters - acting as liaisons between record labels and broadcasters - has consolidated its control over what songs even got presented to radio stations. Labels, which funnel an estimated $100 million a year to these promoters, are becoming increasingly frustrated with the practice. "It's a fortune that we spend on what is, effectively, payola," says Copeland.

All of this underscores another huge problem facing the radio industry: shrinking listenership. The latest Arbitron figures show that while the total audience for the radio has remained steady in the last decade, listening time has dropped thirteen percent. Figures measuring the number of listeners and how long they listen show especially steep drops for young people: since 1998, a ten percent decline for teenagers and an eight percent dip for people between the ages of eighteen and twenty-four. Figures show that all music formats - including alternative, album rock, Top Forty, country and urban - are stagnating or declining.

"My experience is that the next generation is not interested in radio," says Jerry Del Colliano, a radio veteran who publishes an industry newsletter, Inside Radio, and lectures at the University of Southern California. "You have a generation of people who can store music on their computers. They don't need radio to find out about music anymore."

The listener drop-offs come at a time when power in the radio industry has shifted to conglomerates such as Clear Channel Communications and Infinity Broadcasting, which built their empires after the 1996 Telecommunications Act. By far the biggest is Clear Channel, of San Antonio, Texas, which owns SFX Entertainment - the nation's largest concert promoter - plus television stations and thousands of billboards, pushing it's annual revenue to $8.1 billion. Randy Michaels, Clear Channel CEO of radio, has said the company's size will enable him to "reinvent" radio by packaging advertising on a nationwide scale.

Less clear is how Clear Channel's size benefits programming or the public. Michaels says that despite consolidation, programming and music decisions are still made locally at Clear Channel stations. "We spend millions of dollars in research in each market to find out what it is we should be doing to service the market," he says. "If it were true that we've homogenized the formula for programming a music station, we'd just research Los Angeles and New York, and roll it out."

But the numbing consistency of playlists at commercial stations across the country tell a different story. "When we first got signed [in the late Eighties]," says Amy Ray of Indigo Girls, "we'd go to a station, and they would be self-owned and had a certain amount of freedom to play what they wanted. Their playlist wasn't the same as twenty other stations owned by the same corporation. Now it's harder to break in."

In order for an artist's record company to even get a song considered for radio, the label usually must pay big money to indie promoters. Since the demise of old-school "hit men" following the payola scandals of the 1980s, this new, legally sanctioned system of indie promotion has surfaced, in which record-company money is no longer paid directly to the radio stations in exchange for playing records. Instead, record companies pay indies as much as $1,000 or more to get each new song added. The indies, in turn, set up what amounts to bank accounts with stations, funneling some of that record-company cash to programmers in the form of listener giveaways such as concert tickets and vacation trips.

"I had a promoter in here yesterday who got one of our songs added on three stations and then sent us a bill for $15,000," says Ark 21's Copeland. "It's ludicrous, because I'm a small label. To make something happen at radio, you've got to have a lot of money behind it, and a lot of great music is getting lost. I am shocked that the music industry is as meek as it is - why do we put up with this crap?"

In the last two years, executives from Latin-music labels and radio stations pleaded guilty to tax infractions, and Clear Channel was fined for a promotion that guaranteed airplay for a song by Bryan Adams. But the Federal Commission says that it is not conducting any investigation of the radio-promotion business.

Michaels, whose Clear Channel stations glean tens of millions of dollars annually from indie promoters, says labels are coping out by not putting an end to the practice. "I would love to see the labels stop spending money to try and influence our airplay," he says. "I would say to Mr. Copeland, 'There is $100 million spent by him and others to [pay radio promoters], and if that's wrong, stop it.' And I'd thank them."

Columbia Records recently cut payments to indie promoters hired to pitch the song "Bootylicious," the latest single from Destiny's Child. But veteran radio promoter Jeff McClusky said the cutbacks weren't an attempt by record labels to break their ties with him and other promoters. He said the Destiny's Child single was simple a surefire hit, so Columbia didn't have to spend as much on indie promotion to ensure it would be added to radio playlists. "I don't have a problem with that, because this happens with certain superstar releases," McClusky says. "There is still plenty of money to be made helping Columbia break other records. We've been in the business a long time, and I look to be in the business a lot longer."

That future is certain to include a radio world with Clear Channel as a major player. Michaels contends that the public will b better served because of it. "We all have nostalgia for the way things were, but radio is experiencing the same kind of consolidation every other business has seen," he says. "I love to visit small towns and eat at mom-and-pop restaurants. But it's getting harder to do, because there are a million choices, and the chain restaurants are nudging out the mom-and-pop places. There are people, including me, who think that's bad. But people want to eat at the chain restaurant for some reason. The country cooking we remember in our minds isn't as good as what Cracker Barrel can serve up. We miss Main Street, but we shop at Wal-Mart."

One key reason for that shift is that Main Street doesn't have the advertising and marketing budget that Wal-Mart has. Nor do the few mom-and-pop stations left have the financial muscle to out-promote Clear Channel and the other conglomerates who dominate the radio business. Yet a handful of locally owned stations, such as WMPS in Memphis, are hanging tough. They're doing by reviving some of the adventurousness of FM radio's free-form golden age in the Seventies; WMPS' playlist blends Ben Harper, R.E.M. and Ani DiFranco with country, Tex-Mex and local artists. "We play records based on our gut instinct," says WMPS' Inzer. "Our approach is risky, and our audience is smaller because of it. But the ones who like it stick with us."

A similar philosophy prevails at locally owned WWCD, an alternative-rock station in Columbus, Ohio, that works records by indie artists and local rockers into its rotation in a town where rigorously programmed playlists by Clear Channel- and Infinity-owned stations dominate. A few years ago, t eh station fought off a challenge from a corporate-controlled alternative-rock station. The competitor, owned by Clear Channel, has since switched formats.

"I believe there is a special place in hell for Randy Michaels," says WWCD program director Andy Davis. "I can't tell you how much I think this conglomeration thing has totally ruined our industry. People are listening to radio less and are disappointed more when they do listen. We are fortunate to be owned by a local guy who loves music, who has a passion for new sounds. But always lingering in the back of my mind is that the next quarter could be our last. There aren't many of us left."

Even a radio booster like McClusky acknowledges that the business is entering a crucial make-or-break period, with Internet radio and satellite radio looming as competitors in the next few years. "If consolidation isn't addressing listeners' desire for exciting entertainment on a local level," McClusky says, "then the industry is in trouble."

Meanwhile, the increasing number of young listeners dropping off the dial suggests that it already is.