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ARNN IN THE NEWS: NPR's Future; Long-Form Commercial Competitor Debuts

RADIO BUSINESS REPORT - The National Public Radio debacle—which keeps on getting worse with the House of Representatives passing H.R. 1076 (a bill aimed at eliminating federal funding for any programming associated with NPR) on 3/17—may be the biggest story about radio in a decade.

The first hiccup started with Juan Williams; then Congress’ plan to cut CPB funding; then Ron Schiller, NPR Foundation President/SVP, Development was caught on the James O'Keefe ambush video apparently ready to make Islam the endorsed religion of NPR in return for an implied request for funding.

Of course, after everything came out, both he and NPR CEO Vivian Schiller resigned. And the hits keep coming.

But if you pause and dissect the undercover Schiller video, there are four different subsets of damage that occurred:

* The first subset is Schiller suggesting that NPR may well be better off without government funding. This came at a very bad time for them because Eric Cantor (R-VA) immediately grabbed onto that and said, “NPR has admitted that they don't need taxpayer subsidies to thrive, and at a time when the government is borrowing 40 cents of every dollar that it spends, we certainly agree with them.” It gives Cantor the ability to go ahead and defund NPR against the backup of the deficit.

* The second subset, which is really connected to the first, was when Schiller alluded to the fact there should be “as many Muslim voices on the air as there are women.” This statement by Schiller has the improper appearance as if a secular news organization that should be fair and objective is actually suggesting that the religious views of one group should be equal to that of women—which is more than half the population of the US. 

* The third subset of the Schiller video fallout is going to deeply affect the Jewish community’s interest in donating money to NPR. This is because the Jewish community may be less inclined to support an equal amount of Muslim voices on NPR programming to that of women (in fact both the Jewish and Christian communities might now demand equal time out of fairness).

Schiller alienated a lot of extremely high profile, very tolerant Jewish donors and Jewish donors do not want to support a secular organization that is actually purporting to represent one religious viewpoint to such a high degree that it would rise to the level that is should be “equal to that of women” on NPR’s airwaves. Schiller’s comments have all the appearance of him suggesting that Islam could indeed be the officially-endorsed religion of NPR, just as Visa is the officially-recognized and endorsed credit card in past Winter Olympics.

* The fourth subset of the Schiller video is the backlash that is certain to come from The Tea Party, which many now agree is not a political party at all, but rather a broad-based economic movement focused on fiscal reform and responsibility.  The Tea Party appears to consist of every walk of life--Conservatives, Liberals and Libertarians—finally being able to agree on one single thing, they don’t like $14+ trillion dollar Federal debt and trillion-dollar per year-plus deficit spending. That’s why they are called the Tea Party--coined by a CNBC commentator, relating to the dumping of English Tea in Boston Harbor over higher British taxes. It’s not a political party, it’s a fiscal movement.  “We can’t go bankrupt” is the Tea Party’s anti-deficit movement.  Nonetheless, Schiller, a voice and leader at NPR, said it was controlled by “Gun-toting Christians and it is scary.” In this one statement NPR alienated a good portion of the huge, broad cross-section of America that tends to agree that a massive Federal debt and deficit is not something they or their children or their posterity want, and they may lose many of them as a donor base.

NPR also lost Conservatives from the fallout of the Schiller video. Why does this matter? Because many Conservatives listen to NPR programming despite the perceived bias because it’s very calming, often thoughtful and has many nice qualities to it. Point of fact, it was the only default long-form news product on 900 stations across the US until just recently. NPR has further alienated Republicans by Ron Schiller basically saying they’re dumb compared to Democrats. Republicans might not represent NPR’s core donation base, but they do represent a lot of listeners--and many a Republican have forever been pushed away by recent events.

Finally, NPR’s Schiller clearly alienated the Christian community (of which over 70% of Americans profess belief in) as a potential donor source because Schiller denigrated and denounced Christians as gun-toting crazies…which are “scary.”  Even fair-minded Liberals that support NPR don’t want to be associated with that sort of anti-Christian, anti-Jewish elitism that this man represented on that video. 

All of the afore-mentioned groups are now potentially alienated from what was once a regular source of reliable news and information—out of a clear paradigm originating from NPR’s mother ship in DC. In many ways, NPR’s leadership unfortunately appears to have positioned itself left of the Keith Olbermann era at MSNBC. This public perception is quickly becoming a very sobering reality at the NPR affiliate level, many NPR affiliates are no doubt horrified that they are being tarred with the same brush which Schiller and NPR’s senior executive team have painted themselves with. This is a situation that is clearly unfair to NPR affiliates.

Along comes “America's Radio News Network”
The whole NPR fiasco seems to fit in perfectly for America's Radio News Network, the only marketplace long-form radio news alternative to NPR. John McCaslin, EVP of America's Radio News Network, tells RBR-TVBR that ARNN’s stated position actually meets most every criteria of what the Obama FCC might want--which is balanced, accurate reporting without a political (or any other)  agenda, combined with an ability to do differing degrees of localism – heavy to light -- within the three-hour syndicated news programming blocks. By design, it might be the only programming that oddly enough, the Obama administration, Libertarians and Conservatives alike, could unanimously support as a free-market solution to what ails NPR.”

“Prior to all of this we did analytics and we had every expectation that NPR will be around forever,” says Mark Masters, CEO of ARNN. “All we are trying to do is serve the listeners that felt underserved by the often overt bias of NPR. Never in our wildest imaginations would we have thought that this sad event would have occurred at NPR. We have the greatest respect for all the wonderful broadcasters there. All in all, I think NPR and all of its affiliate stations get up every day to provide a great public service and our hats are off to them. My heart goes out to them for having to suffer the repercussions of bad judgment at a high level.”

Nevertheless, ARNN, as a long-form news option, may take a lot of listeners from NPR for the above reasons. We even wonder if some public radio stations actually take ARNN and its sister, America’s Morning News (AMN—6AM-9AM),  as well, if NPR is de-funded this week by Congress.

America's Radio News Network is distributed and affiliated by TRN Syndications.  When Masters made the announcement that there would be another 15 hours a day of long-form, co-anchored radio news through ARNN at the NAB Radio Show back in September of last year, it was well before the Juan Williams firing.  That timeframe was accelerated so that by May 9th they’ll have a total of 12 hours a day of long-form news, which will also provide for different, customizable forms of localism within the long-form news blocks (stations can go to local news in the top and bottom of the hour or they can take segments and go local in the “D” block segment, the last quarter hour).

EVP John McCaslin says ARNN was designed either as a back-to-back all news format for stations in every market that want long-form non-partisan journalism in radio news, or as three-hour blocks that can fit in between standard opinion talk shows on existing Talk radio stations: “Because ARNN’s position is that real journalism should have truth and facts, not a political agenda. Real journalism is about getting to the core issues in a fair, even-handed manner that lives up to the highest journalistic standards--that’s ARNN’s mission.”

McCaslin says the long-form news-only network will be a non-partisan watchdog of events, whether it’s in Wall Street, Hollywood or the political parties--not a lapdog to any of these interests. 

Facts are facts: In some seven of the top ten markets the number one billing station is a news-only station—the one with the highest power ratio. There are two reasons--most news listeners are among the most valuable listeners, and secondly, because news is a “safe buy environment,” sellout percentage of news is extremely high.

McCaslin underscores that because ARNN’s programming is a partisan-free and objective, news-only environment in the tradition of all great past news organizations, there is no risk in it—it’s a safe buy environment for agencies which may be leery of opinion environment.”

CEO Masters adds, “America’s Radio News Network was designed to not only be a political agenda-free zone, but was designed with the PPM in mind to maximize its impact on PPM in an ever-increasing ADD world.”

“Immediacy Media”
With Pandora and so many other Internet companies cornering the market on music growing by leaps and bounds, there are now two clear types of programming for radio stations to look to their future for: music or spoken word. 

Pandora and other versions of Pandora will come along and may ultimately siphon music away from radio the same way FM radio stations siphoned music away from AM long ago--especially with Pandora now moving into the car.

“Pandora and its many competitors will ultimately do to FM music formats what FMs did to AM music,” attests Masters. “What’s going to take the place of music  and help save the revenue of both AM and FM stations, we would argue is spoken word.”

Masters adds a term he repeatedly coined as “immediacy media.” In Masters’ vernacular, immediacy media is the polar opposite of music: “Music the recorded intellectual property that you can play time and time and time again.  It is a means of relaxation and often escape from stress.  Spoken word on the other hand is something that is very current and very perishable.”

He adds, “The question that we asked originally asked before launching AMN (through a joint venture with a newspaper and TRN Entertainment) and ARNN was when the collapse of 2008 occurred, were the larger news media outlets  going to do cost-cutting in the newsrooms and the bureaus across radio and television to save money on the corporate level?  When that answer came back as a clear resounding yes and those cuts were also taking place at newspapers we recognized the time to syndicate our immediacy media strategy with the best standards in journalism.”

Masters says, in an analogy, “If talk radio and other forms of existing spoken word programming is the ultra-thin laptop and smart phone of programming then American’s Radio News Network’s long form news programming is the ‘iPad’ of spoken word programming: “The iPad is now so dominant that there are 14 or 15 knockoffs of it.  Everyone else is copying Apple’s iPad. Blackberry comes out within the next couple of weeks with its version of its first iPad knockoff, this at a time when Apple will be releasing its second generation iPad with cameras.”

Says Masters: “We’ve already spent a year and a half developing and perfecting our initial ‘iPad’ piece of programming for radio, and that was in a joint venture through Talk Radio Network Entertainment and a Washington, DC newspaper--America’s Morning News.” 

America’s Morning News is now in 13 of the top 30 US markets.  Even though this is a completely separate company from ARNN, it’s still represented also by TRN Syndications, a distribution company.

The parent company of America’s Radio News Network (to listen, click here) is America’s Radio News.  It has nine hours of long-form news a day Monday-Friday by the 9th of May, which is less than 60 days away.  With the programming of those two companies both distributed through TRN Syndications’ affiliate wing, combined there is total of 12 hours of daytime programming.  So stations looking to pick up the default radio news audience that’s always been available in every market, the super-valuable news listener. Stations can plug ARNN’s long-form news blocks in and go all news, all day, or intersperse the news blocks between their opinion shows. 

ARNN for music stations?
Masters says long-form news blocks are completely compatible and highly sellable in market clusters by the music-oriented stations’ AEs: “It helps integrate clusters’ salespeople that are only selling music and Sports into selling programming that they are much more familiar with, which is non-controversial  news.”

He suggests looking at underperforming FMs in your group.  If you’re the third biggest Rock station, the third or fourth biggest Urban station, the third or fourth biggest Country station you might take the least revenue-performing FM and flip it to become the first all-News station, which carries with it the possibility of quickly becoming one of the highest-billing stations in the entire cluster. “Because we’re pointed at an 18-49 demographic, America’s Radio News Network is putting out 10 to 12 stories and four to six audio actualities every nine minutes—this with sort of a very subtle, edgy music bed underneath that is compatible with the subject matter discussed. This fun and fast-moving news-only format is attractive to the younger, affluent 18-49 demo, and you can flip that entire daytime to News-only and then play music at night until we get the other six hours up. Right now plan to have all news, 18 hours a day between 6AM and 12 Midnight after mid-year, but at least we’ll have 12 hours a day in daylight hours by May 9th.”

So while NPR has some major issues to deal with in credibility and funding now, ARNN and AMN might just be a sound alternative to stations looking to grab up that long-form news franchise that’s now looking for an alternative to NPR. Certainly, McCaslin and Masters have to be pleased with the timing of these events as the ARNN rollout continues.

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