The State of Country Radio 2008
By Ed Salamon
Country Radio Broadcasters, Inc.
As we begin 2008, Country radio celebrates the New Year with more stations, more markets, and a bigger share of radio listening than a year ago.
That's good news not only for our radio readers, but also for those in the music industry who rely on Country radio for the exposure of their songs, recordings and artists.
Despite the increased popularity of the format, Country radio is faced with a challenging radio advertising marketplace, which affects stations regardless of format.
Country had a larger share of radio listening than any time in at least eight years. Arbitron Format Trends reports showed Country radio with a 9.7 share in the Spring 2007 That is the highest share since Arbitron's first published Format Trends tracking in 1998.
Country radio gained two important markets this year this year. On Monday of Country Radio Seminar ® week, Go Country 105 (KKGO) debuted in Los Angeles. LA had been without an FM Country station since KZLA left the format the previous August. And, as part of the CRS Opening Ceremonies The Wolf 95.7 (KBWF) debuted in San Francisco, likewise filling the Country format void in that city.
Country radio again gained in total number of stations this year, growing from 2046 to 2052 (M Street Journal/Inside Radio Format Country November to November comparison).
HD2 radio continues to grow in number of stations and in number of receivers sold, offering a second channel free over- the- air local radio in many markets, exposing music not otherwise available in their markets, and Country formats include a number of New Country, Classic Country and Outlaw Country offerings.
According to the Radio Advertising Bureau, radio revenues fell 5% in the third quarter of 2007 to $5.5 billion, the worst quarterly decline in years. The loss is due entirely to decreases in local revenue--which fell 5% to $3.7 billion in the third quarter--and national, down 8% to $1.1 billion. These losses more than offset 9% growth in network radio, which ended at $293 million, and a 7% growth in non-spot radio revenues, ending at $395 million.
This year many Country artists have been exposed on Pop radio which helped to develop more fans for Country radio. Music by Rascal Flatts, Tim McGraw and Faith Hill were among the most programmed Adult Contemporary radio songs in 2007, according to Mediabase 24-7. Taylor Swift has a current AC hit. At the same time, artists including Carrie Underwood., The Eagles and Kelly Clarkson brought their fans to Country radio. The Country Radio Broadcasters is proactive in encouraging the growth of new artists for Country radio through its New Faces of Country Music -- show. This year radio attendees voted Luke Bryan, Jason Michael Carroll, Bucky Covington, Jake Owen, and Taylor Swift to perform for Country radio and the music industry on the 2008 show during the Country Radio Seminar®.
In 2007, the Country Radio Broadcasters discovered a substantial opportunity for the Country format to attract Hispanic listeners through the first ever study of Hispanics and Country radio and music. Based on this information a number of Country stations have begun to target advertising to Hispanics. In addition to being presented at CRS-38, CRB again presented the information in Nashville this past summer at Belmont University to better inform the Country Music industry about this growth opportunity and how it applies to them.
In the five years that I have lived in Nashville, my appreciation for the symbiotic relationship between Country radio and rest the Country music industry has grown. Therefore, I also inquired about the record, song and touring industries.
Although a significant percentage of sales happen at the end of the year, 2007 album sales are predicted to be 20% less than last year. Joe Galante, Sony BMG Nashville Chairman says "This year will be the worst year for Country since Soundscan started tracking the format in 1992. Country had a great lineup of releases this year with Carrie Underwood, Rascal Flatts, Kenny Chesney and Keith Urban Greatest Hits, etc. and it wasn't enough. Next year doesn't get any better because the schedule isn't as good and economy seems to be slowing."
The song business fared better in 2007. In March the performance rights organization ASCAP announced that it has record revenues of $785 million for the fiscal year 2006, representing a 5% growth, with royalty payments to its members in the amount of $680 million. In September BMI reported that it would distribute more than $732 million in royalties for its 2006-2007 fiscal year, with revenues of more the $839 million, which is an eight percent increase over the prior fiscal year. Dale Bobo, Senior Vice President of Warner/Chappell Music, says "The continuing drop in physical sales (and mechanical income) means it is more important than ever to be the publisher on hit singles for the performance income and to be creative in licensing songs for other uses."
Touring likewise had a successful year, especially Country's major artists. Country acts Kenny Chesney, Tim McGraw/Faith Hill and Rascal Flatts were among the ten top grossing tours of 2007, according to Billboard Boxscore . Brooks and Dunn and Alan Jackson, Toby Keith, Bead Paisley, George Strait and Keith Urban also headlined successful tours. Rod Harris, President of the Nashville Association of Talent Directors tells me "More than ever in our history other entertainment entities are competing for the fan dollar. However, I think Garth's recent Kansas show tells the story; give them a show and they will find the money to get there."
Best wishes to all for a prosperous New Year. I look forward to the discussion of these issues at the Country Radio Seminar, March 5-7 in Nashville Tennessee.