Local stations see revenues dip

The numbers are in, and 2007 was not a good year for radio in Boston. Despite earlier predictions that radio revenue would begin to bounce back after two years of decline, the estimated gross revenues for the local market are again down - and expected to sink further.

According to numbers released this week by BIA, a Virginia-based financial and strategic consulting firm for the broadcast and communications industries, Boston radio stations took in $310.2 million in 2007, down from $324.8 million in 2006. For 2008, the financial network is projecting revenues of only $296.2 million.

That decline doesn't surprise many in the industry. "Radio generally tracks the performance of the overall economy," says Tom Taylor, the editor of the online trade newsletter Radio-Info.com.

Even the usual big earners are down this year. Sports talk WEEI-AM (850) earned $31 million, down from $36.5 million in 2006. News talk WBZ-AM (1030) billed $34.5 million, down from $35.1 million the year before. On the FM side, "Magic" WMJX-FM (106.7) dipped to $23.8 million from $24 million; "Mix" WBMX-FM (98.5) sank to $17.9 million from $18.3 million; WBCN-FM (104.1) fell to $17.55 million from $18 million; "Oldies" WODS-FM (103.3) slipped to $17 million from $17.25 million; classic rock WZLX-FM (100.7) ticked down to $16.7 million from $16.8 million; and WROR-FM (105.7) dropped to $11.65 million from $13.7 million.

The only two stations to report revenue increases were two contemporary hit - or Top 40 - stations: "Kiss" WXKS-FM (107.9) and "Jammin' " WJMN-FM (94.5). WXKS rose to $23.9 million from 2006's $23.6 million, and WJMN climbed to $19.5 million from the previous year's $18.85 million. "Top 40 is having a good time right now," notes Taylor of what he considers a cyclical rise. "The music is good."

But overall Boston, along with other large markets, has been hit hard. "For 21 of the last 25 months, small to mid-markets have outpaced the top 25 markets," says James B. Boyle, an independent research analyst covering media and information with the New York-based C.L. King and Associates. Boston is considered the 10th-largest radio market in the country by Arbitron.

Although the numbers for other large markets, such as New York or Chicago, have not yet been made available for 2007, Boyle points out that last month alone the difference is substantial: small radio markets, such as Portland, Maine, saw an increase in revenue (nationally, small markets were up 5 percent), even as large markets continued down. "In the last six months, the gap has widened," Boyle says.

There are several theories about why big-city radio is slumping. Larger markets tend to have more stations that belong to large, publicly traded groups, which are more dependent on quarterly reports, says Boyle, and these may end up offering bigger bargains to agencies in return for more immediate sales. In the long run, that depresses revenue.

"Your [ad] rate card is only as good as the lowest price you'll take," he says.

In addition, adds Taylor, larger markets offer more options - including new media - for advertisers, which means more competition for radio stations. Ultimately, all say, the intimacy of smaller markets may have made smaller city advertisers more loyal to their local stations.

"You can still go and see the person who owns the car dealership, who owns the store," says Taylor. "There's still that contact possible, and you can still do business that way."

Spinning the dial

Today and tomorrow, the fifth-annual "Mix 98.5 Cares for Kids Radiothon" will be raising money for Children's Hospital in Boston. The two-day event, from 6 a.m. to 6 p.m. both days, will have WBMX hosts broadcasting from the hospital and inviting listeners to call in to make donations. Last year, the event raised $2.5 million. . . . WGBH-FM (89.7) is launching an initiative to record the state's classical music history and traditions with a series called "Classical Connections." The approximately five-minute pieces, which will include interviews with music teachers and students as well as with artists, will air on Fridays beginning today at 6:35 a.m., 8:35 a.m., and 5:45 p.m. Podcasts, longer interviews, and other Web extras are at wgbh.org/classicalconnections.

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