Media Today, 4th Edition
Chapter Recaps and Study Guide
Chapter 11: The Radio Industry
After studying this chapter, you will be able to:

Sketch the history of the radio industry.

Explain the relationship between advertising and programming.

Detail the role of market research in the radio industry.

Critically examine the issues surrounding the consolidation of radio station
ownership.

Discuss ways in which new digital technologies are challenging traditional radio.

The rise of radio.
o At first, radio was seen as an advanced form of the telegraph, allowing for
coded message to be sent without wires; the new medium was called
radiotelephony, or “wireless.”
o Marconi is credited with brining together a number of technological
advances and concepts that made radio possible; he established the
Marconi Company, primarily for purposes of equipping merchant and
military ships with wireless.
o De Forest invented the vacuum tube that made broadcasting possible; he
envisioned forms of radio entertainment.

Determining the use of radio.
o Conflicting interests fought over the control of radio in the U.S.; the Navy
saw it primarily as a military device, but commercial interests wanted to
develop the new medium within the marketplace.

The creation of RCA.
o As a result of World War I, the Navy, Congress and commercial interests
forced Marconi to sell its U.S. assets, which were reorganized as a holding
company based on the key patents of major American corporations; the
holding company was called the Radio Corporation of America (RCA),
the most powerful player in the early development of radio in the U.S.
o Eventually, the courts broke up the monopoly, and forced RCA away from
the other corporations that controlled it; as a consequence, advertising
became the basis of radio financial support, and networks developed on a
national basis.

Radio and advertising.
o Early radio stations operated primarily to promote their owners’
businesses in other industries; AT&T’s New York station introduced
advertising in 1922, and it caught on.
o By the late 1920s, RCA operated two networks (NBC Red and NBC Blue)
and the Columbia Broadcasting System (CBS) was developed.

Government regulation of radio.
o The Radio Act of 1912 authorized the Secretary of Commerce to issue
licenses and also regulated the use of wireless on ships.
o The Radio Act of 1927 established the Federal Radio Commission
(FRC) as the bureau that would issue licenses and regulate the emerging
industry; the Act established the concept that the airwaves were a natural
resource that belonged to the people, and broadcasters were expected to
operate stations as a kind of public trust.
o The Federal Communications Act of 1934 established the Federal
Communications Commission to regulate all electronic communications
in the U.S.

Radio in the 1920s, 1930s, and 1940s.
o By the end of the 1920s, the industrial pattern of commercial radio was
set: it would be regulated, commercial, and characterized by networks that
served local affiliates throughout the country.
o Network programming included many of the genres that later moved to
television in the 1950s.
o The FCC required NBC to give up one of its two networks; this was the
origin of the American Broadcasting Company (ABC).
o News developed slowly, because the newspaper industry forced the wire
services to restrict service to radio news organizations; radio news
emerged as a strong element during World War II.

Rethinking radio, 1950–1970.
o The rise of television and the arrival of the baby boom generation
significantly altered radio’s programming and audience strategies; radio
gave up network entertainment programming to TV and concentrated on
building specialized program strategies, or formats, aimed at demographic
targets, the most important of which were the baby boomers.
o Radio became increasingly mobile as a result of the invention of the
transistor.
o Disc jockeys developed the rock ’n’ roll format that catered to the baby
boomers and played white covers of black music in most markets.
o Record companies sometimes offered bribes, called payola, to DJs to play
certain records in order to make them hits.

FM radio and the fragmentation of rock music.
o AM radio interests kept FM from emerging as a competitor for several
years, but FM finally succeeded in dominating music formats; the FCC’s
nonduplication rule of 1965 helped encourage unique FM programming.

Challenges of fragmentation and digitalization, 1970 to the present.
o Both AM and FM stations were forced to target ever more narrowly as the
number of stations grew and as the nature of popular music genres
changed and became more diverse.
o The concept of networking changed, and old networks developed
specialized services geared to the specialized formats that had been
established for different kinds of music.
o Fragmentation encouraged the consolidation of ownership in
conglomerates, raising conflicts over the kind of programming the
industry provides.

An overview of the terrestrial radio industry.
o The Telecommunications Act of 1996 increased the number of stations
that any single company can own in a market; this encouraged the
consolidation of ownership.
o Arbitron, the company that measures radio audiences, says that total
listening time is in decline, because of other media alternatives; on the
other hand, radio is increasingly portable and easy to access.
o The industry can be divided into AM and FM stations and into commercial
and non-commercial stations, all of them with characteristic formats.

Radio market size.
o Market size tends to determine the number of stations available to
consumers.
o Program format segmentation has accompanied audience segmentation.

Production in the radio industry.
o A radio station’s format is governed by four parameters: the style of music
the station plays, the music time period (the time of the music’s release),
the music’s activity level (its dynamic impact), and the music’s
sophistication (simplicity vs. complexity).
o There are numerous program formats, sometimes determined with the help
of a format consultant; the term narrowcasting refers to radio’s ever
more specific targeting of audience segments.
o Radio programmers try to determine listening patterns of their targets in
order to reach them; stations try develop personalities that listeners can
readily recognize by means of so-called interstitials (jingles, speech
patterns, etc.).
o The general manager is in charge of the station’s entire operation, and the
program director is in charge of maintaining the station’s format or sound;
on-air talents work within the format and have several responsibilities
during a typical on-air shift.
o In order to maintain the integrity of the station format, DJs pull music
from the station’s established playlist, formulated from audience research
involving call-outs and focus groups.
o Stations use a so-called format clock or format wheel (a circular chart)
to help on-air personnel maintain the requirements of the format.
o Morning and afternoon drive-times are the periods of the day when most
stations have their largest audiences and when the advertising rates are
highest.

Distribution in the broadcast radio industry.
o Networks and syndicators provide programming geared for specific
formats and aimed at specific audience targets.
o Format networks provide a subscribing station with all of its
programming while automatic technology keeps the station on the air and
running; such stations have little or no local programming.
o Consolidation has encouraged a decrease in network affiliations because
the large radio conglomerates feel they own enough outlets so that they
can make their own deals with national advertisers.

Exhibition in the broadcast radio industry.
o In radio, the exhibition point is the moment at which the program is
broadcast..
o There are two kinds of advertising in radio: local advertising spots that
advertise local businesses and services and national spots that advertise
national businesses and services.
o The placement and scheduling of spots help determine their cost to
advertisers.
o Advertisers rely on audience research companies for information about
radio station audiences; research is based on the keeping of listening
diaries, portable people meters, and telephone surveys.
o Poor ratings often lead to changes in personnel, and sometimes result in
format changes, even though that is a risky move.

Broadcast radio and social controversy.
o Consolidation of ownership, and radio’s increasing influence over the
political process are sources of heated debate.
o The lobbying activities of the National Association of Broadcasters (NAB)
is also a source of debate and concern.

Radio and the new digital world.
o Satellite radio and internet radio (audio streaming) are two digital
developments that may challenge the terrestrial-based industry.
o Traditional radio is responding to the digital development by pulling back
on the amount of time given to commercials, by developing HD radio (a
system that sends digital signals of AM and FM stations along with the
analog signals), and by participating in internet streaming (many stations
can now be heard via the internet).

Media literacy and the radio industry.
o Media literate persons should consider the future of radio as more and
more stations are consolidated and the digital options (especially
streaming audio) begin to develop and mature.
o The regulatory environment encourages greater consolidation, but
increasing competition from newer media makes the current conditions in
the radio industry unsettling and challenging.