Tuesday, November 01, 2011

The Power of FM over AM

Wow. This article from the Boston Globe really brings it home.

We've all known for a few years now that AM Radio, as a medium, was slipping badly. Traditional cornerstones of AM formats...sports and talk...were losing market share, and several major AM signals were electing to simulcast on an FM station and seeing positive results. At the same time, we're also seeing a lot of traditional AM formats bypassing AM altogether and starting on FM, also with positive results.

One place near and dear to my heart where this has been playing out is Boston, where many, many years of market dominance by WEEI 850AM (sports) and WBZ 1030AM (news) are radically shifting. WBZ still has a killer signal; one of the best AM signals in the USA, actually...famous for being heard in 38 states...and able to hurl almost 100,000 watts across an AM-friendly saltwater path right into Boston. Even so, WBZ has seen increasing competition from local (and national) NPR powerhouse WBUR and, more recently, WGBH's flip to mostly-NPR-news, too.

But it's WEEI that's the most eye-opening. After two years of losing substantial market share to upstart SportsHub 98.5 (aka WBZ-FM) despite WEEI having the Red Sox games...Entercom finally killed off Mike 93.7FM and simulcast WEEI on the 93.7 signal.

In just one month, they've jumped from 4.6 (9th) to 7.5 (3rd). No change in programming, other than the Sox making the season more dramatic by losing so much, so you have to attribute a lot - if not all - of that bounce to adding the FM signal.

And mind you, WEEI-FM 93.7 is not an ideal FM signal. It transmits from a tower near Peabody (well north of Boston) as opposed to WBZ-FM 98.5's more-central location on the Newton/Needham tower cluster. WBZ-FM is nearly twice as high in the air, too, and height matters a lot in FM signal reach. But 93.7 is the best FM signal Entercom owns, so that's why they used it. And it still gave that big a boost in listeners.

I think this also says a lot about the downfall of AM Radio. There's no bigger game in Boston than Red Sox games; WEEI is getting a 10+ share with those. And if even THAT isn't enough to get people to listen on AM, then it speaks volumes about how viable AM is as a media platform.

Granted, it's not like AM will shrivel up and die. If there's an audience out there that can't get a particular programming except via an AM station, then a lot of them will listen to an AM station. But not as many as for FM, and they won't be as forgiving of substandard programming. And if there's a competing format on an FM station, you're in for a losing fight.

But this says a lot about two things:

First, anyone who buys an AM station and looks to go head-to-head with an existing station...AM or FM, but especially FM...is making a horrible investment and will probably lose.

Second, there are a lot of signals like WEEI (AM) out there. Class B directional signals built decades ago on land well outside the population center, with directional patterns to protect distant AM stations. Signals that, today, don't cover key demographics as urban sprawl has changed the former farmland around an AM tower into suburbs. WEEI's Needham towers were farmland sixty years ago, and its hard null to the west to protect KOA in Denver meant nothing. Today that null means the well-to-do suburbs of the MetroWest region get poor signal at best from 850AM. WRKO on 680AM has similar issues. So do several stations in Rochester, NY and many other cities.

What do owners of these stations do? They have hefty signals that might cover the core market nicely, but are seriously lacking in covering some key areas, and are on AM which is losing value by the week, it seems. It's not like these signals are worthless, so they can't just sell them at a loss. But they are getting more and more difficult to be profitable with them. What do they do?

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