Hartford Business Journal

14 Hartford Business Journal • December 14, 2015 www.HartfordBusiness.com as profitable as it once was and most likely isn't going to grow in listenership. AM's strength, the professor said, is it is local and can provide advertising services to local advertisers who are not interested in the wide reach of the Internet. They want to focus and build their local identity. Enough people are listening, so it makes sense, Hanley said. That's one reason the Connecticut Busi- ness and Industry Association invested heav- ily recently in a radio marketing campaign to push Gov. Malloy and the state legislature to cut spending in the state budget. Brian Flaherty, CBIA's senior vice president for public policy, said AM radio still drives the conversation in Connecticut. "AM radio is still like the electronic water cooler where the conversation happens," he said, declining to disclose how much CBIA spent on the one-week campaign. "From our perspective, we want to be where the conversations are happening. We've done a significant amount of radio buys," Flaherty said. A former state represen- tative from Watertown, Flaherty said another target audience for radio ads is politicians. "The one demographic that seems to listen is elected officials. You catch them. They get stuck in traffic just like we do," he said. Still a draw The audience that is listening is predomi- nantly 45 and older, according to Gary Kapriol, senior vice president of media and analytics at media-marketing firm Cronin & Co. in Glaston- bury. News/talk radio, the staple of AM, is the second most listened to radio format in Con- necticut behind country music, he said. Steve Salhaney, operations manager for CBS' Hartford stations, including WTIC-AM, said that demographic doesn't concern him with regards to the station's ongoing viability. He said as younger listeners' needs mature, they turn to the information provided by news talk radio stations like WTIC. "We try to be as relevant as we possibly can," Salhaney said. "Depending on the pro- gram we may not be extremely relevant to the younger demographic until somebody's in a certain space in their lives where the news, business and finance, and weather are really important. There comes a point where people grow up so to speak and all of those things are important to them." Kapriol said AM radio is still valuable to advertisers, particularly with retailers who use it as a critical component of their mar- keting campaigns. "Radio still reaches a high number of adults on a weekly basis. It's not going away. It's evolving," Kapriol said. Michael Harrison, editor and publisher of Talkers Magazine, which focuses on the talk- media industry, has a more cautious view of AM radio's future. Based in Longmeadow, Mass., Harrison was a talk-show host on WTIC-AM in the early '90s. "There are rumblings throughout the industry that some powerful media com- panies are facing debt and selling off prop- erties," he said. Buyers of those properties can probably make a go of it. Harrison said it's not that the radio model doesn't work. It doesn't work when a station owner paid too much. "A divestiture could breathe more life into the medium," he said. One company that has been doing well, Harrison said, is Connoisseur Media, which took on new ownership in July. Among the Connecticut AM stations it owns are WDRC, WMMW, WWCO and WSNG. It also owns Hartford classic-rock station 102.9 The Whale, among other FM stations. In an interview with Radio Ink magazine in August 2013, Connoisseur's CEO Jeffrey Warshaw forecast what made Connoisseur and its stable of 42 radio stations attractive to investment by Petrus Holding Co., owned by the Perot Co. "If you don't think this busi- ness is going away, now is the best time to buy radio stations," he said, alluding to cheap financing and the fact that stations are worth six times their annual cash flow. At one point, stations were selling for 18 times cash flow. He said his stations in 2013 were operating at 15 percent margins, according to the article. Harrison said Connoisseur Media is an example of a company that could extend the life of local radio as a viable media because it's not loaded with debt and has an understand- ing of local programming. "They seem to be doing a pretty good job. The biggest problem [for some radio owners] is the debt," he said. For sale Companies like CBS, which owns WTIC- AM and other stations locally, would like to get out of midsize markets, industry experts say. (A CBS Radio spokeswoman said no sales are pending.) The Hartford-New Britain market is ranked 52nd in the country. The larger the mar- ket, the better stations do in general terms with national advertisers. Also important is how sta- tions rank compared to other stations. A lousy station in a big market isn't going to get advertis- ing while a big station in a smaller market could. Stations that aren't operating with a crush- ing debt load can be successful if their pro- gramming serves a specific targeted need of a targeted audience, Harrison said. "You have to have indispensable programming that peo- ple need," he explained, like foreign language programming or sports. "Sports work well because fans want to hear the play-by-play." Salhaney, who has 27 years of experience in the market, said local programming con- tinues to be the backbone of WTIC-AM's suc- cess. It is usually near the top five in overall ratings in the market. "For the most part we are live and local," he said. "We have very lit- tle syndicated programming." A lot of air time is devoted to UConn sports play-by-play, as well as Red Sox, Giants, and Patriots football. Harrison and Kapriol both acknowledge from page 1 Technology poses threat for AM radio

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