Radio Economics

While not as prevalent as they once were, some non-news stations still offer some form of news over the air, normally as top-of-the-hour blocks. The economic value of the segments is hard to determine. As more and more outlets were purchased and consolidated into larger ownership groups, radio newsrooms were pressed to produce for more and more outlets. The average news director is overseeing some four stations, according to survey data, which makes it increasingly difficult to parse out whether or not news is profitable. The product is diffused over too many outlets to tell.

Indeed, researchers from the RTNDA/Ball State University ongoing survey of news directors found an increase in the percentage of news directors who don’t know if their news operations are turning a profit or not. Between 2003 and 2004, the figure rose from 53% to 63%. Among news directors from major markets, it increases to 85%.

An examination of survey data over the last nine years shows that the number of stations saying they make a profit is consistently greater than those who say they are breaking even or reporting operating losses. But the uncertainty does not bode well. The last time so many stations were unsure of the future was during the economic downturn of 2000. That was followed by a better 2001, according to the Ball State surveys, but harder times thereafter. With new competition today that was not as robust back then, there is even more reason for doubt heading into 2006.

Radio News Profitability

Survey of news directors, 1996-2004

Design Your Own Chart

Source: RTNDA/Ball State University Newsroom Surveys

Radio News Profitability by Market Size, 2004

Survey of news directors

Design Your Own Chart

Source: RTNDA/Ball State University, Newsroom Surveys

* Major markets are those with 1 million or more potential listeners. Large markets are 250,000 to 1 million; medium markets are 50,000 to 250,000; and small markets are fewer than 50,000 listeners.