A common thread has emerged during round of Q3 quarterly conference calls: The sudden slowdown in broadcast business that hit during the month of September. Many have speculated on the cause, but Saga’s Ed Christian took a more direct approach: He consulted his Magic Eight Ball.
At the end of the day, he said that the tried and true fundamentals of running a radio company remain unchanged. He doubled down on the importance of investing in local programming and staffing.
Christian said the company was rolling along nicely throughout the summer, and then suddenly, in September, they hit a wall. With no obvious culprit, at first he considered blaming the blue moon, but that took place in August. So he began the company’s Q3 conference call by consulting the aforementioned Eight Ball.
It revealed to excuses for missing September expectations:
#1: My fish died
#2: Car trouble
As a third possibility, it was noted that several Saga execs were called to jury duty during the month.
The bottom line was a 3.4% loss during the month, according to Christian.
Further details of Saga’s Q3 results can be found here.
On a more serious note, Christian said possible causes of the slump were intramural radio competition in larger markets and general economic sluggishness in smaller markets.
He said that by year’s end, the company’s political take will hit $5M, which is down from 2008 when it benefitted from a greater number of House and Senate battleground races in its service areas.
Christian expressed his dismay in the increasing depersonalization of the station-agency relationship when it comes to national business. He stated his suspicion that it is only a matter of time before a computer named Watson takes control of national transactions.
He also noted that it has been problematic keeping rate integrity, due to general pressure for discounts, spot packing and spot bundling.
RBR-TVBR observation: Saga’s situation reminds us of a baseball player who is perceived to be in a slump. If you do nothing but read the box scores (or look at the quarterly results reports), it sure looks like a slump.
But if you’ve been observing carefully, you know that the player is fundamentally sound, and consistently hitting line drives. Unfortunately, they are being snagged by well-positioned defensive players.
But the way out of the slump, in a case like this, is not to make major changes – it is to continue to observe the fundamentals and wait for your luck to change. Those line drives will start to fall in eventually.
That seems to be Saga’s approach, and we appreciate both their good humor about the current situation and their steadfast belief that their methods will prevail in the end.