The Sell Off of Air America

Note: this is a little inside baseball. For context, read the two short paragraphs from Tom Taylor's Radio-Info.com that follow.

The sell off of Air America's assets and the ensuing discussion, including the observation in Radio-Info.com (see below) Monday that "the air is out of Air America," followed by Jerry DeMink's incisive and rather damning comments Tuesday have me thinking. I realize that as the founding president of Air America, whatever I say sounds self-serving, but Jerry really raises a larger question about the radio industry and what motivates the people running it. I will not defend my vision or debate hiring non-radio folks like Al Franken and Janeane Garofalo for the thousandth time. Nor will I defend raising and spending nineteen million dollars to get it started. Rupert Murdoch spent twenty times that before Fox News turned a profit. I’ll only say that building a new national media brand is expensive, and we got off to a rough start from which we could never recover.

When a key backer turned out to be a fraud, Janeane told me not to fret because we had kicked down the door for other progressive outlets. Indeed, Progressive Talk is alive and well with the likes of Thom Hartmann, Stephanie Miller, Ed Schultz, Randi Rhodes, Bill Press, Mike Malloy, The Young Turks, Laura Flanders, and Ring of Fire to name a few. But more to the point, Progressive Talk is a viable business. Unfortunately, due perhaps to the parochial nature of the radio industry, Progressive Talk is a better business on television and online with Bill Maher, Jon Stewart, Rachel Maddow, The Huffington Post and The Daily Kos.

George Bernard Shaw said, "All great truth begins as blasphemy." It's easy to dismiss as failures people who take big public risks and try to do things differently. Most of the criticism typically comes from people who honor the status quo at the expense of their own future. "That's the way things are done in radio," isn't just a sad commentary on the state of an industry, it is a death sentence. The fact that Progressive Talk leap-frogged radio onto the Internet and cable television is emblematic of a larger lack of imagination, innovation, and sense of history within the ranks of radio's leadership.

We must ask ourselves why as an industry radio waited so long to engage a robust multi-platform strategy. We must ask why the best and brightest are not drawn to radio, but choose to ply their art online. It is true that new media always steal the content of the legacy medium they supersede. Books supplanted oral storytelling. Hollywood supplanted vaudeville. Television supplanted radio. But in each instance, the legacy medium reinvented itself. Radio, for instance, started playing records only when television stole its dramas and comedies. Unfortunately, that was one of radio’s last innovative moves as a medium.

Restricted competition and high gross profit margins robbed the industry of its creative hunger, and over the decades it became staid and predictable. That was fine until the law of supply and demand kicked in. Government-enforced scarcity of radio signals held down the supply of content, and allowed stations to sell ads at high prices. Then came the Internet, which, famously, destroys scarcity. Content exploded. Suddenly there were commercial-free music competitors at every turn of the browser. The conservatism—and frankly, the downright cheapness--of the powers-that-be allowed them to bury their heads in the sand as the industry stagnated and the online world grew bold, omnipresent, and powerful.

Soon, over radio’s impotent objections, Congress will impose a music royalty on the nation’s stations and they will bristle at the idea of paying for content. Many of them will abandon music formats that no longer seem so lucrative and adopt the soon-to-be less expensive talk formats. That is when you will hear lots of Progressive Talk on FM. If you’re still listening.

©2010 Jon Sinton for Progressive Agenda, LLC

Radio-Info.com

Monday, June 14, 2010

by Tom Taylor | tom@in3media.com |

Monday, June 14th, 2010

No air left in Air America

Air America’s March 25 auction of equipment and other assets grossed about $170,000.

The intellectual property went for $20,000 and the email list for $46,000. There were probably bargains in the large quantities of studio and office equipment auctioned off by David R. Maltz & Company. Sony and Shure lavalier mics went for $75 apiece. Several Moseley STLs sold for $1,400 each. Some computers went for 50-75 bucks. But many pieces of office furniture were marked down as “no bids”, and in the end, the physical contents of Air America at 641 6th Avenue in Manhattan are now scattered among a couple of dozen buyers who don’t care what it once represented. Air America, which went on the air in the Spring of 2004, is in Chapter 7 bankruptcy liquidation overseen by Gregory Messer. One of its fundamental problems was that it overspent in the startup phase, and that’s evident in the list of items up for auction. Air America’s believers can at least say that the progressive talk venture lasted years longer than its detractors predicted. But ultimately the critics were right – it didn’t survive. We’re still waiting for the books and/or magazine articles about the onetime lightning rod. Several staffers were reported to have been making regular notes and at least thinking about a book. You can certainly imagine a juicy Vanity Fair story about the failed lib-talk network.

Reader Jerry DeMink's response published in Radio-Info.com:

Tuesday, June 15, 2010

“Air America did fail…but who won the war?” Reader Jerry DeMink asks “Is this a business or an ideology?”The former CNN Radio executive and TRI reader hit the “send” button after reading yesterday’s lead story about “Air America running out of air” and selling off its assets in a Chapter 7 bankruptcy liquidation. Jerry says “Yes, Air America did fail. So its detractors won the battle. But who won the war? And why the animus against Air America, anyway? Is this a business or an ideology? Talk radio is a business. Any good host or exec will tell you that they are in the audience acquisition, retention and expansion business, to maximize the value of their spots. How does attracting listeners with a political perspective opposite of the majority of stations hurt the industry? Sure, Air America came on the scene with a lot of hype, bluster and attitude. They got noticed. The talk establishment, though, was almost universally negative. Why? To protect existing franchises, stations, hosts and business models? Obama won the election (like it or not). Why shouldn't radio go after his voters? Why not go after an under-served audience? There are more visible liberal talk hosts now than ever before. Air America may be a memory, but its legacy lives on.”