Monday, October 30, 2006

Corporate Sponsors 2010

It’s only a matter of time when corporate support will be more important to the public radio industry than listener support.

That time has already come for numerous stations where gross underwriting revenue is the primary source of income. At many other stations, listener contributions appear to be the largest source of income but are not after subtracting the cost of fundraising. NPR has already had fiscal years when underwriting sales income exceeded station dues and fees.

The influence of these business dollars is being felt today, if not in news coverage then in how public radio conducts its business.

NPR turned down underwriting for the controversial film “Death of a President” because it was concerned listeners might think its news coverage of the film was influenced by taking the money. While that might be the right thing to do, it raises questions about what makes the film different than Wal-Mart. Both are controversial. Both are covered by NPR News. To the outside observer, it might not make sense why the network finds it okay to take money from one but not the other.

Many stations are getting push back on the phrase “non-commercial” radio because of the quantity and qualities of today’s underwriting credits. Everywhere I go listeners, pledge volunteers, staff, and board members chuckle when they hear the phrase “non-commercial.” Then they rattle off examples of underwriters and underwriting language that they deem to be commercial. It’s at the point where saying public radio is “non-commercial” might be costing us credibility with listeners.

Recently, a cable company and corporate underwriter threatened to pull its contract with a station because of on-air fundraising pitches that positioned supporting public radio as a better investment than cable TV fees. The pitches also reminded listeners about what they like about public radio news and don’t like about television.

The offending scripts won’t be used again, and their absence probably won’t hurt overall pledge results, but the incident shows that current and potential underwriters can have influence over how a station markets itself to listeners.

We’ve seen variations of this show up at other stations, where premiums and sweepstakes are used not because they are good for membership fundraising, but because they help sell underwriting. It's product placement in public radio. It's an interesting problem because these stations now have news hosts pitching a premium because an underwriter paid for its placement and not because it’s the best possible fundraising tactic at the moment. It’s a backdoor way for businesses to buy the credibility of public radio’s hosts and journalists. And some stations are willingly selling it using the rationale that it is fundraising, not news.

That’s just a partial list of things happening right now that suggest public radio will find itself increasingly answering to business supporters before listeners or listener-contributors. From where I sit, it looks like an inevitable future. Let’s start figuring out now how to manage it while keeping public radio’s reputation as a “trusted space” intact.


Blogger Jesse Thorn said...

why is it inevitable?

1:16 PM  
Blogger RadioSutton said...

Because stations and networks are not going walk away from six-figure deals. And once they have them, they will make accomodations to keep them. Individually, each accomodation will make sense. There will be very little harm. Collectively, those accomodations will shape how public radio does its business. It's a more liberal underwriting credit here. Offering a premiun that is outside of public radio's core values there.
There will be a lot more of listeners asking "why are they doing that?"

1:57 PM  
Anonymous man who's a fan of ADM, supermarket to the world said...

I hear lots of underwriting that's "right on the line" (if not somewhat over it) on several "big" pubradio stations. At least as defined by the FCC document "On the Nature of Non-Commercial Broadcasting" (

I wonder how much longer it will be before some listener(s) obsessed with "purity" of non-commercialism decides to start documenting infringements and writing complaints to the FCC about it. Sort of a "I must kill my favorite station in order to save it" mentality.

Anyways, something to keep in mind here is that this isn't happening in a vacuum. Part of the reason underwriters are turning more and more to public radio is that the listening public at large is overloaded with obnoxious commercials on, well, commercial radio. It's a major selling point of XM & Sirius, after all: no commercials. Also not entirely true, but I digress. Still, as long as commercial radio is so objectionable with a 22-minute-per-hour spot load, public radio will look rosy-fresh by comparison. Even if public radio today is far more underwriting-driven than it was five or ten years ago.

It's also worth noting that at many stations, they CLAIM listeners are their largest source of revenue but that's with the big disclaimer on it that it's only because of challenge grants. Grants that typically are coming from commercial underwriters. Without those grants, listener support typically makes up perhaps 20-30% of a station's total budget.

Still, the road to hell is paved with good intentions. Without this money, how else can public radio afford to pay for the staff load that's easily four or five times as heavy as commercial radio? And for equipment that's not-infrequently much better as well? These things make the difference in delivering the level of quality in programming that pubradio listeners demand. I've already seen at least one station do an excellent job of making its listeners understand that concept.

11:57 AM  
Blogger RadioSutton said...

re: "how else can public radio afford to pay for the staff load that's easily four or five times as heavy as commercial radio?"

That's the multi-million dollar question. Right now, it can be argued that public radio has a spending problem more than it has a fundraising problem.

While there is no question that public radio programming will be more expensive than commercial radio programming, available statistics suggest that public radio is spending too much money given the service it provides.

Some of that excess spending in on the programming side. Some of it is in management and administration. Some of it is in fundraising.

As an industry, we have good metrics on program performance and fundraising efficiency relative to audience but we lack the same sophistication on measuring whether we are spending our money wisely.

So we go after all this money without first asking, are we being good stewards of the money we already have. Even if the conclusion is "yes," we should be able to show we did the discernment. That's just good business.

9:01 AM  
Anonymous Anonymous said...

I listen to the public radio station out of Norfolk. Last fall they were airing a commercial that I also heard on the commercial radio stations. The commercial was for a concert. When I asked a friend who was involved with the station as a volunteer they came back with the response was that the concert was for a non-profit event-presenting organization. I have also heard language on their "underwriting" announcements featuring hospitals with "the only gamma-knife surgery". ... what you speak of is already happening in some markets. How can they continue to do this, don't they know it's non-commercial? Where are the underwriting police when you need them? Probably swamped with potential violations ...

6:01 PM  

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