Big Subsidies Required?
All of these programs have something in common besides being cancelled in 2008. All of them received subsidies from the Corporation for Public Broadcasting.
CPB's total investment in these programs from FY 2004 to FY 2007 was $8,200,000. FY 2008 is not included here since CPB's annual report with audited numbers is not yet available.
Subsidizing the start-up of network programs is usually a sound investment of CPB money. Successful network programs, even with budgets in the millions of dollars, deliver significant audience and revenue to stations for less expense than most locally produced programs.
Successful network programs are also supposed to sustain themselves when the subsidies go away. The failure of so many programs should serve as a warning to the entire public radio system that something is seriously wrong with the industry's spending model.
Here are the CPB subsidy numbers for the top two recently cancelled programs.
Weekend America: $4,200,000 (2005-2007)
Day to Day: $2,400,000 (2004-2007)
Day to Day produced five original hours of programing each week. Weekend America produced two original hours of programming each week. The millions of dollars provided by CPB were just a portion of each program's budget.
Both of these programs were designed to grow public radio's audience, attract new donors to stations, and attract new underwriting dollars to the industry. In short, they were supposed to succeed in the open marketplace and could not.
Day to Day was reported to have 2 million weekly listeners. Weekend America had 657,000 weekly listeners. We are now learning that those audiences were not big enough to sustain the costs of producing those programs.
This lesson must be applied to all efforts to attract new audiences. The current public radio spending model is not sustainable.
Getting new listeners is always more expensive than keeping the listeners you have. Getting new listeners requires making new investments in infrastructure and unproven content. Failure has to be funded in order to find what works. That's expensive.
On the revenue side, demographically and psychographically different audiences will not generate as much listener-sensitive revenue as the current audience. Public radio already has the audience most likely to make substantial donations to support programming and operations. The current audience is also probably the only audience for which the public radio underwriting model works well.
The working assumption for serving new audiences has to be "spend less and expect to earn less." Based on events of the last two weeks, it also appears that big subsidies might always be required to keep those new services on the air.
CPB's Annual Reports are here