Shock Treatment

It doesn't really matter whether he overtakes KQ and Tom Barnard. Either way, Howard Stern wins. And local radio loses.

SHOCK

TREATMENT

To put it in
theatrical terms,
the Cabbie broke
out of character.
"Yeah, right, they
(REV 105) rule,''
he scowled as his
go-go swagger turned into an angry stomp up the aisle.
"If you can hear them through the static. Because, y'know, they're not owned by a big company or anything. No! Cargill doesn't have
a dime.'' Illos by DARREN NEWBY It doesn't really matter whether he overtakes KQ and Tom Barnard. Either way, Howard Stern wins. And local radio loses.

by David Schimke - -->

Holding court over 36 frequencies from his throne at WXRK-FM in Manhattan, Howard Stern, the self-proclaimed "King of all Media,'' is chatting on-air with an anonymous caller from New Jersey, a soft-spoken, slow-witted professional wrestler who says he's called for advice. Stern, who's just put the fork in a week-old bit about the feminine hygiene habits of Ellen DeGeneres, is initially invigorated by the Friday morning call. It affords him a chance to shift gears, take aim at a fresh target. Improvise. But the wrestler refuses to be turned into a two-bit shtick. He has questions. He wants answers. "I think I'm going to kill someone,'' he confesses to Stern with chilly calm. "Killing women. It's all I think about, day and night. What do you think I should do?''

An intrepid shock jock, reportedly worth well over $100 million, Stern is uncharacteristically tongue-tied. His co-host, Robin Quivers, giggles uncomfortably, mutters "My God," then pulls away from her microphone. Jackie (The Jokeman) Martling and Fred Norris, on-site writers who tirelessly infuse Stern's four-hour morning show with wacky sound effects, are frozen silent at their state-of-the-art sound board. Suddenly Stern is wrestling with a broadcaster's worst nightmare.

Dead air.

"What do you think I should do?" the caller demands. Stern shakes off his brief stupor and gets into character. His voice drops into the soft, soothing baritone that got him into commercial radio in 1976. He prods for weaknesses by asking leading, personal questions. He toys with the caller's fragile sense of right and wrong. Then, under the guise of getting to a commercial break, he cuts the call short. "Call me on Monday," Stern says. "And try not to kill anyone over the weekend." Quivers, Martling, and Norris roar in relief.

The conversation, precariously poised between tasteless humor and indigestible horror, evokes the tightrope that Howard Stern routinely walks. That's enough to keep certain advertisers and urban markets out of the Stern camp--his show is not aired in such prominent locales as Atlanta, Seattle, and Houston--but it hasn't prevented his building a formidable media empire. One day Stern will go too far. Or he won't go far enough. For now, though, the critic-proof movie star, best-selling author, and late-night staple on E! Entertainment Television is on a hot streak. His show is number one in, among other cities, New York, Philadelphia, and Los Angeles, and he has spent the past year adding new markets to his résumé, including Memphis, Syracuse, Detroit, and Minneapolis.

Dallas-based Chancellor Media, which owns seven stations locally, is said to be paying somewhere between $650,000 and $1 million a year to air Stern in the Twin Cities. It's a carefully considered gambit that signals a new era in radio--one in which mega-buck media consolidation demands high ratings; high ratings demand huge audiences; and huge audiences require increasingly rigid and predictable formats.

A good deal of the flux in local radio stems from the loosening of ownership rules that accompanied 1996's Telecommunications Act. In the ensuing year, two companies--Chancellor and ABC/Capital Cities--have consolidated their dominance in the Twin Cities. ABC, a division of the Disney juggernaut and parent company of KQRS-FM and KEGE-FM, acquired REV 105 this past spring and turned it into a hard-rock station. According to most observers, they had two goals in mind: to eliminate the competition for their alternative rock station, the Edge (93.7 FM), and to block a hard-rock move by one of the Chancellor stations that would bring Stern into the market and thus pose a threat to KQ's Tom Barnard. Chancellor wasn't fazed; it rejiggered formats and refocused its energy on morning drive, pulling country music from their just-acquired KBOB, changing the call letters to WBLB (Real Rock 100) and launching a heavy-metal format anchored by Stern's R-rated antics.

The ensuing radio war, front-page fodder since Stern's show first aired in the Twin Cities on April 16, has already been a kick for radio junkies. Stern has gone out of his way to target Barnard, calling him a phony, challenging his manhood, wondering out loud what it would be like to have sex with his wife. In response, Barnard and his "morning crew'' have been conspicuously silent, pretending from day to day that Stern doesn't exist.

In the eyes of the press, this is a numbers war. If Stern makes inroads among male listeners ages 18 to 34, he'll make headlines. If Barnard holds down the fort, the story writes itself. The real news, however, is behind the lines. The battles that matter are being fought underground.

Because win or lose, "The King of All Media" is here to stay.

In writer David Remnick's obsequious New Yorker profile of a couple of months back, Stern takes pains to insist that the over $3 million in fines the FCC has levied against his show have not added to its notorious reputation and have, in fact, been bad for business. The 43-year-old Stern also says he's not interested in being lumped in the same category as Larry Flynt. "Look,'' he tells Remnick. "My life isn't about the First Amendment.''

Well--yes and no. Stern hasn't shown up at the Supreme Court wrapped in a flag, but he's a shock jock's shock jock who, from day one, has found success by being more crass, more crude, more "anti-establishment" than his peers. The fact remains that if he hadn't spent a decade flipping off the FCC's Standards of Decency, he would still be spinning Top 40 in Hartford, Conn., where he worked his first full-time radio job. Jim Riffel, a New Jersey-based filmmaker who just released a documentary titled Shut-Up and Listen! The Self-Proclaimed King of All Media & The First Amendment Wars, takes the view that the FCC has become just another public relations tool for Stern and his recently co-opted parent company, Infinity Broadcasting.

Says Riffel: "The FCC is the best thing that ever happened to Howard Stern. When they fine him, his ratings go up. Infinity Broadcasting dips into their little damage-control fund, pays the fine, then turns a $10 to $20 million profit in increased advertising. When he was fined $1.7 million by the FCC in 1987, Stern put out a double CD called Crucified by the FCC and made an enormous amount of money."

In fact, according to Paul Colford's 1996 book, Howard Stern, King of All Media, it was Stern's patented, potentially libelous irreverence--perfected over a six-year period--which led to an iron-clad partnership with the most powerful executive in radio, Mel Karmazin.

As a DJ at WWWW-FM in Detroit from 1979 to 1981, Stern had a dominatrix deliver the weather forecast and organized a bra-burning demonstration to coincide with the Republican National Convention. Stunts such as these earned him a Billboard award for best AOR (album-oriented rock) disc jockey, then landed him a job at WWDC-FM in Washington, D.C., where he quadrupled the morning audience. In 1982 Stern was signed at WNBC-FM in New York City for an annual salary of $200,000. There he spent most of his tenure playing second-fiddle to NBC's morning man, Don Imus, and fighting with management over content: a skit depicting the Virgin Mary being chased around a singles bar; jokes about AIDS; fake calls to the KKK; an in-studio faith-healing for a paraplegic. But before he was ousted in September 1985 over "conceptual differences," Stern was outperforming Imus and getting better ratings than the station as a whole.

In the wake of the high-profile firing--and increased attention from the FCC--Stern embarked on a strategy that is now a staple of his marketing attack. He started to use other media to promote his visibility. He appeared on CNN's Larry King Live, wrote humorous essays for national magazines, and appeared on late-night TV. He even did stand-up. In the meantime, Infinity Broadcasting CEO Karmazin decided to sign Stern for $500,000 a year--not because he would deliver the largest audience, but because he would guarantee supremacy with regard to a specific demographic, men from 18 to 34. By May 1986, Stern was paying his first fees to the FCC while helping Infinity trounce WNBC. A year later he was number one in Philadelphia. By the fall of 1991, he was number one in New York among all listeners.

Over the next year Stern was splitting hefty syndication fees with Infinity in Washington, D.C., Cleveland, Dallas, and Los Angeles (reportedly in excess of $400,000 per year per market). Then, in October of 1992, Stern hit a wall. For over a year he tried in vain to make inroads in the Chicago market, but was bounced from station to station and beaten back by the market's popular local talent.

Again he healed his wounds by profiting from other forms of expression. His autobiography, Private Parts, became a best seller in the fall of 1993, selling over a million copies and earning its author $3.5 million. A cable special released the same year, The Miss Howard Stern New Year's Eve Pageant, was the most popular nonsports event in the history of pay-per-view, paying Stern over $4 million.

In 1995, E! started shelling out $1.5 million a year to rebroadcast Stern's show on the tube. In 1996 his second book, Miss America, became a best seller and a movie version of Private Parts went into production. In 1997, coinciding with the film's release, he and Karmazin have set out to sign up additional affiliates. Last month his ratings improved in Chicago.

"He's working so many elements now, he can't lose,'' Riffel says. "He's like McDonald's. Even though a home-cooked burger may be cheaper, even taste better, he's there; whether you like or not, whether I like it or not, whether the FCC likes it or not.''

In February 1996, lawmakers in Washington said they wanted to encourage across-the-board competition in the broadcasting industry. For players such as Stern's Infinity Broadcasting, the resulting legislation--just like the FCC fines--turned out to be a blessing in disguise. The Telecommunications Act of 1996 lifted most media-ownership restrictions and led to a dizzying array of broadcast mergers, totaling somewhere in the neighborhood of $37 billion. The biggest deals involved ABC, which was gobbled up by Disney, and Westinghouse, which purchased Infinity for a whopping $4.9 billion just seven months after swallowing CBS. (In the fallout, Karmazin was named boss of CBS radio.) "If you think competition is about my engulf-and-devour company engulfing and devouring your engulf-and-devour company, then I guess we have more competition," says Steven Randall, senior analyst for the New York-based Fairness and Accuracy in Reporting (FAIR). "Because all we've had happen in the last year is an orgy of mergers. And there's probably no area of media that's been affected more than radio."

How does this help Stern? Radio execs in New York and L.A. are more likely to use national talent to build local ratings because they have confidence in proven commodities such as Stern, Don Imus, and Rush Limbaugh. They also have deep enough pockets to ride out a slow transition. In short, according to Jeffrey Yorke, Washington bureau chief at the trade mag Radio and Records, the Telecommunications Act is helping to accelerate an already pronounced trend. "Radio, which has always been local, local, local will now emerge as a conduit for more and more nationally syndicated programming," Yorke says. "Experience proves there's just more potential for profit."

There's no question that telecommunication reform helped pave the way for Stern in the Twin Cities. Previously, no one company could own more than five separate signals in any given market; now they're allowed at least seven, and Randall believes loopholes in the legislation allow for even more. Consequently, last August Chancellor--which already owned KFAN, KDWB, KTCZ, KEEY and KTCJ--made an agreement to purchase Minneapolis-based Colfax Communications. The acquisition gave Chancellor control of KQQL-FM (KOOL 108) and WBOB-FM (now WBLB-FM). It was WBOB--a redundancy as Chancellor's second local country station--that became Real Rock 100, the Howard Stern vehicle.

The entire competitive calculus was based on a battle of the titans. According to Kevin McCarthy, the general manager in charge of Real Rock 100, Chancellor's research showed that three years ago, after ABC bought out the hard-rocking 93X and turned it into 93.7 The Edge, KQ softened its musical format, pushing the median age of its listener from 28 to 32 with a playlist featuring the likes of Billy Joel, America, and CCR. Before this move, one in five of KQ's listeners was a 35-to-44-year-old male. That number has grown to one in three, which convinced the programmers at Chancellor that there were listeners out there pining for more Guns N' Roses and less Rolling Stones. "Our research showed these 25-to-35-year-old guys could be moved off KQ,'' McCarthy says. "But the nuclear weapon was Howard Stern. Musical format alone was not enough. With Howard we can become a magnet.''

In the words of Mick Anselmo, another local Chancellor GM, "If you were an independent operator and decided to take on a behemoth like KQ, you'd have a hard time because of cost and ability to sustain an attack. They would flank you musically. But when you're holding multiple brands, you can beat them at their own game. It's a win-win for us.'' It's also a win-win for Stern, who reportedly got an enviable commitment from Chancellor: Sources at Real Rock 100 say he has a guaranteed deal through the year 2000.

The situation obviously augurs against real homegrown competition on the airwaves. Along with ABC and Chancellor, there are really only three other players in local radio: Hubbard Broadcasting, CBS, and Nationwide Communications. Station managers all over town, echoing corporate publicists nationwide, argue that if fewer owners are moving more money around the dial, listeners will be able to choose the best of the best. Both allies and enemies of Stern point to his show as a boon to the industry in general--raising the beam for all morning hosts and talk-show personalities.

Just outside the incestuous, self-congratulatory world of corporate radio, however, those who watch the industry are concerned that programming will lose whatever edge it has left. Jim Pounds, vice president and media director at Periscope Communications, a Minneapolis ad agency, says companies who've just spent millions to consolidate will not only have to increase ad costs, but they'll have to adopt lowest-common-denominator, no-risk formats with mass appeal.

"These trends may make radio more financially viable, but a far less interesting medium from a cultural standpoint. There's a risk that stations will become so homogenized that they'll be virtually indistinguishable,'' Pounds says. "Hopefully, the big chains are savvy enough to understand they can't do stuff by formula. Unfortunately, these people abdicate to consultants. And consultants haven't had an original thought in several years. They're just duplicating what they did in the last market. If consumers accept that, I suppose they deserve what they get.''

Already the limiting effects of consolidation can be felt in the Twin Cities. Two hard-rock stations are crowding the dial with virtually indistinguishable formats, a circus tent full of zany morning crews are trying to outclown one another, and programmers are already paring down their playlists. So far, though, no one's felt the effects more viscerally than fans of REV 105--the last community-minded radio station with the corporate resources to make the big boys sweat.

Last fall, the Crazy Cabbie--a character on the Edge's morning show, played by Lee Mroszak--was making an appearance at the Mall of America for a special preview of the action-bomb Maximum Risk. An overgrown frat boy, the Cabbie has managed to carve out a living by showing up at public events to scream corporate catch phrases. At this particular event he finished his 30-second pre-screening pitch with the inspiring rallying cry "93.7 rules!" To which a fan in the half-full theater responded, "REV 105!"

To put it in theatrical terms, the Cabbie broke out of character. "Yeah, right, they rule,'' he scowled as his go-go swagger turned into an angry stomp up the aisle. "If you can hear them through the static. Because, y'know, they're not owned by a big company or anything. No! Cargill doesn't have a dime.''

The spectacle, while a tad surreal, was as revelatory as it was comical. Even though REV 105 was dwarfed by the Edge in every category of the most recent Arbitron ratings, the little station with the three separate signals made ABC palpably uncomfortable. On the air, in interviews, or in private conversations, outbursts like the Crazy Cabbie's were the norm. A full two months after REV 105 has been replaced by X105, employees at the Edge are still prickly about the subject. When I contacted one on-air personality from the Edge to talk about Howard Stern, the first thing he wanted to know--after making it clear his name wouldn't be used--is why ex-REV DJ Shawn Stewart was on the cover of City Pages' Best of the Twin Cities issue. "I mean, for Christ's sake," he said. "Can't we just let that whole thing die?"

On the surface, the Cabbie and his cronies got the glass slipper. On March 11, ABC signed a deal with Cargill Communications to acquire 105.3 Cambridge, 105.1 Lakeville and 105.7 Eden Prairie. All told, the stations went for $17.5 million, too much for Cargill's CFO, James Cargill, to turn down. Depending on who you talk to, REV was barely breaking even. Some contend it was losing money.

John Kuehne, who is the general manager at KLBB-AM, Cargill's remaining station, was in on the sale as general manager of REV 105. He says the Telecommunications Act made it nearly impossible for a stand-alone station such as REV to compete. "The reality was that with consolidation happening in the market, the bar got raised. Ratings that would have been OK prior to consolidation weren't OK," Kuehne says. "A station like REV, trying to feed at the advertising trough with the big boys, couldn't stand alone. To make matters worse, our Arbitron numbers weren't near what they needed to be. In fact, from the fall of 1995 to the fall of 1996, they'd gone down."

By buying REV, ABC hoped to accomplish more than eliminating an annoyance for the Edge. By changing REV's format to what they termed "active rock," they created a three-pronged assault on male listeners, 18 to 34, who have already given KQ and KEGE the edge in a majority of time slots. The Edge is programmed to attract young, urban males; X105 is aimed at young, suburban headbangers; KQ captures older, more affluent demos with their softer play list.

Now KQ's audience, by far the most lucrative of the three, is up for grabs. Asking local radio insiders to handicap the race between Barnard and Stern is a little like asking a bar full of football fans at the Wisconsin/Minnesota border who's going to win the next Packers/Vikings game. Barnard enthusiasts pooh-pooh Stern as a has-been, pointing to his subpar performance in markets such as Chicago, Pittsburgh, Memphis, Baltimore, and Phoenix, where audiences have been loyal to local talent. In Minneapolis, they argue, people will tune into KQ's morning crew because they'll be talking about the Twins game or making fun of Arne Carlson while Stern is rattling on about something in the Bronx.

In concert with Barnard's refusal to acknowledge the presence of a national competitor, no one on the payroll at ABC/Capital Cities will make an on-the-record comment about Stern. Steve Konrad, program director at Hubbard Broadcasting's KSTP, sums up their arguments succinctly. "The conventional wisdom is that Howard won't do very well, because listeners here are supposedly provincial and rigid," Konrad says. "General managers all over are saying they won't touch him, because he's a pox, a disease who will infect the whole station."

In the Chancellor camp, Stern fans such as Anselmo and McCarthy say it will take at least a year before his presence can be fairly judged. In the meantime, though, they reject the idea that Barnard has an advantage because he broadcasts from Golden Valley. "It's not about local or national, it's about compelling entertainment," Anselmo says. "Steve and Sharon had a local TV show. Remember? All of a sudden Oprah came to town. When viewers were given a choice between John Travolta on Oprah and the plant doctor on Steve and Sharon, they overwhelmingly picked Oprah. The same will be true of Howard." In markets where Stern is struggling, such as Chicago and Pittsburgh, McCarthy says the show's been shifted from station to station and faces a number of talented morning teams, not just one.

Walter Sabo, a national radio consultant based in Florida, has consulted clients who've syndicated Stern and advised stations on how to neutralize his presence. He says KQ's decision to avoid an on-air pissing match is dead-on. Because, across the board, those who've been most successful against Stern refuse to talk about him, don't try to copy him, and spend every second of their broadcast talking about things happening in their respective cities. Sabo also believes Stern will ultimately prevail. "It's the same interview in every city," Sabo says "The city is always in shock. They don't think he'll beat the number one guy. And he does. And he's number one in billing. It's a pretty consistent pattern."

Sitting on the fence in New Jersey is Joe Lenski, vice president of Edison Media Research. Armed with data from every city in which Stern's aired, he says--believe it or not--that talent will be the deciding factor. Whoever makes more people laugh will be king. According to Lenski, "Tom Barnard will have to put up or shut up, because this is Coke versus Pepsi, Burger King versus McDonald's. I don't think there's a guy in the market aged 18 to 35 who's not going to tune into one if they're listening to another. They're going to compare. People really love Barnard in our research. And it's more than him. It's the whole crew. And he has been on for 15 years. But if the local talent isn't up to the challenge, Stern will expose them. Sure, all things being equal, people tend to skew local. But Howard is way more talented than 99 percent of the DJs in the country. And if he makes people laugh, they'll come back. They always do."

In the short term, Stern's presence can hardly fail to shift ratings. He's arriving on the heels of a national media storm kicked up by the film Private Parts, a semiautobiographical soft-shoe designed to give his bawdy image a mass-market upgrade. Barnard is so dominant in this market--among men and women, 18 to 34, he's beating his closest competitor by a factor of two--Stern is sure to shake up the bottom-dwellers. And, as McCarthy points out, Chancellor to date hasn't spent a dime on publicity. Their big-budget blitz will come in the fall.

"The only thing that could've happened to Chancellor is if Stern came to the market and nobody noticed," Jim Pounds says. "At the very least, they've gotten attention out of it, and a fair amount of sampling on the part of prospective listeners, which isn't a bad thing. And there's no question that any kind of shift, even a small shift in either demand or numbers, will have a demonstrable effect on the bottom line."

Even if he doesn't overtake Barnard anytime soon, Stern seems certain to become a long-term presence in the market. "It's the Howard Stern Casino," Sabo says. "You can enter the casino with him, and play all the hands you want. But ultimately the house always wins."

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