Steve Goldstein
Saga Communications EVP and Group PD Steve Goldstein has been with the company since before its inception, joining Josephson Communications six months before he, and four other Josephson execs, purchased the company they would re-name with its “storied” moniker. The year was 1986, and Goldstein already had developed an impressive radio resume, after starting as a high school student at WVOX/New Rochelle in 1975.
From there, Goldstein had stints in both News and music radio, beginning with the NBC Radio Network, WABC/New York and WNEW-FM/New York, then moving through markets like Hartford and Detroit, before landing at the company that would be Saga in the mid-’80s. It is those wide-ranging experiences that gave Goldstein the expertise and instinct to oversee close to 100 radio stations through two decades that have brought a litany of changes to the industry.
Goldstein recently sat down with FMQB to discuss the current state of the industry, the bright future he sees for Saga, and to share some of what he’s learned over a 30-year career in radio.
You’ve been at Saga since its inception in the ’80s. Talk about the differences in running a radio company today from when you started.
So many things are more complex. We used to joke and say it’s not rocket science, and the PD was the head deejay. Now, the PD is a much more skilled individual, balancing a great deal of research and science along with art. It’s the art that actually drives the success of most radio stations, although we may have lost that feel in our zeal to maximize ratings in the ’90s, where the stations became very templative and mechanical. But a good PD today is one who is not just sitting behind Selector, cranking out a good log. I can find anybody to do that. A good PD is somebody who can create a really interesting morning show, put more color on the radio station outside the mornings, and add more depth. He or she also has more understanding of marketing and a greater appreciation of sales than in the past, because there’s no doubt that has become a more critical component in every radio station.
How does Saga develop those skills in its programmers?
We had an ongoing process for years called “Brilliant At The Basics.” The notion of Brilliant At The Basics is that it’s not the number of things you do right that makes you a top performer, but it’s the number of things you do wrong that will prevent you from being a top performer. So, while it’s completely unsexy, we talk about fundamentals all the time. The fundamentals can range from making sure the call letters are handled frequently enough, to making sure the positioning statement has clarity, to making sure there’s a recycle promo on the air for the morning show everyday.
Execution counts for a lot, and we spend a great deal of time on training. We have an Internet site which is a repository of information the PDs can look at. It has information ranging from promotions done in other Saga markets, to liners, to tips on how to present snow closings. It’s just a myriad of stuff designed to give a programmer more resources, more education and more knowledge, because we have PDs at varied level of experience. We have smaller markets in which they tend to be rookies and we have larger markets where they tend to be more experienced. Our data has to be flexible enough to accommodate that. We’ve also loosely set up what I would call a sibling system, where some of the larger market PDs work with some of the smaller market PDs. It’s almost like a buddy system.
After years of radio companies acquiring more and more properties, why are the large operators suddenly trying to divest themselves of so many stations?
The fundamental notion at Clear Channel was that a national network of stations was going to be of value. What they have learned is that smaller market radio has a different set of challenges than larger market radio – they are in many ways different businesses. If you own in those largest of markets, it’s more difficult to garner any advantage in the smaller markets than they thought. Sure, there’s the scaling by using larger market jocks in smaller markets, and there have been tremendous innovations there, but they’re still fundamentally different businesses.
We operate in a mix of medium to smaller markets. It’s easier to cross-pollinate in a company our size (about 90 radio stations) than in a company of 500 or 1200.
With companies like Clear Channel now divesting and Saga being one of the smaller operators, does this create opportunities for your company to grow?
We’re a public company and public companies need to show growth. We’re going to figure out the best way to do that and the best places to do that. We would be happy to explore and expand at the right time and at the right prices. The difficulty we see going forward is buying properties we believe we can bring extra value to, and buying them at a price which doesn’t place this company in jeopardy.
There has been talk from both mainstream press and Wall Street saying radio is in trouble. These observations create an impression that listeners aren’t coming to radio and the industry is not building a younger demo base, which translates to future customers. Is radio really in trouble?
We are poised for trouble. We do need to build future customers and we need to stop ignoring the lower demographics. I do not think we are going to perish. I just read a statistic this week that direct mail, which with all of the innovations going on out there, especially e-mail and the Internet, one would think to be a dying breed, is up seven-and-a-half percent.
There are tactics that work. Ignoring the vital signs would be a huge mistake, and I do think we have largely ignored them for years. None of this stuff is new. The dissatisfaction with tight playlists has been around for a while. The notion that people can create their own radio stations, and on demand, is a technical innovation that radio needs to be a part of. We can’t ignore them.
Yet, there is synergy between the Internet and radio. We have the unique ability – unlike most other media – to drive traffic to Web sites, and Saga is betting on that as part of our future. We have started a whole Internet division, and we are developing a platform for the whole company. There are economic goals this division has, and each radio station will be responsible for generating income. That’s all part of your larger question, “Can radio survive?” The answer is radio needs to innovate to survive. We need to rethink a lot of the things we’re doing. If we do that, the future is bright. If we don’t, it will be horrible and bleak and disgusting.
One of the innovations that a lot of radio companies seem to be relying on is HD. Has the industry done the job of making the consumer aware of what HD is and how it can benefit them?
That’s a great question, and unfortunately I don’t think we’re anywhere close to providing the listeners with benefit. The satellite guys had it right. They built up product infrastructure. They created a unique product, and then went to the marketplace and said, “Hey, here’s something you might want to listen to.” We’re not at that point with HD. Stations are not investing in it. There’s some programming on these channels, but adding another Country station into a marketplace does not create any tremendous listener benefit, and therefore doesn’t advance the need for HD. And remember, we’re asking people to spend $200 to $500 on a radio. There better be something substantially different and better on the other end for that equation to make any sense.
How is Saga approaching the HD situation?
We’ve actually been very slow. We believe that, while HD is good for the business overall, with limited resources the Internet was the more immediate concern. That may be controversial in the industry, and we certainly discussed this internally, but in terms of being a public company and return to shareholders, the Internet is our top priority right now, although we are converting properties to HD.
You keep referring to Saga being a public company, but it seems that you operate much more like a private company.
I think that’s a reasonable statement.
How do you manage to do that without having shareholders beat your doors down?
Shareholders hire good management; that’s what they want. They look at an industry, and then they look at management. They have constantly told us that their top priority is to invest with people they trust. Most of the money is patient money. In other words, they’re going to be around for a while. They understand there are times where companies need to invest or reinvest. As long as they believe we’re on the right trajectory, most investors are quite sanguine. Of course there’s some impatient money, and we are probably not the best investment for them.
Why has Saga been able to take such a long-term approach when so many public companies are driven by shareholders to show short-term results?
It’s true here too. We have to make budgets and we have to show growth. That’s not different for us. There are a lot of people who won’t invest in us. They think we’re too small, or we’re not liquid enough, or we’re not growing fast enough. People choose different avenues to invest their money. Some people invest in bonds, some go for stocks and some go for Treasuries. There are many different strategies for making money. And by the way, if we don’t perform I can assure you that we’re going to hear from them. So it’s not that the business proposition is much different here at Saga. But our approach is more long-term.
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