Political Dollars, the Radio Show, and Broadcast Finance
What do these three have in common? Well, if you are planning to be at the Radio Show in Orlando next week, you probably already know about the Pillsbury Broadcast Finance sessions at the Radio Show, with this year’s session marking the event’s 28th year. The 2018 edition is titled Pillsbury’s Broadcast Finance 2018: Radio’s Debt Cloud Finally Lifts—a reference to the packaged bankruptcies of iHeart and Cumulus that will lighten both companies debt load in 2019, and which will hopefully allow us to turn the page on investors’ perception of radio as a slow growth, high-debt industry.
The event (September 26 from 8:30am to 10am) is often referred to as the “Radio Show Leadership Breakfast” because (1) the session panels feature some of the most influential CEOs in the radio business along with up-and-comers that will soon become the future of radio, and (2) our friends at Media Services Group are once again buying breakfast for everyone. It’s a tough combination to beat, and perennially a standing room only event.
In addition to our CEO panelists—Caroline Beasley of Beasley Media Group, Ginny Morris of Hubbard, and Dhruv Prasad of Townsquare—Wells Fargo analyst J. Davis Hebert will be returning to launch this year’s event with his always head-turning presentation on the Financial State of the Radio Industry. This economic snapshot (with bright colors and graphs!) provides a degree of insightful clarity rarely found in such a large and complex industry.
But what—for those of you that still remember the question that launched this post—does any of this have to do with political dollars? Well (spoiler alert), one of the points Davis will be illustrating with his slides is a projection that 2018 will be by far the biggest political ad spending midterm election of the century, and an incredibly close second to the biggest political ad spending election of all, the 2016 general election ($2.9B vs. 2016’s $3B). There are 34 Senate seats at stake, 11 of which are highly competitive races, 66 highly competitive House races, and 36 gubernatorial elections, with 16 states “potentially in play.”
Radio will have to fight for its share of those dollars, but in markets with highly competitive races, the influx of dollars from candidates and PACs can be so immense that ad buyers have trouble finding media that aren’t sold out as election time nears. The competition to place ads can be so intense that I’ve been contacted by more than one noncommercial station trying to figure out how to deal with candidates that are insisting upon placing ads on their stations.
Which raises the less fun to contemplate, but equally important, matter of ensuring that your station’s political ad practices don’t leave you fighting off political advertising complaints once the election is over. The political advertising rules for broadcasters are complex and so fact-sensitive that many an experienced broadcaster is left scratching their head trying to deal with a political ad buy. I know those calls well, which often begin with something along the lines of “I’ve been doing this for 20 years, but I’ve never had something like this pop up before….”
That, along with the fact that stations’ Political Files are now online for political activists to scrutinize at any time, day or night, means broadcasters will again lose a lot of sleep this election season trying to ensure they are doing everything right. In hopes of making their lives a little easier, Pillsbury released an updated version of its Political Broadcasting Advisory this year.
So if you’ve been clinging to the last edition like it’s your security blanket during election season, you can now toss it aside and get that warm and fuzzy feeling that comes from holding something that’s still warm from the laser printer (it’s much longer than you’ll ever want to read on a phone). That way, you’ll have something to read on the plane ride to Orlando, where you will arrive well-versed in the intricacies of political ad rules compliance, and stoked for a great Radio Show.
We look forward to seeing you there!