Balogun+Strategy+report

TO: //Proximity// music team FROM: Robiat Balogun DATE: 01/06/2010 SUBJECT:Radio One strategy analysis  

Here is my Radio One strategy analysis. Radio One is the leading radio broadcasting company geared towards the urban population. With the increase of online radio, Radio One stations are not doing as well as expected. While Gen Y users have adopted Radio One stations, however it  is not their primary source for musical entertainment.  Radio One Inc. is one of the nation’s largest radio broadcasting companies. The company was founded in 1980 by talented radio broadcasters, Catherine Hughes, Chairman and son Alfred Liggins III, CEO. Radio One currently owns 53 radio stations located in urban markets in the United States, (Wikipedia 2009).
 * Profile **

Along with ownership of radio stations, Radio One owns; Magazine One, Inc., interests in TV One, LLC, cable/satellite network programming primarily to African-Americans and Reach Media, Inc, and owner of Tom Joyner Morning Show. Based in Lanham, MD, Radio One primarily targets African-American and urban listeners/viewers, (Radio One, Inc.).

Radio Ones revenue comes from four sources: · Advertisers pay for space on their websites. ·  Tower rental income. · Ticket sales and revenue related to Radio One sponsored events · Management fees

Radio One stations currently reaches 12 million listeners weekly. According to Radio Ones’ 10-K/A report, 58.0% of their net revenue was generated from the sale of local advertising and 24.2% from sales to national advertisers, including network advertising in 2008. The data for 2009 has yet to be filed due to accounting errors.

 The primary force driving competition in the radio industry is access to new music, talk shows, and events sponsored by those stations. The purpose of Radio One, Inc is to dominate new and existing markets with a significant African-American presence (Radio One, Inc.). Although Radio One has achieved their primary objective, the growing popularity of portable music players and internet radio, cause listeners to stray from radio, leading to a large drop in the stock market.
 * Competitive Landscape **

The Radio One Company competes with Yahoo! Inc., Google and Microsoft for internet users (Reuters, 2009). Radio stations continue to compete by allowing users to stream music from their websites with fewer commercials. Radio One, Inc. is determined to evolve with the ever changing technologies controlling user’s access to free music.  <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;"> <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;"> Radio One, Inc. has decided to face the demise of radio stations by developing new media technologies, such as; “satellite delivered digital audio radio service, which has resulted in the introduction of several new satellite radio services with sound quality equivalent to that of compact discs, audio programming by cable television systems and direct broadcast satellite systems; and digital audio and video content available for listening and/or viewing on the internet and/or available for downloading to portable device (Radio One 10-K/A).”
 * <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">Radio One’s strategy **

While Radio One, Inc. is unsure about their future in the radio industry, investments to branch out are in process. In 2008 Radio One invested in iBiquity, a developer of digital audio broadcasting technology with future opportunities including investments in, or acquisitions of, companies in diverse media businesses, music production and distribution, movie distribution, internet-based services, and distribution of our content through emerging distribution systems such as the internet, cellular phones, personal digital assistants, digital entertainment devices, and the home entertainment market (Radio One 10-K/A).

<span style="color: #000000; font-family: Arial,Helvetica,sans-serif; font-size: 10pt;">The growing popularity for internet radio and portable music is slowly draining the life out of the radio industry. Internet companies such as Pandora, iTunes and Yahoo! Music, connect Gen Y users to record industry music for little to no cost. Radio One, Inc. has a problem in that it owns a large number of old style AM stations.
 * <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">Gen Y implications **

While Radio One, Inc streams live music on their website and have invested in companies outside of the radio industry, the Company is not sure what future they have in radio. Gen Y’s new found need for instant gratification from media digital downloads will cause many radio industry companies to reevaluate their futures.

Radio One, Inc. (2008). About Radio One. Retrieved January 7, 2010 from [] Radio One, Inc. (2008, December 31). Form 10-K/A. Retrieved January 7, 2010 from [] <span style="font-family: 'Arial','sans-serif'; font-size: 10pt; mso-fareast-font-family: AGaramondPro-Regular;">Reuters, Radio One, Inc. (2010, January 7). Retrieved January 7, 2010 from <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">[] <span style="font-family: 'Arial','sans-serif'; font-size: 10pt; mso-fareast-font-family: AGaramondPro-Regular;">Wikpedia. (2009, December 9). Radio One. Retrieved January 7, 2010 from <span style="font-family: 'Arial','sans-serif'; font-size: 10pt; mso-fareast-font-family: MinionPro-Regular;"> <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">[]
 * <span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">References **<span style="font-family: 'Arial','sans-serif'; font-size: 10pt;">