Young Broadcasting, once – but no longer – a forward-thinking TV company, just filed for bankruptcy under the crushing
$13 $1-billion debt load. This follows the bankruptcy of cable company Charter and, of course, TV-station-owner Tribune company. And let’s not forget radio giant Clear Channel, with $19 billion in borrowing, tapping its last-resort debt and Sirius-XM (whose stock I own) nearing bankruptcy while even Muzak crosses the line.
We’ve been wringing hands over newspapers and magazines but TV and radio aren’t far behind. Broadcast is next.
It’s a failure of distribution as a business model. Distribution is a scarcity business: ‘I control the tower/press/wire and you don’t and that’s what makes my business.’ Not long ago, they said that owning these channels was tantamount to owning a mint. No more. The same was said of content. But it’s relationships (read: links) that create value today.
Young tried to build relationships, once upon a time. At WKRN in Nashville, Mike Sechrist did amazing work starting blogs, buildilng relationships with bloggers, training the community in the skills of the TV priesthood. But he left and all that disappeared. Been there, done that, I can imagine executives saying as they try to stuff the hole in the dike with borrowed dollars. Didn’t work.
The local TV and radio business, once a privilege to be part of, is next to fall. Timber.