Study Guide for

Study Guide for

1. 
   radio most pervasive medium on earth
   
   1. 
      nearly a billion working radios in U.S.
      
   2. 
      average adult listens to radio 2.25 hours each day
      
   3. 
      number of receivers in U.S. up by more than 50% since 1970
      
2. 
   radio’s universal appeal
   
   1. 
      source of entertainment, companionship, info
      

1. 
   radio relatively recent invention
   
2. 
   “father of radio” debate
   
   1. 
      candidates include Maxwell, Hertz, Marconi, Tesla, DeForest, Fleming, Fessenden, Sarnoff
      
   2. 
      Guglielmo Marconi devised “wireless telegraphy”
      
   3. 
      David Sarnoff’s “radio music box” memo supposedly suggested mass-producing radio receivers for home use
      

1. 
   Dept. of Commerce sets aside 2 frequencies for radio – 1922
   
2. 
   first station owners were receiver manufacturers, department stores, newspapers, colleges
   
3. 
   first paid announcement aired on WEAF in New York
   
4. 
   age of commercial radio launched
   

1. 
   radio stations begin chain broadcasting – 1922
   
2. 
   first network RCA’s National Broadcasting Company (NBC) – 1926
   
3. 
   Columbia Broadcasting System (CBS) – 1928
   
4. 
   Mutual Broadcasting System – 1934
   
5. 
   American Broadcasting Company (ABC) – 1945
   
6. 
   today most radio networks owned by major corporations (GE, Disney, Westinghouse, Westwood One)
   

1. 
   radio’s growth, with lack of sufficient regulations & inadequate broadcast band, led to overlapping signals & widespread interference
   
2. 
   National Radio Conferences (1922-1925) asked for limitations
   
3. 
   Radio Act of 1927
   
   1. 
      formed Federal Radio Commission (FRC)
      
      1. 
         issue station licenses
         
      2. 
         allocate frequency bands
         
      3. 
         assign frequencies to individual stations
         
      4. 
         dictate station power & hours of operation
         
   2. 
      FRC established Standard Broadcast band (500-1500 kc)
      

1. 
   escapist fare
   
2. 
   provided free to the listener
   
3. 
   “Amos ‘n’ Andy” most popular radio show in history
   
4. 
   President Roosevelt’s “fireside chats”
   
5. 
   Communications Act of 1934
   
   1. 
      established Federal Communications Commission (FCC)
      

1. 
   FCC imposed wartime freeze on construction of new broadcast outlets
   
2. 
   existing AM stations prospered
   
3. 
   programs centered on War concerns
   

1. 
   TV initiated after World War II
   
2. 
   TV #1 entertainment medium by 1950
   
3. 
   radio profits declined, networks lost prominence
   

1. 
   Bell Laboratory scientists invent the transistor – 1948
   
   1. 
      miniature portable receivers enhance radio’s mobility
      
2. 
   prerecorded music became radio’s mainstay
   

1. 
   deejay Alan Freed coins term “rock ‘n’ roll” – mid-1950s
   
2. 
   Top 40 format synonymous with rock music & teens
   
3. 
   rock stations led most competitors by 1960
   

1. 
   Edwin Armstrong develops static-free alternative to AM – 1938
   
2. 
   construction on FM stations begins – 1946
   
3. 
   FCC authorizes stereo broadcasting on FM – 1961
   
4. 
   FCC limits AM/FM simulcasting – 1965
   
5. 
   FM’s audience appeal evolved
   
   1. 
      classical & soft music – 1950s-early 1960s
      
   2. 
      Gordon McLendon’s Beautiful Music first popular format
      
   3. 
      progressive format focused on album cuts
      
6. 
   FM achieves parity with AM – 1979
   
7. 
   FM attracts 80% of audience – late 1980s
   

1. 
   FCC authorizes AM stereocasting – early 1980s
   
2. 
   FCC doesn’t declare technical standard, resulting in slow conversion
   
3. 
   FCC declares Motorola industry standard – early 1990s
   

1. 
   more than 1,500 stations operate without direct advertiser support
   
2. 
   88-92 MHz reserved on FM band for noncommercial facilities
   
3. 
   Corporation for Public Broadcasting established – 1967
   
4. 
   National Public Radio (NPR)
   
   1. 
      provides funding & programming to member stations
      
   2. 
      more than 12 million listeners
      
5. 
   categories of “noncom” stations
   
   1. 
      public
      
   2. 
      educational/college (holding more than 800 licenses)
      
   3. 
      community
      
   4. 
      religious
      

1. 
   specialized programming (narrowcasting) salvaged radio – early 1950s
   
2. 
   today more than 100 format variations
   
3. 
   frag-out refers to fragmentation of audience due to numerous formats
   

1. 
   radio garners 7% of all advertising revenue
   
2. 
   70% of radio’s revenues come from local spot sales
   
3. 
   AM daytimers least profitable
   

1. 
   economic downturn – early 1990s
   
   1. 
      highly leveraged transactions (HLTs)
      
   2. 
      radio property values down
      
   3. 
      cash flow problems, budget cuts
      
2. 
   local marketing agreements (LMAs) provided broadcasters a means for functioning in joint operating ventures
   

1. 
   economic upturn – by mid-1990s
   
2. 
   FCC relaxed ownership caps & duopoly rules
   
3. 
   consolidation of operations reduced expenses
   
4. 
   concerns about downsizing
   
   1. 
      fewer jobs available
      
   2. 
      more generalization, less specialization
      
   3. 
      fear a loss of programming diversity
      

1. 
   brokerage firms handle the sale of many radio stations
   
   1. 
      brokers receive 7-8% commission
      
2. 
   auctions seen by some as last resort to get rid of profitless stations
   
3. 
   active trading of stations, some prices exceeding several million dollars