Is charging for studio time while also building a broadcast channel a conflict of interest?

Photo courtesy of Public Address

Photo courtesy of Public Address

Just returned from a visit to St. Louis to appear on The Nothing But the Car Facts Show with host Steven Paul. He has been running the show now for a few months and we decided to have me on there to talk about AutoConverse, our new automotive local marketing site. We spoke about the site and some of the ideas behind it. We had some laughs, ran in to a few blips, and overall the show came out nice (you can view it unedited at NothingButtheCarFacts.com and I am in the process of making an abridged version of it, a trailer if you will, that I will share soon enough). Shouts out to Steven and his wife Amy for showing me a good time too. They are fantastic hosts.

The show was aired by iWatchRadio. Think of a network television station that broadcasts its own feed, in this case at iWatchRadio.com and also on their Facebook page. Throughout the day (and night if possible) they air shows. The shows are hosted by various people, such as Steven Paul. Show hosts pay a flat fee to the studio slot which includes all the technical labor and broadcasting of their show. iWatchRadio then creates an archive of the show and makes it available from their website.  It’s a pretty straight forward business model, with lots of potential, but with one major dilemma…the content and advertising.

The potential I mentioned lies in the growth and franchising possibilities. As iWatchRadio builds its clientele of show hosts booking slots at the studio, they will eventually run out of slots, thus resulting in increased prices and being more selective with show hosts and their shows. This leads into the franchising possibilities where entrepreneurs may want to set up their own studio using the iWatchRadio format as a springboard. These are relatively easy problems to solve as they are logical and conventional growth challenges for most businesses.

The area that is going to be a bit more tricky for iWatchRadio is the content and advertising. iWatchRadio is being paid by the show hosts for studio time and broadcasting, but they are also trying to do more with the content than just broadcast it. They want to build a brand around iWatchRadio as a source for…as a source for…as a source for what exactly? This is where the dilemma lies.

Good content is difficult and expensive to produce consistently over long periods of time. And while good content is important for success, content is not the only part that is valuable. The people creating and delivering the content as well as the advertising potential that comes along with good content, can also be valuable. If iWatchRadio wants to charge people to use the studio and be broadcast, then it can’t be selective on who rents out the studio because it won’t be able to fill the rental slots. As a result, the content they air will vary greatly in quality and subject matter, making it all but impossible to build a brand or a channel around a core audience like cable and network TV stations do.

As an example, nobody watches the local TV channel that anybody in the community can use to broadcast. You watch a program on the station because the people airing it got you to watch it. iWatchRadio can’t advertise people to watch its channel because it won’t be able to control the programming being aired when renting the studio out like it does, and they won’t be able to afford advertising each individual show airing on their station. See the dilemma?

In the broadcasting business, the network pays big bucks to license content so that they can sell ads to run during the programs being aired. This license affords them certain freedoms and flexibility with the content and certain stipulations and liabilities. TV and Film companies invest into creating a program, alas the content, and lease it to network producers. The network which airs the program earns its keep by growing its audience and generating ad revenue. Thus the network has a vested interest in developing an audience around content that it selectively acquires to appeal to that audience. It’s not going to air programs that do not appeal to its core audience.

For iWatchRadio however with the content creators paying to rent the studio and be broadcast, the network, iWatchRadio in this case, is less concerned about the quality of the content and the type of content it produces because they are being paid up front. The end result is that iWatchRadio’s audience is a mixed bag which limits its advertising potential. In addition, iWatchRadio charges the show host to run ads on its program that it sells. This is a serious limitation for the success of the show host. He is already paying for studio time and air time. He shouldn’t have to pay extra depending on the type of content he or she is airing.

Essentially what iWatchRadio is attempting to do is run two different businesses with one inside the other. But as you can see, it poses some real-world challenges that do not bode well for it clients or even its own interests for that matter. It would be better for iWatchRadio to establish some channel partners that can syndicate or re-distribute content more seamlessly on behalf of its clients renting out the studio, that iWatchRadio could make more seamless for the show host, and concentrate on things like trailers and promotional videos as up-sells to generate additional revenue streams.


About the Author

Ryan Gerardi
Creative, resourceful, and resilient B2B sales and marketing technologist who works with people and businesses on a variety of levels to help elevate their game, their brand, and their businesses.