Thursday’s Themes . . .

CUMULUS DECLARES CHAPTER 11:  You could have set your watch by this one.  Just 48 hours ahead of their 12/1 default deadline, Cumulus has voluntarily gone into Chapter 11 bankruptcy protection with the support of about half of its creditors.  So what does this mean?  First, Cumulus will keep operating as normal.  They claim to have enough cash on hand to run their business even though they can’t pay the interest on their loans.  Then the courts will decide what (if any) parts of Cumulus must be sold off to pay creditors.  It’s worth noting that all equity will get wiped out during the process, so any current stockholders are out of luck.  Assuming this process goes as planned, a smaller debt free Cumulus could emerge to begin a new chapter of existence.  If things don’t go smoothly the courts to chop up Cumulus and sell its pieces to the highest bidder, thus bringing the curtain down on Cumulus Broadcasting.  Radio Ink has a good summary of the situation in the attached link.  Give it a read.

THE CRB’S STREAMING RATE HIKE FOR 2018:  On Tuesday the Copyright Royalty Board (CRB) announced its annual performance royalty rate hike per song streamed.  In 2017 streamers paid a base rate of $.0017 per play (if you need help interpreting that number it’s about one sixth of a penny).  Now in 2018 a “cost of living increase” will raise the royalty to $.0018, as reported in the attached RAIN link.  I know this doesn’t seem like a big deal, but for streamers like Pandora who play billions of songs per week under this royalty arrangement every millicent counts.  Keep in mind the CRB’s rate only applies to songs streamed in an online radio environment.  On-demand or playlisted streaming isn’t covered this way.  That tier of services requires a label-direct licensing deal.  The label-direct royalty costs vary from deal to deal, but are typically quite a bit higher than the CRB rate – the ballpark range is $.003-.004.  Now you can put your calculators down and get back to your morning.

BRANDS NEEDS A VOICE SKILL . . . LIKE YESTERDAY!:  Imagine coming into work one morning at your ad agency only to find all of your clients lining up at the front door demanding an Amazon-specific Voice Skill perfected immediately.  That’s exactly what’s occurring in today’s agencies, as the new reality of the Age of Voice sinks in.  Almost all big brands need a Voice Skill to get on the 1-2 deep “voice search shelf” on platforms like Amazon and Google.  So agencies are scrambling to become experts in this field, as reported in the attached AdWeek link.  On the surface this seems like an incredibly hard new challenge for agencies to figure out all at once.  But it’s also an opportunity.  Because once a shop cracks the Voice Skill code and demonstrates success with existing clients, they can turn that success into the tip of the spear to conquest new clients.  Just the idea that brands would select AORs based on their ability to integrate Voice Skills should tell you just how important Voice is becoming to marketers.

Have a great Thursday guys!

235 thoughts on “Thursday’s Themes . . .

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