Can WCCO make it in its second century?

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Editor’s note: Since this article went to press there have been these developments:

• WCCO Radio parent Entercom Communications announced a corporate rebranding as Audacy Inc. Audacy.com also replaces radio.com as its streaming brand.

• The station hired Brad Lane as market manager for WCCO from WTMJ in Milwaukee. Lane spent the bulk of his radio career at KSTP/Hubbard Broadcasting in a variety of on- and off-air roles.

Today — Friday, April 30 — Dave Lee will wake up at his southeast suburban home, walk to his basement studio, and begin his three-hour air shift at WCCO Radio. When he finishes, just before 9 a.m., it will not just mark the end of his workweek, but the end of a radio career that dates back to 1973, at KRAD in Grand Forks.

For WCCO Radio, the day will be tinged with a sense of foreboding. Lee, 67, is arguably the last in a line of legacy talent that connects the station with its heyday of the 1960s and ’70s. His morning drive show generates somewhere between a third and a half of the station’s revenue, much of it from sponsor relationships Lee himself formed and nurtured.

His retirement is not merely a symbolic break with the past, but a critical fork in the road that will determine the station’s future. That WCCO (830 AM) had no replacement for Lee lined up just two weeks before that important day speaks volumes. The iconic radio station that was once the town square of Minnesota faces a near-term full of challenges.

’CCO remains a powerful force in Twin Cities broadcasting, earning millions in revenue for its owner, Philadelphia-based Entercom Communications, now the second-largest radio group in America, following its purchase of CBS Radio in 2017. But WCCO is in many ways a shell of its one-time self, attracting a fraction of the audience that it commanded in its heyday and no longer a ratings leader among the region’s news and information stations.

As Lee moves from drive time to a photo on the station’s wall of fame, WCCO faces the same question it has faced throughout the last quarter-century: What is the cure for its chronic audience atrophy, and is it worse than the disease?

A history of dominance

“It was surreal, it was the place.” Those are the words of Jon Quick, WCCO’s marketing director, then program director, from 1980 to 1992. “We had the Twins, the Vikings, music, news,” he says. “We had a 30 [percent audience] share much of the day and a 35 share in AM drive.”

The radio station was founded 99 years ago as WLAG at 710 AM; it became WCCO in 1924, its call letters reflecting its owners, the Washburn Crosby Co., a predecessor of General Mills. It was reassigned to 830 AM in 1941.

After the advent of television in the 1950s, most national radio programming moved to television; local radio stations, previously dependent on networks for much of their programming, were left to fend for themselves. WCCO seized the opportunity, curating a lineup of legends and dominance in audience metrics.

For decades, WCCO was the place Minnesotans turned for news and sports. But competition has hollowed out that position. In the February 2021 Nielsen ratings, released as this issue of TCB went to press, Minnesota Public Radio’s all-news KNOW-FM was the #2-rated local station, while iHeart Media’s mostly sports KFAN was #3, and ‘CCO was tied for ninth (with sister station Jack FM; Hubbard’s KS95 was #1). For the first time in its history, WCCO’s biggest programming niches are “owned” by competitors.

Other factors had an impact as well. Minnesota’s agricultural sector long relied on ’CCO for commodity and crop prices. The station’s farm director was feted across the state’s ag belt and held down important on-air segments each day. Now all that information is available on a smartphone;  ’CCO dropped farm reports two generations ago.

There are other issues. In January, WCCO’s average listener, per Nielsen data, was 65 — older than any other major media entity in town; 68 percent were 65+. (Entercom says the age is 53, perhaps relying on a lesser used metric known as median cume, which was under 54 for one month in 2020.) Advertisers generally are looking for listeners 25-54 or 18-34 years old. “It was always a challenge to talk around the age thing,” says Ethan Adam, a longtime former  ’CCO sales exec.

For most businesses, losing 90 percent of market share would be catastrophic; so would bleeding 83 percent of its customer traffic (see sidebar By the Numbers, below). Radio is no exception, but  ’CCO has defied convention. That defiance is the source of its ongoing success, but also the core of its existential dilemma: When is WCCO broke enough to merit an overhaul?

Basket case or power player?

The essential question to contextualize WCCO’s future is whether these dire audience metrics are really meaningful.

“WCCO hasn’t focused on ratings for many years,” says Shannon Knoepke, the station’s market manager (essentially its COO). “The station [is] sold on results for clients.” It’s a self-serving justification, of course, but it is also not without an element of truth.

“[WCCO] overachieves in revenue vs. audience size,” says Mark Fratrik, chief economist at BIA Kelsey, a consulting firm that advises the industry. “News and talk listeners are in higher demand,” he says. People selling “cars, boats, and other specific advertisers want that audience.” By contrast, the advent of digital music and streaming services has devastated music radio, its programming commodified and often presented by disc jockeys recording air segments from studios hundreds of miles away.

In January, WCCO attracted slightly more female than male listeners, per Nielsen data. (Most news/talk stations attract a disproportionately male audience.) Nonetheless, its recently departed program director told on-air talent to imagine they were aspirationally programming for a 42-year-old man.

“[Management is] definitely trying to young it up,” explains Adam.

Digital streaming is a recent emphasis. Knoepke proudly notes the station’s online listenership was up 47 percent year over year. WCCO also is the only news/talk station in town to provide live and local programming in the evenings and much of the weekend. But from a scale standpoint, its reach is limited. Former managing editor Steve Murphy says the station has operated with seven to nine news staff (currently seven) throughout most of its recent history. The Minnesota Public Radio newsroom has a head count of nearly 70.

Even television wants part of ’CCO’s legacy. Many of the signature elements of ’CCO’s morning show, from school closings to a full-time meteorologist, have been ceded to morning TV.

But the name of the game is revenue, and WCCO remains a formidable force. BIA Kelsey estimates ’CCO is the fourth highest-billing radio station in town. BIA and a combination of local sources estimated WCCO had revenues of slightly over $15 million in 2019 (including digital). (2020 market revenues were down 28 percent locally, say insiders, due to the pandemic recession. WCCO’s downturn may not have been as great due to the buoyancy of political advertising last year.)

That said, there are others in the industry who mistrust BIA’s data, pointing to iffy revenue estimates BIA circulates for ratings leader KFAN, which most of the industry believes bills in excess of WCCO but who BIA says bills much less. These doubters suggest WCCO is billing closer to $9 million to $10 million including digital. Because the data is proprietary and WCCO refuses to comment, there is no way to settle the question.

And despite ’CCO’s audience shrinkage, BIA’s estimates of historical revenues at the station show a much smaller decline.

The permanent impact of the 2008 recession is notable in the data, but also notable is that the falloff in audience is far steeper than revenue. (Digital revenues, recalls Adam, account for 10–20 percent of station revenues.)

One current WCCO employee who requested anonymity says that given its modest ratings and weak demographics, “Entercom was shocked at WCCO’s top-line [revenue] when they bought it.”

One reason for ’CCO’s strength, says a competing radio programmer in town who did not want to be quoted publicly on a competitor, is that “everything is for sale, and there is so much to sell.” WCCO has more commercial inventory than any station in town. The advertising load in morning drive is particularly heavy.

“They started loading that show with 22–24 minutes of [ads],” says Quick. “That’s hard to listen to.”

Everything on WCCO Radio can be sponsored: time checks, weather forecasts, news updates, the studio itself. Every format element is a small piggy bank. Knoepke expects station revenues to rebound to 2019 levels this year. “I have no concerns,” she notes.

One outsized aspect of the advertising effort at ’CCO is personal endorsements by program hosts in place of recorded ads. WCCO has perfected these endorsements, or “sponsorships,” as it calls them, and they likely represent a greater share of revenue for the station than any other locally.

“Our strength with endorsements is [that] we’ve earned listeners’ trust,” says Lee. “They’ll take a look at it.”

And Lee’s prowess is known throughout town. When he took over the WCCO morning show in 1998, he says, then-general manager “Steve Goldstein told me I’m responsible for revenue and other people’s livelihoods,” Lee recalls. He’s taken that admonition to heart and turned maintenance of those relationships into an art form.

“I’m naïve enough to think sponsorships are real friendships,” he says. “It’s not work for me.”

One such friendship is with Owatonna-based Federated Insurance and its chairman, Jeff Fetters. “We’ve used WCCO for over 50 years,” Fetters says. “Dave was the reason we moved a lot of our advertising to WCCO. He takes the time to understand the business he’s representing. You can tell he really cares.”

Federated’s approach is refreshingly old-school in today’s era of metrics and precise ROI. “We don’t expect [WCCO] to sell something for us. It’s their reputation and the trust in the community that we hope conveys to us,” Fetters says. WCCO delivers the decision-makers the company is trying to reach. And has “the right person to deliver the message.”

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Morning-centric

When Knoepke says she has no concerns about revenues rebounding, it must be taken with a grain of salt for a single reason: Dave Lee is retiring.

“Dave does more endorsements than anybody that I’ve worked with,” says retired WCCO market manager Mick Anselmo. “And he does them better than anyone.”

Lee is a native of Hatton, North Dakota, the son of a rural mailman. He graduated from the University of North Dakota, then hopped to jobs in Grand Forks and Fargo. He became a regional celeb at KFGO, where his stock in trade was comedy bits trading on the dialects and folkways of North Dakotans, not dissimilar to the schtick of Charlie Boone and Roger Erickson. Quick heard him in 1984 and thought Lee had the chops to fit right in at ’CCO.

He turned down a job in the station’s sports department, but eventually “my wife said, ‘If you don’t give it a shot you’ll regret it.’ ” Lee arrived at ’CCO in 1989.

For most of his first decade at the station, Lee did AM drive fill-in work. ’CCO’s air talent was long-tenured and had copious amounts of vacation. By the time Boone & Erickson retired in 1998, Lee was a familiar voice to their listeners and had been anointed by the duo as their successor.

“He is without question the most talented we’ve had here at WCCO,” says ’CCO evening host Mike Max. “He can host any time slot. Call any sports play-by-play. There’s no other person like him in the history of Twin Cities radio. He is an absolute natural. He has a great voice. He can do play-by-play in the evening and get up at 4 a.m. and interview the governor without missing a beat. People like Dave Lee are born, not made.”

Max attributes Lee’s effectiveness to “constant preparation. He’s an extrovert. His social network is expansive. He’s in a lot of different settings. He builds trust while he gathers facts.”

Beyond being talented and exceptionally well-liked, Lee’s show is a cash register for ’CCO.

Morning drive is responsible for one-third to one-half of the billings at most radio stations says Anselmo, and WCCO is no exception. And because Lee reads so many of those ads, and nurtures so many of the advertiser relationships, his departure breeds uncertainty.

“Dave has the strongest relationships with clients in their building,” notes an exec at a competing radio group. “Don’t think we don’t smell blood in the water.”

Lee says he will continue to do endorsements for the station as long as both sides find it mutually satisfying, which gives Knoepke a measure of confidence. “Morning drive will continue to be our strongest daypart,” she says. “I believe if we can win in the mornings, we will win all day.”

Knoepke is clearly talking about revenues, because ’CCO does not win in any key daypart. Lee’s show was sixth in the market in the January Nielsen ratings, middays placed ninth, afternoon drive tied for 11th, and evenings came in seventh.

Job one for Knoepke is to hit a home run with Lee’s replacement. “This is not a transition where you wing it,” says Tom Langmyer, CEO of Great Lakes Media. Langmyer was the vice president of CBS Radio’s news/talk group in the 2000s (including WCCO) and ran KMOX in St. Louis and WGN in Chicago, two of a handful of similar “heritage” AM stations left in the country. Langmyer listened to WCCO over several days before agreeing to share his thoughts with TCB. He said succession planning is key in a transition like Lee’s.

’CCO suggests it is ready. “We’ve known about this for a year and a half,” says Knoepke. “It’s a weekly conversation. We’re going through a search process, auditions.”

Normally that process would be driven by a programming executive, but right now WCCO is without a “brand manager,” as Entercom labels the role. Knoepke dismissed John Hanson during the winter, the third programming exec she has replaced during her six-year tenure.

Though Knoepke is well-liked and described as a leader by most of the staff TCB interviewed, it is unclear how much decision-making authority Entercom cedes to local management. Some observers and past employees believe it is very little; others say it’s near-absolute.

Chicago-based broadcast industry columnist Robert Feder told TCB that Entercom-owned market leader WBBM-AM lost its morning drive cohost to retirement a year ago and was not replaced, an apparent cost-cutting move. “[Entercom] have not invested positively in any of their Chicago properties,” he says. “They have no bench, and they don’t know how to nurture talent.”

Knoepke has no choice but to replace Lee, but given the lack of an obvious in-house successor, the question is, where to turn? Opinions are myriad.

“You can’t replace Dave,” says Anselmo. “You do something else.” Even Lee calls it “an opportunity to recreate the format.”

WCCO has a tattered rep replacing marquee talent. It has shuffled through a who’s who of local television royalty in PM drive since Steve Cannon’s retirement, to little apparent success. Cory Hepola moved from KARE-11 two years ago and describes his midmorning niche as a work in progress. Obvious local radio competitors that TCB spoke to are uninterested or hemmed in by noncompete clauses or contracts.

In that vein, there’s some talk that WCCO will go to more of a continuous newscast in AM drive and might not immediately designate a successor. Rumors abound that WCCO-TV morning anchor Jason Derusha is high on the station’s list of possible successors, and the former CBS corporate siblings might even look to simulcast some of his 4:30 a.m.–7 a.m. TV newscast.

“Morning drive has pretty much transitioned to news,” Lee says. “The format is not conducive to [comedy] bits anymore.”

And that’s where attracting marquee talent to AM drive is a challenge. “You want a compelling talent who loves to perform,” says Quick, “but it’s not really a job a performer is going to want.” In essence, 1989’s Dave Lee might not want 2021 Dave Lee’s job.

WCCO’s inability to develop its next generation of program hosts is at the core of the station’s audience struggles. An inability to maintain programming leadership with a consistent vision is another factor. “It’s your job to build a bench,” explains Quick. “I went on the road to listen to radio, like a baseball scout.” Quick found Lee in Fargo and former midday host John Williams, now at WGN, in Peoria, Illinois.

The case for change

Questions about its future are not new to WCCO — yet it has long shied away from dramatic shifts in tone or emphasis. Knoepke was rather unforthcoming in TCB’s interviews, conducted by phone and email, with David Heim, Entercom’s corporate communications vice president, monitoring; she declined to talk about ratings, audience data, revenue, nor, unsurprisingly, candidates to replace Lee.

Knoepke focused on key themes like trust, reliability, and tradition, but did not articulate an interest in change. But many industry observers believe the only way forward for ’CCO is a major update and modernization of its sound. At every transition in the recent and not-so-recent past, the station chose continuity over reinvention, worried about jeopardizing what still are very substantial revenues.

“ ’CCO’s power ratios [the revenue premium it derives above what ratings metrics would dictate] are what make it hard to change,” says former programming boss Andy Bloom, whom Knoepke hired in 2018, but was replaced in less than a year. “Revenue matters, and their revenue has held up as the ratings have slid.”

Knoepke is regarded by competitors and staff as a capable executive but her background is entirely in sales. The consensus in the industry is she needs an equally capable programming executive to manage the burden of talent development and strategy.

Some believe her two programming hires, Bloom and Hanson, were imposed by Entercom. Hanson declined an interview, but Bloom does not accept the thesis, saying he had numerous detailed conversations with Knoepke before his hire: “[She] did not hire me because [she] was satisfied with 180 cume (see sidebar, below) and 4.5 share.”

Bloom believes he was hired to evolve to a sharper-edged news/current events format, but Knoepke got cold feet. “As long as people think of WCCO as their grandparents’ station,” Bloom says, “then it is.”

The question is whether ’CCO leadership is trying to have it both ways. “They’re looking for someone to change it without changing anything,” Bloom says. “They need to hire someone with a track record of success, with a vision, and get out of the way.”

Even the station’s detractors acknowledge this is not an easy proposition. “The biggest problem is finding people qualified to update a heritage brand,” says Langmyer. There are probably fewer than 10 stations in the country of ’CCO’s scale and format.

Bloom was followed by Hanson, who came from an Entercom sports station in Kansas City. Said one ’CCO insider, “he had the misfortune to arrive with a sports-oriented mentality in a period when hard news became primary.”

Knoepke says she intends to replace Hanson with “a leader with forward vision.”

’CCO’s air talent is thirsting to take some risks. “Our biggest challenge is letting people know what we’re doing and finding a new audience,” says Hepola, referring to the challenges of getting the word out about his new program.

“For radio to work right now, people need to know what you’re about,” says noon–3 p.m. host Chad Hartman. “It has to be distinctive, even memorable. You have to have an opinion. There’s not a future in bland. People tune into talent. That’s why [KFAN’s] Dan [Barreiro] is the best show in town right now.”

“A major risk needs to be taken to capture new audience,” says Sunday host Roshini Rajkumar, “within our tradition of voices of authenticity.” She said if there is a long-term vision for the station, she is unaware of it.

Development of talent is an industrywide problem, says Bloom. “It’s driven by a generation of budget cuts across the industry.”

There’s one other problem, and it’s a big one. Only a fraction of listeners even use the AM band. As one empathetic competitor put it, “[WCCO is] programming for the audience available to them.”

According to data provided to stations by Nielsen, in 2020, 82.2 percent of the available radio audience did not tune to AM (see “AM Blues” sidebar, page 36). What this means is WCCO is casting an audience net that reaches only 18 percent of listeners, almost all of them over 50. There are only two AM stations left in the region that even attract a substantial audience:  ’CCO and iHeart’s conservative talker, KTLK.

The AM deficit is so significant that when Twins baseball returned to WCCO in 2018, the team required an “out clause” if WCCO could not get an FM simulcast by 2020. (Games are now simulcast over Entercom country station “The Wolf” at 102.9 FM.)

Boxed in

A decade ago, the world was WCCO’s oyster, competitively. KFAN was still struggling on the AM band. KNOW had yet to become a major competitive presence. And Hubbard’s all-sports format at 1500 AM never got enough traction to be relevant. At that point, WCCO could have made a format pivot and occupied any market niche it wanted.

Today, the station is boxed in. KNOW has nearly twice ’CCO’s audience share and more than twice the number of listeners per week. “They’ve had a huge run. Public radio started acting like real radio, promoting, employing formatics [programming techniques to hold listeners’ attention],” says Bloom. “I’d look at them as a model for how to modernize a format.”

KFAN’s dominance over ’CCO in sports is equally stark. It’s not a coincidence that after 6:30 p.m., when KFAN ends local programming, WCCO pivots to sports. KFAN has outpaced WCCO in talent development as well. “KFAN works so well because it’s not about a formula,” says Hartman, “it’s about talent.”

One reason you’re unlikely to see a major programming shift from WCCO is that the only space not occupied by a more robust competitor is the one it holds.

Programming to diverse audiences

Though WCCO’s ratings do not include listeners outside the metro counties, its programming often seems equally geared to Greater Minnesota. It is neither urban nor urbane. Its legendary air talent over the last four decades made their mark with a schtick rich in Scandinavian dialects and jokes about herring. It resonated for enough of us, but if you didn’t grow up on a farm or in a deeply Lutheran suburb, it could also be a barrier.

After years of programming to the least diverse aspects of Minnesota’s population, WCCO has made strides in recent years to diversify its air talent. PM drive cohost Jordana Green is a highly observant Jew, Cory Hepola is in a mixed-race marriage and is father to Black children, and late evening host Henry Lake is Black. Weekend hosts Rajkumar and Sheletta Brundidge are also women of color who offer vastly different takes on that experience.

“I’m in favor of diversity in our content, but I’m against tokenism,” says Rajkumar, a communications consultant in her weekday job. “I want us to think big, address diversity and inclusion with smart, qualified hosts. Not [be] sappy and placating, but challenge people to think for themselves.”

Knoepke declined to say anything specific about WCCO’s audience makeup or future goals.

The final factor limiting WCCO’s reach is that, like most radio stations in America, it is owned by an overleveraged media company that reported miserable 2020 results. The large national radio groups—iHeart, Entercom, and Cumulus Media—control most of the key dial positions in the Twin Cities. iHeart is at its maximum of six local signals, while Cumulus, Entercom, and locally owned Hubbard Radio have three. The supposition is that to maximize the economic leverage of owning an urban radio cluster, one or another of these groups will engage in a sale or swap to produce a second six-station cluster.

“Having six stations in town is key to maximizing revenue,” explains Anselmo. “This is a game of shelf space. Something in the next five years is going to change.” Hubbard isn’t going anywhere, and could be a buyer, but Anselmo says Entercom or Cumulus may choose to exit the market, to then grow in another.

The future

A savvy contrarian would make several points in WCCO’s defense.

• First, digital streaming and smart speakers may quickly render the AM band struggle moot. There is no “band” on the internet other than bandwidth, so WCCO is at no competitive disadvantage online, and is increasingly adept at promoting and marketing its digital content. (Edison Research found in 2019 that as many people were listening to radio on a mobile device as on a radio.) Anselmo says most stations are getting 10 to 15 percent of their audience from the stream. Unfortunately for WCCO’s branding needs, that’s under the umbrella of radio.com, Entercom’s digital streaming brand.
• The divisive Trump presidency, COVID-19, and now the year of the trials connected to the death of George Floyd have provided an extraordinary opportunity for news-driven stations to reintroduce themselves to the market.
• Finally, WCCO remains a cash machine with a community of satisfied advertising partners. If it can stave off additional audience erosion, it can tread water for a long time before sinking below the horizon. “Entercom doesn’t understand the legacy,” says Quick, “but if Shannon [Knoepke] can sell the heck out of it, it doesn’t matter. People have been writing WCCO off for years.”

Why then is the biggest question around town not ’CCO’s direction, but whether Entercom intends to sell its historic studio building in downtown Minneapolis to raise cash? The threat to WCCO long-term may not be the age or size of its audience, but an owner who sees it as a pawn or rook on an industry chess board.

“Radio is most threatened by people in leadership roles who only account for it as a commodity and see stations as real estate assets,” says Langmyer, speaking of the industry in general. “But radio has an incredible future when led by smart, creative, visionaries who can build connection with an audience.”

A 100 year-old AM station can dream, can’t it?

WCCO by the numbers from big to little

According to data archived by local radio historian Jay Philpott, in 1968, WCCO attracted a 51 share, meaning more than half of the people listening to radio in the Twin Cities at any given time were listening to WCCO. Its closest competitor, KSTP Radio (1500 AM), had just under an eight share. There was one FM station reporting miniscule ratings that fall, Entercom music station WAYL, known by the tagline “The Beautiful Whale.” (Prior to the CBS merger, Entercom was an owner of mostly music stations in midsized markets.) FM was a niche technology; in the 1960s, most cars lacked FM radios. 1968 was ’CCO’s high-water mark in the ratings era.

A decade later, in early 1979, with an FM band now full of competitors, ’CCO still drew over a 30 share. That summer its engineering staff went on strike, and its unionized talent honored the picket lines. Management manned the mics for five weeks.

The strike ended and talent returned, but a third of WCCO’s audience did not. Coincidentally that year, says Philpott, five FM stations moved their antennas to the IDS Center so their signals blanketed the metro area. Also in 1979, Hubbard-owned KSTP-FM became KS95 and, under program director Chuck Knapp, emerged as the town’s first FM station that did more than just play music. Strike-weary listeners sampled the better fidelity of the FM band, and realized it offered weather, traffic, and news, and some stayed.

“We never really recovered,” says former WCCO program director Jon Quick.

One can debate the merits of  ’CCO’s programming and its role in a 50-year ratings slide, but the real driving force was competitive pressure. ’CCO held a 20 share as late as 1991, but by 1998, with Steve Cannon and Boone & Erickson all retired from their drive-time strongholds, the station had fallen to a 10 share. The era of double digits ended around 2000. For a decade then, ’CCO routinely rated in the upper single digits, but between 2012–2013,  ’CCO saw more audience loss, concurrent with competitor KFAN’s move from AM to FM. This left WCCO with a 4 to 6 share of the audience, which it has held for most of the last decade, though periods between 3–4 shares have not been uncommon.

Another way of measuring a radio station’s impact is “cume” — the number of individuals listening per week — an important stat for many advertisers trying to reach the greatest number of ears. As recently as 1979, WCCO had 1.4 million in cume. In the January 2021 ratings, that number had sunk to 181,000, a drop of 83 percent.

“Most of that decline is not being on the FM dial,” says Mick Anselmo, who ran WCCO from 2008–2015 and spent 23 years prior building the powerhouse group of stations that is the local iHeartMedia cluster, whose flagship KFAN is the most dominant sports radio station in the country by audience share.

AM blues

The decline of AM radio has been happening for decades. Though the bulk of radio listening happens in cars, there are now car manufacturers that do not include AM bands on their sound systems. And most car radios do not allow you to switch between stations on different bands easily.

“You get in a rental car and AM is still set to factory presets,” says Twin Cities radio historian and former WCCO marketing exec Tom Gavaras.

A local watershed was KFAN’s move to FM in 2011. The following year, WCCO experienced an enormous ratings drop. The move apparently took many of ’CCO’s occasional listeners off AM permanently.

For WCCO to survive the next decade, the consensus is the station needs an FM signal. “This is a turning point,” says former program director Jon Quick. “WCCO needs to get on FM. If you want to look at building new audience, you need to be on FM.”

Retiring morning host Dave Lee will not be around to broadcast over it, but “I think you do need an FM signal,” he says.

There are two ways to accomplish this — buy a station or use one of parent company Entercom’s. In 2021, Entercom country station 102.9 FM The Wolf’s programming day will be broken up by up to 190 Twins simulcasts. This is a problem for a station already fighting for listeners with iHeart’s K102 and streaming services. Programmers in town told TCB that by simulcasting Twins baseball, Entercom has effectively killed The Wolf’s ability to hold an all-day audience.

So why not simulcast WCCO all day on FM, as Entercom has done with WBBM-AM in Chicago? Because that would require, at least temporarily, sacrificing the several million dollars The Wolf bills. “CBS and Entercom both told us you’ll never make up the lost revenue with a simulcast,” says former WCCO sales exec Ethan Adam.

In the current environment, such a move seems untenable. “The big three [Cumulus, Entercom, iHeartMedia] are overleveraged and burning the furniture to stay alive,” says an industry source currently involved in brokering radio station transactions.

Historically, solid radio signals sell for large multiples, so Entercom could never hope to pick up a competitor’s signal for a song, if you will. But in late 2020, the opportunity presented itself. Northern Lights Broadcasting, the radio arm of the Pohlad family enterprises, which had paid $28 million to acquire GO 96.3 FM in 2007, put the station and its low-power sibling at 95.3 FM up for sale.

The Pohlads found it difficult to make money in radio, and recouping their investment proved no easier. Still, the local industry was shocked when Northern Lights sold both frequencies to a nonprofit religious broadcaster for just $2.45 million. Had Entercom made an offer for GO, it could have acquired an FM signal for WCCO for less than the cost of a year’s revenue on The Wolf.

It’s key to note that as of this winter, Entercom stock was down 62 percent since buying CBS Radio. iHeart went bankrupt in 2018, the same year Cumulus emerged from Chapter 11. The industry’s fiscal state is constraining its capacity to spend, says former CBS Radio executive Tom Langmyer: “There have just been very few transactions of this type in the past few years, period.”

This story appears in the April/May 2021 issue with the title “The Shrinking Neighbor.”

Adam Platt is TCB’s executive editor. He has covered media businesses in the Twin Cities since 1985.