Successful radio businesses are about culture not just ratings: Paul Thompson

Paul Thompson has stepped down from his daily hands-on role as Executive Chairman of DMG, as reported earlier. He speaks to radioinfo in an extended interview this week.

radioinfo: Why have you pulled back from the daily operational role of Executive Chairman?

Thompson: There are many reasons why I believe the timing is right. It is far too easy for a founding CEO to stay too long. It is healthier for an organisation for the founder to leave too early than stay too late. The transition from radio broadcasting to multi-platform delivery and the launch of digital radio combine to create a natural watershed. And Cath is ready to go as CEO.

radioinfo: As Non-Executive chairman, how much hands on involvement will you continue to have in the business?

Everyone feels obliged to accept the direction of an Executive Chairman. No-one will necessarily take any notice whatsoever of the advice of a non-Executive Chairman. But I will offer it anyway!

radioinfo: You are known for picking good people to work for you. Are you confident they can continue DMG’s success without your direct input?

I am very proud of the depth of quality people that we have at DMG Radio. Cathy O’Connor, Kingsley Hall, Dean Buchanan, Keith Thomas lead an extraordinary group of talented, motivated people They are ready to do great things.

radioinfo: How long has it been since you set up DMG Radio Australia?

We launched in February 1996 but acquired our first radio stations in September of that year.

radioinfo: Going back to the early days, what are your memories of the most difficult aspects of setting up the business?

The concept was to build a national FM network from new licences which the Government had neither allocated nor even decided to allocate. The process of working with Government and the then ABA to bring a new licence regime into existence despite powerful, committed and even ruthless lobbying from vested interests was a memorable challenge.

radioinfo: In retrospect, was buying all those regional stations a good idea or just a headache?

We sold the regional business for a significant profit. That alone made it a worthwhile venture. It is also noteworthy that ownership of the vast regional network allowed us to employ outstanding executives and staff, many of whom hold significant positions with DMG to this day.

radioinfo: What will it take to make Vega a success?

Thompson: Perseverance.

radioinfo: Do you have a ratings target for the two Vega stations? What is it?

We expect to reach 5% market share early next year. That’s 5% per station, not 5% combined!!

radioinfo: What will it take to keep Nova as successful as it has been in years to come?

The courage and energy to continue to innovate. The essence of the Nova culture is to challenge traditional radio mores, to overturn and rebuild them. The pressure of day to day business combined with natural human apathy constantly drags you back towards the mainstream. Nova shouldn’t go there.

radioinfo: Looking back to your time before DMG, what are your fondest memories of setting up and leading Austereo, before it merged with Triple M?

The sensitivity of a competitive relationship deters me from commenting.

radioinfo: What happened between you and Peter Harvie, once the two companies merged, that prompted you to leave the company?

Thompson: Perhaps surprisingly, nothing.

radioinfo: One of the other things you are known for is the ability to build a supportive culture within a company. What is your approach to building a successful business culture within a media business?

An organisation is most effective culturally when it stands for something beyond its business objectives.

radioinfo: What advice do you have to aspiring PDs and managers about how to treat people and inspire them to achieve?

This is too complex to address in a short answer, but the essence of it is a shared vision.

radioinfo: Is running a radio company different from running any other business? How?

Running a radio company in 2008 is different to running a radio company in 2007. And 2009 will be different again. But a great radio station does have a relationship with its listeners that is closer and more intense than the relationship most other businesses have with their customers.

radioinfo: Enough looking back. Let’s look forward. Will there be any purely radio businesses in 20 years time, or will they all be integrated ‘media’ businesses?

The integration of radio and online is almost complete now, let alone in 20 years.

radioinfo: Will radio withstand the current advertising downturn better than tv, newspapers or other commercial media businesses?

Media which allows itself to become commoditised will struggle in a low demand high competition environment. The quality of radio management will be the determining factor.

radioinfo: Now let’s talk about the overall media landscape in Australia. Is the mixture of commercial, ABC and community radio working for Australian media?

The various sectors of Australian radio combine well, if subconsciously, to deliver quality, variety and satisfaction. It is appropriate to give significant credit for this to the regulatory body ACMA and its predecessor the ABA. It ensures that each sector functions according to its designated purpose.

radioinfo: DMG has had problems with and lodged objections about several community stations. What are your thoughts about community radio?

I am a great believer in community radio. The only circumstances in which DMG has had concerns is when aspirant entrepreneurs with no concern for the ethic of community radio have sought to corrupt the concept by using a community licence as a backdoor commercial venture. True community broadcasters are as opposed to this as anyone.

radioinfo: Is digital radio important for radio’s future, or is it just a side show?

Thompson: It is too early to tell. Let’s give it every chance.

radioinfo: Did you read in last week’s Australian about the ‘reception problems’ for digital radio. Is the reception going to be a problem?

A lot of work is going into improving digital radio signal coverage. The release of inaccurate, out of date data by someone in the industry was an act of considerable bastardry!