While reading my issue of R.A.P. on this Saturday afternoon, I was interested in the comments about production talent fees in medium and small markets [Aug. '93 RAP Interview with Scott Statham]. I own and operate an AM/FM combo in Jefferson City, Missouri which is about market number 290. I came from the talent and production ranks in the '60s. I can really get on a soap box as an advocate for talent and production fees in any size market, but I didn't always feel that way.
Back in 1985, a very talented staffer came to me and bluntly told me that I was not paying her to work for other stations and that I had no right to give her work away however I saw fit. At the same time, other stations in the market were encouraging clients to use our talent and facilities with rate discounts if they weren't producing spots. To add to our workload, we had "hang a shingle" advertising agencies cropping up on nearly every street corner with self-declared creative people writing impossible copy and expecting us to make them look like heroes.
On the sales side, we felt that the market just wouldn't pay the tab for production costs when everyone else was giving it away. I had a little bit of the feeling that the talent was attempting to change the rules in the middle of the game.
After much gnashing of teeth, we finally instituted production charges on the following basis:
If the spot recorded for our station is to be dubbed for broadcast elsewhere, a talent fee of $10 to $50 per spot will be billed to the client or agency plus a $2.50 fee for any reel or cassette.
If the spot is not used on our stations, then a studio charge of $17.50 per hour would be charged and possibly "producer charges" if special conditions exist.
As General Manager, I make the decisions on total charges. In rare instances, I have waived charges. In all cases, we do not automatically do dubs etc. when other stations call. It is the responsibility of the account rep to inform the client of these charges.
We have since raised our rates slightly, but to this day, we're about the only stations in the market that regularly charge. Despite the fact that we're standing out here alone, we've only had one or two clients and one agency who resisted. In fact, most clients are used to paying charges at all other media. TV has huge production charges. The newspaper has film charges etc., and specialty and billboard advertising all charge for art work and production materials.
As far as the company is concerned, we essentially make very little or no money with production billing. It does give talent a little extra income and encourages them to produce better spots.
Sales guru, Dave Gifford, has a saying that applies here: "ask and you get... don't and you won't." Just how many sales types, when faced with another radio station cutting rates, have said "you get what you pay for." After eight years of production billing, I contend that we've earned far more respect from clients and agencies than we've lost. I would strongly urge every radio station to start putting some production charges in place.
I'm enclosing a copy of our production billing form that each production person submits to me. I fill in the bottom portion and turn it over to billing for invoicing which is mailed the same or the next day.
Frank Newell, Owner/General Manager
KJMO-FM/KWOS-AM, Jefferson City, MO
Thank you. Thank you, thank you, and thank you. And furthermore, thank you.
By the way, the form Frank mentions is a simple 1/2-page form. It is titled "Production Billing" and contains the following information: Date, Client, Agency, Bill To, Station Person in Charge, Talent, Number of Spots, Number of Dubs, and Studio Time Used. There's a line that says, "General Manager fills out remainder of form," and the following fields are listed: Total Talent $, Studio Time $, Dubs $, Other ___ $, Total Charges $, and GM Approval
Following is a copy of a letter on the same subject which John Pellegrini wrote to Scott Statham after reading the interview in the August issue.
Caught your interview in R.A.P. and had to see if I could offer any help on this ridiculous talent fee situation. I've been there myself, and it truly sucks. One GM I worked for said that since "our production is so much better than the rest of the market, we'll offer it free just to piss off the other stations." Try paying the rent on that! "Thanks for the compliment, boss. But...."
The situation here at 'KLQ is different. We do get talent fees for both work that goes to other stations, as well as free-lance work. Plus, I have the added benefit of being able to have all my free-lance billed through the station, which gives me the relief of not having to deduct taxes on my own -- it comes through station payroll.
We were able to set this up by simply giving the station and the sales reps a commission percentage for all outside production they arrange. That makes them more interested in keeping a lookout for paying gigs, and makes the station's involvement worthwhile as well.
Perhaps you could have a meeting with your GM and the Sales Manager and discuss this kind of setup. I don't know necessarily if your Program Director would be interested or not, as this is primarily a sales department incentive. But, there is one thing I've learned over the years: if you really want something changed at the radio station, make the sales staff interested in it first. If they think they can make money off it, management will be much more interested than if only you and your PD want it to happen.
Unfortunately, unions for Production Directors have never really gotten off the ground. Perhaps something to do with food bills while trying to strike. Good luck, and I hope you all get these "buddies" to get out of their little kaffee-klatch situation.
John Pellegrini, Production Director
WKLQ-FM, Grand Rapids, MI