Until these seismic changes, radio stations were owned mostly by two groups, multi-media companies and conglomerates like GE, RKO and Westinghouse in large markets, and “mom and pop” operators in the medium to small markets.

Big banks and investment companies “found” radio in the mid-1980s. They weathered the storm of the 1989-1991 recession and, under the new ownership rules that followed, they really charged into the industry thereafter in the 1990s, when radio became an “investment.”

The new models worked for a long time. Stations were aggregated into clusters, huge radio companies were built, revenues and profits skyrocketed, and fortunes were made.

Not to toot my own horn, but I worked in local radio and later, as a young AP salesman, I made over 5,000 separate, in-person visits to radio and TV stations. By contrast, a few of the new breed of radio investor never set foot in a station until they decide to buy one. The next generation of entrepreneurs in their 30s and 40s are captive to this new paradigm. They have no choice. Deals to buy competitive clusters today are too expensive to fight the money. Don’t get me wrong. It is good that investment capital is drawn to our industry and a big reason I have been successful. But radio has evolved. It is bigger, more complicated and more expensive.

We are decompressing after six very tough years of slow growth and sometimes no growth. In some cases we relied on technology, and not people. In misguided efforts to be tops in the demo, we duplicated or homogenized formats, or made changes in programming that simply didn’t work. We can’t (or refuse to) attract new listeners, many of them young. We fight for revenues with a hungry and growing Internet. Until recently our leaders have not been very vocal or visible, but thankfully that is changing. While I don’t perceive satellite radio as a threat, changing audience measurement, HD conversion, iPods and the battle over performer’s royalties are more challenges.

Actually, under the circumstances we are doing just fine by comparison to other “old media.” In Wall Street parlance, we are in the later stages of a transition from a “growth business” to a “value business.” This has been coming for some time, but the handwriting is on the wall now that Merrill Lynch, for one, has greatly modified its method of valuing broadcasting companies to more heavily weight Free Cash Flow (FCF), and Citadel’s Farid Suleman stating recently, according to press reports, that he intends to return 50% of FCF to his shareholders next year and 75% of FCF annually thereafter. A number of public radio companies already pay regular dividends. In this transition values expressed as multiples of revenue and cash flow moderate, and our PE ratios more closely resemble utility stocks, or even less.

All this said, the industry and the marketplace that supports it simply are evolving. The forces of a free market are at work. Some of the results are not pretty. Almost all of our stocks are down. Some investors are unhappy. Some deals are imploding, but they are mostly the results of bad deal making and not a fading terrestrial radio industry. The sub-prime mess has sent a chill through the capital markets, but that will be temporary. After this spasm (and we all hope it ends quickly), we’ll get back to business and adjust to the needs and wants of our listeners and the new financial metrics, as we always do.

Our great strengths are that we are wireless, we are everywhere and we are (or can be) local, local, local. Even stations that are music intensive or those that rely heavily on nationally syndicated programming can be local, local, local if they fill their local program time with adequate doses of local news, weather, traffic and sports. The Internet is powerful, but it needs media like radio, especially radio, to push users its way.

Our hundreds and hundreds of good radio companies operated by great management and talent repeatedly generate dependably strong revenues and high cash flow margins. So, by comparison to other industries, we truly are envied, which is why there never will be a lack of entrepreneurs, investors, bankers and others who want to be in the radio business.

I just counted. I have nine radio receivers in my home, one in almost every room. Perhaps I am different from most listeners, but I consider radio to be my “friend.” I have two favorite radio stations, but no favorite TV station or favorite cable TV channel. My time spent listening (TSL) is huge because I am drawn to good content.