Radio One Analysis

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Radio One Inc. is a company that was founded in 1980 by Catherine Hughes who had learned the radio business while teaching at Howard University. Catherine and her husband purchased WOL-AM in Washington, D.C. for just under one million dollars. Hughes changed the format from R&B music and public affairs to talk radio. To cut back on expenses the Hughes became radio personalities. Expansion for Radio One began in 1987 when the Hughes' purchased WMMJ-FM in Washington for about $7.5 million and began broadcasting a new musical format targeting African-Americans. In 1992 and 1993, Hughes acquired four stations in Baltimore, Maryland, for $6.4 million and in 1995 purchased WKYS-FM in Washington for $34 million. Also, in 1995 Alfred Liggins lll, CEO and president of Radio One Inc., saw an opportunity to expand into the Atlanta, Georgia market. Liggins believed that the African-American population was growing and it presented a profitable opportunity. Hughes and the rest of the Radio One's board thought that the company should concentrate on the newly acquired stations. Liggins formed a separate company to purchase the Atlanta station for $5 million, and in June 1995 Radio One of Atlanta was introduced, WHAT-FM. At the end of 1996 the Baltimore station WERQ-FM had attained a number one ranking, and the Washington station, WKYS, was ranked number two. By 1998 Liggin's Atlanta station was ranked number 4 and WHAT-FM affiliate and its sister station WAMJ-FM were later purchased by Radio One and became wholly owned subsidiaries of the company in 1999. One of the reasons that the radio stations were doing so well was because of the corporate strategy that Radio One had adopted. Radio One targeted primarily African-American audiences in as many major markets as possible with urban-oriented music, entertainment, and information geared toward the African-American population. This was made possible by the FCC relaxing the existing regulations in 1992, which allowed...
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