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Sky-High Opportunities
Marc Holland keeps evolving his business model, which is how he kept his in-flight audio program production company flying after September 11.

California CEO Magazine

By Scott S. Smith

When he first heard the news about the World Trade Center and Pentagon crashes last September, Marc Holland of Sky Radio, was shocked by the tragedy, like everyone else. Then he realized it had a personal impact. The hijackers also had taken over his business model and it was about to crash.

You may know of Holland's mellow baritone from listening to the audio business channels on United, American, Delta, and Northwest airlines. If you've flown across the country and you've plugged the headphones into the in-flight programming, perhaps you've heard Holland chat with CEOs in various 5- to 20-minute-long interviews that tend to discuss the face of business and how business leaders are adapting to change.

Holland knows plenty about change. His monopoly with airline audio feeds comes from his ability to spot an overlooked market, which he began to do in the late l980s.

Back then, he was a Hollywood director's agent. His mother, a teacher, was always asking him if he could get free things to give out to her students. So he would ask companies he came in contact with. Then one day, a contact at Reader's Digest asked if he had any ideas about how to get students to sell the magazine. Within two weeks, Holland put together a deal.

He talked four Six Flags theme parks into supplying 10,000 free tickets to hand out to students as a promotion. The attraction for the school administrators was that these were made available to those who attended an anti-drug assembly. They also had to sell a couple of Reader's Digest subscriptions along the way, which was no big problem for the schools. Holland collected $10 per ticket from Reader's Digest for the access. The project led him to create Educational Support Marketing Network, which devised similar events for schools and companies, such as General Mills and Nestle.

After selling off part of that company in 1992, Holland turned his sights to corporate relationships. He began to promote annual reports and company messages over recorded telephone messages. Under the banner of Interrep Information and Communications Services Inc., callers, who generally were responding to ads that appeared in Worth and Smart Money, could hear interviews with CEOs or press releases read aloud.

In-flight takes off
With his Interrep business making him a frequent flyer, Holland became aware of airline audio channels and their lack of business content. Another light went on as he saw a way to make his mark in the sky. He then put together deals to pay the major airlines for the opportunity to play pre-recorded business interviews 20,000 feet in the air. The company, Sky Radio, today specializes in interviews with top leaders in business, politics, sports, and culture. Holland lately has run talks with Sumner Redstone, Vince McMahon, Anne Rice, and Willie Brown, among others.

Sky Radio revenue comes from three primary sources: paid ads during his programs; sponsorships from partners like Forbes Radio and Yahoo Radio; and paid interviews with CEOs, with packages ranging from $5,000 to $100,000, depending on how often, how long, and on which airline. In addition, there is a video product broadcast on airline TVs, with the average package costing $30,000.

"What we tell decision makers is, 'Would you rather send out a press release that might be picked up by the media, or would you want a chance to put your undiluted message in front of a premium audience?"' says Holland.

The idea worked and Holland says the privately held company sold out every second of available time it had in 1998 and 1999. In 2000, the beginning of the dot-com meltdown started to slow his business.

But it wasn't until 9/11 that Holland saw the danger of having all his eggs in one basket. First, he had to save what he had. Then he moved to diversify his business.

He decided to focus his efforts on his top four airlines and terminate relationships with the smaller ones. A series of crisis meetings with airline executives led to a restructuring of their financial arrangement. He then consolidated his three websites into one and made cuts in staff. But companies simply didn't want anything to do with airline media, so Sky Radio was still in a tailspin.

"I realized that we were dealing with was a negative psychology that transcended the facts and we had to do something to turn that around," says Holland.

So he decided to put a positive spin on things. He invited Anthony Robbins and other authors of bestsellers on human potential to address on air how to overcome fears. Caspar Weinberger, Stewart Varney (formerly of CNN and now with CNBC), and Andy Grove also came on to encourage optimism.

In addition, Sky Radio content these days tends to emphasize the need to manage projects better, as well as address issues of security and storage. Sky Radio also is conducting more interviews with business trend research firms, such as Gartner Group, IDC, Yankee Group, and Jupiter Media Metrix.

Much of Sky Radio's partnership compensation comes in the form of barter. On National Public Radio, it has $25O,OOO in promotion identifications. With Yahoo, it received $70 million in banners. Forbes and Entrepreneur magazines have traded ad space, as well. This diversifies the company's assets and sources of cash beyond simply charging for airtime. And, as a result of striking an exchange with billboard companies, Holland has been able to offer ad space at airline terminals in the package.

So what's next? What if airplanes were to install satellite dishes and do away with pre-recorded content?

Holland answers that Sky Radio would evolve some more, and the name may change to reflect that.

"At several points in my career, I've had to invent fishing to sell hooks," Holland says. "You can bet that whatever we do, it isn't already being done."

Flying High
Sky Radio 12155 Riverside Dr. Valley Village, CA 91606 818-762-6800	Business Paid inflight audio channel business programs. Sells discount ad as space in magazines, on websites, and on airport terminal billboards, as well.
Employees Sky Radio employs 21, led by owner Marc Holland, who says he's looking to hire more.	Financials Revenue was $3.7 million last year and expected to be flat this year. Profit has been steady at about $1 million for several years.