Listening to rock and roll and pop hits on AM radio has been a rite of passage since the 1950s. But not today, when kids can listen to just about whatever they want on YouTube, Spotify or with digital downloads. This goes a long way in explaining why Walt Disney Co. is selling its network of 23 stations and instead focusing on reaching its young audience through digital media. “The younger end of the audience is digital natives,” said Radio Disney General Manager Phil Guerini. “They are born with an iPad or other digital device in hand.” It wasn’t that long ago that Radio Disney was one of the hottest concepts on the air. It started broadcasting for the children and family audience in 1996 from stations in major markets, including Chicago, Boston, Denver and Atlanta. The programming mixes top 40 contemporary artists with up-and-coming performers identified by Disney as appealing to its core audience. On-air personalities include “Morgan and Maddy in the Morning” and Brooke Taylor in the afternoon; Ernie D. hosts a weekly countdown show, “Radio Disney’s Top 30.” Late afternoon “takeovers” feature music artists in the studio taking listener requests. Stars such as Selena Gomez, Justin Bieber, Taylor Swift and Demi Lovato have been launched or gotten a big boost on the format. It’s hard to know exactly how far Radio Disney has fallen against the competition, which on AM radio is dominated by news outlets, talk radio and ethnic programming. Radio Disney commissions Nielsen Audio to conduct custom studies to determine ratings of its network as a whole but not for individual stations, as well as satellite, digital and mobile listenership. It would not disclose those figures. (Nielsen typically collects listener data by using portable people meters, a device that picks up and measures listenership of the top 48 stations in the country. Radio Disney stations, given its young audience, are not encoded to be detected by the meters.) But internal research released by the Burbank media and entertainment giant on how its radio network is accessed shows radio as a last choice. Radio Disney found that 37 percent of its listeners 6 years and up listen via satellite, another 35 percent use the Internet, and 31 percent are on mobile devices. Radio accounted for only 18 percent of its listeners. John Lund, a radio industry consultant near San Francisco, has a blunt assessment of how pre-teens view AM radio. “Yes, every car has AM radio, but there is no hipness in the dial that mostly programs talk radio for elderly men,” Lund said. Lengthy strategy The network is headquartered a few blocks from the main Disney campus in Burbank at the studio and offices of KDIS-AM (1110). The station produces nearly all the live programming for the network of 22 AM stations and one FM station nationwide from 4 a.m. to midnight. Network stations carry the feed straight with no local programming or talent. Disney is retaining KDIS, mainly to produce content for digital distribution. Radio Disney actually began to broaden how listeners could access its content more than 10 years ago when it reached a deal to have Sirius/XM Holdings, the Washington D.C. satellite broadcaster, to carry its station. The current iteration of the Radio Disney website offers more. A link will stream the same shows airing on the network. Other links lead to music videos, short performer bios, a blog with music-related news, and information about the Radio Disney Music Awards and the Next Big Thing project showcasing emerging talent. Website visitors can also request songs, enter contests and take quizzes. Now the network is moving heavily into mobile. In July, it announced it would launch two channels through Denver-based mobile entertainment network ShowMobile that stream on Apple and Android operating system devices. The social-media based network has carved out a successful niche among teenage girls with an app that allows viewers to follow stories that originate on YouTube and other platforms. A few weeks later, it was on-demand, personalized radio company Aha Radio, in Palo Alto, hooking up with Disney. The Aha Radio app allows listeners to create a personalized live radio station and is optimized to sync with a car radio. It is owned by Harman International Industries, a Stamford, Conn. maker of audio electronics, including car stereos. This month came a deal with San Diego music streaming service Slacker, a Spotify rival, which is partnering with Radio Disney on three stations, including the Top 30 Countdown and Radio Disney Junior aimed at children 6 years old and younger. The network also has a broader strategy with ABC Television Group that involves cross-platform promotions. The Next Big Thing feature has emerging artists appear on Radio Disney but also the Disney Channel, Disney social media sites and at live events. The Family VIP Birthday event at Club Nokia on Nov. 22, marking 18 years of Radio Disney, will air exclusive highlights on the radio network and Disney Channel. Guerini said it’s no coincidence the show takes place the night before the American Music Awards airing on ABC from the nearby Nokia Theatre. Disney faces little competition in the children and family demographic. Only Kids Place Live, a channel on Sirius XM, comes close to Radio Disney’s offerings and reach. Guerini views the real competition from online activities such as YouTube and social communities that cut into listening with Radio Disney programming. “We have competition for time spent and need to break through those other things for our audience’s attention,” he said. Radio Disney is one of two radio networks Disney operates. The other is ESPN Radio with four owned-and-operated stations. Disney sold off its ABC Radio assets in 2007 to Citadel Broadcasting. Slow sale Disney has actually been trimming back at Radio Disney since two stations were sold in 2010. It sold another seven last year. The process of selling the other 23 stations is in various stages of negotiations, Guerini said. The Radio Disney business, while important for branding purposes and promoting Disney artists, is less important when it comes to revenue. Its ad sales are not broken out in earnings statements and get lumped in with all broadcaster revenue. Tuna Amobi, an equity analyst at S&P Capital IQ in New York who follows Disney, pays little attention to what goes on with the radio business. “I am surprised they had a meaningful presence as it does not fit with their long-term content strategy,” Amobi said. So far, Disney has laid off about 200 employees, with the majority of those let go at the station level at the end of September. A minimum of two full-time employees remain at each station until the sales are finalized. There are sales teams in Los Angeles, Chicago and New York. There is no sale deadline, though Guerini noted it is a lengthy process that involves the Federal Communications Commission because of the transfer of the broadcasting license. In Disney’s fourth quarter earnings statement, a write-off of $73 million related to impairment costs of radio FCC licenses indicates the company expects a loss on sale of the stations. Mary Beth Garber, executive vice president in the Los Angeles office of advertising and consulting firm Katz Radio Group, has the opinion that Disney shouldn’t have too much trouble selling off its 22 AM stations though obviously the price will be low. “They won’t sell at the multiple that an FM station would,” Garber said. “Their scope of use is more limited than an FM station.” The Deal, a national publication on corporate transactions, reported last month offers had been made and accepted for the sale of WWMK-AM in Cleveland and WFDF-AM in Detroit. The Cleveland station is selling for less than $1 million, while the Detroit property has a price of between $2 million and $3.5 million, the trade publication reported. Garber and Lund were in agreement that the future of those AM stations well may be in the niche market of foreign language broadcasting. In urban areas with significant immigrant populations, buying an AM station is plausible. Los Angeles, for instance, has a number of foreign language stations, including Spanish, Chinese and Persian. In San Francisco there are at least five Chinese language radio stations, and outside of Seattle stations broadcasting for the Southwest Asian population, Lund said. “There is money in that,” he added.