NPR will integrate NPR Labs into its general budget and tighten its focus on public radio after almost five years of running the division as self-sustaining.
Under the restructuring, NPR Labs will transition from its status as a stand-alone unit and move from NPR’s distribution division to its technology and operations division. NPR Labs will also drop the Technology Research Center name that it used to market consulting work to clients.
The restructuring eliminated the top job at NPR Labs, held by Rich Rarey, a 34-year NPR veteran. Rarey, who will leave July 31, took the job of director of NPR Labs in February when founding director Mike Starling took a voluntary buyout offer and retired.
“Whenever we have to part ways with someone so experienced, it’s very difficult,” said Marty Garrison, vice president for technology operations and broadcast engineering at NPR. “But we feel this was the best option we had of keeping NPR Labs a going concern and a benefit to the public radio system.”
As a technology research and development division, NPR Labs has worked to develop live captioning of radio programs for blind and hearing-impaired people.
The unit was funded from NPR’s general budget until an organizational restructuring in 2009, when it became self-sustaining through grants and other sources of revenue such as “fee-based consulting services, including projects that address advanced broadcast coverage, listener assessment, and developmental broadcast technology.”
But NPR Labs struggled to hold on to that income. It posted a $455,030 loss for the first six months of fiscal year 2014, according to financial statements. During that time, the consulting business brought in about $153,000 less than projected. Meanwhile, expenses went about $343,000 over budget.
Expenses rose in part because NPR Labs wrote off debt of $238,000 owed to it by a major consulting client, which ended its business with the unit. Garrison declined to name the client.
The losses jeopardized the efforts of NPR Labs to remain self-sustaining. “We did not see a pathway to profitability,” Garrison said.
NPR Labs will continue its research work with a focus only on issues relating to the public radio system at large, including captioning and emergency alerts for the deaf, blind and hard of hearing. Previously, the lab worked with clients outside of public radio, including the National Association of Broadcasters.
“The work of the lab will continue as is with the grants and projects moving forward,” Garrison said. “It’s an as-is situation. But they will be better resourced now than when it was self-sufficient.”