Selling a Sounds System : Orange Firm’s Hooked on Bringing Reading Method to Classrooms


As the teacher places five “Hooked on Phonics” flash cards in front of the first-grade class, hands fly into the air. In her eagerness to be called on, a little girl named Stephanie jumps up from her desk and runs to kneel in front of the teacher, waving her hand furiously. After being called on, Stephanie slowly pronounces each word on the cards, saying: “Read the book out loud,” as her classmates applaud.

But these first-graders are not learning to read with children’s books. As part of a pilot program in the Inglewood Unified School District, the students are learning with Hooked on Phonics, a controversial reading method that uses cassette tapes of simple words set to music along with flash cards and workbooks to teach reading phonetically.

“I’ve never seen them so enthusiastic. They feel they are learning to read, so they are encouraged to go on. The rhythm, the music, the patterns are catchy so the kids pay more attention,” said Dolores Bryant, a veteran teacher of more than 20 years. “The Hooked on Phonics people came in with everything. We aren’t paying a thing. We’re just happy to have them.”

And Gateway Educational Products, the Orange company behind Hooked on Phonics, is happy to be there. Inglewood is the first step of its ultimate goal to place its $200 reading system in thousands of U.S. classrooms. Armed with test results from the Inglewood pilot programs, Gateway wants to make its case before every school board in America.


Sound too ambitious? Not to John Shanahan, a former music jingle writer for several small companies, who in 1985 founded Gateway. The company is also venturing into Great Britain and has plans to eventually introduce a Spanish-language version of Hooked on Phonics. Also scheduled is the first Hooked on Phonics store, a retail outlet and learning center slated to open in Inglewood this December. “We will be in every school,” predicts Shanahan. “When we show the extraordinary effects of the program on these kids, the parents are going to demand it. It’s basic. Learning to read should be simple, it’s just not that difficult.”

However, Gateway’s beginnings were a little rough. An advertising watchdog group found fault with its advertising claims, forcing the company to change its promotions. Educators questioned the validity of its instruction methods--some still do. But the company argues that it has addressed most of the concerns.

Hooked on Phonics, now in its seventh edition, has slowed down the music on the cassette tapes included with the basic program and altered its programming tapes. The company beefed up its package with SRA Reading Laboratories stories, published by a division of Macmillan-McGraw Hill.

And Gateway now has an advisory panel of 10 leading educators--with members from the state Department of Education, the University of Washington and San Diego State University--to review its reading program and assist with any changes.


For $199.95, a consumer who calls on the “1-800-ABCDEFG” hot line now gets a Hooked on Phonics box packed with five reading workbooks, 12 cassette tapes, 380 flash cards and a set of 100 SRA power building stories, separate from the workbooks. The cassettes feature letter sounds and words set to a musical beat, almost like an aerobic workout tape.

Gateway’s official company mission is to “overcome illiteracy by continuing to develop educational programs which improve learning for both adults and children.”

And for Gateway, a privately held company with more than 300 employees, it is not a mission impossible, but a mission profitable. From meager revenue of $100,000 in 1987, Gateway sales--mostly of Hooked on Phonics--generated $98 million last year. Revenue will surpass $100 million this year, Shanahan said. The company says an average of 6,000 people, schools and organizations purchase its educational programs each week. Gateway also publishes “Hooked on Math” and “We the People,” a history lesson narrated by actor Martin Sheen.

The 52-year-old Shanahan, who lives in Newport Beach, said he got his inspiration for Hooked on Phonics from his son who became ill on the days he was scheduled to read aloud in class. Reaching back to his own memories of phonics as a student in Boston and with experience as a jingle composer, Shanahan said he wrote and recorded catchy lyrics on tapes to help his son learn to read.


Now, Hooked on Phonics has grown from an idea born in Shanahan’s home to a possible answer to illiteracy in the nation’s inner cities. The company recently joined forces with Amer-I-Can, a self-esteem program for gang members and ex-convicts developed by actor and Football Hall of Fame running back Jim Brown.

“When Shanahan came up and sat in my living room, I thought, ‘This makes sense,’ ” said Brown. “Shanahan has a vision. I want Amer-I-Can to be in every school in the country and he wants Hooked on Phonics to be in every school in the country. It was a perfect marriage.”

Brown, whose group is a for-profit organization, is planning an Amer-I-Can Foundation, a nonprofit, which would take his message into the schools to help combat both crime and illiteracy.

“Other than self-esteem, I think literacy is one of the most important things,” Brown said. “A lot of young men in crime can’t read. It creates a lack of self-esteem and no options for employment. What else can you do but become a criminal?”


Shanahan said Hooked on Phonics will eventually alter some of its tapes and workbooks to help incorporate the Amer-I-Can positive self-esteem message and target reading packages for certain groups, such as people in prison.

For a six-month period that started in July, Gateway is paying to send teachers into five first-grade classrooms of the Inglewood Unified School District, which has several schools on a year-round schedule. Each day, for an hour and a half, the Gateway teachers take over the class, instructing students on reading with Hooked on Phonics.

The company plans “to take Hooked on Phonics across the nation,” Troy Roland said. “It’s an effort for us to reach out and help some people. We could have gone to Santa Ana, it would be a lot closer for us, but instead we come here where they don’t get a lot of help.”

But some educators claim this kind of help is not what America’s inner cities need.


Doris Roettger, president of the International Reading Assn. and a longtime critic of Hooked on Phonics, said that sounding out words does not equal reading comprehension. She tells of one small boy who was taught to read with the phonics method and could sound out everything, but couldn’t understand what he read.

“He hated reading,” she said. “People say if you sound out the words you can read, but that just isn’t true. You have to put it into context and look at the meaning.”

The educational debate about the merits of Hooked on Phonics centers on academic disagreements about the best way to learn to read, specifically, the difference between “whole-language” and phonics.

Whole language reading techniques start with something like a story, much more than just a word or sentence. Beginning readers learn to decipher words by using not just phonics, but also understanding sentence structure and meaning. With phonics, readers learn by relating letters to sounds and then building the sounds into words and sentences. Using phonetic principles, children learn to associate the correct sound with each part of a word.


In the first decades of this century, a drill method of phonics was practiced, where students would repeat sounds over and over. Prominent educators started to fault this method for too much drudgery, and by the 1930s, a new method developed where children learned to recognize words without repetitive exposure to sub-word parts. This went on until 1955, when the book “Why Johnny Can’t Read” was published, which demanded a return to phonics.

Now, most educators agree that children should be taught phonics. The argument focuses instead on what type of phonics should be taught--either explicit or implicit phonics. Explicit phonics is when students are directly told of the sounds of individual letters. With implicit phonics they are told to induce the sounds that correspond to the letters from repeated exposure to words containing those letters.

“I’m not an expert, but you have to be able to read before you can seek understanding, either by asking someone what the word is or looking it up,” said Brown, who supports the phonics method. “I can read a medical journal, and though I may not understand all the words, I’m glad I can read it.”

With an estimated 40 million illiterate adults in America, Shanahan said educators would do better to re-examine their own methods than criticize Hooked on Phonics. However, he said every time educators criticize Hooked on Phonics, sales of the program actually increase.


“The people look at the educational system in this country and they wonder why we’re being shot down by the system,” said Shanahan. “If the educational system hadn’t created this vacuum of illiteracy in this country, we wouldn’t be here.”

In 1991, some Harvard educators wrote a study for the reading association that determined Hooked on Phonics’ material “diverted the learner from meaning,” and criticized the program as so dull and mindless that it could turn off potential readers. The study further complained that a reader is asked by the cassette to read words directly into a workbook with no confirmation that the words are correct. But these days Jeanne Chall, the Harvard education professor who directed the association study, said that she does not want to criticize Hooked on Phonics because of changes the company made, namely the addition of the Science Research Associates reading component. This addition, she said, addressed the study’s complaint that the program was dull and lacked reading material.

“We wrote that report before the company changed itself,” Chall said. “He’s made some changes that addressed our concerns.”

However, the Literacy Volunteers of America--a group dedicated to increasing literacy with its national tutoring program--remains critical of Hooked on Phonics, saying the $199.95 price of its package is too high for its target population and that the program holds out “false hope” to people that sounding out words and memorizing word lists will translate into reading competence.


Literacy Volunteers serves millions of adults who read below a fifth-grade level, a population that often has self-esteem problems because of their illiteracy. The group said an important part of learning to read is regular contact with another adult who can offer praise and encouragement.

“Working in isolation with tapes and flash cards will almost certainly result in yet another failure for these adults,” said Beverly Miller, a Literacy Volunteers spokeswoman.

But Eric Fisher of Zanesville, Ohio, considers the program a success. The 28-year-old said he bought Hooked on Phonics two years ago, after trying unsuccessfully with several other reading programs.

“The schools just passed me through; they could never figure out why I couldn’t read,” said Fisher. After using Hooked on Phonics daily for two months, Fisher said that he went from a third-grade reading level to a 10th-grade level. He then returned to night school and now runs a locksmith company.


“When I would use the program, I would sit alone and feel about two inches tall,” Fisher said. “But it was better than being in a room full of people. Now, I have my own business and my own apartment.”

And in Inglewood, administrators, teachers and students seem pleased with Hooked on Phonics, saying that at least 40 parents, sensing reading skills improvement in their children, have asked where they can buy the program.

“Hooked on Phonics is geared for this generation of kids, whose parents may be unemployed or are too tired from work to read to them every night,” said Betty Steward, principal of Highland Elementary School in Inglewood. “My concern is that the parents who buy this might not know how to use it.”

‘Hooked on Phonics’


Gateway Educational Products in Orange is seeking to expand use of its controversial method of teaching reading in the nation’s public schools.

Gateway Educational Products

* Business: Educational materials

* Primary product: “Hooked on Phonics” reading series


* Headquarters: Orange

* Founded: 1985

* Chairman: John Shanahan, founder

* Employees: 300


* 1992 sales: $98 million

Gateway Advertising

Gateway Educational Products slashed advertising expenditures for 1992 while revenue continued to soar. In millions of dollars. 1990 Revenue: $27.0 Advertising budget: $22.6

1991 Revenue: $50.0 Advertising budget: $45.0


1992 Revenue: $98.0 Advertising budget: $15.4

What Is ‘Phonics’?

A method of teaching reading that focuses on mastery of word sounds, with less emphasis on meaning or context.



“Gateway has been working on making their products more school-friendly. We’re not saying that traditional education is not meeting the needs; we’re saying that there needs to be a variety.”

--Lena Preer, principal, Los Angeles County office of education’s division of alternative education

“With ‘Hooked on Phonics,’ I see tremendous improvement in people’s reading skills and a lot of pride. People want to stick with the traditional ways but those ways aren’t working.”

--Jim Brown, actor and president of the Amer-I-Can Organization



“Saying sounds and memorizing word lists will not automatically enable anyone to read. And ‘Hooked on Phonics’ does not involve human interaction, which is the single most important element in successful teaching and learning.”

--Beverly Miller, spokeswoman for the Literacy Volunteers of America Inc.

“Look at the title: ‘Hooked on Phonics.’ It’s not ‘Hooked on Reading’ and there’s an important difference. When children are hooked on reading, they will grab a favorite book and crawl up in your lap. My 2-year-old grandson would never crawl up on my lap with a book of word lists.”


--Doris Roettger, president of the International Reading Assn.

Sources: Gateway Educational Products, Leading National Advertisers Inc., individual agencies; Researched by JANICE L. JONES and DEBORAH VRANA / Los Angeles Times