"Shazaam! Damn straight."
Posted on 05/28/2015 6:08:43 AM PDT by raccoonradio
After news broke about the Rush Limbaugh Show getting kicked to the curb by WRKO-AM in Boston, Nielsen radio market #10, I received about a dozen emails asking when I was going to comment. So, here goes.
First, understand the “business of business is business” and the “business of money is money.” And it’s money not a station’s Nielsen ratings that will ultimately determine your success or failure as a personality. For most of us, revenue and ratings are connected. But, that’s not true for everyone.
After Rush Limbaugh stepped over the line with his Sandra Fluke comments a few years ago, his mistake being an old man verbally abusing a young woman, which in our society is never acceptable, liberal bloggers and media sites made note of the dozens and dozens of advertisers who canceled advertising in his show. Somewhat true, in an indirect way. But the real story, almost always left out by liberal bloggers, is most of the advertisers who supposedly canceled never advertised in his show. His show has always been filled with non-traditional, non-mainstream advertisers, advertisers who buy into the Rush Limbaugh brand to focus on his niche ditto head audience. And there’s nothing wrong with this because many ditto heads are affluent. Many have the bucks to buy gold coins in event the economy goes to crap because of Obama and besides they want to “take our country back.” No one is really sure who took the country or where it’s gone, but they want it back! I saw the hand-painted bed sheet hanging from a bridge in Northern Kentucky a few weeks ago. I know they’re serious.
Limbaugh’s Sandra Fluke comments were the cause, indirectly, of the Wall Street Journal Radio Network being shuttered. Because of no placement demands from advertisers, commercials from other radio networks could not be broadcast locally during Limbaugh’s show and some of those other radio networks, like the Wall Street Journal Radio Network, lost – in the weeks immediately after his Fluke comments – almost 40% of its revenue. I am told Fox News Radio lost about the same.
Today, talk radio stations are considered “toxic” or “non-toxic.” If a station broadcasts Limbaugh or other shows like Sean Hannity and Glenn Beck they are deemed “toxic.” If a station does not broadcast those conservative talk shows they are considered “non-toxic.” National advertisers buy, via radio networks and agencies, mostly “non-toxic” stations. When I first heard about this “toxic” and “non-toxic” nonsense I thought it was a joke. But, it wasn’t. And since most news/talk stations broadcast Limbaugh, Hannity, Beck and other programs like Michael Savage’s The Savage Nation, there are few “non-toxic” news/talk stations for advertisers to buy and that’s not good for the format.
Following so far?
But, Limbaugh’s business model, in comparison to most other syndicated talk shows, is somewhat unique and this is where those beating the drum about advertisers canceling commercials on liberal blogs are missing the point.
The Rush Limbaugh Show is fee based, meaning stations pay the show’s syndicator, Premiere Networks, a rights fee based on market size, plus provide barter commercial time to broadcast the program. Limbaugh’s show reserves at least 5 minutes of barter commercial time each hour with stations agreeing to broadcast those network commercials sold by the syndicator.
Mr. Limbaugh, sir. I regret to inform you Indianapolis and Boston no longer desire your services. Maybe if we deflate some footballs people will listen?
Boston’s WRKO-AM is paying around $500,000 each year in rights fees. They also provide approximately 3900 barter commercial minutes annually, which if valued at just $150 per :60 seconds is another $585,000 in cash they’re giving up. And there’s the Rush Limbaugh Morning Update, which tacks on another 780 minutes annually for another $117,000 in commercial time. All in Limbaugh’s show is costing WRKO-AM around $1.2 million dollars annually. Now consider all those advertisers, nationally and locally in the Boston market, that have no placement demands because his show is considered “toxic” and you quickly discover the financial reason WRKO-AM is declaring, “No Mas! No Mas!”
There was a time when Limbaugh’s show could make or break a news/talk station. There were short-sighted stations that foolishly called themselves “Rush Radio.” There was a time when paying Limbaugh’s huge rights fee was the cost of doing business in the news/talk format. But, no more. Not with terrestrial AM radio, its declining revenue environment and his declining ratings.
Minneapolis pays around $300,000. Tampa pays approximately $250,000 in rights fees. WIBC-FM, which also announced they were canceling his program is paying around $150,000 in cash to broadcast his show. He’s got around 600 radio stations. Do the math. Much of the business of the Rush Limbaugh Show is not in advertising revenue from commercials, but in rights fees.
WRKO-AM is owned by Entercom and WIBC-FM is owned by Emmis.
Clear Channel Media + Entertainment iHeart Media produces the Rush Limbaugh Show through its radio network, Premiere Networks. It requires most of its company owned news/talk stations to broadcast the show, pay the rights fee and give up barter commercials. See how the show is less dependent on commercials for survival and more dependent on guaranteed rights fees? There’s little chance Rush’s poor ratings today or tomorrow will change anything, because the money flows from its stations to the network to Limbaugh through a process called (corporate speak) “vertical integration.” Production and distribution is in one tidy package and distribution is all but assured.
Two more markets have canceled Rush and while we’re told “exciting news” on new radio homes is forthcoming, nothing is being said and weeks have gone by for an Indianapolis station to volunteer.
I was quoted in the New York Daily News this week. The article from David Hinckley talks about Limbaugh’s $400 million contract being up in 2016. Hinckley opines in his article, “Given Limbaugh’s prominence, his next deal could say a lot about both his status and the state of conservative talk radio.”
While his paycheck may be smaller in the coming years, as long as co-owned stations are forced to pay his rights fee, ditto heads will be happy to know he’ll be around for a while…unless he too yells, “No Mas. No Mas.”
Mr. Letterman, please pick up the white phone...Mr. Letterman, please pick up the white phone...
...whoever he is.
Libtard fantasies. Delusions.
So this guy things Rush rises or falls on whether Sandra Fluke is a slut?
And it turns out Rush was right about Sandra Fluke. Hope she enjoys hanging out with gals with hairy armpits.
"Shazaam! Damn straight."
Best known for his programming and as a personality at the legendary 700WLW in Cincinnat, lives in Cincinnati, Ohio with his wife Kathie and dog Jake. He likes to garden and cook. Don’t hold that against him.
—In 2010 Clear Channel, now iHeart, started its own conservative talk station in Boston, WXKS 1200 “Rush Radio”. They took Rush off Entercom’s WRKO as part of this. Two years later the station changed formats (now brokered business/financial radio from Bloomberg). WRKO got Rush back.
Now they have decided to stop carrying Rush and will substitute their own Jeff Kuhner (Savage listeners may remember him filling in). Kuhner’s morning slot will be replaced by a new show hosted by Kim Carrigan and another host to be named later, with content from boston.com aka The Boston Globe.
Rival WMEX, owned by Blackstrap and leased to Daly XXL of N.C. was rumored to be taking Rush. Nope; they have said they would rather run a show with host Bill Keeler out of Utica NY. Rush will be homeless in Boston though some listeners will still be able to get him on WGIR 610 Manchester NH, WTAG 580/94.9 Worcester MA, WXTK 95.1 on Cape Cod, and WHJJ 920 Prov RI. All are owned by iHeart whose Premiere arm syndicates Rush.
Maybe sports talk is considered “non toxic”. It’s doing well...anyway WRKO wants their own local guy and hope to make money with him. They were losing money with Rush,
who may well keep doing his show for years to come and maybe where you are, you can still hear him.
And...that $400 million 8 yr contract from 2008? (Salary plus bonuses). Rush is not going to get that kind of money next time around. iHeart is deep in debt as it is.
Maybe he’d retire or maybe he’ll wind up on smaller stations...or no station at all...in your market depending on the economics of radio.
In the first episode of WKRP in Cincinnati, station owner Mrs Carlson comes to the station after new program director Andy Travis changes the format from elevator music to rock and roll. Her son Arthur is the station manager.
Mrs Carlson: Young man this radio station is a business. It is not here for your personal listening pleasure.
Andy: Ma’am, I know it’s a business. That’s why I had to
change the format.
Thanks for some real data. I give credit to Rush for coming up/with a model that worked for a long time, but the end is inevitable. His Fluke comment was the wrong thing to say at the wrong time, fueling the “war on women” myth during an election season. He should have known better.
WIBC in Indianapolis is canceling? Wow. They are all conservative talk radio. I hadn’t heard that.
Yup...but this guy seems to know his stuff at least as far as the money goes. Also true that Boston isn’t necessarily a conservative paradise. But Howie Carr does fairly well.
(In Lowell MA, WCAP AM 980 was paying to carry conservative talker Howie Carr, but is dropping him to instead pick up liberal talker Jeff Santos. Turns out when Howie went _back_ to WRKO, advertisers turned to the Boston station. Rather than PAY for Howie, WCAP is _getting paid_ by Jeff Santos to carry his show. Air America flopped even in liberal Boston, with the likes of Santos having to pay to get their shows on....anyway it’s money, all money.)
Woo hoo! The free market at work.
So, you see, there's no need for The Fairness Doctrine or Net Neutrality or any other government imposed "solution".
At one time, Parks was Program Director at 700WLW here in the Cincinnati area. This article sheds light on why that is no longer the case and why the current programming lineup at the station is predominantly “unlistenable”.
Who is Darryl Parks?
Nobody asks, “Who is Rush Limbaugh?” and this guy talks about Rush’s “declining ratings” - in their wildest dreams.
as a technophile and good businessman Rush is more and more active on the virtual side on the Internet, which is where radio is going.
it is guaranteed that Rush is basically going to be around forever, or as long as he chooses.
Old people love him, and after his book series now little kids do, too.
As little as I listen to Rush any longer, I have NEVER heard of this metrosexual blogger until now.
Rush was right. And this clown is just a Leftist.
The libs arguing for the Fairness Doctrine would get mad each time I pointed out it would probably mean conservative hosts being forced on the local NPR outlet. “Fair is fair...”
About that $400 million contract Rush got in 08. Not bad.
Times have changed though. Flashback:
http://www.wsj.com/articles/SB121504302144124805
>>Updated July 3, 2008 11:59 p.m. ET
Conservative radio talk-show host Rush Limbaugh Wednesday inked an eight-year contract for around $400 million, underscoring how radio is spending big sums on bankable talent to compete in the crowded entertainment field.
>>Mr. Limbaugh’s compensation of $38 million a year, plus a signing bonus of about $100 million is less in absolute terms than the five-year, $500 million contract Howard Stern cut in 2004 with Sirius Satellite Radio Inc. But Mr. Limbaugh’s contract could net him more, as Mr. Stern must pay costs for his cast and production.
It’s a big jump from Mr. Limbaugh’s last contract, which at $285 million was a record for a radio personality when he signed it in 2001. Since then, the weekly audience for his three-hour midday show has held steady at about 20 million listeners, according to his syndicator, Clear Channel Communications Inc.’s Premiere Radio Networks. But advertisers are increasingly anxious to reach that audience.
Advertisers in general are fleeing commercial radio. Their marketing studies show a continued trend towards streaming and podcasts, with the broadcast audience becoming older and poorer every year. Hence the selection of “non-traditional” advertisers.
Bump,
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