Posted on 03/02/2008 9:15:04 PM PST by jwalburg
As waves of talk hosts, producers, disc jockeys and news personnel are sent packing in the wake of Citadel- ABC Radio's financial collapse, shell-shocked radio insiders are wondering if anything can be done to save their highly- successful talk format.
Yesterday, now known as "Black Friday", has career professionals in a state of outright panic, with even more job cuts expected on Monday. When it is over, even the highest- rated major- market outlets will be expected to somehow function with few remaining staffers.
And even deep cuts aren't likely to provide more than a drop in the bucket for Citadel's precarious situation, especially heading into a macroeconomic slowdown.
For years, broadcasters have been held hostage by incompetent executive management, forced to watch as they gutted the industry. While their scorched- earth policy was meant to maximize station valuations, in the end they have succeed only in losing billions of dollars, with angry investors left holding the bag.
And when CNBC's Jim Cramer correctly called radio "dead" recently, a few of these clods still had the nerve to dispute it.
Somehow, even while some of the nation's most successful talk and music stations and imploding due to gross mismanagement, these corporate suits still have their jobs. And some are as arrogant as ever, a key point in Cramer's rant.
Topping the list is Citadel CEO Farid Suleman (above left), radio's poster child for managerial incompetence. How this man could survive beyond Monday in his current position is beyond comprehension. As he speaks of coming "belt- tightening", cost- cutting that apparently excludes him, why is he unwilling to accept blame for his company's outright destruction?
While Citadel- ABC Radio was encountering a nationwide ad sales meltdown, Suleman was busy sucking up to Don Imus, wasting months crafting an ego- boosting mega- deal for the elderly fossil- talker. Instead of bringing the best programming minds into the fold to confront the challenges of the future, Suleman micro- managed schedule changes in markets as small as Providence.
Now, Citadel's stock has fallen so low that the New York Stock Exchange was forced to suspend trading and outright delisting now seems a certainty. Shares (NYSE:CDL) are down 87% in just the last year.
At a mere dollar a share, the firm's entire market capitalization is now below $300m. Instead of the quarterly profit Wall Street was expecting, it reported a $848m loss, mostly because station valuations have been written down to rock-bottom levels.
Given this dire scenario, Citadel's survival prospects are virtually zero and it's now just a matter of waiting for the complete implosion. With stations now worth so little, massive debt to pay and rapidly- deteriorating ad revenues, who would want this sick puppy at any price?
Normally, the best strategy would be to break up the company and sell off stations individually, but there are already a glut of unwanted outlets clogging the market. And in a tight credit market, who in their right mind would loan a person money to buy radio stations?
For talk radio, the problem is that our format is as successful as ever in terms of ratings, with record audience growth likely during this wildly entertaining election year. With the prolonged Democrat primary contest and wide- open November races, it doesn't get any better than this. It's a talk host's dream.
So what can one do? We've all sat back and watched helplessly as our industry was gutted for no good reason. Those few who still have jobs may not for much longer.
Yet the audience is still there and actually growing. And top- quality shows such as Rush Limbaugh's certainly aren't hurting for advertisers.
Over the past year, we've seen large numbers of displaced broadcasters wonder what to do with their lives. Now, the situation has deteriorated to the point where even the most successful hosts are threatened by managerial stupidity.
Playing it safe now longer works- it's time for an vocal campaign to remove the rot that plagues the executive ranks of this industry before the rest of it collapses. If you think keeping quiet will help you get back to work, guess again. The party's over.
In addition, there may be opportunities for broadcasters to purchase stations at fire- sale prices in the coming months and years. YOU know what you're doing, THEY didn't. Mom- and- pop operators relying on local clients and community service have the best chance of surviving this train- wreck and even thriving.
Let's get to work and figure out how to save talk radio, the one medium that can survive iPods, streaming and every other technological development currently killing the music formats.
Our economy is a mess. THis is a symptom.
No, the listeners are the ones ultimately held hostage. Then again, it's amazing how so many people willingly suffer through the decades old cookie-cutter crap that's on the dial. I've said it a zillion times before, and will say it again - if everyone would get together and turn off their sets in protest for just one day, the useless suits would panic and fling themselves out of the towers. Maybe then we'd get something worthwhile.
They suffer from that same over sized ego's that print newspapers have, and they are all going to go down the tubes to the toilet.
Satellite radio is suffering from the same ego and they are not going to survive either.
They need to realize that things have changed and change with them, but it seems that they cannot.
I pay a decent a amount for commercial free programs that I like and I'm willing to do that because I can listen to them when and where I wish, and also how as well. You can't beat that with a stick.
Now we just need to get rid of TV.
Rush probably has enough money to buy every station in the Citadel portfolio — and if he doesn’t have enough in his own pocket, or doesn’t want to risk that much, he could certainly attract enough investors.
Citadel’s current market cap is about $290 million. Carve it up and split the stations between Rush Limbaugh, Rupert Murdoch and George Soros, and then you’ve got a freakin’ circus on the AM dial. I don’t know how much it would illuminate the national discourse, but wouldn’t it be fun?
Of course, with dirt-cheap radio stations available, some of them would probably go Spanish or Hindi or Mandarin.
I saw this coming ten years ago, which is why I got out of broadcasting. Non-talented, ignorant, management suits and "consultants" have ruined radio.
Imus was a really bad, bad move. He is driving away listeners in droves. Once that dial is moved, you have a tough time moving it back.
I set my radio to 660 Sports Radio during the morning commute (Imus’ old station), because I just can’t listen to that program. At lunch time or evening drive, I hop in the car, and something other than WABC is on the radio. Usually I will flip over to Rush at noontime, but not listening to Hannity has been a real pleasure.
WMAL (Wash DC Rush station) finally dropped that waffling moderate Chris Core on Friday. It’s probably not a bad thing if the RINOs get the axe.
Now it is for me with the nationals Rush Limbaugh and internet streaming-wise on my computer, WABC’s Mark Levin. They still do brillent when it comes to talk radio. Otherwise I do local talkradio.
What we are going to see more is more emphesis on local conservitive talkradio shows, folks who know what is going on the local level. As I have said in another posting, the only nationals I listen now is Rush Limbaugh and Mark Levin.
Imus is jarring and off-the-deep-end. Hannity whines and is still not well-rooted in his conservative ideology to be worth much time. Others just don’t even rate listening to at all.
WLS-AM 890 in Chicago actually has a great lineup, which includes Rush and mostly home-grown talent and is a station I need to tune into each day. Unfortunately, they are part of the Citadel group and as of late Friday, they were announcing big layoffs and a possible format change.
As near as I can tell, Citadel has mismanaged their purchase of ABC Radio, at least as to how it impacts WLS.
I hope this gets straightened out soon. I’m really glad for the internet radio access to their talents, as well as Rush, all live.
If Scott Adams is accurate, it isn’t just the broadcasting industry that has this problem either.
That gets directly to my point. We don't really need the stations anymore. Rush is not a station, nor do the others need to be.
The business models are changing, and that's OK with me.
Advertisers are becoming more savvy with their nickles, and people are not going to get the free stuff anymore, but that's OK too......
The old days where institutional ads that were not directed at any particular groups, have yielded little result for decades. The smarter companies have found better venues, and podcasting is one, cable TV another, with it's unique variety.
Radio has not been able to compete, and I say this as a ex-accountexec with a major FM station many years ago. It was hard then.....Now it's got to be really hard.
I guess I have noticed more ads on streaming radio. So you think old stations will become online stations, and the advertisers will pay for spots on online streaming radio? I do notice more ads now. But I don’t see how me in South Dakota, listening to a Texas station and hearing ads for foundation repair and steel siding out of Dallas/Ft. Worth — which is what is happening now — will help advertisers. Won’t they have to target less rather than more? Or, do you think we will end up having to pay to hear streaming radio, to register, instead of getting “free stuff”?
Impeach, FYI.
Prayers up for Melanie.
They simply are fading away as a carrier for the nationally syndicated programs. These programs are not produced in radio stations. They are produced in studios and sold to vendors or the vendors are owned subsidiaries.
What this really means is that the bulk of listeners are moving to other means of listening, and the way the new media is monetized is different and actually more targeted for advertisers. better bang for the buck.
This all means that stand alone stations are going to be very rare, and collective groups the norm. They are not going to be traded publicly as they were before, and will be largely private corporations as the growth potential is nearly gone or very weak, and stockholders will not be interested.
Industries mature at some point, and radio has been hanging on by a thread for decades. It's past time to put it in it's new place as a local entity, and forget about growing it back into a national ad media source as it was for 50 years.
As to talk radio, it will still flourish, but you will not hear as much of it on radio stations. You will get it on devices and on a pay per view, or free, as the case may be. It will be salted with national ads targeted to demographics for that particular genre, and I see a lot of video moving this direction as well.
These devices will and are interfacing with your home and auto audio/video systems, and this means that fewer people will listen to local stations. This reduces ad revenue, and changes the dynamic for radio and eventually TV as well. Things like TIVO and MOBI TV for smart phones and pods are changing the way people access media, but we will still get what we want, you can be assured of that.
I don't see any of this as being a bad thing. It's better for advertisers as to wasted ad money, and it's better for consumers as we can listen or watch when we want to, and not because of the date and time the program airs.
I like it.
This probably explains why our local stations are almost exclusively local sports, weather and country music. I am forced to go online for what I want to hear, and the only market left to the local stations is sports because you can’t get local sports anywhere else.
Radio is all about drive time, the other 20 something hours of the day are irrelevant.
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