It doesn’t take a genius to know that there’s going to be another massive round of “layoffs” (firings) in the year ahead. Clear Channel, the largest radio group in the known universe, is not going to be able to pay off the 19 billion dollars it owes lenders. Little things like paying off senior debt don’t worry the vulture capitalists that run radio now; you just turn the screws on the top layer of management and force them to re-finance the deal, insuring another round of exorbitant fees. Everybody’s happy.
Except the hundreds, perhaps thousands more radio folks who are going to get pink-slipped in the coming year by Clear Channel, Cumulus, and Citadel.
Cumulus, which is a huge group owner but not as big as Clear Channel, has spent the last year firing anybody who makes a decent wage and replacing the veterans (or not) with low-paid-still-wet-behind-the-ears “talent.” The bankers who run corporate radio today can’t tell the difference between quality on-air presentation and schlock, and the mid-level managers (those few who’ve made it through the last two years of purges) have no choice but to cut expenses.
Prediction: both Clear Channel and Cumulus will be significantly smaller organizations a year from today, but I won’t venture a guess as to what’s going to happen with Citadel. Cumulus has already tried (and failed) to take over Citadel. The “big three” will just keep re-financing debt they can’t possibly pay, enticing the bankers with more personnel cuts to “make the model cash-flow”.
Who’s the real loser here? Well, the experienced radio folks who will join the ranks of the many like them who’ve already lost their jobs; and, the consumer. The listener. Fewer “live” radio shows; fewer (if any) local news reports; more station clusters being run by one person during nights and weekends; and fewer real reasons to listen.
More music? Please. The mp3 player has taken over that function. More commercials? Sure, if there’s anybody left to sell and produce them. More live, local personalities serving up your daily dish of news and entertainment? Sorry. Not gonna happen.
I think it’s another grim year ahead for radio.
One of the local stations here has managed to find news-readers SO inept that they could not pronounce "Marshall & Ilsley" the same way twice in a row.
ReplyDeleteAnd every three weeks or so they find another newbie, who cannot pronounce any (random) three Wisconsin township names.
For more on how private equity firms, like the ones that own Clear Channel, make money read the new paperback edition of "The Buyout of America: How Private Equity is Destroying Jobs and Killing the American Economy".
ReplyDelete-Author Josh Kosman
Tim: I'm really interested in your take on this. It's clear you're referring to commercial radio here, but what about public radio? Isn't that doing just fine, maybe even better than ever before? NPR is doing some pretty remarkable things, both in traditional radio and online.
ReplyDeleteDo commercial stations measure themselves against public radio in terms of audience (I don't think they show up on Arbitron)? If so, how do they stack up? I know that there are public radio stations in Minneapolis and Seattle that program popular music and do very, very well (at least around pledge drive time). My thought is that commercial radio doesn't compete for ad dollars against public radio (although this is less true every year), doesn't need to really deal with it, but the increasingly local focus and original programming from public radio is probably stealing listeners who can't take all the right wing talk and demographics-obsessed music. Thoughts?
Jason: in my 4+ decades of commercial radio, working from LA to Florida (and the last couple decades in Madison) it's been my experience that commercial stations are in huge denial about the impact of Public Broadcasting outlets in their markets. In Madison, not surprisingly, public radio is a HUGE factor, and it's doing VERY well. The same can be said in a lot of other markets, from L-A and NYC to places like Austin TX, Raleigh-Durham, and scores of others, like the Twin Cities. The gutting of news departments that started a couple years ago (and continues) and the cost-slashing trend of having so many stations in a cluster "voice-tracked" by one person (who usually is affordable, rather than talented) will continue to erode the audience for commercial broadcasting in 2011, while public stations, with their ongoing and admirable committment to LOCAL news and information and talk shows with reasonable voices, will continue to enjoy substantial market share (though not, as you pointed out, officially "measured" by Arbitron) and those commercial stations which still use that aged "more music" approach will find that their audience will continue to erode, with management in denial that the mp3 player has replaced the FM radio as the source for music. By shedding the local talent with an understanding of, and ties to the community(read: cutting payroll), commercial radio's future is not very bright.
ReplyDeleteJust my thoughts.