Economics threatens to silence radio

Washington Times ^ | March 4, 2009 | Jennifer Harper

[Jim Robinson]

When big media companies lose big money, the public gets unnerved.

Some people wondered, for example, whether the New York Times would fold after it racked up $400 million in debt and was forced to borrow against its own office building to stay solvent a few months ago.

The paper is still publishing.

Now it is the moment of truth for CC Media Holdings - parent company to Clear Channel Communications, the nation's largest radio conglomerate. The company announced that it lost $5 billion in revenue in the fourth quarter, following a layoff of 1,800 employees in January.

Among its many properties, the Texas-based company counts Premiere Radio Networks - home to Rush Limbaugh and Michael Savage, among many other broadcasters - as a subsidiary with 190 million listeners. Clear Channel's programming is heard on AM, FM, online, HDTV, via iPods, cell phones, and even navigation systems on BMWs and Volvos.

The company on Tuesday appointed a "revenue manager" to maximize any moneymaking capabilities - with 40 monetizing experts to be hired in the near future.

"Clear Channel is showing us that there are no quick fixes to big corporate financial problems. They're going to have to operate with fewer resources - and I just hope it doesn't hurt the end product," said Michael Harrison, founder of Talkers Magazine, which tracks talk radio.

There are interesting dynamics at work, he said.

"Rush Limbaugh is now being hailed as the leader of the Republican Party. So maybe it's talk radio, which is the hope of the medium," Mr. Harrison said.

"Clear Channel hasn't failed yet. It has traditionally been the pattern that where Clear Channel goes, the industry followed. That was more true when the company was publicly traded, but that's no loner the case since it went private in 2006...

[gondramB]

>>When big media companies lose big money, the public gets unnerved. <<

I’m not sure why the public feels that big media should be immune to supply and demand. Radio won’t be silenced - there will simply be less money for programming that people don’t want to support. Radio will continue but Howard Stern may get hundreds of thousands instead of millions and less popular shows will have to take less money if they want to stay.

[Professor_Leonide]

Unsuccessful talk show hosts and their channels (think Air America) can’t make it even in the best of times, and sadly, the minimally successful talk radio venues will fold in hard times.

Rush Limbaugh will continue to succeed.

[Cicero]

Uh oh.

I would THINK that Rush would be safe, since he has such a large and loyal audience. Even if Clear Channel fails, he should be able to syndicate himself among the surviving radio stations.

That’s assuming, of course, that any radio station in these economically difficult times, with shrinking advertising revenues, would want to have a guaranteed audience maker. It’s always possible that today’s owners and managers suffer so badly from liberal derangement syndrome that they’d rather commit suicide than give airtime to a conservative.

And it assumes that Obama doesn’t come down with the Fairness Doctrine at the key moment and scare everyone off. He might seize on a major crisis in the industry as a chance to intervene.

[dr_who]

It isn't just "economics". The so-called fairness doctrine may be dead, but the Democrats will find other ways to get what they want. Watch out for "diversity of media ownership" and "net neutrality". Featured on Drudge/WSJ/Politico:

WSJ: Obama to Tap Tech Adviser as FCC Chief

This jerk is a friend of Obama and a big time fundraiser. Draw your own conclusions.

Politico: Rush Job: Inside Dems' Limbaugh plan

[utherdoul]

Most of radio is garbage. The music is the same canned classic rock on a twenty minute rotation with “thirty minutes of music” being about twenty minutes of crappy ads. I rarely listen to talk radio (mostly because I don’t have time) but Howie and Rush form most of my listening basis when I do.

The other half of radio is of course NPR of which 95% is leftist garbage or crappy authors pimping their work or lamblasting the jews. I never listen to it but its got a built in fanbase more rabid than the average Mac user or Obamite. Not to mention its tax payer funded meaning it can’t go out of bussiness ever.

[dr_who]

One would think that the FCC is going to go after Clear Channel ...or Clear Channel is preemptively licking Obama’s boots.

[WVRockDJ]

Those folks need to fact-check a bit better. While Premiere Radio Network is an arm of Clear Channel, Michael Savage is syndicated through the Talk Radio Network, run by the Masters family.

[fight_truth_decay]

Times is borrowing to build their Internet presence (over paper) and to attract advertisers.

[Oldeconomybuyer]

Advertising revenue falling below fixed costs. Same thing happening across most industries. Near depression. Too bad our White House cares more about their political future than individuals or commerce.

[hoosierham]

Call it class envy or whatever you like;I believe the huge salaries received by the executives and many entertainers simply doesn't reflect their true value.

It is possible to price yourself out of the market.

One of my ex-brothers-in-law refused to work for less than union scale as an electrician.He used to be laid off more than he worked!Why should anyone else be immune to the reality of economics?

[Oldeconomybuyer]

In an open market, all prices are based on what people are willing to pay for goods or services, not what the government says they are worth. Example: US vs. China.

[hoosierham]

That's correct.

And sometimes the buyer overpays through miscalculation or ignorance,later to find he didn't receive the value expected.Next time the buyer refuses to overpay.

[Oldeconomybuyer]

Agree!

[Clinging Bitterly]

Big media outfits like CC have only one major problem and that's debt service on their acquisitions. It may have been supportable in a stronger economy but it sure isn't now, and they will likely need to do some selloff and downsizing.

Our biggest local station, a 50KW true clear channel AM (also owned by Clear Channel), just dumped the local on air people for the second time in a year, this time replacing them with a live airing of the Glenn Beck show (in addition to the regular delayed broadcast in the afternoon). They have a brand new state of the art studio, a fairly new transmitter, and a huge four tower directional array, but for years their local programming has been mediocre at best and whomever has been running the mixer is a total incompetent.

The station announcements say they will soon have a new and “unique” local morning show, but what it's going to be remains to be seen. They carry the top three national daytime shows plus a popular regional show (also conservative politics oriented), plus the successor to Art Bell overnight, and I don't think that's going to change.

This may be a liberal town, but the second rated station in the market once bowed to “community pressure” and dumped it's conservative shows, and only saw lower ratings - because the long haired maggot infested dope smoking FM types stayed with FM. Their only interest in “talk radio” is to silence the voices of the right.

Whatever becomes of Clear Channel and the like, the properties (programs and transmitters) are not going to go dark. Ownership and management could well change, but barring a total SHTF scenario changing us into a hunter gatherer society, the valuable assets will survive and continue to operate.