Few saw it coming.
This group of Texas outsiders rounding up over 1,100 stations was unthinkable back then. But the little engine that could wound up to be the little engine that couldn't. You don't head for the door and sell off 400+ stations and jump into the arms of investment bankers to take you private unless being a public company doesn't work.
Well, being public doesn't work for Clear Channel and, for that matter, the rest of the radio industry it supposedly leads.
Radio is a good cash flow business for now, but a bad investment. An industry that has lost the next generation has no future. Who invests in stocks with no future? The fat cats know this. They know that there is more money selling off the real estate than operating the family business.
But how could this happen?
How could a company that got every consideration from the FCC and Congress mess up so badly?
How could a company that had assembled all the prime stations in all the prime markets with all the best people go so lame?
Was it Steve Jobs who did it with his iPod and digital downloading? Was it the record labels because they lost sight of the next generation at precisely the same time radio did? Was it because Congress would not allow further consolidation? Was it satellite radio?
What was it?
It was management not ready for prime time -- the wrong people managing the right assets.
And that means the man at the top -- John Hogan has to take responsibility. True, it isn't a cakewalk working for a large family business. But Hogan is the one who made key decisions for the leader in radio consolidation. The buck stops with him.
One of my readers hit a responsive note by reminding us that Clear Channel's squandering of top talent was virtually unprecedented:
"The following list could be a list of the most brilliant people ever to grace the radio business....Randy Michaels, Bobby Lawrence, John Gehron, John Cullen, Jay Meyers, Roy Laughlin, Andy Rosen, David Ross, Mike Glickenhaus, Jim Meltzer, Jack Evans, Bill Richards, Steve Smith, Bennett Zier, Marv Dyson, Lee Clear, Bruce Demps, Jack Taddeo, Dave Lange, Brian Purdy, Jerry DelCore, Ken Spitzer, and on and on and on....instead its just the tip of the iceberg of the talent that has been drained from this company..."The Hogan years have been tough. Litigious and arrogant in the beginning and unilateral and self-absorbed in my opinion after that, Clear Channel under Hogan failed to make critical decisions that doomed its fate and hurt its fellow consolidators.
- "Less Is More" devalued radio. It was an attention getting ploy that eventually convinced advertisers and agencies that radio had too many commercials and that their commercial configurations weren't effective. "Less Is More" never translated into better ratings. It never led to increased revenues that resulted in higher profits. "Less Is More" hurt radio more than helped it. "Less Is More" is Hogan's baby.
- Failure to support the People Meter delayed industry adoption of the measurement advertisers and agencies demanded. In a digital era, Hogan chose paper diaries. It was almost as if he instinctively knew that Clear Channel was not in the radio business for the long haul.
- Seemingly endless management changes weakened the strong field of actual working managers Clear Channel assembled through luck or skillful acquisitions. As my reader put it, "Internally the joke is he rearranges the deck chairs every August right before the Titanic hits the iceberg. Change the game before anyone knows you failed at the last game". That might be unfair because Hogan still had to report to the Mays family, but he could have fought for what was right or he could have resigned if he didn't like it.
- Clear Channel presided over the "Dark Ages" of radio -- no impacting new formats, no new mega stars, no minor league system for growing talent for its large market stations. It was as if they just got the knife out and started cutting.
- Embracing virtual voice tracking never panned out. It was a shortsighted way to save money through technology. Paying talent to record tracks for markets they are not in is not local radio, it's not even network radio. It's "Sin-dication" because it is a sin to try to mislead the audience, send the wrong message to talent and try to run radio on the cheap.
Well, it cut costs with the best of them.
It excited Wall Street with its promise of quarterly earnings -- at least for a while.
It acquired things, but not really things that could make the company an earnings leader in the 21st century.
It did little impressive on the Internet.
Late to the game with a mobile strategy.
Ignored Generation Y.
You've probably got your own thoughts as to what made so many great assets in properties and people go so badly for Clear Channel. Sadly, there is no shortage.
If Clear Channel radio had been a rousing success -- a Wall Street wonder, a category killer John Hogan would rightfully be taking the credit.
He's got to step up and take some of the blame.
And credit should go to the many managers, programmers and sales people who have been able to fight for market share with their hands tied behind their backs, their budgets slashed and without the benefit of top management leadership.
In spite of all the odds these people used their pride, ingenuity and resourcefulness to help the Mays' get to where they are today -- ready to get rich a second time.
It wasn't their man John Hogan who did it.
It was the people of Clear Channe.
I call them Hogan's Heroes.
