Write to me again because I'm still saying it.
The other day I wrote a piece about employee pricing that could help existing local management buy radio stations from cash strapped consolidators who have fallen on hard times.
Basically, there are a lot of radio stations for sale -- publicly and privately. The more visible ones are CBS' smaller markets and Citadel's "make me an offer, any offer" markets.
So what do we know about Sam Zell, the successful real estate mogul who once teamed with radio's programming mogul, Randy Michaels, to build and sell Jacor for lots of money.
1. Zell doesn't like "employee pricing". He wants distress sale pricing. Zell doesn't pay retail. Look at the record.
2. Zell can always find financing. I know it's hard to come by but he's got lots of options -- among them, try to sell his Local TV unit -- perhaps with the newspapers that are dragging him down -- to someone who can. Say, Rupert Murdoch or someone of his ilk. Never count Zell down for getting a deal done, but the price must be sweet.
3. He's comfortable employing people like him -- a little off center, but talented. Michaels was made for Zell.
4. Michaels did not hire his old Jacor buddies away from Clear Channel (and he's hired a lot of them) to have them get their fingers dirty with news print. I love these guys -- and like some of their print ideas -- but even Jesus couldn't turn newspapers around (Forgive me, Sister Mary Francis, I know I am going to go to hell for that one). But they can still run a mean radio group -- if only they had one.
5. A terrestrial radio group by itself is not worth the investment. There is no growth in a business that does not now have nor will in the future have the next generation available. That's why an Internet strategy is so important. Michaels has been hiring good Internet people ostensibly for the newspaper business.
Something big is in the works.
Maybe Mel Karmazin has a plan to roll Sirius XM up with a terrestrial radio group to create one giant media platform. If he does, I hope he's got a major Internet and mobile component or that roll up will shrivel up as soon as investors figure it out.
I think Lee and Bain have all they can handle with Clear Channel. They're not having a lot of luck selling Clear Channel's debt. The master plan may have called for adding more radio to the Clear Channel group, but I'd be surprised to see it with these folks now. I do expect the Mayses will ultimately be shown the door -- kind of like Larry Wilson at Citadel -- and blamed for everything that is wrong with Clear Channel.
And, as I've said, there's Zell and Michaels.
I'm not counting them out and you can't, either.
They are uncharacteristically quiet and that is saying a lot.
Anonymous, write to me. You know who you are -- and I do, too. Tell me I'm wrong about this big bang theory of mine.
And cross your fingers and toes while you're typing.
Radio is falling apart. The owners and operators are seemingly oblivious to all this. You and I are talking about it all the time. They are missing in action.
And you know what they means?
They've got some deals up their sleeves.
It's hard to say with certainty who it will be, but it will be someone.
As we used to say in Philly, "You Heard It First on W-F-I-L".
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Thanks for forwarding my pieces to your friends and linking to your websites and boards.
