Marky Mark's Clear Channel Pay Cut

There's a new Marky Mark and the Funky Bunch -- it's not Mark Wahlberg.

It's Mark Mays and the private equity firm of Lee Capital Partners and Bain Media.

Forget the Obama inauguration. Closing Gitmo pales in comparison. By now you've heard the real "breaking news".

Marky Mark is taking a bullet for his employees -- a 40% pay cut.

Isn't that impressive?

Even his brother, Randall, is going along with it. Founding Father Lowry Mays' best work -- Randy and Mark -- are voluntarily giving up (and I'm tearing up right now) $875,000 and $895,000 respectively.

For one year.

Then, they go back to getting a pay raise.

Up to $1 million per son -- in other words, they make some of the short fall back and emerge from this year of financial sacrifice earning an even higher salary.

That's called A Marky Mark Mays Pay Cut -- less is more. Go offer that deal to the employees you just fired and see them jump at it.

And no more guaranteed bonuses for the two boys, either.

See, they're really going to suffer in 2009.


Unless they meet certain performance guidelines and then rest assured that their bonuses will be capped at only $4 million -- a piece. (The way Marky Mark is going, I'm wondering if the bonus isn't tied to how many employees they fire -- you know, at least in terms of cost cutting).

One of my Clear Channel executive readers thought I was not being fair by ignoring the Mays pay cuts so I want to go on the record here and commend them for attempting to pull off another heist on their employees.

This isn't a pay cut -- it's a raise that Marky Mark is calling a pay cut.

How dumb does he think his employees are?

Thousands fired -- with 1,850 of them pink slipped just days ago -- and the two most useless parts of Clear Channel are getting rich again.

And forgive me for thinking -- in the back of my mind -- that Marky Mark and his Funky Bunch is getting ready to ask the surviving Clear Channel employees to --

Let's say it out loud all together --

Take a pay cut.

Without the raises a year later and with no bonuses.

The Mays family and their selfish view of a grand industry is not above lining their pockets even as they conduct the most massive extermination of radio talent in the history of the industry.

Don't forget the millions they made in stock -- when Clear Channel stock was worth something.

And, the over compensation that was paid during the good years.

And, oh yes -- the bail out profit when the Funky Bunch at Lee & Bain overpaid for a declining asset to take the Mays family out.

Pay cut, indeed.

In effect, the Mays family has looted the place.

It's hard to know if the Funky Bunch at Lee & Bain is delegating decision making to Marky Mark and his brother as well as to their minion, John Slogan Hogan. This group is clueless. You'd think they'd be embarrassed, but they know no shame.

What's tragic is what could have been.

No one really predicted these Texans walking away with the prize of 1,100 radio stations thanks to consolidation. They had a history of being an unremarkable company under patriarch Lowry Mays. They were known as "Cheap Channel" in the days well before consolidation.

Who would have guessed?

But someone else might have made it work using a different approach.

They have severely damaged the radio industry -- and that will be their legacy.

It was an accident of fate -- Lowry's health problems -- that jettisoned these two sons into major positions at the one company that was big enough and influential enough to set the tone for radio consolidation. Under normal circumstances, because of their age and lack of experience, they would be lucky to get a middle management job at a bank or accounting firm.

And if their father wasn't who he was, they would have been canned if for no other reason than they were suckered into buying Bob Sillerman's concert company -- a company they couldn't run and had to sell (now Live Nation).

Sillerman has a way of walking away from the disasters -- after someone else buys them.

Sillerman was among the first who figured out the money he could make selling to naive guys with their hands on lots of money to spend. They were ready to buy anything with easy money that the Wall Street bunch could give them -- for a fee.

The Mays kids and a handful of other dupes have inadvertently enriched smarter guys like Sillerman who has taken the money and run.

Now, while Marky Mark is asserting his "leadership" on a hobbled radio industry that was harmed the most by Clear Channel's presence, the sector dies a slow death.

More Clear Channel employees will follow the 1,850 from Tuesday's massacre.

The bottom feeder consolidators like Citadel with their penny stocks and lack of vision will just use Clear Channel's game plan as cover for their own cutbacks.

Again -- and together, please -- a growth industry does not cutback.

I'd like to say that now that the Clear Channel bloodbath is over, the worst is behind for the radio industry. But I can't.

Downsizing will continue.

Nationalization will be so impressive Hugo Chavez would be impressed.

What will emerge is a company that plans to use transmitters and towers as repeaters. Sell advertising across that platform through small cluster, regional and/or national teams. Don't be surprised if Clear Channel becomes big in remnant advertising.

No, not selling spots to the Ajax Carpet Company on Main Street U.S.A.

But selling cheap air time -- for bid to the lowest bidder -- a commodity like everything else Wall Street values.


Sales less.

Fate has played a cruel game on the radio industry.

If Susquehanna, Nationwide or Jefferson-Pilot/Lincoln Financial had become the lead consolidator instead of the greedy Mays family, I truly believe radio would have survived to enter the digital age -- not just in the terrestrial radio business -- but as an Internet stream of different content, podcasting, mobile content and all the things necessary to keep the next generation listening albeit using different devices and concepts.

You see, Clear Channel got it all wrong.

Full of itself, it took the next generation of radio listeners for granted.

Clear Channel thought the next generation was the Mays children.

Not the 76 million people born between 1978 and 2000 that could have made all the difference.

For those of you who would prefer to get Jerry's daily posts by email for free, please click here. IMPORTANT: First you must check your mail or spam filter to verify your subscription immediately after signing up before daily service can begin.
Thanks for forwarding my pieces to your friends and linking to your websites and boards.