If I Ran Clear Channel

Citadel won't make it past the serious problem of renegotiating its new debt agreement by the end of this year.

Citadel may not even make it to the end of the year.

Yesterday, Citadel went silent on financial info.

No more press releases or conference calls. They're just going through the motions now because there is no longer an upside to the radio industry and in particular, their stock.

Bankruptcy is inevitable.

The best they can do from here on in is more of the same or worse. The economy is killing the part of radio that bad debt management and poor decision making hasn't already done in.

Citadel is not alone -- all radio groups are in trouble with revenues down 20-30%.

And when Cox, one of the better run groups, is down at all their stations, you've got snapshot of how serious the situation is.

As my readers know, consolidators buying stations at hugely overpriced multiples and at interest rates they could only manage in boom times is why the industry is failing.

The question is can you save it -- do you save it? Or is it just destined to die?

On the present course, there is no turnaround possible in spite of which flavor Kool-Aid radio CEOs are trying to serve you.

The industry has contracted over the past few years and really contracted since last Fall.

Cumulus CEO Lew Tricky Dickey got away with furloughing all his employees for a week to save about $1 million. He could have just given back $1 million of the $8 million unnecessary bonus he took last year to sign a new Cumulus employment contract, but noooo.

Radio One and Done is now trying to one-up Tricky Dickey by closing for ten half-days (I guess that sounds better than five full days -- take that, Lew!).

Even Radio One and Done jocks will have to go off the air but don't worry -- radio's answer to everything, voice tracking, will kick in. I guess these morons don't understand that listeners want to be entertained on the radio not voice tracked to death.

At Radio One and Done vacation days must be taken or they'll be lost -- that's a new policy just announced. Odd, isn't it -- their hardworking employees hunker down to help this troubled company. They postpone their own personal time off. Now -- when they get to take their rest becomes an issue.

Radio cannot be saved from these CEOs if they remain in power.

In any other industry, they'd be toast. But with the poison pills, convoluted stock control setups favoring the failing CEOs and boards of directors swallowing their tongues -- you see what you've got.

I promise you -- radio will not survive if this keeps going on.

There is another way out.

One with more promise.

Run radio like a local business -- with local management empowered to hire, fire and make a profit.

It is very unlikely to be enacted, but I think you'll agree it gives radio a better chance to survive than the next idiot's "three weeks off with half pay and half days" which is bound to happen.

May I share my plan with you?

1. Fire the CEO.

Okay, I lost you at "fire", didn't I -- because you know it is never going to happen. But if you're going to continue to read this plan, you're going to have to assume these recommendations can be implemented -- at least until the end of this piece.

2. Replace him or her with the best general manager in the radio group. No, don't promote another lame administrator who has spent the last five or ten years kissing the fired CEOs sorry butt. I want the best GM in the group -- someone who knows sales, programming, local radio, business and has outstanding people skills that would make Dale Carnegie envious.

Still with me?

3. Fire all corporate staff -- everyone. (This is not making me a lot of friends with the NAB for lunch bunch, but what the hell -- there I said it).

4. Eliminate all regional, national or any other cockamamie organizational charts -- you won't be needing them under my proposal. Sorry, we're only keeping the hard working talent from now on.

5. Each station in the group has a manager who has one job -- manage the damn station. Not two. Not three. (You'll see why soon).

6. Each manager reports directly to the new CEO. Remember? That appointment was just filled by the best operating manager in the group.

7. Each manager gets a one-page "goals" sheet. It lists the expectations of the group in terms of income, profit, audience, etc. It also lists the budget that corporate is promising to the manager for one year.

8. You see, you don't need all those needless levels of regional or cluster management because once this paper is signed and the GM knows what he or she is expected to do -- and what they will get in economic support -- you won't be talking to them again until the year is up. They can catch up on their reading. Why not start here?

9. If the GM meets the group's goals, he or she keeps their job and gets the compensation promised plus a bonus based on how much over the goal this manager can deliver. He or she wins an automatic renewal for another year with reasonably increased goals. You can't fire them even if you hate their guts. This is not eHarmony. It's about the best manager running your best assets.

If you're still with me so far, hold on -- there's more ...

10. The GM hires the PD -- and yes, a live, breathing, thinking program director is a requirement for each station. Whether he or she is on the air as well is up to the GM doing the hiring. It's in the contract -- "must have PD".

11. Since the manager gets to hire the PD, the PD also gets a one-page "goals" sheet with what is expected and how much money he or she has to run the department. If they succeed, they get to earn another one-year contract. If they exceed the GM's goals, they get more compensation and consideration. If they fall short, the call on whether to keep the PD is up to the GM.

12. The GM promises to stay out of programming decisions or his or her nose will fall off. After all -- you hired the PD and we have to assume you at least know how to find the person you want for one year so butt out. Failure to do so is a breach of your contract and the GM gets fired.

I can go further into this, if you like ...

13. Here's a novel idea -- the PD hires the talent within the budget he or she agreed to in their signed goals sheet.

14. Each morning show is live and gets a live jock or team (the PDs call) and a minimum one-year contract. I like morning teams. They make the station a lot of money. I'm locking them up for a year -- that's nothing. And, by the way, this is not a typical Clear Channel contract that they can wiggle out of -- it's a real contract that says -- work your ass off for us, we've got you covered.

15. A minimum of 80% local programming is mandated -- more if the PD likes.

16. No voice tracking!

Oops -- just lost John Slogan Hogan (oh, that's right, I lost him at #1).

17. Make all-nights your "minor" league to develop talent at all-night prices. Promote the all-night show up to evenings with a significant pay raise when you need an evening jock and if the all-night jock is ready. We used to do this, guys and gals.

You may want to click over to some "happy talk" radio news right now because this going to get ugly ...

18. Make afternoon drive just like mornings and put a "morning" personality into that slot. Research shows afternoons are bigger or as big as mornings in ratings so -- duh -- do something about it. Don't just do repeater radio.

19. No voice tracking! (Just thought I'd say it again because once I called for an afternoon show with a "morning" personality, I'm afraid some GM is going to panic back to voice tracking).

20. Give the morning and afternoon talent a piece of the show's revenue once they make their goals. No tomfoolery here. Open the books. If they bring in more money, they should get a piece of the profit. And no raising the threshold in year two -- unless it is by a pre-agreed, fair percentage like 5% or 10%. My plan calls for not screwing people.

Anyone left standing?

21. Sales manager must field a team of at least ten salespeople in all markets. The sales staffs are separate for each station in the group. My concept is the stations compete against each other and that competition brings in more revenue.

22. Sales people work on commission and yes they get vacation and if you're smart -- let them get some favorable health insurance arrangement once they earn their keep.

23. Commit to train them -- don't make the mistake of the Lew Dickey's "Dickey Doo and the Don'ts" by cutting them loose without the tools to sell. If you turned a brain surgeon loose on say, a radio CEO, without training them to do that type of surgery, you wouldn't like the results, would you? Be nice.

24. Uphold your rates. No dropping of drawers. No pressure that leads to panic and low unit rates. The GSM must do this and by the way, the GSM gets a one-year "goal" sheet. Leave them alone once you hire them.

25. 12 commercial units an hour max -- ever. Never 13. One unit at a time.

26. No commercial break longer than one minute or one unit.

27. Weather and traffic can be added.

28. Two 30-second promos -- one per half hour if it isn't for some foolish contest that nobody really wants to play.

29. No public service announcements that say "Clear Channel cares about your community". Don't you get it yet? People today want you to actually show them you care. Go into the community. I know this is hard to do from Cincinnati or San Antonio but hell -- we've eliminated all that corporate waste.

And while I'm at it ...

30. Every phone gets answered. Use interns to answer studio lines (pay them with tickets). No recorded messages.

31. Put news back on the air -- let your PD decide how and leave them alone.

Of course, we can make every station profitable and local but we cannot make radio a growth business without entering into the digital future ...

32. Each local station builds 50 podcast franchises (not squeezed from terrestrial radio concentrate). Monetize through live reads and ancillary forms of income. Do not tie any of these into the radio operation. It's a separate stream of income.

33. Let your salespeople sell Internet radio stations to your local advertisers. Not yours. Their retail or business "radio" stations. You build them. Own the imagery. Produce them and they pay you. My friend Joe Benson can do this now. Up and running in a week and getting every week thereafter. Imagine this stream of revenue.

Oh, hell -- I'm not giving Lee and Bain any more ideas for nothing.

Hey, I can go one better.

Lee and Bain can hire me for one year at $1 and I'll take 10% of the increase in profit that I generate with this plan.

I know one thing for sure, the best talent in radio will come work for me under my proposal because they know when left to be the professionals they are -- and not abused or mismanaged by morons -- they can achieve goals under any economic conditions.

I'll guarantee them reasonable security, decent pay with incentives and I'll leave them alone to meet their agreed upon goals.

But I'm not relocating to San Antonio.

Unless I get Hogan's corporate jet.

Pick me up at Scottsdale Airport.

Not that I don't trust you or anything, but I get to bring my own pilot.

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