A Manager Grades Clear Channel

One of the great things about living in this country and being broadcasters is that we have freedom of expression.

And since the Internet has come along, we have seen so many diverse views on almost everything that it takes Google to help us search all the content.

Here in this space, I have written about my love for the radio industry and its people, disdain for consolidation and its mismanagers and concern that the best content providers ever are missing the digital revolution.

Some days I try to use humor.

Some days I can barely hide my outrage about what the biggest consolidators are doing to ruin a perfectly good radio industry. Often I try to share what I have learned about generational and new media.

I get a lot of email and love every bit of it. You make me think, suggest story ideas (about one-third of my pieces are inspired by readers) and express differing views all in good spirit and kindness. In fact, you have also given me great ideas like doing face-to-face media solutions labs (more at the end of this piece).

It is so much fun I never want to take a day off. I’m on vacation for two weeks but not on vacation from this space. I have an understanding wife. I’m enjoying my beloved Jersey shore currently ahead of the NAB Radio Show to see old friends and make new ones. I'll do a keynote for my friend Kurt Hanson, a person who saw the digital revolution coming before most of us.

Maybe I’ll even get to see Lew Dickey at the NAB so I can ask him why he has changed so much in the 15 years I have known him. Before consolidation, I never saw the side of Lew that we are all seeing now.

Recently I got an email from a Clear Channel employee that I thought was so enlightening that I wanted to share parts of it with you.

Keep in mind that this is one person’s opinion. I have redacted information that could put this person in jeopardy because as much as we enjoy free speech in our country, radio's three consolidation bullies have more hot air in them than those bloated balloons on the floats at the Macy’s New York Thanksgiving Day Parade.

Also keep in mind that John Hogan, while I disagree with him in his stewardship of Clear Channel, did get elevated to the top post and whether you and I agree with him or not he has been employed and rehired for quite a number of years.

Here’s the email from a Clear Channel executive -- excerpted with permission -- with my thoughts interspersed:

“One thing you should remember about CC is that it is still full of great radio people who know what to do. Great supervisors like Dave Crowl for example is an excellent leader”.

Amen to that. Clear Channel's great assets went far beyond licenses, transmitters and towers and many excellent people remain at the helm in spite of layoffs and cutbacks.

“The article you did recently on the "rate increase" directed out of San Antonio is a bit off; This is one region, the George Toulas region, he said in a meeting in Dallas that he was challenging us not to go less than 15% below last year Average minute rate. Where he screwed up was when he put some of us who were not up that standard in a group and during a conference call said 'Apparently some of you weren't listening'. I will tell you in this environment, we all are listening very intently...Most of the company and fellow managers think this is just completely crazy. Just like the "synergy" idea where we sold billboards and signs in Amphitheatres and the horrible LIM (Less is More) idea that did nothing positive”.

It seems consolidators love the idea of pressuring sales – not just Clear Channel. The more they apply the whip, the more they think the troops will respond. Here is yet more evidence that the concept being applied does not work.

“The big regional guys like Toulas, who came to CC out of retirement, are all competing for big bonuses and the recognition of beating another region. Its not working, less than half of the CC stations actually beat their market revenue last month”.

It is always helpful to keep in mind the hidden goals of the executives who hold the whip in their hand.

“Premium content stations; Nothing but horror stories on ratings and everything else, stations have switched to it then switched right back to local when they heard it. Dramatically changed some stations with no regard for history etc. We pulled it off of our … station when the jocks all sounded like they were from up north, just crap thats (sic) all it is, might as well go satellite”.

We’re seeing some push back by Clear Channel on its "national is local" initiative – most notably in Detroit where CBS’s talker is eating “The Fan” for lunch. Clear Channel dumped ESPN Repeater Radio and hired back local hosts. There is hope that they will come to their senses.

“Since the Bain takeover, decisions are difficult to get the ok on, most of the time your e mail or call is never returned or returned very late. Its not their fault, no one can handle the load these guys are taking”.

“Locally, where I had two sales managers for four stations, and National guy that worked out of another market, plus a DOS. Now I have one sales Manager, I handle National and no DOS…plus half the sales dept I used to have. If the number one seller in this market wanted to work for me, I probably couldn’t hire them”.

Less is more will never work when fewer sales people are expected to sell greater ad contracts. John Hogan earned his nickname "Slogan" from "Less is More" although it may wind up being the epitaph for his Clear Channel years.

“I do believe that their is a light at the end of all this, most of us believe the true operators will come back and then perhaps we will enjoy going to work every day”.

There is a future but not with just terrestrial radio alone. Terrestrial radio is a good business for the next five to seven years if debt service doesn’t eat up all that free cash flow. If owners can buy properties at lower and manageable multiples they can run radio for a profit.

But a growth industry radio will never once again be.

Unless …

It gets a mobile, Internet and social network strategy and invests at least one-third of its operating budget into developing this digital space. That's at least one-third of a budget that consolidators can barely spend on the status quo.

Wait until you see the firings that are coming in the next few months at Clear Channel, Cumulus and probably even Citadel -- they can't make their numbers and all three risk running into their loan covenant agreement. People used to challenge my assertion that bankruptcy awaits them the same way they challenged my disdain for consolidation. Now ... well, even the happy talk places are being forced to get real.

Sorry. Don’t want to say it, but it is true.

But -- there is hope on the horizon because the likes of Slogan Hogan and his crew and the screw ups at Citadel and Cumulus will not be present for the digital future.

Radio people will.

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JERRY'S 1-DAY MEDIA SOLUTIONS LAB. Those of you who want to be part of the digital future and the reinvention of radio may be interested in Jerry's 1-day Brainstorming session being planned for Scottsdale in January. Reinventing terrestrial radio. Podcasting. Streaming audio and video. Attracting Millennials. Social networking. Mobile content. Texting. Thinking like Apple using generational media concepts. All this and more working face-to-face with the recognized expert in traditional and new media in a 1-day workshop. To get on the list for more information and earn an "early bird" discount if you decide to attend, email jdelcolliano@earthlink.net or "email author" (below).