For the past two years, the ranks of American radio stations have been reduced by thousands and thousands of people.Consolidators who found that they could not repay the loans they took out to buy their stations had no other way to cut costs. After all, the biggest expense at a radio station is talent.
Of course, the biggest asset at a radio station is also talent.
So, consolidators like Clear Channel, Cumulus and Citadel devastated their local operations, invented
cheap ways to import networked, syndicated or voice tracked programming and while they were at it -- committed one more act of hari-kari.
Firing sales people.
Now there are disturbing signs that the firing of managers, sales managers, account execs, program directors, air personalities, support personnel and engineers was more than just a way to save money.
Cumulus, Clear Channel and Citadel actually are practicing a nondiscriminatory version of ethnic cleansing. Nondiscriminatory because these consolidators will fire anyone regardless of their age, talent, race, importance, desirability or productivity.
Firing experienced and therefore more expensive personnel and replacing them with wet behind the ears cheap workers.
Cumulus replaces fired workers from a uniform company.
Clear Channel thinks ex-hotel workers and out of work Enron execs make good replacements.
Citadel hires whomever will work for their company at the cheapest pay grade.
Then, last week, as I commented in this space, the Broadcasters Foundation under the leadership of Phil Lombardo decided to take what is reported to be a $125,000 “gift” from broadcasting disgrace Lowry Mays and name an award after him as thanks.
What an uproar it caused. Jimmy Carnegie's RBR poll shows over 60% of the respondents think the Mays money is tainted.
This boys club – The Broadcasters Foundation – did what it does best. That is, running an elitist group.
That turns out to be spitting in the face of all the other people not named Mays who have given money year in and year out to the Broadcasters Foundation to help it do its good work – support the downtrodden, unemployed, ill and disadvantaged broadcasting industry employees.
Lately, that’s a lot of people.
But ask around – few radio people even know of The Broadcasters Foundation. And even though there are no doubt legitimate examples of how television and radio people have been helped in their time of need, the Mays debacle has focused attention on this group of big spenders who live high off the hog while gifting less money than they could to our needy brethren.
Just look at the IRS tax returns for this non-profit organization.
Salaries and expenses from the most recent 2008 fiscal year reveal Broadcasters Foundation execs Gordon Hastings and Jim Thompson accounted for one-tenth of the entire operating budget. It must cost a lot to employ executives to give out money to unemployed radio people.
Hastings made $189,000 and Thompson earned $72,000 accounting for over 15% of The Broadcasters Foundation annual revenue. No doubt these are two talented guys, but come on – The Broadcasters Foundation is a charity.
Is it full time work?
You be the judge.
Eight employees.
Doing what?
What’s worse is that expenses exceed the gifts made to help needy broadcasters.
There's $45,900 for rent - $3,825 per month for "pricey digs" in midtown Manhattan. As one of my readers remarked, “Why isn't this outfit based in a Quonset Hut over in Bayonne?” Bayonne is nice this time of year.
Another $65,000 for "office expenses."
The salaries and expenses come to about 41% of the total budget.
Comparing The Broadcasters Foundation to other organizations of this type reveals that effective charities keep salaries and overhead under 25% of their annual budget.
The Broadcasters Foundation, therefore, is ineffective by that gold standard.
As one watchdog tells me, “To add more insult, this outfit LOST money on its investments last year - something Hastings & Thompson should be monitoring closely”.
The board of directors seems to be bullied by the oversized personality of Lombardo.
This matters because good people and good companies are giving substantial money for good works and their money is being – well, let’s just say, not optimized at a time of great need.
And maybe that’s how the "Lowry Mays Excellence in Broadcasting" award came about.
A social club for the working and well paid elite disguised as a mild mannered charity to help less than one percent of the victims in years of Lowry Mays firings.
This is insane.
My friend Eric Rhodes, the publisher of one of my favorite trade publications Radio Ink, is a great booster of radio. But in a rant the other day, Rhodes lost it:
“Recently an industry blogger wrote a vicious attack on the Broadcasters Foundation, encouraging others to stop supporting the organization because it had named an award after Lowry Mays, whom this man claims "raped" the radio industry with the cost-cutting practices at Clear Channel”.
That industry blogger is me – my name is right there on the article. I'm not hiding.
I never used the word "raped", though.
And the attack was not as vicious as what Mays and Clear Channel and the other establishment radio groups have been doing to their employees.
Incredibly, Rhodes said:
“No matter what you may think Mays has done to the industry, at least he's giving back to it. As far as I'm concerned, the foundation could do a Larry Flynt Award if it brought in the income to save the families of struggling broadcasters”.
You’re kidding, right Eric?
Mays giving back to an industry he pillaged.
Well, that’s not where I’m coming from.
So let me lay it out as simply and clearly as possible:
- Don’t make donations to this poorly run, misguided and insensitive Broadcaster’s Foundation. Start a new one that exists to be a charity.
- Let’s go to Bob Neil and Bruce Reese and Dan Mason and a number of other good operators and establish a real outreached for fired employees. Get volunteers to administer the charity. They can help. So can the NAB if it wanted to.
- Give away at least 75% of what you raise for helping people in need.
- Let’s make sure everyone in radio who needs help knows how to get it (not the ineffective excuse The Broadcasters Foundation has for getting the word out).
- Put a few unemployed people on the board of directors – that’s one way to keep a clear conscience and make some better decisions.
- Make retraining part of the new charity’s mission. I’ll donate a special “lab” on this topic and you won’t even have to name an award after me.
- And for God’s sake, have a formal way to funnel job openings to the people who were “laid off” so they can get back to work in a meaningful way.
From now on, let’s not turn our backs on the people who built radio into the industry that Wall Street coveted so much that banks bought everything in sight.
Let’s have some respect for the talented folks who still toil under bad conditions doing more than one job without the resources and often without the gratitude.
And let’s not ever think it is okay for the biggest, baddest consolidator of all, Lowry Mays, the man who caused the most destruction of local radio, to be pardoned by an elitist social club hiding as an ineffective distributor of charitable gifts.
If Mays wants his image to be rehabilitated, he can start with “I’m sorry”.
Then, proceed by rehiring the people his company fired.
He can keep his $125,000.
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