That’s what radio industry watchdog Jerry Del Colliano of Inside Music Media.com is reporting. With indigestion from Thanksgiving feasts just starting to wane, his latest blog is sure to cause more heartburn for thousands of people and their families.
Let’s face it. It is what’s expected in the halls at Clear Channel iHeart Media offices across America each year. When the annual roulette game begins and the Wheel of Fun spins, “Will my name pop up?” is always the question asked this time of year. The truth is the firings never stop. There’s always a few over here and a few over there so the people who should be paying attention won’t notice or be alarmed.
This is not unique to Clear Channel iHeart Media. It’s corporate survival in America magnified by the fact it happens at a media company.
But firing a third of its workforce? That’s almost five times more (in percentage) than the 7% Obama Inauguration Day RIF of “aught 9.” I hope Jerry’s wrong, but the technology and the infrastructure are in place to do it right now. It has been in place for years.
I know of two people, both under the radar, whose names came up on the Wheel of Fun in the last few weeks and there’s one whose departure really is unfortunate, as he was dedicated to his stations and is dedicated to the area he and his family live.
When I sent him my all too common note of “sorry” his response back was classic.
“There’s no such thing as a unsuccessful former employee of Clear Channel.”
iHeart Media, or any company for that matter, sees little else than a expense in a person and cuts them lose. But, with most everyone given a copy of their company’s home game, they end up better off.
That says it all, doesn’t it? A calculated brain drain based on salary and tenure.
Prior to my own demise, the end of each year was one of dread. First came a budget process that was always about “doing more with less.” Less people, less marketing and less printer cartridges. “A subscription to the Cincinnati Enquirer? I know you’re a news/talk station, but why do you need that?”
What was disturbing was the wasted time and adversarial nature of the weeks and weeks of meetings, having to subjectively rank employees by their perceived worth, which was corporate code speak for “name your top five and cut the bottom two.” Once I had to explain why we needed producers at a news/talk station. When I simplistically said, “to answer the phone,” a few on the other side of the table nodded with an understanding approval. “Oh. Makes sense. Hadn’t thought of that.”
Then corporate figured out it was wasting everyone’s time, including their own, and just gave the Market Managers a flash drive with the names of those on death row. Easy, clean…efficient. No need for any discussion.
Each November or December a date was set and the execution orders were carried out.
The Market Manager and whatever a program director’s job is defined as today are just facilitators. It’s a top down management structure and mentality where those on the local level are told to sharpen the blade and operate the guillotine, while those in the corporate offices are kept safe from the splattering blood and the needed emotional showers that follow after dropping the blade.
Which bring me to this.
If what Jerry Del Colliano is saying is true, is there no one left at the Clear Channel iHeart Media corporate level that will simply say this is wrong and whatever we are trying to create, transform or save on the backs of the two thirds of employees left, does it have a chance of succeeding or is it about just cashing a paycheck?
Rhetorical question. I know the answer and have been disappointed by more than a few.
A few years ago I had a memorable conversation with a complete stranger. It was summer in New York State’s Adirondack Mountains. A relaxing, rural and pristine place if there ever was one. My wife and I were staying at Lake Placid’s Mirror Lake Inn. Before heading out for the evening, we crossed the narrow village road and went to the hotel’s bar overlooking the water. We both sat down, my wife to my left. I ordered two beers. A man who appeared to be in his late 50’s was to my right. He said to me, “So what do you do?” I told him I was a radio station programmer. His response was, “Once you start getting that paycheck it’s hard to make a change in your life, to do what’s right and do what you want to do isn’t it? Well nice talking with you. Enjoy your evening.”
He wasn’t rude. That was all he said. Then he disappeared.
That conversation has always stuck with me. He was right. Once that paycheck starts it clouds your view of what is right and wrong. Not too dissimilar to the recent scandals in the Roman Catholic Church. Sure they understood it was wrong for children to be molested, but they chose to keep the money flowing into the institution and to hell with the victims.
Here’s a radio Tale of the Tape:
The entire radio industry in 2013 had revenues of $17,649,000,000. The Clear Channel iHeart Media debt is north of $20 billion and heading higher. Put another way…ready for this…20 thousand million dollars. There is no way any company can cut their way out of this mess or kick the can of “bond debt” down the street far enough, not with the high interest being paid on those bonds and not in a declining revenue industry.
So far in 2014, with the first three quarters in the books, the RAB reports revenues are down -1% or as the RAB put it in their headline…
Radio Shows Double-Digit Growth in Digital Revenue for Q3 as Industry Continues to Build It’s Strong Digital Platforms
Off-Air Revenues Also Show Significant Gains as Industry Revenues Indicate Improving Trends
Huh? That’s not exactly what your five-line says, RAB (i.e. Grand Total).
Sooner or later someone will step up, speak their mind and do what’s right to help save radio from its current reckless management, regardless of a paycheck and bonus.
Many times I spoke up, but many times I didn’t and for those times I apologize. At one point I did walk from that paycheck, but I was lured back.
If your name comes up in the coming weeks (and I’m hoping Jerry is wrong) remember…
“There’s no such thing as a unsuccessful former employee of Clear Channel.”
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Frankly I don’t give much credence to Jerry Del Colliano. Six – 8 months ago he published that all of CBS Radio will be sold to Cumulous. My contacts at the highest levels of CBS Radio told me this is nuts. Then he came back telling his news comes from Les Moonves himself. I don’t doubt iHeart will be letting people go but it won’t be wholesale.
What baffles my mind that these major investment houses don’t push for better results. With stock prices less than $5.00 what ROI can they get? With Cumulus making all those acquisitions they have added more debt although Westwood One is what seems to be only division making real money. Their conservative syndicated products are mainly running on PE’s. Last year in their fillings with SEC they stated they will concentrate on larger markets because that’s where the money is. Larger markets as noted here WABC, WLS are stuck in the mud. They haven’t sold any small market clusters either. My crystal ball tells me sometime in the next couple of years Cumulus will be broken-up. As for iHeart a similar fate.
It’s pretty simple. If you owe the bank $100,000 and you can’t pay it back, you have a problem. If you owe the banks $100,000,000 and you can’t pay it back, THEY have a problem. And so it goes …
🙂 Clearly stated Carolyn. So true. I hope you’re doing well. Darryl
Regarding Carolyn’s comment, is that not why the word “restructuring” comes up so often? There could be a hybrid where some of the stations are sold for a quicker debt repayment, albeit reducing overall share, right Darryl? That would lend credence to Mr. Kasman’s point.
Nick, I like to refer to restructuring as “rearranging the deck chairs.” 🙂
Of course; but when the Titanic went down, the boat was truly gone. The restructuring means the boat loses sailors, and takes real hits and resulting damage. In the Navy, there is a unit called Damage Control Central to keep the boat afloat. In business, there are people named Romney to be the DCC. The real pain of the sailors losing shipmates does not fully go away, but the boat does eventually fight another day.
It’s common in the higher officer ranks for the politics to really settle in to secure the advances, and they turn into suck ups. It is one way for a lousy leader to visually succeed and advance, it does not change the fact that they made lousy decisions for their subordinates, it just means they are not directly doing it and the boat can still sail.
Maybe there is a family you know lobbying for a bailout, saving their leadership. Look what they could sell to a politician. Charlie Daniels mentioned the devil coming to score a soul…..
How much would unlimited press and media suppression be worth in cash, especially if the buyer uses unlimited amounts of other people’s money?
From a former employee who has been let go from that company 3 times in my radio life. The last time in April of 2009, six days after I bought Real Estate. There is a special place in hell for the guys at the top of the food chain in that company. Karma is a bitch and I think it may be just around the corner. There is a better life after iHeartless Media.
actually, a lot of former clear channel employees end up being former broadcasters. all i’ve seen is people hit the brick wall and disintegrate. life after this gig usually ends up involving food service or car sales. regardless of what one thinks of one company or another, it is in most areas a very challenged industry, in part because of the economy, in part because of failed management. if this is the titanic, i’m going to keep on trying to think of a way to keep the bee-atch afloat just a little bit longer.
You are correct. First you have three major owners controlling the industry. As for smaller groups or stations the line is out the door of on-air folk willing to work for pennies.
I find radio talent that can’t find a job fit into a few job categories: Selling in broadcast or other products/services, work hard for VO work that doesn’t add up to much in medium or small markets and in big markets very competitive. Some talent does not realize great slots to fill are in news and that’s generally stable.
But there is another reason in my opinion – Just lack of unique talent. On the music side I know of very few personalities nationally that create a distinguishable product. In talk radio so many have become conservative talkers not being able to talk about anything else and that’s not selling any longer. Talkers in sports do well and they usually have strong highly identifiable personalities.
When I’m asked by recent college broadcast/media grads or those grads of these fraudulent in my opinion announcing schools whether TV or radio I tell them the same. What really makes a difference is your acting skills. Whatever on-air role you play it’s still show biz and acting experience allows you to create your product. Think Casey Kasem, Don Imus (stand-up), Dan Ingram, Dick Biondi, and Wolfman Jack.
As part of the problem current program directors do not understand how to let a talent personality grow. Formats don’t allow distinguishable personalities.
Like all show biz job security doesn’t exist unless you are a top talent resulting in numbers or a boss who really likes you. I know a nothing special jock that iHeart has moved from one major market to another and doing AOR, Country, Sports at different times. In TV like Megyn Kelly on Fox who is articulate and very hot; photos of her on-line isn’t for a network newscaster.
This is the fallout from four significant events that happened in the mid-90s: The Telecommunications Act of 1996 and the technological advances that affected corporate networks & the Internet. Companies like Clear Channel grabbed handfuls of overpriced stations that brought them into a high debt amount. Then, the Internet exploded in popularity as an entertainment medium, particularly in the music arena. When it became possible to voice track, that spelled trouble for air talent. I voice tracked someone out of a job in ’99, and later that year, I suffered the same fate. The 4th event: Hiring a well-known person who wasn’t qualified to run a large radio company. Enough said about that last item.
Well said.
My step-dad, a radio veteran of about 40 years, just got handed his iheart pink slip 2 days ago. He had been able to dodge the bullet for 10 years. I feel badly for my parents. I’m not sure what he’s planning on doing. He has an amazing voice, a lot of talent, years and years of experience, but unfortunately with how the business is now-a-days, those qualities aren’t necessarily appreciated. If they were, he’d still be on staff. This article was spot on.
Lili, I’m sorry to hear about your step dad. 40 years is a career in any industry. My thoughts are with him and you this holiday season. Darryl