The Radio Equalizer: Brian Maloney

01 March 2008

Shell-shocked Radio Insiders Wonder What's Next


Managerial Incompetence Destroying Successful Format

As waves of talk hosts, producers, disc jockeys and news personnel are sent packing in the wake of Citadel- ABC Radio's financial collapse, shell-shocked radio insiders are wondering if anything can be done to save their highly- successful talk format.

Yesterday, now known as "Black Friday", has career professionals in a state of outright panic, with even more job cuts expected on Monday. When it is over, even the highest- rated major- market outlets will be expected to somehow function with few remaining staffers.

And even deep cuts aren't likely to provide more than a drop in the bucket for Citadel's precarious situation, especially heading into a macroeconomic slowdown.

For years, broadcasters have been held hostage by incompetent executive management, forced to watch as they gutted the industry. While their scorched- earth policy was meant to maximize station valuations, in the end they have succeed only in losing billions of dollars, with angry investors left holding the bag.

And when CNBC's Jim Cramer correctly called radio "dead" recently, a few of these clods still had the nerve to dispute it.

Somehow, even while some of the nation's most successful talk and music stations and imploding due to gross mismanagement, these corporate suits still have their jobs. And some are as arrogant as ever, a key point in Cramer's rant.

Topping the list is Citadel CEO Farid Suleman (above left), radio's poster child for managerial incompetence. How this man could survive beyond Monday in his current position is beyond comprehension. As he speaks of coming "belt- tightening", cost- cutting that apparently excludes him, why is he unwilling to accept blame for his company's outright destruction?

While Citadel- ABC Radio was encountering a nationwide ad sales meltdown, Suleman was busy sucking up to Don Imus, wasting months crafting an ego- boosting mega- deal for the elderly fossil- talker. Instead of bringing the best programming minds into the fold to confront the challenges of the future, Suleman micro- managed schedule changes in markets as small as Providence.

Now, Citadel's stock has fallen so low that the New York Stock Exchange was forced to suspend trading and outright delisting now seems a certainty. Shares (NYSE:CDL) are down 87% in just the last year.

At a mere dollar a share, the firm's entire market capitalization is now below $300m. Instead of the quarterly profit Wall Street was expecting, it reported a $848m loss, mostly because station valuations have been written down to rock-bottom levels.

Given this dire scenario, Citadel's survival prospects are virtually zero and it's now just a matter of waiting for the complete implosion. With stations now worth so little, massive debt to pay and rapidly- deteriorating ad revenues, who would want this sick puppy at any price?

Normally, the best strategy would be to break up the company and sell off stations individually, but there are already a glut of unwanted outlets clogging the market. And in a tight credit market, who in their right mind would loan a person money to buy radio stations?

For talk radio, the problem is that our format is as successful as ever in terms of ratings, with record audience growth likely during this wildly entertaining election year. With the prolonged Democrat primary contest and wide- open November races, it doesn't get any better than this. It's a talk host's dream.

So what can one do? We've all sat back and watched helplessly as our industry was gutted for no good reason. Those few who still have jobs may not for much longer.

Yet the audience is still there and actually growing. And top- quality shows such as Rush Limbaugh's certainly aren't hurting for advertisers.

Over the past year, we've seen large numbers of displaced broadcasters wonder what to do with their lives. Now, the situation has deteriorated to the point where even the most successful hosts are threatened by managerial stupidity.

Playing it safe now longer works- it's time for an vocal campaign to remove the rot that plagues the executive ranks of this industry before the rest of it collapses. If you think keeping quiet will help you get back to work, guess again. The party's over.

In addition, there may be opportunities for broadcasters to purchase stations at fire- sale prices in the coming months and years. YOU know what you're doing, THEY didn't. Mom- and- pop operators relying on local clients and community service have the best chance of surviving this train- wreck and even thriving.

Let's get to work and figure out how to save talk radio, the one medium that can survive iPods, streaming and every other technological development currently killing the music formats.

FOR New England regional talk radio updates, see our other site.

Volume Two in Robert Ferrigno's "Assassins" Trilogy is finally available! See the Amazon box in the top right corner for details.

Support this site! Please contribute at the Honor System box to the right. Thanks again!

Technorati tags:


  • Let's play Guess The Party. Just did a quick check at Open Secrets to see who Farid Suliman gave to and came up with:

    GREENWICH,CT 06831
    Viacom Inc

    GREENWICH,CT 06831
    Collins, Susan M

    NEW YORK,NY 10019
    Schumer, Charles E

    NEW YORK,NY 10019
    Schumer, Charles E

    NEW YORK,NY 10019
    Kerry, John

    GREENWICH,CT 06831
    Collins, Susan M

    NEW YORK,NY 10153
    Straight Talk America

    NEW YORK,NY 10019
    Dodd, Christopher J

    By Anonymous Anonymous, at 01 March, 2008 15:59  

  • Clearly there was never really a market for conservative talk radio to begin with!

    I don't know why the Right cannot accept the realities of the free market, and understand that the message is...JUST.NOT.GOOD.ENOUGH??

    By Anonymous Anonymous, at 01 March, 2008 18:39  

  • Put down the pipe, hash.

    CDL's problems stand completely separate of any "message" coming from its stations' programming. Furthermore, its problems will extend to all stations equally, whether they be right or left, as would be seen in San Francisco at KSFO and KGO, respectively.

    CDL's problem boils down to this: They bet a huge amount of money on a proposition, that they had to either expand or die - and so they seriously overextended themselves with the ABC Radio purchase. When that strategy didn't work, they doubled down by socking a whole bunch of money into Don Imus
    that Don Imus would provide success because of His Very Presence.

    So, to make that workable, they had to release local hosts that most of the ABC and CDL station audiences were accustomed to - and the ratings suffered.

    You ascribe to "message" CDL's difficulties, but seem to make no room for pure managerial incompetence in your calculation. In that vein, I would ask why ClearChannel is down only 1.5% in stock price in the past year, and Viacom is UP roughly 0.5%, in comparison to CDL's 85-90% drop in that same one-year time frame.

    By Anonymous Anonymous, at 02 March, 2008 00:28  

  • You are right on a number of points, Brian. And for any of us who have been in radio since the 80s, we've seen it happen before. The problem with radio is consolidation. When you have thousands of companies doing radio, you create competition. You don't have a few cookie cutter formats being duplicated and rehashed over and over. Local and regional broadcasters tailor their products to appeal to the distinctive flavors of their communities. That means more music by regional and local bands. That means talkers who actually know their community and focus on issues truly relevent to the markets they serve. That means news departments who actually track down stories and report versus two minutes of barter national news at the top of the hour. That means program directors who focus on coaching their talent in an effort to nurture future top talent. That means promotions departments focused on branding the station to the entire market -not just repackaged national contests - as well as looking for every opportunity to put the talent and the station among the listeners.

    But, Brian, you are just as guilty as those you condemn. You aren't passionate about talk radio ... you are singularly focused on promoting right wing radio and sucking up to and hero worshipping the neo-con national talent whose very presence put local talkers out of the market. Yes, right wing talk radio has a large audience, but who are those millions? Primarily White Males over 50. That's obivious from the endless stream of Tepur-Pedic, Cialis, Lipidor and 1-800-FLOWERS ads that proliferate every national talk show. Because you put partisanship over the medium as a whole, you and your ilk have done eveything you can to condemn and destroy liberal talk radio. You don't seem to get the fact that your passion to promote the right wing echo chamber rather than promoting the medium is the reason why, despite the numbers, talk radio is marginally profitable. Hate to break it to you, Brian, but old white guys are not a highly sought after demographic to media buyers. The younger demos don't relate to Bill O'Reilly, and his creepy O'Reilly For Kids book isn't netting passion for a 60ish white guy who rants like your out of touch dad.

    You partisan nitwits don't get it. A passion polemic on radio, local talent, local music, local news, local outreach, is what can save radio. But your obsession with your silly Franken Photoshops and hurling your tired tripe about Liberal Moonbattery (and in case you haven't noticed, young, passionate liberals and centrists are dominating the primary cycle), you should have been advocating all talk radio - Right, Left, Hispanic, Sports, Local, Specialty Interest. Doesn't matter. You cheer the falters and failures of Air America, not realizing that Progressive talk will reinvigorate the format.

    Blame the suits all you want, Brian. Your partisan hackery and the pasty faced old guys you worship and vote for are the reason why another pasty faced white guy declare radio as dead.


    By Blogger Dave Carroll, at 02 March, 2008 12:17  

  • Anonymous?

    It's called sarcasm, buckwheat.

    So put YOUR pipe down, and get mine up...

    By Anonymous Anonymous, at 02 March, 2008 12:43  

  • From all the data I have seen, the format known as "talk radio" isn't dead at all. Just Citadel-ABC Radio seems to be dying. Probably will be sold in a fire sale soon and perhaps rebuilt by a competent management system or more likely, merged into an existing company.

    The free market has shown that conservative talk radio and sports talk radio are the top two forms of talk radio and are still growing. Liberal talk radio still has not found a consistent, growing audience and perhaps never will. Only time will tell.

    By Blogger Carl, at 02 March, 2008 14:39  

  • Off topic, but:
    Brian, I thought you said concerns for Obama's safety were just the rantings of the liberal media. Guess you were wrong:

    By Anonymous Anonymous, at 03 March, 2008 07:13  

  • You come from the right and I come from the left. What does it matter? We both love radio and talk radio. You are so right in what you write here. I worked with most of those folks on WLS before coming here to do "progressive talk radio." I've been in radio for 33 years and talk for 20 years. This is the worst I've ever seen it. These folks like Suleman are killing radio. Where the hell is the FCC, the DOJ, or even the congress. We can track all this back to Telcom 96. Thanks Bill Clinton.

    By Blogger Jay Marvin, at 03 March, 2008 07:32  

  • "We can track all this back to Telcom 96. Thanks Bill Clinton."

    Correct, Jay.

    By Anonymous Anonymous, at 03 March, 2008 22:48  

Post a Comment

<< Home

Page Rank Checker

Powered by Blogger