Financial clamp-down part of Clear Channel takeover

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By: Mike Austerman

On The RadioIt used to be that reporting on radio was all about covering the things heard over the air. Now Art Vuolo and I spend as much time being business and legal reporters as we do covering the actual entertainment. This week is no exception. Clear Channel, owner of WMXD-FM (92.3), WKQI-FM (95.5), WJLB-FM (97.9), WNIC-FM (100.3), WDTW-FM (106.7), WDFN-AM (1130) and WDTW-AM (1310) locally, has clamped down on first-quarter spending for marketing and music research and halted nearly all hiring. A memo from CEO John Hogan was leaked on the Internet in which Hogan reportedly claims, “We are generating less revenue for Q1 than we budgeted and less than what actually ran last year. At the same time, our budgeted expenses for Q1 are up 4 percent.”

Some of the reason for the financial clamp-down is that the publicly traded company has agreed to be reconfigured as a private entity by essentially being acquired by a number of capital investment firms for $19.5 billion, $39.20 a share. The bad budgetary news sparked a sell-off of Clear Channel stock, which last week was trading at more than $10 less per share than the deal price.

The mega-deal received approval from the Federal Communications Commission late last month, with the requirement that the company sell off some of its stations in 42 markets around the country. While none of the Detroit-area stations were on the list of stations identified to be sold off, it’s pretty clear that with the kind of financial pressure Clear Channel is under there are very few properties that should be considered safe if they are losing money. Already we’ve seen just how brutal a time this is with the numerous personnel cutbacks that were made by the company late last year, here in Detroit and nationally.

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Given all of that, it’s no wonder Rich Homberg decided to get out of commercial radio by leaving his job as vice president and general manager of news WWJ-AM (950) in favor of joining Detroit Public TV, which owns and operates Channel 56 as well as programming classical/jazz WRCJ-FM (90.9). Homberg had been with WWJ and CBS radio since 1996 and was a major part of bringing the sports format to WXYT-AM (1270) along with the broadcast rights for the Detroit Tigers and Red Wings.

“Rich Homberg has certainly demonstrated a deep commitment to southeast Michigan and he has a clear understanding of the important role a broadcaster can play in helping our community achieve its goals,” said Steven Strome, chairman of the Detroit Public TV Board of Trustees. “We consider him the ideal leader as we expand our services in a rapidly changing media environment.”

“This is an exciting time to join Detroit Public TV,” Homberg said. “The station shares my commitment to creating local content that can strengthen our region by uniting viewers, listeners, and businesses along with cultural and educational institutions to address vital issues.”

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Thankfully, it’s not all doom and gloom on the radio. Some of the best programming heard locally helps great causes, and the calendar is full of ’em the next few weeks. First off, country WYCD-FM (99.5) will have its annual St. Jude “Country Cares for Kids” radiothon Wednesday and Thursday at Oakland Mall in Troy. There will be live broadcasts from 6 a.m.-7 p.m. both days. Call (800) 374-4995 to donate, or visit www.wycd.com.

WWJ steps up starting at 5 a.m. Friday with a 31-hour radiothon to benefit THAW, The Heat and Warmth Fund. All the money raised during this event will help keep the heat and lights on for Metro Detroiters in need. The donation line is (888) 579-4950 with more details at www.wwj.com.

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Set your dial: Not only is the big football game today, but also WRCJ’s airing of the 2008 Symphony Bowl, pitting the New York Philharmonic against the Boston Symphony Orchestra. This annual tradition was started by Chris Felcyn in 1989 as a way to generate some excitement for the arts by featuring a musical battle between performance groups of the cities participating in the Super Bowl. Tune in for all the excitement this morning at 10 a.m.

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Mike Austerman is the founder of Michiguide.com and has covered radio for The Oakland Press since 2001.


Reprinted from the Sunday Oakland Press, February 3, 2008

 

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This page contains a single entry by Mike Austerman published on February 3, 2008 1:53 PM.

West Michigan: Newsmakers Feb 3, 2008 was the previous entry in this blog.

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