The Latest on Furloughed iHeart Employees Returning

The big day is coming – June 30th – the date iHeart told its numerous furloughed employees 3 months ago that their fate will be reconsidered.

Corporate has been tight-lipped about what their decision will be. 

With 3 weeks to go, Bob Pitman and Rich Bressler know what they are going to do and it’s fair to say when it comes to drama, you won’t be disappointed.

There is confusion about whether furloughed workers have any hope as promised or whether other iHeart employees have something to be concerned about and why they can’t get any answers from the company.

We now know the reason market managers and even HR won’t address the topic with them.

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Entercom’s Daddy Issues

Joe Field built the legacy small market radio group known as Entercom.

His son, an S.O.B., (Son of the Boss) took over the company, mortgaged the future by overpaying for CBS Radio and then tried to “un-CBS” the merged company.

Today, the Entercom that Joe Field built is worth less than $2 on the stock market but has close to $2 billion in debt.

The Fields stand a reasonable chance of losing control of the company if they have to go back to lenders.

Reenter Joe Field who whether you are aware of it or not, is back but in a very different way and it if it doesn’t work, there will be a lot of misery for Entercom employees.

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iHeart’s End of June Housecleaning

Months before COVID, iHeart dumped over 1,000 employees.

Then COVID handed iHeart’s beleaguered owners a “gift” and they used it to substantially eliminate more jobs as advertising took a hit.

This pattern of firing, layoffs, furloughs, “dislocations” and “excellence hubs” (as they called them) morphed into employees taking off a few weeks from the company with no pay.

iHeart billing is off as much as 50% as they continue to burn through what cash they have left to keep operating.

All this as Liberty Media awaits the DOJs ruling on whether they will be allowed to make a takeover bid even as iHeart searches for foreign money to prop them up.

Now they’re going to get serious about cost cutting in some vulnerable markets (over 80%) and it’s going to look and feel desperate and not unnoticed by other radio groups.

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Apollo to Disassemble Cox Media Group

All that talk about keeping Kim Guthrie and her team was just talk as we found out recently.

Then Apollo Global Management cleaned house and turned right to the Bain playbook.

But it’s even worse.

More resignations.  More uncertainty.  A new mission after paying $3.1 billion for the TV stations and reluctantly paying another half billion for radio.

The new owners seem to be ready to trade off consistent profits for an approach that concentrates on reducing debt.

They will transform the best run media company into what will soon look like iHeart and Cumulus all in one.

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Foreign Money Invades Local Radio

I have to laugh every time I see the NAB beg for a government bailout of radio by overemphasizing the critical importance of local radio.

Radio is the least local it has ever been and the NAB is ironically the chief enabler of consolidators and their private equity backers who have ruined the industry.

Late last week, the FCC gave the greenlight to a Cumulus petition to allow virtual monopoly control of “local radio” by foreign interests.

This changes everything – obviously the failing consolidators would not go begging for money overseas unless it was their absolute last option.

We’ve discussed the deleterious effects of private equity owners on local radio, Main Street advertisers and declining radio jobs but the greenlighting of foreign financial interest in radio is an entire other aspect to reckon with.

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