The FM Red Herring

(Editor’s note: today is the last day to get the $300 discount on my January 27th Media Solutions Lab – learn more here). 

For years now radio executives have been screaming for FM chips in cell phones.

Their twisted little minds figured that just about everyone eight years of age or older keep cell phones in their hands and wouldn’t it be nice to put a radio there, too.

Emmis CEO Jeff Smulyan has been leading the FM chip charge but to no avail.

Smulyan argues that radios on mobile devices in Europe increase a station’s total listening. That may be so in Europe, but even there the increase is statistically insignificant.

Mark Ramsey came out with an excellent study this week in which he polled actual consumers who already bought a cell phone and asked them if they specifically looked for a phone that had FM radio.

88% said no.

4% said yes.

So, as we say in Philadelphia, “who don’t know that?”

Why all the fuss about putting FM on cell phones?

It doesn’t take a brain surgeon to tell you that young consumers barely even use their telephones as telephones let alone radios. And as Ramsey points out maybe Apple only has one mobile device that is FM ready (Nano) but there really are a lot of cell phones for sale with FM capability.

FM on cell phones is a red herring -- the definition of which is something intended to be misleading or distracting.

Why is the radio industry being played for fools by virtually every group CEO (that is a good question in and of itself) and by the very group that is supposed to represent their best interests – the National Association of Broadcasters?

And one more thing – are we as dumb as they think we are because I can show you how to look at consumers and read exactly what they want which begs the question what do potential listeners want and what does the radio industry want.

They are not the same thing. 

The back story is almost unbelievable. 

The Internet Is So Over

Almost as soon as it arrives, the Internet is on the decline.

You may find that hard to believe and I understand that. But some big mistakes are about to be made under the assumption that media content needs to be contoured for the Internet.

As recently as last week, we saw hints that the Internet had seen its finer days when a rumor circulated that Apple had banned single radio station apps from its popular app store. As it turned out, there is no apparent reason for immediate concern as Jacobs Media, one of radio’s leading app producers, said that Apple had accepted client requests for single app approval as recently as a few weeks ago.

The rumor was that only apps with 100 or more stations would be approved by Apple as DJB Apps’ Jim Barcus reportedly told Radio Magazine that Apple rejected 10 of his company’s single station radio stream apps on November 10. Barcus claimed that Apple told him single station apps are the same as so-called FART apps and are considered spam by the Apple store.

But there is a bigger question.

Why are radio stations streaming content on the Internet as we enter 2011 when what consumers want – and crave – is short-attention span content that they can access and use at will?

Internet streaming of radio never worked with most stations barely gaining 3% increases in listening to add to its terrestrial ratings. For all the problems with AFTRA and commercial rights, the software problems to allow insertion of non-terrestrial advertising – streaming simply laid an egg.

What worked over the air wasn’t as desirable as a stream – and it makes sense if you look at things from the consumers’ point of view rather than that of radio companies.

Radio has come late to the Internet game and now risks investing time and money to catch up on in an area I am representing to you is over.

We’re going to talk about a better use of time and money than radio pursuing Internet ventures in the next year or so at my January Media Solutions Lab

But let me preview what the future is if it is not the Internet. 

Don’t Touch Lew Dickey’s Junk

I have uncovered something very interesting about Cumulus CEO Lew Dickey that may give you some insight into how this powerful radio consolidator thinks.

When the term family jewels is used – say, to describe the pat downs that TSA is giving travelers these days – it is used to describe a person’s private parts.

In the Dickey family, the family jewel is the media operation that was handed down from father to son and siblings.

That is why it is a bit odd that in a lawsuit that Dickey inflicted upon his former Danbury, CT and Westchester, NY manager Kristin Okesson, Lew Dickey is asking a federal magistrate to in a sense pat his ex-employee down for resigning her job and leaving the company, but hands off of his family jewels.

It is apparent to some that the Dickeys are looking to inflict as much financial harm on this female executive who resigned, went to work for a more respected operator and then filed a discrimination suit against Cumulus.

In essence Dickey wants Okesson to pay him almost a million dollars for the financial hurt she allegedly brought upon his junk.

What he didn’t count on is that Kristin Okesson’s new employer is paying all her legal bills and that for the first time Tricky Dickey may not only lose his lawsuit but regret that he ever filed it.

This is a story of Thanksgiving to anyone who has ever been screwed by an employer who seemingly had all the power and money to get their way.

There are new developments in the Okesson case which read more like a soap opera than a legal action. Closing arguments were heard in Bridgeport on November 9th.

After hearing what is looming over the Dickey empire, Suing Lew will probably try to negotiate a settlement with the person he picked on probably because she stood up to him every step along the way.

Dickey appears ready to lose and wind up with unintended consequences, but until he settles and a gag order is imposed on how much that settlement will cost, this is a public story of vengeance and bad policy.

No one ever leaves Cumulus and lives to tell the story (let alone get costs and damages) but it could happen to Kristin Okesson.

And wait until you hear how this entire lawsuit may backfire in Dickey’s face. 

Radio in 2011

This is an early warning that 2011 will not be like 2010 or any other previous year since radio or record industry consolidation.

In fact, 2011 will not resemble anything the media industry has ever seen before because several circumstances are driving the owners of big radio and record companies to acts of desperation.

This is important because, if I am correct – and I wouldn’t be saying this if I didn’t believe it – hold on tight, it’s going to be a rough ride.

In spite of some of the scary things I am going to share with you, there are a few good opportunities that will occur that even a year ago would have been unthinkable.

Maybe some respect for good old mom and pop.

A second chance.

Investment banks are doing something so blatantly telling that it can predict what they are up to as owners of radio companies in the next 12 months. I’m surprised so few have noticed.

What Bob Pittman’s hiring foretells about the change in direction ahead.

And four documented examples that will illustrate how 2011 will be a year like no other in the radio industry.

Oh, and somehow even Randy Michaels may figure into all of this.

The Death of Cable News

Rupert Murdoch and Steve Jobs’ secret plan to build a news site expressly for the iPad is a cable news killer.

But it could also be an opportunity for radio.

How so?

Not in that if cable news is crippled, more people will turn to radio again. But in a new way.

Cable viewers skew older, but this new iPad venture between the unlikely duo of Jobs and Murdoch will have to attract younger demographics to have a chance.

However, the plans which I am going to tell you about also offer an early warning to radio operators and ex-radio people who are smart enough to follow the lead of something Jobs and Murdoch call the Daily.

Ignore what is about to happen at your own peril. Here is a blueprint, timeline and specific way radio people or ex-radio people can get a jump on what I think will be a huge growth business.  

Read this story today.
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Anonymous tipsters copy and paste internal memos or emails here.  


I’ve got five bold predictions for you in radio, new media and music that I think you’ll want to know.

• Which radio group will start selling stations – possibly as soon as next year – in spite of the fact that station prices will be very depressed and money is hard to come by. Learn why, how much these stations are likely to get plus what type of person is the ideal buyer. You may be surprised.

• The unintended consequence of the new music royalty tax on radio which, as you know, I believe is a foregone conclusion. Here’s my best thinking of when the tax will be settled and when stations will likely have to start paying.

• What’s up with streaming media, an industry that has already been mugged by the music industry royalty tax? However there is a workaround on the horizon. Details follow.

• Apple’s next move. The usual holiday sales should be brisk, but that’s not what I am talking about. There is a game changer ahead that will impact the music industry and terrestrial radio.

• How big will local new media ad sales get? There is evidence that it is surging in some local radio markets, but I’ve got the percentage of all local business that you can expect to go to new media and a time frame.

Read this story today.
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Anonymous tipsters copy and paste internal memos or emails here.  

Clear Channel’s Next Owner

A lot has been made of the recent appointment of former MTV and AOL head Bob Pittman to a high level executive position at Clear Channel – the presumption being that Pittman’s arrival signals a new day for its radio, entertainment and new media prospects.

But there is a developing back-story that could constitute more than an executive personnel change.

Clear Channel could have a new owner in the not too distant future.

The plot thickens because the wheels may already be in motion so Clear Channel owner Lee and Bain can escape from a huge investment gone badly for them.

This real time scenario is unfolding even as the company claims to be searching for a replacement to departing CEO Mark Mays.

But this is what is likely to happen.

If you are a subscriber to Inside Music Media, click through to unlock the rest of the story. To become a subscriber, it’s as low as 39 cents a day. No ads. No outside influence. The straight scoop. Sign up here.  

Lew Dickey’s Thanksgiving Turkey

Cumulus Media just can’t figure out how to sell.

Harvard and Stanford grad and Cumulus CEO Lew “Tricky” Dickey has been beating up his employees for years about their underperforming sales ways.

He’s thinned out their ranks. Told me face-to-face in Philadelphia that maybe it’s not a bad thing to get some fresh blood into the company.

Dickey, who never enjoyed a career as a radio salesman, had a lot of blame to throw around for Cumulus account execs who actually know how to sell.

Sales meetings conducted from the Cumulus headquarters in Atlanta beamed to local stations via Skype. Local sales staffs hate this because it keeps them off the streets and away from clients who do spend money with them. Dickey likes it because he can badger them to sell to new categories like health care.

As the Dickey Empire totally remade local sales, it took key accounts away from the salespeople who attracted and maintained them and dished them off to so-called Key Account Managers who got paid a lower commission for managing the business.

Increasingly more local sales were made through Atlanta to prevent the higher local sales commissions from being paid – a big incentive for a sales profile. Of course, I am being sarcastic here. Nothing throws a wet towel on selling like messing with the seller’s commission.

Lew Dickey held his most recent conference call with analysts where he was snagged for the company’s underperformance in local business by blaming the economy. Truth to be told, many radio groups are doing poorly in local, but Dickey is comfortable simply blaming the recession.

CBS is up over 3% in local for the same period and interestingly enough, President Dan Mason uses a traditional sales approach with account execs deployed in local markets. Could that be something that would interest Lew Dickey?

Of course not.

The smartest radio guy in the industry (at least in his own mind) has yet another play date with local sales that is more like a senior project than a sales strategy.

It’s called Value Alert Notification.

And you won’t believe what it forces sales people to do and how it actually works to kill local sales.

If you are a subscriber to Inside Music Media, click through to unlock the rest of the story. To become a subscriber, it’s as low as 39 cents a day. Sign up here.

Facebook’s New Messages

Facebook is getting ready to offer consumers a new communications system called Messages.

Mark Zuckerberg did a presentation a few days ago about this new way to handle email and text messaging that is worthy of your attention.

Email s becoming slow and outdated -- young people use it sparingly.

Facebook’s move is about how changing consumer habits have forced the largest player in social networking to change before they lose critical mass.

See any similarities between Facebook and how radio, the music industry and new media do things?

Neither do I.

But it’s never too late to learn. 

Bob Pittman Is the New John Hogan

Nice move.

Hire the man who brought MTV and AOL to prominence and call it a step in the right direction for an outdated radio company to embrace new media.

And why would Clear Channel have to recycle the well-traveled Pittman?

Let me count the ways.

One, Clear Channel owes $19 billion in debt due in two years and has no earthly way to pay it back. That means the company will either be chopped up or sent to bankruptcy – neither of which sounds that bad to me when you look at how other radio companies did when they emerged from bankruptcy.

They did fine. Everyone else got screwed.

Two, go back and read one.

Clear Channel is lucky to generate a few billion a year in profit with its radio and outdoor operations. Not likely that it could repay $19 billion in debt at that pace.

So you do the next best thing.

Turn to unearthly ways to get into digital media and for investment bankers that means hiring one of their own to work with a “management team” so owners Lee and Bain can sell this as a great reason to help refinance that $19 billion in debt.

Or as one of my readers wrote upon hearing of Pittman’s appointment:

“Exactly the kind of call someone who knows nothing about radio would make. The smoothest move since Ted Forstmann tapped Farid Suleman to run Citadel”.

So while others are reading about this game changing appointment of Bob Pittman as chairman of its media and entertainment divisions, you’re likely seeing through the move as one that has more to do with window dressing than substance.

If not, and with all due respect to Pittman, I could have named a hundred executives who could lead the digital way but no – the Clear Channel investment bank owners has to have Pittman who ironically also has experience running the real estate company Century 21 which means it really is all about the real estate.

Now you know that a smart organization doesn’t make a major appointment like this without having replaced CEO Mark Mays who leaves within the next few months. But that doesn’t stop Lee and Bain because whoever that puppet is, the investment bank owners are going to name Pittman as head of media and entertainment anyway.

Who needs to have the new CEO sign off on it?

After all, they are all puppets and Lee and Bain pull the strings.

But beware.

Think John Hogan.

Something big is up. 

Cable Takes a Dive

Just in the past few months, a significant and major change in cable television subscriptions has occurred.

This trend is worth watching if you are in competing media because there are potential repercussions for you as well.

Up until now, we’ve known that broadcast network television was declining not only in total viewers but the important young viewers category. The median age of a network TV viewer is at 50 years old – a concern to advertisers who demand a younger demographic.

But cable has held up well even with Internet competition and new ways to deliver mobile video content – until now.

It’s not just that cable subscriptions are off but that TV subscribers are not switching to satellite or phone competitors, either.

Third quarter results just released by the dominant cable and satellite TV operators show big losses.

This could be the first indication that Internet video is coming of age with consumers using the Internet to get their entertainment content. Netflix, Hulu and other new age video distribution sites could be the beneficiaries, but the trend is hard to read at this point.

As you might expect, cable companies are in denial.

Time Warner Cable lost 155,000 video subscribers in the third quarter compared with 64,000 a year earlier.

Comcast’s losses more than doubled in the third quarter, to 275,000 perhaps because sweet deals that Comcast offered when analog TV shut down a year earlier expired.

DirecTV picked up subscribers but Dish Network lost them.

The cable, phone and satellite companies representing over 80% of all subscribers showed a combined gain of 66,700 video subscribers. This pales in comparison to a year ago when they gained over 400,000 subscribers.

The cable decline should come as no surprise as video subscribers have been leaving for years but the crafty cable companies made up the difference by selling higher tiered content packages.

So what does this mean?

The line between TV and radio is blurred because popular mobile Internet devices include video and audio (and text AND social networking).

Satellite radio claims continued growth as a monopoly but young consumers want no part of it. They don’t like to pay for that which they can access for free.

I am about to present some pretty compelling evidence in the form of research that you will want to know about because we have now arrived at the epicenter of change for video – the same change that has been morphing in radio and music – and you’ll get a potential glimpse of the future ahead of everyone else.

The consumer is showing us the way – five demands we ought to listen to. 

How To Bulletproof Your Career

For the past few years the big three consolidators have been firing people by the hundreds if not the thousands.

More cuts are happening even now ahead of the holidays (and the end of the year) and the prognosis is for more cost cutting in the year ahead on a continuing basis.

Many employees of Cumulus have told me that they can’t wait to get out – some have set deadlines for themselves in 2011.

Meanwhile Cumulus is hiring.

Hiring inexperienced people who will work for less without radio industry experience.

On the music side, record labels are not hiring.

The labels are beleaguered. EMI is about to fall and I wouldn’t bet the house on the surviving big three labels because, frankly, there is less need every day for a record label in the digital world.

Many of you ask – how can I stay in the media business and not work for people like the Dickeys, Farid Suleman or John Hogan?

Others want to know where the good jobs are and how to get them.

So, let me address these issues.

The trick is keeping a job you like even when you don’t like the people you work for. Never let them push you out by insulting you, terrorizing you (are you listening, Lew Dickey?) or freezing you out by cutting wages, adding responsibilities and adding insult to injury.

The strategy is: don’t react -- respond.

If you can survive poor employers in an industry that you love, then you’ll want to turn your attention to how to build your value while you are looking for the next career.

And that career, by the way, is either in local radio in smaller and medium markets working for non-consolidated operators or larger cities where people are valued (i.e., Bonneville).

In the year ahead great strides will be made in the mobile Internet. Radio and music industry people are ready-to-go for creating mobile content. I’m doing a segment on this at my upcoming Media Solutions Lab – that’s how strongly I feel about the opportunities ahead. 

That’s why you want to survive as long as possible so you can make the move to either an employer who sees traditional media in a future context or make the jump to new media.

In other words, you want to be bulletproof.

Here’s the plan -- what to read and how to prepare for a new way of thinking.  

Clear Channel Plan: Let Salespeople Make Up Their Own Rates

If you want to know why local sales are down, you can find many reasons – most of them caused by poor decisions made by corporate owners.

Instead of fixing the problems – Clear Channel is now reportedly considering a new way to create even more.

According to Tom Taylor, there is some speculation that Clear Channel is considering revising its sales commission structure in a very unusual and potentially dangerous way. I wish it were a hoax, but Tom’s too good a reporter for that.

All of this nonsense is the best work of Lee and Bain, the two investment bank owners of Clear Channel. The plan is typical investment bank “think” as you’ll soon learn.

The incentive is not on selling more spots.

Not on selling spots in a certain time period such as morning drive.

Not based on any standard that radio sales has ever recognized in well over 50 years. And that’s because the new Clear Channel system is designed to pimp out salespeople because the company can’t give them a product that the marketplace will buy at a fair rate.

I’m sure you’ve noticed how most radio companies – even good ones – are having trouble selling local ads this quarter.

There is a logical explanation.

Take away local personalities and replace them with voice tracking from 1,200 miles away or repeater radio syndication from the home office and you’ve saved money alright, but you haven’t given advertisers and agencies anything to get excited about.

Therefore, local personalities are the best way to get premium rates that drive local billing growth. Okay, so much for that.

Then, owners like Cumulus are reallocating local sales to their home office in Atlanta and therefore the easy business is handled by a national salesperson whose main purpose is not to serve the local client better but to help the Dickeys get away without having to pay the local salesperson’s higher commission.

And finally, local sales is being driven – again – by national centers that dictate who to call on, how to do it, how many calls to make and so on. Therefore, radio selling becomes dialing for dollars instead of building mutually beneficial relationships.

Local sales staffs take their instructions weekly from headquarters and you see how things are working out.

Now the most amazing cockamamie plan of all from the makers of Less Is More.

This new plan could be called Screwy Sales.

Wait until you hear how it works. 

48 Millions iPads To Program By 2012

It turns out that I have been estimating the growth of Apple’s iPad tablets for 2011 too conservatively saying that there will be 11 million more sold by the end of 2011.

Now an analyst for Wedge Partners is predicting somewhere between 45 to 48 million more iPads manufactured and sold in the year ahead.

That’s an upgrade from 13.5 million in 2010.

There are many reasons for predicting the accelerated growth of iPads not the least of which is the anticipated inclusion of a front-facing camera and a thinner, one-piece design.

There is no doubt Wedge Partners is bullish on Apple. They even predict 48 to 50 million iPhones will be sold next year and for content purposes, iPhones are mini-iPads.

This medium is going to become extra large real soon.

I’m an Apple shareholder so you can imagine how I am salivating at the thought of all this, but there is something else that is lighting my fire.

Someone is going to have make content for all these iPads and iPhones. Apps are apps but they are only good when they link to something iPad users care about.

There is a major change in the making and smart observers are tracking it.

Television is in trouble and cable is beginning to decline.

Radio is having a heck of a time making local sales with their repeater radio content.

Newspapers are starting to take a licking not from competing media so much as small entrepreneurs who are making inroads with hyperlocal media sites (more on this at my January Media Solutions Lab).

The record business – well, outside of Taylor Swift things are pretty bleak going into the holiday season.

What is encouraging – in fact, compelling – is that up to 48 million additional iPads are going to be in the hands of consumers in just 14 months and they are going to need us.

Content producers – marketers – social networking experts – creative people or if I may put it another way – radio and music industry people ready to make the move to the digital side. Yes, broadcast companies and record labels can come along for the ride but this new revolution is open to everyone and anyone who has an entrepreneurial spirit.

I’m going to outline for you some of the best opportunities for iPad content creation so you can get a leg up on everyone else and get the creative process started.

Here we go. 

Why Monthly Music Subscription Services Fail

Spotify is all the rage in Europe – a free version and paid monthly subscription service for all the music you could ever want.

Spotify is trying to enter the U.S. market next with high hopes.

Google is getting close to unveiling its plan for the Android platform and will likely offer a paid subscription model for cell phones.

Zune’s HD Pass already has a subscription service that allows streaming to Android phones as long as they are online.

Not much demand there.

Rhapsody has been around a while, offers streaming for monthly fees, and is losing subscribers constantly.

Go figure.

Rdio’s claim to fame is social features and easy to use interface for music discovery.

The jury is still out.

Apple is planning a subscription service although I am not convinced it will look likes these or the other ones out there.

Why is it, then, that monthly music subscription services fail?

They’ve all got great features and some have small and consistent support.

This is one of the most important questions of the digital age and yet, in my opinion, most of us are looking in the wrong places for the answers.

There is little doubt that the next generation of music intensive consumers is obsessed with music discovery. For the first time, they don’t have to rely on radio to hear a few new songs a week.

They don’t need to put up with repetition of the same 20 to 30 tunes.

Don’t have to listen to someone else’s preferred music because they can always listen from their own playlists.

And best of all, this new age music consumer has the coolest, smallest, slickest devices in their hands for being in control of the music they discover and want to hear.

There is an answer to why music subscription services, which otherwise are pretty nice, just can’t seem to gather enough critical mass to succeed. You could blame the record labels for throwing a monkey wrench into the subscription model because they have certainly done that. After all, the best of the subscription services may be the one you can’t hear in the U.S. – Spotify – because they have not been able to cut a deal they can afford with the major labels.

But there is a missing link that I’d like to point out.

One that helps explain why monthly music services fail.

And one that gives an insight into the labels’ fantasy of getting Internet service providers to charge monthly fees for music access which will never get traction.

And it even helps explain what terrestrial radio is doing wrong even though radio is offering its music for free.

It’s not about price.

Monthly music services, record labels and radio stations fail to see that consumers – as they always do – are screaming out for what they want.

And here it is. 

Apple Readies a Potent Blow to Music Radio

Even as the radio industry is fighting a war with Apple to get CEO Steve Jobs to put FM radio on his popular mobile devices, Apple is getting ready to deal a severe blow to music radio.

Not that anyone in radio is noticing.

And I can guarantee you very few know what I am going to share with you this morning about Apple’s latest plan to rethink the way music is presented to its 100 million plus iTunes subscribers that will have catastrophic ramifications for radio.

To put the issue in perspective, keep in mind that most station owners still believe that if you build an iPad or iPhone with an FM chip, they will come.

It is interesting --- and significant – to note that Steve Jobs has basically turned a deaf ear toward radio interests for ten years now. He just doesn’t think his youthful market of changemakers want a radio as part of their mobile devices.

Emmis CEO Jeff Smulyan is the most visible radio executive who passionately believes radio listening would increase if somehow, someway Jobs can be convinced to go with the FM chip. Smulyan cites the success in Europe with FM on mobile.

In such cases, slight increases in radio listening are reported but when times are tough as they are now even the slightest increases are deemed to be worth it.

But not in this country.

Radio on a cellphone or iPod is a non-starter for consumers. The iPod Nano has been available with an FM chip here – a small bone Apple has been willing to throw to terrestrial broadcasting – but it has not even represented a blip in audience ratings.

And other non-Apple mobile products have been offering FM radio with the same flat results.

One thing about Jobs.

He sure knows how to throw his competition off guard.

In this case while radio wants desperately to become part of the cool world of Apple mobile devices, Jobs is about ready to drastically change that cool world and put it further out of reach for terrestrial radio.

This time Apple’s focus is not on FM broadcasting.

It is about music.

After all, music is the content that has led the mobile revolution. Without music at 99 cents (or free) there could be no iPod.

Without an iPod, there would be only radio for music discovery even if radio program directors continued their decades old policy of minimum music discovery (adding only three new songs a week to their playlists).

But consider this.

Jobs faked the music industry out of their business and here is how Apple is going to fake music radio out of theirs

The Dismantling of Citadel’s KGO, San Francisco

Mickey Luckoff has been out as President and General Manager of KGO/KSFO, San Francisco for about one month now.

Luckoff left with his hands in the air and two fingers holding his nose as Citadel CEO for Life Farid “Fagreed” Suleman finally got to him.

Luckoff stayed on after Citadel bought ABC from Disney hoping that he could keep the station he operated for 35 years together. To quote the Bible:

“What Mickey Luckoff has joined together, let no man put asunder”.

35 years – numerous owners later from ABC to Cap Cities and Disney – and then a catastrophic event.

True, Arbitron’s People Meter has been shorting news/talk stations all over the country probably because the drive-by listening rating service only seems to like hit music stations. Even at that, Luckoff kept churning out the money.

Now in one short month, Fagreed Suleman has managed to do what could not be done in 35 years – the dismantling of KGO.

But before we get to what Suleman plans for KGO, let’s look at Fagreed’s so-called life.

Suleman had to eat his $55 million stock award last week when Citadel attorneys had a little sit down with the judge in a lawsuit brought by investment partner R2 – a lender turned shareholder – that called Citadel’s compensation plan "one of the most egregious frauds by a company emerging from Chapter 11."

In all, over $100 million in bonus shares awarded (mostly to Fagreed, of course) just after Citadel emerged from bankruptcy had to be cancelled.


Think about it.

Say you have money invested in Citadel and Suleman and company take a $100 million bonus almost as soon as the bankruptcy court gives Citadel to the lenders. You wouldn't like it, either.

Fagreed doesn’t need any introduction to greed – that’s how he got his nickname. Citadel is still in court defending itself against R2. R2 saying the stock awarded to managers vested over two years in their pre-arranged bankruptcy stipulated options that vested over three years. As The Wall Street Journal reported, “R2 complained the restricted stock would dilute value of R2's shares and others owned by the company's former creditors”.

No problem. Citadel just decided to turn these questionable stock awards into options.


Wasn’t that simple?

What should be of equal or greater concern to the lenders turned owners is that Suleman is systematically wrecking the company.

Look at how Suleman is beginning to dismantle KGO right now. 

Career Clinic: 7 Ways To Be the One Hired

It’s the weekend, a good time to focus on our careers and how to either change positions or seek a new one.

The media business is like every other business in a way when it comes to seeking employment but it is also unlike many fields requiring a different approach.

I developed a strategy to give my USC students a leg up on competitors when they were seeking their first jobs. If you try it, it is likely to help you stand out from the crowd and be the one your interviewer will remember and hire.

In this piece, I’ll show you:

1. How one page of pure dynamite will set you apart from other candidates.

2. How to double down on credibility so much so that your interviewer will be pulling for you.

3. All you need to know on building a powerful page on “7 Ways You Can Contribute to” the company at which you are being interviewed.

4. A few dos and don’ts to help stack the deck in your favor. 

Lew Dickey’s “F” In Local Sales

Lew Dickey’s nose is growing.

A few days ago on a quarterly earnings call with investment analysts, the Cumulus CEO went from “tricky” to “slicky” when he boldly reported that national and political ad sales were the leading sales categories.

But then a caller asked the ranter from Atlanta for a more responsive answer about why local sales were off – after all, investors should be concerned when radio, a local business, cannot produce growth in local sales.

Lew did his best imitation of Pinocchio.

Dickey said – only when pressed – that local was about 50 basis points short of flat. For those of you who did not graduate from Harvard and Stanford as Lew did, let me translate that – local sucks.

But you’re not going to believe why – and if you do I have The Holland Tunnel all ready to sell you right there in Hoboken, NJ.

Here’s what Captain Lew is peddling to the public and his employees in confidential memos about why a strategic move he imposed on Cumulus is failing so badly. 

When Radio Stations Don’t Compete With Each Other

Radio stations used to relentlessly compete with each other for the last listener, last ad dollar available and the hearts and minds of their local listeners.

Since consolidation, the recession and live, local radio cutbacks, stations have turned into transmitters and towers of outsourced programming. One wonders if that hasn’t contributed to the steady loss of listeners. Even the People Meter’s hopelessly inflated numbers that also include drive-by listening barely can keep station ratings treading water. 

How important is competition and where has it gone?

I’d like to get into that this morning because I believe it is crucial.

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If you haven’t subscribed yet and would like to access this story, let me tell you what you will get in this piece.

1. Why investment banks want less competition (in their own words) and why radio needs more (in mine).

2. How Pandora has become a major competitor to radio and why radio is ignoring the popular customizable programming service even as Pandora gets ready to double down and be more of a local competitor.

3. What is the curse of buying your competitor?

4. Why do investors hate radio so much today?  No group has been more vocally against terrestrial radio than the investment banks that helped ruin it.

The Promise of Hyperlocal Media

One of the things I am most excited about is hyperlocal websites and content distribution.

There is growing evidence that people without broadcasting or journalism backgrounds have made their way into this area with great success.

While the money isn’t there yet, I’ve got a plan for that. I am devoting time at my upcoming Media Solutions Lab in January to the promise of hyperlocal media.

This new hyperlocal media business was meant for radio people and this morning I would like to tell you more about it.

If you are already a subscriber, thank you very much for joining our group and you can click through now to unlock the content.

If you haven’t subscribed yet and would like to access this story, let me tell you what you will get in this piece.

1. What the critical difference is between low powered FM (also called hyper local by some) and online, mobile and commercial radio hyperlocal that I am tracking.

2. How local should you go – you probably won’t believe it, but I’ll tell you.

3. Why hyperlocal content is the perfect startup for radio station employees – current or recently let go.

4. The three ways to monetize hyperlocal.  Don't forget that!

5. Enhancements that can be added to build even richer content.

It’s all right here. 

The Music Industry vs. Radio

Everyone seems to know the blow-by-blow between the NAB and record labels over the performance royalty tax.

Last week NAB’s ambitious CEO ex-senator Gordon Smith bamboozled his board of directors to go along with musicFIRST’s basic offer to make radio pay up in return for some minor concessions.

That we know.

What many may not know is:

1. The labels’ end game.

2. The real cost that has not been addressed by anyone.

3. Why Cumulus and Citadel are on the side of the music industry.

4. My advice on how to nip this tax in the bud right now. Any station can do it starting tomorrow.

5. And, how to make a profit with radio stations cutting out record labels – if they have the courage to resist the tax and move in another direction.

Angry Listeners

In the upcoming election tomorrow it appears the electorate is angry.

When they get mad at politicians, they vote them out of office.

Increasingly, in the media business, listeners, viewers and consumers of content have many more options than ever. And they have their own ways of voting the media in their life out. 

This morning, I’d like to delve into why our audiences are increasingly angry. And they have options. A lot of them.

If you are subscriber, thank you very much for joining our group and you can click through now to unlock the content.

If you haven’t subscribed yet and would like to access this story, let me tell you what you will get in today’s piece.

1. What it takes to get a good read on audience content preferences in the digital age.

2. Why it pays to take the pulse of consumers all day through Twitter and other means before problems emerge that could cause irreparable harm to your brand.

3. Apple’s secrets to customer success. I have a valuable link for you about how Apple works to please consumers.

4. How to sense when audience sentiment is changing in a world this fast and with so many options.

5. The one thing that audiences insist that you do for them.  Are you doing it?

6. How to avoid making listeners feel they have outgrown their need for the content you provide.

The answers start here.