On January 13th, Clear Channel Media Holdings, Inc. announced the retirement of CEO John Hogan from Clear Channel Media and Entertainment (OTCBB: CCMO) while simultaneously renewing Chairman/CEO Bob Pittman’s contract for an additional five-years.
A media innovator and life-long leader, Pittman started his career in radio broadcasting at the age of 15 at a small station in Mississippi and eventually moved onto a management position as programmer for a rock-formatted station in Pittsburgh. Soon after taking the station to number one in ratings, Pittman moved up to top 10 marketplaces where he programmed NBC-owned AM and FM stations in Chicago and, later, NBC Radio's flagship station, WNBC in New York. Pittman, who has had a lucrative track record having formerly served as CEO of MTV Networks (NYSE: VIA), AOL Networks (NYSE: AOL), Six Flags Theme Parks (NYSE: SIX), Quantum Media, Century 21 Real Estate (NYSE: RLGY), and Time Warner Enterprises (NYSE: TWX), is also a founding member of the New York based private equity investment firm Pilot Group, LLC.
After taking a hiatus from his prominent media career, Pittman put lipstick back on what some would call the pig – the radio medium - staking $5 million into the behemoth Clear Channel, which now broadcasts to over 150 cities via 850 owned radio stations domestically and internationally at an additional 140 stations in areas such as New Zealand and Australia. The investment clearly paid off – resulting in Pittman taking the helm as Chairman and CEO of Clear Channel. Boasting top brands like Z100/WHTZ New York and 102.7/KIIS Los Angeles, Pittman has further helped revitalize Clear Channel’s massive radio presence and its digital extensions. There is no doubt that that Pittman – the passionate jock turned programmer turned investor turned consultant turned distinguished media executive – has developed an innovative strategy and vision for growth, and has built an incredible culture and sustainable future for terrestrial radio and its digital assets (despite a rapidly changing landscape that’s brought on competition from music streaming services like Pandora and Spotify.) Clear Channel radio, its industry-leading syndication, digital music service: iHeartRadio, as well as its live concerts and events – has become one of the most leveraged, powerful and ever expanding global platforms.
However, Clear Channel is extending almost $2 billion in borrowings from three to five years – boosting interests at a little under $60 million annually and essentially doubling interest to push out maturities on over $4 billion it owes. Since Pittman, Bain Capital Partners and Thomas H. Lee Partners LLP have taken over, Clear Channel’s interest expenses have exceeded the company’s operating income in every quarter since the end of 08. With advertisers cutting back on broadcast radio due to economic trends, coupled with Clear Channel’s posted losses, refinancing at a higher rate is not a cure at all. It does, however, give the media empire time to improve the balance sheet. So with five more years under Pittman's belt, what are five things you think can he do to continue to improve and reinvent radio in order to maximize revenue/efficiency while cutting costs?
With the help of innovation, economics and technology, over the next few days, I will propose five solutions if I were in Pittman's shoes. If you've been thinking about subscribing and would like to access these solutions, let me tell you what you will get:
1. How Clear Channel can maximize on big name personalities to rapidly increase its revenue beyond traditional advertising. They've already done this to a great extent with Ryan Secreast and Rush Limbaugh, but how can they further invest in major market personalities and reap in returns by supporting their fame?
2. How Clear Channel can cut huge debts and overheads through a strategic mixture of syndicated and local talent in every marketplace.
3. How Clear Channel can further consolidate and get rid of dead weight that will allow them to be more competitive internally and fiscally better off in the long run.
4. How Clear Channel can take more control over the world music market through music publishing, record contracts and leveraging its own platform and brands.
5. Another solution that will absolutely blow your mind and make you think “Wow! That’s a great idea! Why aren't they already doing that?”
Subscribe to this story now to access the full article of solutions in the next few days and as always please feel free to leave your thoughts!