iHeartMedia’s lawyers are probably very happy to see May in their rearview mirrors, after dodging a bullet in a Texas courtroom last week. A friendly judge barred the company’s creditors from seeking notices of default on some $6 billion of iHeart’s $21 billion in corporate debt, racked up primarily from pillaging the radio industry over the last 20 years.
iHeart’s creditors were attempting to call out the company for constructing a shell game in an attempt to keep its debt from crushing it. They noticed last year that the company had begun transferring hundreds of millions of dollars in assets to two “independent” subsidiaries named Broader Media and CC Finco. In simple terms, having already borrowed tens of billions against hundreds of stations, thousands of billboards, and countless other media ventures, iHeart moved some of those assets to “new” corporate parents, thereby creating “new” value against which to borrow even more money. Even better, this shuffle protected those assets against existing debt claims. Continue reading “iHeartMedia Dodges Bankruptcy, Option Remains”
The radio industry’s efforts to carve out space for itself on mobile phones took some big strides foward this summer. In late July, AT&T announced that it would seek to enable FM reception capability in the Android devices it offers. This month, after a NextRadio-led Twitterstorm, T-Mobile declared it would do the same.
This is an important milestone for the NextRadio effort: three of the four major wireless providers in the United States have embraced the notion that terrestrial radio should be part of the media mix on mobile platforms. It will be interesting to see how long Verizon, the #1 carrier in the country, decides to hold out on offering FM radio as a feature in its phones. That it took until 2015 for this to happen is testament to the gatekeeping-power of the wireless oligopoly in the United States. Continue reading “NextRadio Reaches Carrier Milestone”
Several broadcasters have teamed up in a petition with the FCC seeking to change the agency’s sponsorship identification rules. Presently, if an entity pays a radio station to put a program on the air, the station must clearly disclose this relationship on the air at the time the sponsored programming is played. This rule is an old one, first instituted to crack down on the practices of payola and plugola — or the back-channel compensation of radio stations by record labels and promoters to spin their tunes.
The “Radio Broadcasters Coalition” reads like a who’s who of corporate radio: Beasley Broadcast Group, Cox Radio, Cromwell, Emmis, Entercom, First Natchez, Greater Media, Henson Media, and
Clear Channel iHeartMedia. Their 20-page proposal seeks to flip the script on payola/plugola disclosures, allowing stations to air music and sports programming that the station is paid directly for without any on-air disclosure at the time of broadcast. Instead, the Coalition suggests that stations engage in a “robust listner education program” about sponsored programming, run “daily announcements” about sponsored programming, and post “enhanced disclosures” online. Continue reading “Broadcasters: Music and Sports Payola is Okay”
In its latest quarterly filing to the Securities and Exchange Commission, Emmis Communications, the Indianapolis-based broadcast conglomerate who developed the NextRadio/TagStation suite and is a major player in HD Radio, had some interesting things to say about both technologies.
Back in 2013, Emmis inked a deal with Sprint in which broadcasters would pay $15 million a year to Sprint through 2016, in quarterly installments, in exchange for Sprint adding FM receiver chips to some 30 million devices on its network. Emmis has been working with other broadcasters to help shoulder the burden of this deal, but it would seem that industry enthusiasm for the project is coming up a bit short. Specifically (p. 30): Continue reading “Broadcasters to SEC: Digital A Variable Priority”
This week, radio industry muckraker Jerry Del Colliano published a blog post announcing his acquisition of a "secret memo" from Clear Channel CEO Bob Pittman to executive staff. The details of the memo itself are hidden behind Del Colliano’s blog paywall, but the preview is worth a gander.
Reportedly, the memo is entitled "Expanding iHeartRadio onto the Terrestrial Platform" and outlines exactly how the broadcast conglomerate plans to do this. It is unclear from the preview just what the plans are, but it definitely signals that Clear Channel aims to use its iHeartRadio streaming platform as a primary content provider to some (if not most or all) of the company’s radio stations. The Pittman plan also reportedly suggests that iHeartRadio will become the company’s "main source of revenue" in the process. Continue reading “When the Internet Takes Over Radio Stations”
Interesting news out of Saga Communications, a broadcast conglomerate with more than 100 stations in nearly 30 markets. Saga has decided to limit its online-streaming presence to the stations it owns in the top 100 markets.
For those stations that will stream, Saga plans to cap listening geographically, limiting online access to those who actually reside in the stations’ on-air coverage area. In addition, Saga may implement a 90-minute time limit for online listening: listeners will be prompted to click something to continue the stream after the initial session. If they don’t respond, they’re done.
Considering that the majority of Saga’s stations are outside the top 100 markets, this is a significant diminution of the company’s online streaming presence. Saga claims the cost of streaming is prohibitive, as it spends $800,000 per month to provide station streams, while the revenue it generates from them is paltry. Most of this money goes to pay performance royalties on the music it streams.
Contrast this with the actions of radio’s biggest player, Clear Channel, over the last year. Clear Channel’s building what it hopes to be the go-to portal for streaming broadcast radio stations in iHeartRadio.com. Not only has it repositioned its broadcast properties to act essentially as billboards for the company’s online presence, but it’s entered into several agreements with other broadcasters (both commercial and noncommercial) to aggregate their streams exclusively through its portal.
Clear Channel is also taking steps to attempt to control the cost of streaming royalties. Earlier this month, the company broke from the rest of the radio industry, striking a deal with the Big Machine Label Group to pay the first-ever performance royalties for broadcast airplay. In exchange, the company gets a discounted rate for streaming royalty payments to the label. Continue reading “Broadcasters Still Ambivalent About Streaming”
Clear Channel’s had a lot of success enticing broadcasters into its iHeartRadio service. On the surface, it looks like a nice turnkey solution for radio stations which have neither the time, technical knowledge, or money to go it alone on the Internet. Just sign up for distribution through iHeartRadio and set up enough gear to send a source-stream to the aggregator.
From there, Clear Channel does the rest, providing all the front-end bandwidth necessary for your listener base and leveraging its economies of scale to put stations’ streams in front of as large of a potential audience as possible. The iHeartRadio application is a default install on a variety of smartphones, gaming consoles, and vehicle infotainment systems. Continue reading “The Fine Print of iHeartRadio”
This week, Clear Channel (#1 in national radio station ownership) and Cumulus (#2) inked an agreement intimately linking their online broadcast strategies.
Cumulus will integrate the webcasts from its ~560 radio stations under Clear Channel’s iHeartRadio streaming platform, and will actively promote it on-air. In exchange, Clear Channel will cross-promote Cumulus’ SweetJack service, a Groupon-style business the broadcaster is developing in markets where it has stations, both on-air and online. Continue reading “Broadcast Conglomerates Consolidate in Cyberspace”