A brief history… Infinity Broadcasting started in 1972, back when the full restrictions on radio ownership were still in place. The company was relatively unimportant until 1981, when a guy named Mel Karmazin showed up. Mel broke the “rules” of radio. He quickly developed a reputation for turning foundering radio stations around and making them ratings successes and money-makers. Bankers like that. Mel targeted young people, not the 50+ people who grew up listening to radio before TV arrived.
In 1985, Mel hired Howard Stern who had been fired by the venerable RCA, then owner of WNBC-AM. An old-timer in the radio business named Don Imus worked at WNBC at the same time. When WNBC went away to make room for WFAN-AM, Howard and Imus became the cash cows of Infinity in nationwide syndication (beyond just the Infinity stations). The group of stations owned by Infinity grew up to the limits of the FCC limits.
Then radio changed forever in 1996 – the Telecom reform act removed the national ownership caps and relaxed limits on individual markets. The venerable Westinghouse Broadcasting absorbed Infinity and Mel, which quickly was acquired by CBS in the merging frenzy of the late 1990s.
Mel wound up being the head of CBS’s radio division. It took a few years and a lot of money from Viacom, but CBS eventually chased Mel and his crazy ideas out of CBS.
Mel joined a company called Sirius in 2004 that had this odd idea of distributing radio using satellites that weren’t subject to FCC content restrictions and didn’t require having local radio licenses and towers. The service would be funded by subscription revenue, and have no advertising on most of its channels.
Mel offered Howard Stern a very big contract to come work for Sirius. Howard had the potential to immediately add millions of subscribers.
Viacom refused to let Howard out of his contract early, and put him in legal hell – forcing him to stay on the air but prohibiting him from talking about Sirius and that he was leaving. He managed to pull it off – CBS still tried to sue Stern for promoting Sirius while under contract to CBS/Viacom. The case was ultimately settled with Sirius getting the rights to 20 years of tapes of Howard Stern and Sirius paying $2 million. CBS would eventually find a way to also purge itself of Don Imus using the pretense of his “racial insensitivity”.
So what does any of this have to do with radio in 2010? They (radio, not CBS) are doing it again to Dr Laura. Dr Laura failed to come to terms with Premiere and has been dogged by boycotts from gay groups and Al Sharpton that make it hard for her to survive in advertiser supported radio. She decided to take an offer to move to Sirius/XM where boycotts won’t work and she can say whatever she wants – she already was on Sirius via Clear Channels XM channel, but that was kept pretty quiet.
Dr Laura has been making money for syndicated radio since 1994. The final two weeks of her time on the air – rather than saying Thank You for helping radio for 15 years and being graceful – several people in radio with oversized egos are getting very public and trying to outdo each other announcing they are booting Dr Laura off their stations early because she has the audacity to mention she is moving to Sirius – as if radio listeners won’t be able to Google “Dr Laura” the first week of January and find out where she went and why.
Sirius/XM just renewed Howard Stern for another five years – Sirius has about 20 million subscribers willing to pay $20+ a month to get away from advertiser supported radio. Alienating Dr Laura in such a stupid way is not going to do anything but speed up the demise of terrestrial talk radio syndication. $20 milion x $20 x 12 months is a lot of money. There are mllions more radios sitting in cars that are not currently activated.
