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32 Jobs Were Cut At Emmis Communications

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HIPHOPJUNKI

EMMIS COMMUNICATIONS CORP. third-fiscal-quarter revenues fell 5.1% to $59.164 million, with radio off 5.2% to $42.634 million, blamed primarily on a decline at Top 40/Rhythmic KPWR (POWER 106)/LOS ANGELES comprising "substantially all of our radio division's shortfall against its markets" due to the launch of format rival KRRL (REAL 92.3) by iHEARTMEDIA, offsetting better performance against their markets by the INDIANAPOLIS, ST. LOUIS, and AUSTIN clusters.

The company also announced that it had cut an undisclosed number of employees and chopped the pay of all senior executives.
- See more at: http://www.allaccess.com/net-news/a...es-fall-5-1-company-wide#sthash.1hVu4IkB.dpuf
 
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Here in St. Louis, it was announced that air talent Todd Newton, among others both on and off air, was let go. Rick Sanborn who has been on air for 30 years here, was also released.

Jim Shannon
 
This is a company that's struggled a lot for quite a while. They had to sell off 2 stations in Chicago and they're LMA-ing a station in NY and another in LA. The debt issues at iHeart and Cumulus get a lot of attention, but Emmis is the company that's really been forced to sell assets.
 
Emmis sold its TV assets, or at least several of them, to focus on radio about seven years ago. Clearly they made the wrong focus at that time. Sorry to hear of those losing their jobs.
 
TheBigA said:
They had to sell off 2 stations in Chicago and they're LMA-ing a station in NY and another in LA.
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If the station you think they are LMAing here in L.A. is the former KPOL-FM/KZLA/KMVN at 93.9, I think you missed a few FCC Daily Digests, A.

That station was sold to Grupo Radio Centro (which had LMA'd it for 3½ years before purchasing it) back in 2012. Sale closed a month before New Year's Day 2013.
 
They probably would have had to trim costs even if Big Boy hadn't left, but this demonstrates that talent still drives revenue.
 
umfan said:
They probably would have had to trim costs even if Big Boy hadn't left, but this demonstrates that talent still drives revenue.
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Ratings drive revenue. Whether the numbers are generated by music, talent or something else is to a great extent immaterial.
 
David, are you channeling Mario500? I obviously meant that ratings had been adversely impacted by the departure of this DJ, which created a financial issue through lower revenue leading Emmis to have to trim costs which they achieved through a staff reduction. In other words, "You think?!?"
 
umfan said:
David, are you channeling Mario500? I obviously meant that ratings had been adversely impacted by the departure of this DJ, which created a financial issue through lower revenue leading Emmis to have to trim costs which they achieved through a staff reduction. In other words, "You think?!?"
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I am not channeling anyone. Ratings drive revenue.

Talent, music mix, contests, outside advertising and other factors may drive ratings, just as new competition may negatively impact ratings. And advertisers, save specific cases based on live copy or endorsements, buy ratings, not talent or whether we are running a cool contest.

The fact is that KPWR was fragged in all dayparts by a new competitor. Interestingly, the morning race is a near tie while the greater advantage has gone to the new station in the music dayparts.
 
TheBigA said:
How about if CPM is being driven down by external forces?
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You mean, I assume, a general softening of the market. That is partially the case in LA, but market revenues are fairly flat in the 2014-2015 period so the bulk of any station's decline come from competitive forces and the need to sell at rates adjusted for the decline in numbers.
 
DavidEduardo said:
You mean, I assume, a general softening of the market.
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Exactly, and competition in the marketplace is getting even more intense, which continues to drive down spot rates and overall revenue, regardless of what the ratings are.

The digital boom already happened in radio, so they can't count on that "growth" any more.

I've said this many times before, but radio companies need to look for new revenue streams other than on air. That isn't going to be an area for growth anymore.

If you're a company like Emmis, your only new revenue stream comes from either selling or LMA-ing a station. If that's new revenue, that will lead to layoffs.
 
umfan said:
David, are you channeling Mario500? I obviously meant that ratings had been adversely impacted by the departure of this DJ, which created a financial issue through lower revenue leading Emmis to have to trim costs which they achieved through a staff reduction. In other words, "You think?!?"
Click to expand...

No, David's statement is correct. The departure of a DJ, even one as popular as KPWR's Big Boy, does not automatically lead all by itself to ratings drops and a corresponding drop in revenue. As he points out, the whole station took a hit in the ratings from KRRL, and it looks like the only advantage stealing the morning guy did for iHeart was to draw more attention to the new station. They could have lost the lawsuit, had the injunction that prevented Big Boy from going on the air, and still taken a hit in the ratings.

KPWR suffers from what I call "KHJ syndrome" ... they hit the top of the ratings book consistently for several years, then forgot to freshen the format. Eventually, the station sounded tired ... to the audience they became "old Power 106", just as KHJ started sounding old and predictable by the 1970s. When iHeart sensed the opportunity to flip 92.3 to take on 105.9 formatically, they nicely timed it to a point in time where Kurt was at a contract negotiation point*, then made their move.

The high profile lawsuit surrounding Big Boy got Real 92.3 more publicity than a format flip normally would have, and I'd bet they were prepared to go it without him if they lost. Remember, this is a company that owned the highest billing CHR in America and replaced its beloved high-profile morning guy after decades of ruling the book, and suffered no appreciable damages. Of course, I'm talking about KIIS-FM and Rick Dees ... and you'll note the replacement guy is still there.

I think iHeart had every scenario possible worked out. The morning show was a potentially disposable element.

*-For those who wonder how iHeart would know that, do you really think Big Boy didn't go talk to them at his previous renewal point? They knew since at least then when the opportunity would present itself again.
 
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