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More layoffs in Utica and Syracuse

B

BobRoss

Anyone see these? Morning guy axed from Mix in Utica, and a few people axed at WSEN in Syracuse.

http://www.cnyradio.com/2008/11/25/morning-man-schrier-exits-mix-1025/
http://www.cnyradio.com/2008/11/26/more-casualties-at-wsen/

Looks like Citadel tossing Big Jim was like "breaking the seal" on local layoffs. Let's hope this is it... but I have a feeling it's not.

Also saw something on AllAccess about Citadel maxing people out at 2 weeks of vacation. Anyone who already has more weeks can kiss 'em goodbye. Two weeks for everyone, end of story. That's gotta suck for people who've worked years to earn those extra weeks, only to have it taken away in an instant.

And seriously... how much is this actually going to save the company? When off-air people take vacation, it's no big deal. Someone else covers their duties for the week. It's not like you see anyone hiring "temp sales people" or a "temp GM" for the week. When on-air people take vacation, sure, different story. But it still can be done without costing more. Have people from other dayparts (or gasp, sister stations) fill-in. Voicetrack when possible, be live only if absolutely necessary. There's no reason giving people a 3rd or 4th week of vacation should cost the company any more money.
 
Vacation Planning

BobRoss said:
Voicetrack when possible, be live only if absolutely necessary. There's no reason giving people a 3rd or 4th week of vacation should cost the company any more money.
Click to expand...

Citadel is issuing stupid corporate-wide edicts that will ultimately reduce revenue. I hear that they've cut ALL live bodies 7-Mid, including shows that had top ratings and exclusive sponsors who paid for the talent several times over.

Now, as far as vacation is concerned, remember that vacationing air staff has to be replaced by part-timers. Calling in that part-timer, who's probably making 8 bucks an hour, to VT the shift while the regular guy is gone, will cost them (by decree) one hour of PT salary.

5 days x $8 = $40.00

That $40 = how many spots per week?

Now it they did something crazy like paying a PT $10/hr., and actually ran the shift live, you'd be looking at:

5 days x 4 hrs. x $10 = $200.00!!!

How many spots do you need to sell to cover $200? Better still, how many times does $200 go into Farid's $10-Million dollar 2008 "additional compensation"? Heck, let's take just $1-Million...

$1,000,000 / $200 = 5000

So, if they cut Farid a measly million, they can fund 5000 vacation weeks, and actually fullfill the terms of the contracts that Citadel shoved down most of their talents' throats.

Which brings us to an interesting question... If Citadel violates the terms of a talent contract by reducing vacation time, does that mean that the contract is null and void, and that talent can move across the street if they can scare up a better deal? Especially in NY, where non-competes are no longer enforceable?
 
Re: Vacation Planning

SirRoxalot said:
Citadel is issuing stupid corporate-wide edicts that will ultimately reduce revenue. I hear that they've cut ALL live bodies 7-Mid, including shows that had top ratings and exclusive sponsors who paid for the talent several times over.
Click to expand...

If true, that is very stupid. Looks like 93Q met the edict by eliminating Donovan instead. I feel bad for the guy, but it makes sense. CHR stations cater to younger listeners. Where are those listeners (or where should they be) during the midday shift? School. Sure, there are plenty of adults who may be able to listen during the day at work, but most offices tend to lean for the more vanilla/neutral sound of an AC station. There isn't much of a "need" for a CHR station to be competitive during middays, but afternoons and evenings are important.

It also makes sense financially. I would assume Donovan, being at Q for 16 years, was making a heckuva lot more than whatever Mike Cauchon makes after only a few years on the full-time roster.


SirRoxalot said:
Now, as far as vacation is concerned, remember that vacationing air staff has to be replaced by part-timers. Calling in that part-timer, who's probably making 8 bucks an hour, to VT the shift while the regular guy is gone, will cost them (by decree) one hour of PT salary.
Click to expand...

They don't HAVE to call in part-timers to cover vacations. If they really want to be cheap, they can have FT jocks from different stations VT the shift and it costs nothing. They're already in the building anyway; it would just take an hour (or less) away from their other off-air duties. I don't suspect there's a huge audience overlap between 93Q and 95X... just use aliases, keep the tracks short, and most people probably won't even notice. Obviously, this wouldn't work for Ted & Amy taking vacation - but it should work for any other shift. VT'ing may not work for the "Top 5 at 9" either... if Cauchon takes a vacation, you could slide Rick Roberts to evenings for the week, and have someone track his shift.

Yes, it's cheap and shoddy. And I hate how Clear Channel does it (in some cases every day with certain part-timers who jock on multiple stations, or jock one station and report traffic on others). But if it's limited to vacations only, and it helps people continue to enjoy the full amount of vacation they've earned, so be it.[/quote]


SirRoxalot said:
Which brings us to an interesting question... If Citadel violates the terms of a talent contract by reducing vacation time, does that mean that the contract is null and void, and that talent can move across the street if they can scare up a better deal? Especially in NY, where non-competes are no longer enforceable?
Click to expand...

I'm not a lawyer, but I would expect, if vacation time is specifically addressed within a personal contract, the contract supersedes any standard policies in the company employee handbook.

I do know of another broadcasting company where a wage freeze is in effect for 2009, but the company must honor payraises for anyone who is represented by a union contract or a personal services contract. (They can ask employees to say no, but they can't force it.) With that in mind, if Citadel strips vacation away from someone whose vacation is contractually defined, I think that would nullify the contract.

As for non-competes... yeah, it's great NYS finally outlawed them, but it's too bad the economy sucks right now. Anyone who is worth luring away, would likely want more money than a competitor would be willing to pay right now.
 
fgarvin said:
Go to www.terraserver.com and enter "[EDIT]" in Greenwich, CT and see where Farid Suleman lives, firing people, driving down stock prices and destroying a great company.

[EDIT-Private Content]
Click to expand...

I find it funny the address was edited out... it is easily found through a Yahoo People search (along with his phone number). If Farid Suleman was too cheap to pay the 5 bucks a month to keep his number unlisted, that's his fault.
 
Citadel is issuing stupid corporate-wide edicts that will ultimately reduce revenue.
Click to expand...

It's not about raising revenue, it's about getting the stock price above $1 before they get de-listed in a few weeks. Usually, big, easily-understood layoffs are a sure thing to jack up the stock price; supposedly they show that the company is "serious" about getting profitable enough to meet Wall Street's expectations.

I'm no stock expert, but I suspect that the Street will see this the same way those of us on the list do: a desperate gambit that's slicing off entire limbs (never mind "trimming the fat") and the unfortunate truth is that radio, as an industry, is in for some very tough times, revenue-wise. We're well past the point of "cutting yourself into profitability" and I would hope most traders know that.

I hesitate to say that Citadel is doomed when it comes to their stock price, but I'd be shocked if they don't try and unload some medium-market properties in a hurry pretty soon; try and get some hard cash...even a few tens of millions...to stock up the coffers and try to ride out the economic storm. If they can successfully pull off some sales in a down market, they MIGHT get the stock price back up...depends on whether or not there's enough "spare" facilities they can sell without killing their revenue stream for the future.
 
Bottom Line

Citadel's got big problems. Selling off any of their medium markets won't bring in enough cash to make a difference. They owe $2.1-billion on a company valued today at $2.13-billion. As things stand right now, the medium markets are the most productive. The former ABC stations and the ABC network are in the toilet - and they're the source of most of the debt. Even $100-million isn't enough to make a real dent because any effect it has on the debt will be partially offset by the loss in asset value. In other words, they'd owe $2-billion, but the value of the company as a whole would drop almost that much because the value of the sold asset would likely be equal to the selling price.

All of that is dependent on finding a buyer who has cash in hand, because it's unlikely that the current credit market is going to loan money to ANYBODY trying to buy a major radio cluster. If it wasn't a killer deal for the buyer, what hope would they have of making a long term profit?

Unless there's a big turnaround in major market revenue, or Citadel sells off some major market clusters for a lot more than they paid, they're likely to follow Tribune into Chapter 11.
 
Interesting, SirRoxalot...I hadn't thought of it like that but you're spot on.

Question, though...assume Citadel goes into bankruptcy. Much of their debt could be written off, but no court will allow ALL of it to be written off. They're going to demand that Citadel cough up some major cash to satisfy SOME creditors...even if it's pennies on the dollar. Way I see it, the only way that can happen in the short term is if Citadel sells off some, or even a lot, of their facilities.

Assuming that's the case...what's more likely to be sold? The small-market stations, medium-market stations, or big-market stations? That's an honest question...I don't really know what a judge would demand. Your post suggests that the big market stations would be first on the chopping block, is that an accurate interpretation?
 
Divestiture

The biggest reason for Citadel to go Chapter 11 would be to lessen the debt load. The company is still making money, but so much of it is going to service the debt that there's little left for improving operations, or for the shareholders.

If they had their druthers, I suspect that Citadel would like to divest the ABC Networks portion of their holdings. Citadel generally isn't big on news in the first place, and there are so many other news outlets now that network radio news doesn't have much appeal. I've heard that the division is bleeding money, mostly because it relies on national business which has largely dried up.

I'm sure that Farid wants to hang onto the major markets, but their revenue has dropped so much that it may not be possible. So much of that business depends on national buys, and is purely ratings driven. Recovery of national business to previous levels is doubtful, and Citadel's programming cuts aren't likely to move ratings upward. That will make radio even less competitive when compared to other advertising venues. The biggest problem with selling a major market cluster is that Citadel likely doesn't have a prayer of getting back what they paid for it, so it won't improve the bottom line anyway.
 
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