MEDIA: Shake Up in Boston Sports Radio, Re-Apply for Your Job & Billionaire Closes Co. After Union
Monday, November 06, 2017
GoLocalProv Business Team
|Broadcasters will no longer need to have local facilities under FCC change|
This week media across New England and the country exploded in financial implosions, missed debt payments, dramatic closures, and big transactions. Throw in a big FCC ruling which may have the biggest impact on local media.
It was an especially bad week for employees who are members of unions in media.
In Rhode Island, over the past couple of weeks, we saw one of the last family-owned newspapers sell to GateHouse media - owners of the Providence Journal. The Newport Daily news was sold by the Sherman family and fate of the paper is unknown.
And, the parent company of WPRO — Cumulus — hit yet another financial pothole.
SEE SLIDES BELOW
Big Broadcasters Win
FCC Ruling may be the biggest game changer.
Quietly the Trump Administration-controlled FCC made a major rule change for the benefit of the consolidating giants like WJAR-10’s parent company Sinclair and WPRI-12’s parent Nexstar.
The FCC change eliminated a nearly 80-year-old requirement for TV and radio stations to maintain a main studio in or near the communities they serve. The elimination of the rule means Sinclair no longer needs to have a Cranston location and could broadcast from their corporate HQ in Maryland or any other state.
“This rule is unnecessary; most consumers get in touch with stations over the phone or through electronic means,” Republican Chairman Ajit Pai said in an online posting ahead of the vote. Stations can produce local news without a nearby studio, and the rule can impose “major costs” on broadcasters, Pai said.
Paid, appointed by Trump is rapidly rolling back regulations on broadcasters. Bloomberg reports, “Federal Communications Commission Chairman Ajit Pai is moving to change the Lifeline communications subsidy program in ways that will quash waste and “more efficiently and effectively” help provide internet service to poor people, according to the agency.”
More Radio Deals
Sports Hub Gets Yet Another Owner
When radio group Entercom (owner of WEEI) bought CBS Radio, they acquired their better performing rival 98.5 the Sports Hub in the deal.
Beasley Media Group owns 63 stations in 15 markets. Boston has been a hotbed of sports talk in America.
The Sports Hub has the radio rights to the New England Patriots — their long-term financial fate may be tied to Tom Brady’s diet of kale salads and his immortal post-40-year-old performance.
Missed Debt Payment
WPRO’s Parent Company Cumulus Moves Towards Bankruptcy? Defaults on Debt Payment
Cumulus — the parent company to a slew of Rhode Island radio stations including WPRO AM and WPRO FM continues to flounder.
Its stock has plummeted again — now just $0.30 and it missed a critical debt payment.
“The Company is scheduled to make an interest payment of approximately $23.6 million on the 7.75% Senior Notes due 2019 issued by Cumulus Media Holdings Inc. … the Company to forgo the scheduled interest payment on November 1, 2017, thereby entering into the applicable 30-day grace period under the terms of the Indenture. Such nonpayment constitutes a “default” under the terms of the Indenture, which matures into an “Event of Default” if such “default” is not cured or waived before the expiration of the 30-day grace period on December 1, 2017., according to the company in an SEC filing, Richard Denning, Senior Vice President, General Counsel and Secretary
Cumulus CEO Mary Berner said, “While the company has ample cash to operate our business, Cumulus continues to be constrained by an excessive debt load. With the assistance of outside advisors, we are proactively exploring a range of alternatives with our lenders and noteholders to restructure the balance sheet and reduce debt. Our objective is to be able to redirect more of our time and resources to where they can have the greatest impact on our future – investing in our employees, in key technologies, and in initiatives that drive growth.”
iHeart (Parent company of WHJJ, WHJY) is forcing employees to re-apply for their jobs
iHeart, who just bought Boston all news station WBZ-AM — one of the last great AM radio stations and according to a report in the Boston Globe, they have “indicated employees at the station will have to re-apply for their positions, and that it does not plan to honor two union contracts.”
“In a letter sent Thursday to a union official, an attorney for iHeartMedia said that the company ‘will interview and consider for employment the on-air announcers and off-air production staff currently employed by CBS at WBZ-AM,’’ reported the Globe.
“The letter goes on to say that iHeartMedia ‘will not be assuming the two collective bargaining agreements between CBS Radio’ and the Screen Actors Guild-American Federation of Television and Radio Artists, SAG-AFTRA.”
Billionaire Founder of TD Ameritrade closed his digital news sites after the employees unionized.
A week ago, reporters and editors in the combined newsroom of DNAinfo and Gothamist, two of New York City’s leading digital purveyors of local news, celebrated victory in their vote to join a union.
On Thursday, they lost their jobs, as Joe Ricketts, the billionaire founder of TD Ameritrade who owned the sites, shut them down.
At 5 p.m., a post by Mr. Ricketts went up on the sites announcing the decision. He praised them for reporting “tens of thousands of stories that have informed, impacted and inspired millions of people.” But he added, “DNAinfo is, at the end of the day, a business, and businesses need to be economically successful if they are to endure.”
DNAinfo and Gothamist have always been unprofitable and a bit of a billionaires plaything, but the workers may have dramatically misunderstood that this was a “vanity play” by Rickets more than a growing business concern.