WSJ: Pittman Envisions New Life for Radio
From Marissa Marr at wsj.com
(Bob) Pittman, 58 years old, fled the corporate world in
2002 after exiting the now-broken-up AOL Time Warner in a cloud of
recriminations over the ill-fated merger. He retreated to his favorite
pastimes, flying his planes and traveling. He later launched a private
investment firm with his own money, backing start-ups including email
newsletter DailyCandy and the tequila brand Casa Dragones.
Now he's back in the building where he started MTV and where
AOL Time Warner was based after its merger. Gone are the round spectacles and
coifed hair from his AOL days, replaced by open-neck shirts and stubble. In an
office adorned with models of the jets he has owned over the years and MTV
Moonman awards, Mr. Pittman has been plotting a revival rooted in trying to
make radio cool again and convincing marketers that radio deserves more than
the 6% share of total ad spending it currently commands (television attracts
around 50%).
It is a challenge unlike anything else he has taken on.
Whereas his involvement with both MTV and AOL occurred when they were fresh and
new,Radio is one of the oldest of old media. Its future was bleak even before
the Internet and satellite radio came along, but now traditional radio faces an
array of digital competitors in streaming music services, from Pandora to Spotify.
While most Americans still listen to radio in some form,
radio advertising grew just 1% to $17.4 billion in 2011, according to the Radio
Advertising Bureau.
To make life even tougher, Clear Channel is laboring under
$20 billion of debt, a legacy of a 2008 leveraged buyout arranged right before
that year's financial crisis. The company reported $4 billion in losses for
each of 2008 and 2009 due to onerous impairment charges. By 2011, the outlook
improved but the company was still in the red to the tune of $302 million.
"Bob's drawn to the challenge of a turnaround and
working on something that most people think is doomed," said former MTV
chief Tom Freston, who worked for Mr. Pittman in the early days of the music
channel and is a fellow "Burner" (an attendee of the Burning Man arts
extravaganza in the Nevada desert).
"Bob's had more reincarnations than the Buddha."
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