iHeartMedia's organizational re-structuring news early Tuesday was quickly followed by scores of lay-offs, including on-air talent and office employees.
At least one veteran radio personality described the action as a 'bloodbath', reports Billboard.
A laid-off iHM employee added by e-mail: "My meeting with the GM this morning lasted maybe 45 seconds or so. He read a statement from a piece of paper (that I barely remember) and I was shown the door." Another laid-off source has been hearing all day from colleagues and speculates that the job reductions are disproportionately hitting "mid-major markets," like Pittsburgh or Richmond, Virginia, as opposed to more lucrative big cities, or smaller markets where the company can more easily install syndicated programming from its central office.
In his Inside MusicMedia blog, Jerry DeColliano posted 'If radio had a Richter Scale, what iHeart is about to set in motion is a 10." He added SVPP Tommy Austin, EVPP Jon Zellner and Chief Programming Officer Tom Poleman have been working on the programming RIF for months.
iHM, which has more than 850 stations, has struggled financially in recent years. The company restructured its debt in a Chapter 11 bankruptcy proceeding last year from $16 billion to $6 billion. It has also been moving towards digital streaming, with the iHeartRadio app, which has 128 million users but commands far less in advertising revenue than its AM-FM stations.
Billboard reports iHM spokespeople wouldn't comment or confirm the number of layoffs, but said in a statement that "the number is relatively small given our overall employee base of 12,500."
"We are modernizing our company to take advantage of the significant investments we have made in new technology and aligning our operating structure to match the technology-powered businesses we are now in," the statement continued. "This is another step in the company’s successful transformation as a multiple platform 21st century media company."
Spotify-and-YouTube-style streaming, as well as alternative entertainment options such as Netflix and video games, have pounded traditional broadcast companies in recent years, and tracks no longer have to catch on at once-all-powerful radio stations in order to become major hits. "That's where iHeart is headed," says another iHeart employee laid off Tuesday. "Their focus is going to be on their app and podcasting and not as much on local markets and terrestrial."
Late last year, cable giant Liberty Media Corp., which specializes in buying damaged media properties and turning them around, reportedly asked the Department of Justice to expand its iHeart investment from 5% to a controlling stake.
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