WSJ Confirms NY Post Report: CC To Cut 7% Of Staff
January 19, 2009 at 6:03 AM (PT)
THE NEW YORK POST reported FRIDAY (NET NEWS 1/16) that a major restructuring at CLEAR CHANNEL would begin on TUESDAY (1/20), with a plan that seeks to cut $400 million in costs to be unveiled.
Over the weekend, THE WALL STREET JOURNAL (1/17) added to that report, writing that "CLEAR CHANNEL plans to lay off about 7% of its U.S. staff and replace more local shows with syndicated content, moves that could affect the broader radio and outdoor-advertising businesses for years to come."
The focus is on rewarding the very best salespeople, and letting them maximize their own compensation, in part by picking up accounts from their less-stellar peers.
The WSJ story continues: "TUESDAY, CLEAR CHANNEL will lay off about 1,500 employees, mostly in ad sales, and implement other cuts aimed at saving close to $400 million, according to a person familiar with the situation.
"The cuts will help CLEAR CHANNEL 'catch up' with other radio companies, which have engaged in layoffs and other cost cuts since early last year. CLEAR CHANNEL's restructuring lagged behind competitors thanks largely to an 18-month battle to take the company private, a process that ended in JULY 2008.
"But other radio and outdoor-ad companies could end up embracing certain strategic elements of CLEAR CHANNEL's restructuring if they see it finds success.
"On the radio side, the company is likely to eliminate chunks of local programming and replace it with national programming, much as it has brought RYAN SEACREST's LOS ANGELES-based radio show to other markets in recent months. If a local show seems successful, the company will try to syndicate it faster than it might have in the past, a person familiar with the situation said.
"The bulk of CLEAR CHANNEL's job cuts will be in sales, dropping those who aren't top performers. 'The focus is on rewarding the very best salespeople, and letting them maximize their own compensation,' in part by picking up accounts from their less-stellar peers, this person said."