Cincinnati Enquirer article on Randy Michaels (Darth Vadar of the radio biz) being booted upstairs.
Observers: Radio move is a mystery
Clear Channel swap a shocker
By John Eckberg, jeckberg@enquirer.com
The Cincinnati Enquirer
Local and national radio industry observers were mystified Tuesday by the reassignment of Randy Michaels from chief executive of Clear Channel Radio to chief executive of new technologies for San Antonio-based Clear Channel Communications.
The move triggered a 16.5 percent drop in Clear Channel's shares, which closed at $25, down $4.94.
Michaels
"When an executive of Randy's caliber is reassigned to a business unit of secondary importance, it almost implies that something has gone astray,' said Jordan Rohan, an analyst at SoundView Technology Group in Old Greenwich, Conn.
"It is a very strange time to make a move like this," said Robert K. Riggsbee, founder and president of Inside Media, a media planning and media buying agency based in Newtown. "He turned Clear Channel into a company of 1,200-plus stations. I sincerely think they want him to be in charge of their next revenue opportunity: interactive radio and satellite radio."
As chief executive of the new unit, Mr. Michaels will focus on interactive, wireless broadband and satellite technologies, the company said Monday. Mark Mays, president and chief operating officer of Clear Channel Communications, will become acting chief executive of Clear Channel Radio, based in Covington.
George Nichols, a media stock analyst at Morningstar Inc. in Chicago, said the reassignment might have minor repercussions, if only because Clear Channel has become a symbol for the industry.
"Clear Channel is the big fish in the radio pond, a radio-industry leviathan that everyone either hates — mainly independent artists or consumer advocate groups — or everyone wants to emulate, mainly rivals," Mr. Nichols said. "
Mr. Riggsbee said if Mr. Michaels does not have a noncompete agreement or financial incentive to stay, he would expect to see him move on to another radio giant.
"It's like Barry Bonds coming up in the free agent draft. Randy Michaels is the Barry Bonds of the broadcast industry, and if he's a free agent, you could see another shocker, depending upon the exit strategy in his contract," Mr. Riggsbee said.
Frank Wood, the founder and chief executive of Cincinnati-based Secret Communications, suggested that because Clear Channel stock had hit a trough — worth about half its $30 billion value a year ago — the company might have needed to take some visible action.
The reason for the reassignment? Mr. Wood said he did not know but could guess: "His name wasn't Mays," Mr. Wood said, referring to chairman Lowry Mays, and his sons: president Mark Mays and chief financial officer Randall Mays.
Mr. Wood, formerly an executive at Jacor Communications, whose stations were absorbed by Clear Channel in 1999 for $6.5 billion in stock and debt, said he wondered who would replace Mr. Michaels.
For instance, will it be former AOL Time Warner chief operating officer Bob Pittman, Mr. Wood wondered.
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