CBS Radio Layoffs Show How Wall Street Changes The Media Rules

6a00e54f069c4188340133f3568248970bThe rules of the game in the broadcasting business used to be pretty simple: If you rule the ratings and pull in enough revenue to make a big profit, you get to keep your job. But the sad news this week for some outstanding broadcast professionals is that the rules have changed. Ratings, revenue and profits just aren’t enough anymore.

Case in point is CBS Radio and, more specifically, WWJ-AM, one of the country’s only remaining all-news radio stations. Nationally, CBS is essentially the nation’s most successful radio group, maintaing profitability in big markets during The Great Recession. Locally in Detroit, the company owns the three most-listened to radio station in the most recent ratings. On WWJ, “All News All The Time” and the market that spends its days and nights on wheels have been a successful marriage for more than 40 years on a station with a history that dates back to 1920. It was #1 in the ratings in the winter months, when drivers relied on its news, traffic and weather while navigating snow and ice-covered roads. But none of that is enough for a company that apparently wants profit margins to equal movie theater popcorn.

Full disclosure: I am a fan of WWJ. That is where I earned my first paid job in broadcasting. I consider many of the longtime staffers to be friends. We at Tanner Friedman work with the professionals there on news stories almost every day. As a businessperson who often spends hours per day in the car, I rely on their all-news product to stay informed in the mornings, afternoons and evenings when I can’t safely read online. But now, that product is being damaged, along with the careers of talented and knowledgeable broadcasters, because apparently being successful isn’t enough for big corporate media anymore. Here are the facts, as reported by The Detroit News: Reporter and producer jobs cut, the afternoon anchor team bought out, salespeople laid off and, perhaps worst of all for the community, overnight news won’t be news at all – it will be recorded (in what is still a “shift town”).

Nationally, it’s the same story, even at powerhouses that are also pillars of their communities, like WCBS in New York and KMOX in St.Louis. Still unfathomable, after all of these years of cuts in the media, is why a company would want to make its product worse in the name of growing its customer base. It’s a rationale that can’t possibly work.

Also, it’s one thing when failing companies have to cut to turn themselves around. But when the survivors of the media change of the past decade make cuts like this, it begs the question “What’s going on?” Unreasonable profit mandates? Or is CBS trying to attract investment, a merger partner or, potentially worst of all, a buyer? CBS won’t say. In fact, the company did not make any sort of public statement in the 24 hours since the story first broke.

It just brings to mind a quote from the movie “Wall Street.” Bud Fox, the would-be mogul, after finding his conscience says this to the greedy raider Gordon Gekko: “How much is enough, Gordon? When does it all end, huh? How many yachts can you water-ski behind? How much is enough, huh?”