As the corporate broadcasters move away from their core business of broadcasting into the realm of empire building, the largest of these have incurred financial debt & hinged on bankruptcy. In efforts to generate capital, most have sold off core assets crucial to broadcasting. Cumulus Media is the last of these to sell mountain-top real estate, towers & transmission infrastructure. In a move to reduce debt, Cumulus intends to sell 253 tower sites in 32 states. In a story just posted by InsideRadio , CFO John Abbot didn’t indicate how much the company will gain from such sales, but believes the advent of 5G wireless will garner top dollar for these holdings. Cumulus has been shedding assets as part of its post-bankruptcy strategy. The company has so far paid down $275 million of debt since it emerged from chapter 11 in June 2018. Most notable was its decision to sell six FMs to Educational Media Foundation for $103.5 million & the pending $12.5 million sale of 770 WABC New York. Previous attempts to generate financing for Cumulus have included gaining permission from the FCC for up to 100% foreign capital to keep the mega-corporate afloat. In the meantime, additional land sales are in the works. CEO Mary Berner said the company is currently “working on ways to monetize” some land it owns in the Nashville market. The city, where Cumulus owns five stations, has been quickly growing, making such real estate more valuable than ever. Another deal that has been held up for the past 4 years is a $75 million sale of land in the Wash. DC area to a land developer. Companies such as Vertical Bridge & American Tower have paid millions to secure facilities to satiate market demand for wireless connectivity. Broadcasters, in exchange, typically lease back their antenna space. Now Cumulus Media is considering following suit.
Meanwhile, iHeart Media, another company teetering on the verge of financial ruin & recent bankruptcy proceedings is about to ask the FCC for permission to allow up to 100% foreign investment to raise capital for financing in a move similar to Cumulus, Univision & others. iHeart has also recently been on the verge of bankruptcy due to over-financing & mismanagement of it’s core businesses. Unlike Cumulus, iHeart already unloaded it’s broadcasting infrastructure & land holdings to pay off debt & avoid shutting down. As recently reported here & elsewhere, it has made major staffing reductions & diminished the value of it’s on-air presence by terminating many of it’s talented air personalities & those behind the scenes in an effort to reduce overhead operating costs affecting it’s bottom line.
The viewpoint of this reporter is that the monolithic corporate broadcasters have failed to gain American investment for what was once a lucrative industry in this country. It seems apparent that US capital providers see little growth in corporate broadcasting or the ability of these companies to manage finances in a manner that avoids insolvency. Requiring foreign capital to prop up an American industry is indicative of businesses that have long gone off the rails in attempts to reduce media to mere ‘product’ to be monetized for growth & profits at all costs. Is it a measure of success that American companies must now rely on foreign investment to remain profitable – or even functional? It also points to the utter failure of the FCC’s Telecommunications Act of 1996 that allowed the broadcasting industry to become more & more monopolistic & removed from it’s core business objectives. The FCC’s defined mandate to promote diversity & opportunities for all within the media structure has been abandoned in the past 25 years. Meanwhile, technological advances, consumer tastes & access to media via multiple means has surpassed what was once a vibrant broadcast industry in the US, while on-air radio & TV continuing to thrive in countries outside of North America. Support your local “indie” or small group broadcasters, deserving Public radio-TV or LPFM stations!