Limbaugh is threatening to split after Cumulus CEO Lew Dickey blames him for declining revenue
Anonymous sources close to Rush Limbaugh said on Sunday night that the conservative talk-radio colossus is on the verge of ditching his syndication deal with Cumulus Media, which broadcasts his shows on 40 stations in 36 markets. Why? "According to the source," says Politico's Dylan Byers, "Limbaugh is considering the move because Cumulus CEO Lew Dickey has blamed the company's advertising losses on Limbaugh's controversial remarks about Sandra Fluke, the Georgetown law student."
Lew has previously blamed the post-Fluke boycott for losses at the company. In an August 2012 earnings call, he said the Limbaugh boycott was a big reason the top three Cumulus stations lost $5.5 million that quarter, and this March he said the company's 3.5 percent drop in revenues was due largely to a "residual hangover" from "advertisers sitting out."
Limbaugh's talk of splitting is "a very serious discussion, because Dickey keeps blaming Rush for his own revenue problems," Politico's Limbaugh source counters. "Dickey's talk stations underperform talk stations owned by other operators in generating revenue by a substantial margin. It's not a single show issue... it's a failure of the entire station."
On Monday night, the Cumulus side struck back, telling Mediaite's Andrew Kirell "that the ad troubles in connection with Limbaugh's show are, indeed, severe." One anonymous source in the radio advertising industry tells Kirell: "The vast majority of national advertisers now refuse to air their ads during Rush Limbaugh's show."
If Limbaugh walks — his contract ends this year — Cumulus will lose the No. 1 rated talk radio program in the country, probably to rival syndicator Clear Channel. Limbaugh would lose access to 40 radio stations, including his flagship channel, New York's WABC.
Media Matters, which helped organize and push the boycott, thinks Cumulus comes out ahead. "If Limbaugh and Cumulus part ways, it would represent a significant reduction in Limbaugh's overall footprint and serve as yet another reminder that Limbaugh's brand is bad for business," says Media Matter's Angelo Carusone. He explains:
If I were Limbaugh, I wouldn't want the CEO of one of my major affiliates consistently informing the business community that my show is causing millions of dollars in losses every quarter.... Cumulus isn't the only radio company reporting significant losses attributable to Limbaugh. Dial Global has also attributed millions in losses to Limbaugh. Many others in the industry report negative consequences resulting from Limbaugh's recklessness....
So, on the one hand, we have multiple radio companies reporting losses directly attributable to Limbaugh's show as well as Limbaugh himself complaining about media buyers. On the other hand, we have an unnamed source close to Limbaugh's show denying reality about Limbaugh's advertiser woes and attacking one of the host's biggest affiliates. At this point, it doesn't really matter who you believe. The fact that Limbaugh's affiliates are consistently reporting losses and that Limbaugh is now attacking them is evidence of the one thing that has become undeniable: Rush Limbaugh is bad for business. [Media Matters]
Limbaugh fans, on the other hand, are pretty sure Limbaugh has the upper hand. "If Cumulus CEO Lew Dickey thinks he's got revenue issues now," says The Right Scoop, "just wait until Rush pulls out of 40 Cumulus radio stations and hooks up with their competitors." It does seem like "Cumulus is in bigger trouble without Rush than Rush is without Cumulus," says Ann Althouse at her blog:
I'm guessing Rush is having great fun with this, tormenting Dickey, who disrespected him. What source do you think talked to Politico? Cumulus, we're told, reports its earnings on Tuesday, and Rush doesn't like hearing its financial problems blamed on him. How would you people do without me? [Althouse]
Cumulus and Limbaugh will both be fine, Talker magazine's Michael Harrison tells The Daily Caller. And "the blame game for sagging revenue currently being played by Rush and Cumulus contains a bit of truth and a bit of hyperbole on both sides." But that doesn't mean there are no victims, Harrison adds. "None of it is good for talk radio in general and the people really being hurt are the small and medium players in the business who rely on Rush and Cumulus as resources, or simply role models by which others judge the industry."
For lots of people, the real question here is, "Why is the story worth covering?" says Joe Gandelman at The Moderate Voice. This whole flap is clearly a little bit of "spin control at work" on both sides and some evidence that the boycott, "plus the reaction of some previous advertisers with genuine disgust at Limbaugh's Fluke comments, have changed 'the marketplace.'" And that matters because Limbaugh matters, Gandelman says:
Limbaugh (unlike some conservative talkers) is a skilled broadcaster and political entertainer — but his hyper-partisanship and ideological purity has set the tone for the Republican Party. How many independents, centrists, and moderates have met people who do nothing but repeat Limbaugh's phrases and attitudes? If he says the party is on the wrong course, expect for the party to re-adjust eventually to his course. So advertisers keeping a distance has some significance — that some kind of change may be in the offing. Limbaugh will survive, but his style of radio may not be as popular for younger conservative talkers (who want to get big advertisers). [Moderate Voice]
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