In the 2020 edition of Radio Ink’s 40 Most Powerful People in Radio we have a special interview with Emmis CEO Jeff Smulyan, who, up until this year, was on our power list every year since the list was launched in 1996.
Our interview focused on Jeff’s many years as a great leader and the powerful force of positivity he is for the industry. Here’s a snippet of that interview, including this quote from Cromwell CEO Bud Walters about his friend.
Jeff Smulyan is the epitome of a forward-thinking leader who works for the “good of the group” with moral courage. He sees opportunity and tries to grasp and develop it so all can share in the benefits. The broadcast industry has shared so many good ideas and opportunities because Jeff Smulyan was involved as an initiator, leader, supporter, worker. Besides that, Jeff is a damn nice person. I admire his gumption, tenacity, and forward vision. Jeff is a good man.
Bud Walters
CEO
Cromwell Media
Our entire interview with Jeff Smulyan is only available to magazine subscribers. You can subscribe to our digital edition HERE or our print edition HERE. Here’s an excerpt of our interview with Jeff in the 2020 issue of Radio Ink’s 40 Most Powerful People in Radio.
Radio Ink: How has the pandemic impacted your life and the company?
Smulyan: It has changed everyone’s life dramatically. We are fortunate because we don’t have any debt. The last time the economy collapsed, we had $600 million in debt and our leverage went from 4 to 13 times in 16 months. Now we have money in the bank, so we haven’t had to lay anyone off, no furloughs, no benefit cuts. It is clearly a monumental disruption.
Radio Ink: When you look at how it’s impacted the radio industry, what are your thoughts?
Smulyan: It breaks my heart. I know it’s a struggle, and I’ve lived through it before. For a project I was working on, I looked back over the last 25 years and traced what the last downturn did, so I know the impact on people’s business. You just hope you can get out of it and move forward, but I know there will be some permanent damage.
Radio Ink: A few years ago you decided to get into other businesses. Can you explain why you wanted to go that way?
Smulyan: We are as data-driven as everybody, and we looked at a lot of math. I love this business as much as anybody. I made it my career, but five or six years ago, we looked and saw the math wasn’t moving in our favor. We decided not to buy anything else, harvest assets, and pay down debt so we have the ability to transition. A lot of it is listening levels and competition. We have been streaming audio since 1995, and I’ve never made any money at it, but it’s been a great replacement in the minds of consumers.
Radio Ink: When you look back, what do you consider the best times in radio when the money was flowing?
Smulyan: Emmis had a golden decade between 1981-90. We were the kings of turnaround. We bought Indianapolis, Minneapolis, St. Louis, and L.A., Hot 97, WFAN, and the NBC stations. Our biggest problem then was we couldn’t buy anything else in top markets. That’s why we bought the baseball team [the Seattle Mariners]. We had a few failures, but not many.
The period of ’96-01, we were skeptics early on, and while the company had gone public in ’94, by the time the real crush came, where there was so much capital, we watched assets go from 10 times cash flow to 12 times cash flow to 16 times to 23 times. We looked at the map and said this map doesn’t work. That’s when we got into TV. We thought paying 23 times cash flow for a radio station was insane. If you look at the history, that statement is accurate. You had everyone consolidated and when the music stopped, everything declined fairly precipitously.
Radio Ink: Was there a time where you were really frustrated and said, “I need to get out of here”?
Smulyan: Never a day. Many years ago, Sam Zell came to me. Sam had Jacor at the time. He wanted to merge Emmis and said I would run it: “Randy [[Michaels] would be delighted to work with you.” I knew we were in a bubble. I said if I want to make the most money in life, I would do this in a heartbeat. You will know intuitively when this thing has peaked, and you will vacate. Then you will say, “Hey, let’s go into the widget business.” But I love this business, and I don’t see that it will ever not provide a great living for my family. I know it will peak and decline, but I love it. Two years later, Sam sold and made a gazillion dollars.
When you are levered at 13 times and the bank is at your door — we solved monumental problems. Every part I loved. There were nights I went home and said, “I don’t know if I’m going to get through this,” but I loved it all. I don’t have any regrets. An economically rational person would’ve vacated when we knew it was wise to do so. I loved the industry more than the most dollars.
Was there ever a deal you wanted and went after but didn’t get — and were glad in hindsight?
Smulyan: Yes. We adopted the position that we were hanging around the hoop. I can still remember the ABC deal. All of us went after that. We were eliminated quickly. Farid Suleman got it, and that led to his bankruptcy. Then Lew Dickey got it, and that led to his bankruptcy. Now Cumulus has those assets. I was talking to a friend, saying I hope Cumulus doesn’t hit the wall, but if they do, that’s three bankruptcies with the cornerstone of the same assets.
The deals I had that I wished we had gotten that we didn’t were the three sports deals. We had a chance to buy the Vikings, and I didn’t do it. We had a chance to buy the Dodgers, but it had to be with seven stations from Fox because we didn’t think a radio company could buy a business losing that much money without other assets. At the last minute, the Murdoch family decided they didn’t want to sell the stations. Then we had a chance to get the Nationals in Washington, but we didn’t. I’ve no complaints about my life. It’s been really good.
Radio Ink: Do you still hear from employees who worked for you?
Smulyan: That is the most gratifying thing. We hear from people who worked for us all the time. Gene Baxter worked for us 20 years ago, and when he retired he sent Rick a note saying, “Of all the places I worked, Emmis was the best by far.” We get a lot of that. Those are the things that matter. We have had a lot of people who have stayed with us a long time. Comments like that are very rewarding.
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There is no other broadcaster more deserving of this recognition than Jeff Smulyan. Jeff is in a class by himself when it comes to dedication, ingenuity, focus, and leadership for this industry.