Is iHeart Right To Tighten The Belt?


There were waves across the radio world on Friday as iHeartMedia sent out an all-staff communique warning of a tightening of the belt in the face of economic uncertainty.

“Team, Although we’ve made great strides in our business and have built a leadership position across all audio platforms thanks to your extraordinary efforts, we are not immune from the headwinds caused by the economic pressures we read about in the headlines every day — and that is forcing us to make tough choices on costs and priorities. 

Our goal is to do everything we can to get through this difficult economic time while protecting our employee base as much as possible.  Therefore, we’ll be implementing the following necessary cost savings:

  • Temporarily suspending the 401(k) match starting in your next pay period and for future months until the advertising marketplace improves. Please note that any contributions made so far in this year will not be affected.
  • We will only be backfilling mission critical roles.
  • Stopping or reducing all discretionary spending, including non-essential T&E, overtime, outside vendor spend, temporary contractors, etc.

These measures are part of our proactive plan to keep our company healthy in the economic slowdown and to be fully ready for an economic recovery.

We appreciate your commitment to iHeart, to our communities and to our partners, and we are confident we will successfully navigate through this period and be well-positioned for growth when the economic pressures subside.” — Bob and Rich

This was received with the usual industry disgruntlement and attitude toward previous iHeart actions and RIFs, especially following the company’s record Q4 earnings call. It’s important to note here that no layoffs were announced. But mumbles and groans aside, there was a definite economic shift this past week that radio should not ignore.

The Wall Street Journal reports record-breaking borrowing by banks from the Federal Reserve’s discount window to the tune of $152.8 billion. That’s the largest spike in borrowing since 2008 and more than three times the amount from 2020.

Berkshire Hathaway’s Warren Buffett has been called in by the Biden administration to advise the growing tension as more banks face collapse, including potential capital injection from Berkshire.

In the wake of Silicon Valley Bank and Signature Bank cratering, Bloomberg reported The Mid-Size Bank Coalition of America sent a letter to Treasury Secretary Janet Yellen, the FDIC, the comptroller of the currency, and the Fed on Saturday asking for a two-year suspension of the FDIC’s deposit insurance limit. This would protect financial institutions from a “run on the bank.”

None of these situations guarantee another 2008 for the economy, but it appears iHeart is preparing for the worst. Is radio ready? Most broadcasters have been here before. What lessons did we learn? Are we ready to stay one step ahead and convince advertisers, national and local, of radio’s power?


  1. Listening to my iHeart sports station, they are constantly talking about how the phone or wi-fi doesn’t work and how the engineers have to transfer items from another cluster. Radio is about engineering and if they can’t even spend money on equipment needs how are they going to pay the employees?

  2. How many people will they burn on their way out the door, is the question. Have you ever tried to contact their accounts payable department to chase down your past due payment? Good luck with that.

  3. Just an excuse to squeeze employees and save money. Curious what flights, trips, expenses, raises iHeart executives are enjoying…

  4. These companies keep running it to the edge then somehow are saved in the end. The banks don’t want to be radio station owners. Eventually their luck is gonna run out, and the banks are gonna want SOME kind of return. These companies have no hard assets left, they’ve sold off all their studios and towers.

    There is a crash coming, and the longer it takes, the harder it’s gonna be. I left the conglomerates in 2005 and have resisted every temptation to return. My recommendations for those who are left, keep sending out those resumes.

  5. It’s all about the debt. If not for IHeart (then Clearchannel’s), severely leveraged acquisition by Bain Capital, the company might well be in a better position to survive this downturn.

    The Mays family destroyed the company so they could walk away with billions.

    • Lean about Business, Bob. A successful exit is the whole point. Radio is not a culture or a religion. It’s a business. There are good business owners, and bad.

  6. If you’re still on the air, in a full-time position, it’s time to start prepping. EVERY major company has a huge debt ratio. Couple that with a decline in ad spend. It’s going to get harder for companies to pay their bills. Companies must make cuts. Cuts are coming. Playing a contest, or reading a liner about an upcoming concert are not things that companies are going to pay for much longer. The people who ask callers where they’re calling from can’t be paid much longer. The industry expected DJ’s to become comedians in 7 seconds or less (and they’re not), which is what caused a talent exodus from radio…. Now, the companies realize they are paying people who should not be paid, which is expedited by the fact that the money to pay these people is running out.

    For the largest audio broadcasting company to suspend 401k matches, in an email, is a massive statement. The can’t invest in their employees’ future. I commend their candor because we don’t usually see or hear it. The situation is fluid and getting negative.


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