Bob Pittman: Operating an ooh company with a radio group “hurt us”

Operating an out of home company with a radio group “hurt us” says iHeart’s CEO Bob Pittman on this week’s AdAge Podcast.  Here’s how the conversation went

Where does spinning off out of home fit in to this?

We love the outdoor business as well as the audio business.  The investor base is quite different.  The outdoor business is valued on asset value.  As a matter of fact some of them are REITs…and the media business is a whole different set of investors.  Having the two together hurt us, not helped us.  Because they would say I love you but I don’t want that outdoor.  Or I love outdoor but I don’t want that media.

Outdoor is also having a moment.

It’s great.  By the way, radio and outdoor are the two most efficient media, meaning, they’re the most underpriced…The good news about being together as we had them…was we were able to take our learnings from programmatic and data and push it across both companies.  So that Clear Channel Outdoor really has a leadership role in that as well as we have in the audio world.

Insider’s take:  Synergy is overrated.  There are benefits from running a standalone out of home company.  Management isn’t distracted.  Investors can easily understand the company.  Some people argue that companies should diversify across industries.  The stock market won’t reward you for doing what an individual investor can do for themselves by simply buying a basket of companies in unrelated industries.

Pittman’s comments come at the 24 minute mark of the interview


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