"It always happens the Wednesday before Christmas. Last year Clear Channel fired 20 people. The year before that it was 34. And it was always right before Christmas."
That's from a local radio employee. On December 14, Clear Channel's San Diego radio group fired 11 employees. Although no on-air personalities were canned this time, the pre-holiday pink slip tradition had a chilling effect on some of the remaining employees who said the mass firing showed insensitivity and bad timing.
"This year they only axed 11 people. But it was still just before Christmas," said an anonymous non--Clear Channel employee.
The day after the firings, the remaining Clear Channel employees received a memo that was supposed to help boost morale. The memo acknowledged that though Clear Channel must spin off the five Mexican stations (91X, "Kool 99.3," "Magic 92.5," Z-90, and XTRA-AM) it operates, the San Antonio--based company had until September 2006 to do so.
According to in-house correspondence, Clear Channel is asking $135 million for all five stations. According to an industry observer, that fee seems high considering that the same memo said those stations will only generate a net profit of $6 million this year.
"The industry standard is that a station is worth 15 times what it nets. Based on that, these stations should actually be worth $90 million. But since these are Mexican stations, and you are only buying the right to operate them and not own them, it seems like it should be even lower."
Local Clear Channel radio manager Kelly Kibler, when asked about the firings and the divestiture, answered, "No comment."