Rush Limbaugh Signs $400 Million Radio Deal
Thursday, July 3, 2008
Talk-radio pundit Rush Limbaugh agreed yesterday to stay on the air for at least eight more years, signing a deal with his syndication company that Limbaugh said is worth more than $400 million, including a $100 million signing bonus.
The lucrative agreement between Limbaugh and Clear Channel-owned Premiere Radio Networks of Los Angeles is the second-largest ever for a radio personality, ranking behind only Howard Stern's five-year contract with Sirius Satellite Radio in 2004 that was valued at more than $500 million in stock and cash.
After almost 20 years in national syndication, Limbaugh, 57, remains the most popular personality on talk radio, as well as an influential voice among conservatives. His program -- heard weekday afternoons in Washington on WMAL (630 AM) -- commands a weekly audience of nearly 20 million listeners on 600 stations, according to Premiere, which markets his program to stations and advertisers.
Terms of Limbaugh's renewal weren't disclosed in yesterday's announcement. But Limbaugh, in an upcoming article in the New York Times, said he would earn about $38 million annually under the deal, in addition to a "nine-figure" signing bonus.
The eye-popping figures demonstrate that Limbaugh's value has soared even as conventional radio's fortunes have declined and his own audience has remained flat. Traditional radio broadcasters have been losing listeners for years to competing technologies, such as Internet streaming, satellite radio and podcasting. Radio advertising began slumping before the general economic slowdown.
The general decline, however, has made a handful of nationally known stars such as Limbaugh relatively more valuable. In his previous contract renewal, signed in July 2001, Limbaugh reportedly earned $250 million over eight years, with a $35 million signing bonus.
Limbaugh's audience hasn't grown since then, according to Premiere. The audience and station figures released by Premiere yesterday are the same audience totals and station count that the company said Limbaugh commanded in 2001. But Talkers magazine, which covers the talk-show business, pegs Limbaugh's audience at 14 million, a figure the publication calls "a rough projection."
In a statement yesterday, Limbaugh said, "I'm having more fun than a human being should be allowed to have." In the same statement, Clear Channel chief executive John Hogan said: "Broadcasters of Rush's quality come along once in a lifetime. We're privileged to continue our relationship which is unprecedented in the history of our industry."
People in the radio business had expected Limbaugh to re-sign with Premiere, which has syndicated his program since 1997. The agreement is good news for Clear Channel, the nation's largest radio-station operator, at a time when the San Antonio-based company's management is trying to close a long-delayed, $24.4 billion buyout that would take the company private.
The only elements of doubt in Limbaugh's re-signing were uncertainty about the Clear Channel deal and Limbaugh's desire to continue his program. Limbaugh began losing his hearing seven years ago -- and underwent rehabilitation for an addiction to painkillers in 2003. But Limbaugh dispelled those concerns with the deal, which will keep him on the air through 2016.
The agreement covers his daily three-hour radio program; his daily 90-second commentaries, called "The Rush Limbaugh Morning Update"; a monthly newsletter called the Limbaugh Letter; and Limbaugh's Web site, RushLimbaugh.com.
In reaction to the announcement, Tom Taylor, news editor of Radio-Info.com, said: "As Humphrey Bogart once said, this is the continuation of a lovely friendship. Both sides have made a lot of money for each other."
Limbaugh's political clout is hard to pin down, in part because his loyal audience of listeners already agrees with much of what he says. His influence on candidates and events is often exaggerated -- sometimes by the boastful Limbaugh himself.
For example, Limbaugh led the faction of conservative TV and radio personalities who deemed Sen. John McCain insufficiently conservative and opposed his campaign for the Republican nomination. Despite this, McCain wrapped up the nomination in early March.
Limbaugh perhaps had more success in scrambling the Democratic primary campaign. He exhorted conservative voters to cross party lines and vote for Hillary Clinton to prolong infighting within the Democratic Party. Although it's unclear how effective Limbaugh's "Operation Chaos" campaign was, Clinton was able to secure victories in several states that enabled her to stretch her campaign to the final primary in early June.
"Be careful what you wish for, Rush," she quipped in early March, after winning primaries in Ohio, Texas and Rhode Island.