Air America Goes Silent

Liberal Radio Network Financially Challenged From Outset

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LOS ANGELES ( -- Air America, the long-struggling liberal radio network, will cease operations on Jan. 25, in anticipation of a Chapter 7 bankruptcy the company will file soon. Charlie Kireker, chair of Air America Media, issued a memo to staff announcing the shutdown of live programming, citing the "very difficult economic environment" as playing a big role in Air America's business woes. An Air America spokeswoman did not return requests regarding how many employees were affected.

"National and local advertising revenues have fallen drastically, causing many media companies nationwide to fold or seek bankruptcy protection," Mr. Kireker wrote. "From large to small, recent bankruptcies like Citadel Broadcasting and closure like that of the industry's long-time trade publication 'Radio and Records' have signaled that these are very difficult and rapidly changing times."

Rumors of the 6-year-old company's closure and impending bankruptcy have been swirling for years. It was sold to Stephen L. Green of S.L. Green Realty for $4.25 million in 2007. But even with the sale, the company struggled to keep listeners as well as advertisers -- especially following the departure of its most recognizable talent, Al Franken, who left to focus on his campaign for a U.S. Senate seat from Minnesota. Its other breakout star, Rachel Maddow, ultimately found her biggest following through her eponymous talk show on MSNBC, a liberal-leaning network that trounced more moderate competitor CNN for the first time in year-end prime-time ratings in 2009.

Air America's plight had always been in direct contrast to conservative talk radio, which has thrived for years with personalities such as Rush Limbaugh, Sean Hannity and Dr. Laura Schlesinger. It was also hampered by limited distribution, airing in only 100 markets compared to shows like Mr. Limbaugh's, which ran on over 600 stations nationwide.

"It just wasn't a priority," said one radio media buyer who bought limited airtime for clients on Air America in previous years. "Without name-brand talent, it was hard to get most clients to execute buys and not look too partisan."

In the end both Air America's attempts to raise funds from listeners, where it focused most of its revenue effort, and its ad sales fell short.

"With radio industry ad revenues down for 10 consecutive quarters, and reportedly off 21% in 2009, signs of improvement have consisted of hoping things will be less bad," Mr. Kireker wrote. "And though Internet/new media revenues are projected to grow, our expanding online efforts face the same monetization and profitability challenges in the short term confronting the Web operations of most media companies."

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