NEW YORK (CNN/Money) -
The nation's No. 2 radio broadcaster is on the hunt to replace Howard Stern, who will jump to paid radio in just over a year.
Joel Hollander, the president of Infinity Broadcasting, told analysts gathered at the UBS Media Conference in New York that the Viacom (down $0.11 to $36.06, Research) unit is "feverishly looking " to hire a replacement for the boisterous and controversial talk show host.
While Hollander did not identify candidates, he said "big stars" have expressed interest in filling Stern's shoes. Hollander did not indicate whether Infinity plans to stick with the shock-jock formula or broadcast a new type of morning talk show.
Stern announced in October that he was leaving public radio and had signed a five-year, $500 million deal with Sirius Satellite Radio, one of two leading providers of subscription radio service. Stern's official start date at Sirius is January 2006.
Since his announcement, Stern has angered Infinity officials by regularly touting the benefits of satellite radio on his four-hour morning show. Stern has said one of the big drivers behind his decision to jump to a nascent medium like satellite radio is its freedom from government oversight.
Throughout his 20-plus years on the airwaves, Stern has been investigated for broadcasts that regulators deemed indecent. Stern has boasted, both before and after his announced exit, that satellite radio is a safe haven from government watchdogs, who have stepped up enforcement of anti-obscenity laws in the last year.
His on-air statements have irked Infinity executives, prompting Stern to say he might leave the broadcaster before his contract ends at the end of 2005.
Hollander, an industry veteran brought in last year to turn around Viacom's struggling radio business, did not rule out an early exit, but said Infinity is reluctant to "sacrifice the cash flow" that Stern's show generates for Infinity.
"We will deal with (Stern's status at Infinity) when we are ready to deal with it," said Hollander. "Right now we're planning on him to be on the air to fulfill his contract (and) that's what he wants to do."
Hollander acknowledged Stern won't be easy to replace. But when Infinity taps a successor, he pledged it would be "something big."
In related comments, Hollander also rejected the perception, fueled by recent moves by other top radio personalities to satellite, that public radio is headed for extinction.
He noted that 295 million people listen to public radio every day, compared to 4 million satellite radio subscribers.
But Hollander also said he expects that Sirius (up $0.88 to $8.97, Research) and XM Satellite Radio (up $0.87 to $38.60, Research) will continue to grow. Last month Sirius hired Mel Karmazin, the former Viacom president and Infinity founder, as its new CEO.
Hollander praised Karmazin, but said satellite radio investors are suffering from "irrational exuberance." He noted that satellite operators face competition from various sources, including the Apple iPod and Internet radio.
Public radio, said Hollander, "has survived every technological advance of the last 50 years. It's not going away."
To that end, Hollander's comments Tuesday signaled that Viacom intends to stay in the business despite sluggish growth and past hints from company executives that Infinity would be put on the block.
Infinity owns 185 radio stations around the country. To combat increased competition, Hollander said the company's long-term goal is to focus on the top 20 radio markets, including New York and Los Angeles, that currently generate 80 percent of Infinity's revenues.
"We feel positive about what Viacom is putting behind the company," said Hollander, noting Viacom recently invested $13 million to $14 million in 8 company-owned radio stations.
"They're going to give us the ammunition to get the best content, the best personalities, and the best music," he added.