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Howard Stern: the end is near?
As the clock ticks down on the Stern's move to satellite radio, the rumors are swirling.
July 18, 2005: 12:46 PM EDT

NEW YORK (CNN/Money) - Wherever Howard Stern is, rumors are never far behind.

This time the radio industry is abuzz with reports that the bawdy talk show host will leave AM-FM radio by Labor Day, a full four months before his contract at Infinity Broadcasting is due to expire.

The ventured reason: September is a crucial ratings period for radio advertising and Infinity won't be able to sell ads down the road if those ratings are based on a personality who is no longer on the company's airwaves.

But that's not all of the Stern buzz these days.

To replace Stern, Infinity has reportedly signed rocker David Lee Roth, who announced last year a five-year, $500 million deal to move his show to subscription-based Sirius Satellite Radio in January. Roth, the solo artist formerly the lead singer of Van Halen, would substitute for Stern at Infinity stations in New York and Los Angeles.

Stern played into the speculation Monday with an on air spoof. He called in to the radio show apparently surprised that he was not allowed to have a farewell show, even though he still has five and a half months left on his contract.

That Roth would fill Stern's shoes in two Infinity markets supports another speculation: that Infinity, a unit of media giant Viacom (Research), is not looking for one magic bullet to replace Stern but is instead planning to tap multiple personalities for different regions around the country.

Michael Harrison, the publisher of radio industry magazine Talkers, confirmed the whispering but noted that Stern is a master at feeding the rumor mill. Speculation that he would jump to satellite radio had long circulated before he cut his deal with Sirius (Research) last year.

Other longstanding rumors haven't panned out -- not yet anyway. "For years we never knew if he was actually on the verge of getting fired," said Harrison.

Infinity spokeswoman Karen Mateo has confirmed that the company is talking to many potential replacements, but has said that no announcement about its Stern succession plan is imminent.

Happy to see Stern go?

Stern's show has been a huge source of revenues for Infinity -- attracting, some analysts say, $175 million a year in advertising. Of that, Stern and his sidekicks pocket at least $30 million, according to these estimates.

If Stern is off the air before his contract expires, presumably Infinity would have to pay him for any remaining time left under the contract. There's been talk as well that Sirius would pay Infinity to release Stern from his contract so it could begin broadcasting "The Howard Stern Show" sooner than January.

Disputes over Stern contracts are not unheard of. When Clear Channel Communications, the country's No. 1 radio broadcaster, pulled Stern from its stations last year, it stopped paying licensing fees to Infinity. The fracas ended up in court.

Stern, for one, has made it clear that he is ready to go whenever his bosses give the order.

In announcing his defection last October, Stern said he was fed up battling government watchdogs over claims his on-air commentary violates rules barring obscene and indecent programming on public airwaves. The broad crackdown that followed the 2004 Super Bowl broadcast, in which singer Janet Jackson exposed her breast during the live half time show, was the catalyst for Stern.

But it's clear, too, that relations between Stern and Infinity executives were strained and got noticeably worse after Stern quit. One friction point: Stern's frequent trumpeting of satellite radio over AM-FM radio after his announced move to Sirius.

The fact that the Stern scuttlebutt is picking up makes sense, said Harrison.

"There's obviously a tremendous amount of tension between him and Infinity and it's getting closer and closer to the witching hour where he's going over to Sirius Satellite Radio," said Harrison. "So many are watching, from stock watchers to radio programming watchers. It's ripe for rumors."

For Infinity, Stern's departure comes at an especially challenging time. AM-FM radio has been among the slowest-growing media sectors as advertising dollars move to the Internet, cable television and other newer forms of entertainment.

To compete, radio broadcasters like Infinity and Clear Channel Communications (Research) are rejigging programming, experimenting with shorter commercials, and embracing new technologies like high-definition radio and Internet downloads.

Other broadcasters, like Walt Disney (Research), are reportedly looking to sell their radio assets.

Some Wall Street analysts have recently lowered their growth estimates, already in the low-single digits, for radio advertising.

Just how much is Howard Stern worth to Infinity? To find out, click here.

Not all satellite radio subscribers are thrilled with Stern's looming arrival. Click here for more.  Top of page


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