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Last year, private equity firm Terra Firma acquired struggling number four music label EMI for about $6.4b (including debt).  A few days ago, an internal email from Terra Firma’s CEO Guy Hands leaked.  It hinted at major house cleaning. 

Ahead of Tuesday’s EMI staff meetings, early reports on the wire services and from the Wall Street Journal are citing insiders that those changes may include job cuts for  as much as one third of EMI’s six thousand person global staff. 

Even as sources suggest the cuts may be smaller, the number of jobs lost is expected to be substantial.

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Patience is a virtue, especially in private equity.  Since November 2006, Bain Capital and Thomas Lee Partners have been trying to buy and privatize outdoor advertiser and radio station operator Clear Channel.   The $19.5b leveraged buyout offered was approved by shareholders ($39.20/a share) but it’s been stuck in regulatory limbo. 

Recently, there’s been an increase in speculation the deal was close to falling apart. The skepticism has hurt the stock price. The stock is trading near $35, a significant discount to the $39.20 buyout price. Now there may be a positive shift.

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In May, Sonos, the maker of a wireless multi-room digital music system signed a deal to offer music from internet radio station Pandora.   Today, the Santa Barbara based company added Sirius Satellite Radio (via the Internet) to their mix.

As part of the new partnership, owners of Sonos Digital Music Systems will have access to streams from eighty music and talk channels from Sirius Internet Radio.   The service will cost $3/month but won’t require any special hardware.

The Sonos system  is kind of like a cross between an iPod, a remote control and a home stereo.  It wirelessly streams a music collection from up to 16 computers or storage devices (including MP3 players) to Sonos receivers.  Receivers are placed around an owner’s house Click to Read More

eBay announced Tuesday that it was ready to begin auctioning advertising airtime through the eBay Media Marketplace for Radio.  The service, which is powered in partnership with Bid4Spots (which has been hosting radio airtime auctions since 2005) will provide an open access market for buying advertising slots on 2,300 US Radio Stations.

A similar effort to create a marketplace for cable television ads ran into a wall of resistance from cable television channels and the Cable TV Advertising Bureau in April. That’s not the case, so far, with radio.  The hammer will fall today, in a positive way, when the service goes live.  All of the major radio operators will be part of the market including Clear Channel, the nation’s largest radio operator.

Stations in all of the top 300 markets nationwide will be represented and the auction marketplace will include access to ad inventory for both conventional over-air radio (terrestrial but not satellite) and Internet radio Click to Read More

The future of Clear Channel, which owns over 1,000 radio stations (as well as a substantial outdoor billboard advertising business), is anything but certain.  The company has been negotiating a buyout with private equity companies for months.  On May 3, the company’s board rejected a bid from Bain Capital and Thomas H. Lee Partners that the board stated was only 0.5% above the previous bid.   This week, however, the Wall Street Journal reported (citing people familiar with the deal) shareholders are starting to get behind the deal, even as the board is rejecting it.   

Shareholders Highfields Capital Management (3.2%) and Fidelity Investments (9.7%) are reported to be backing the proposal which has been raised to a price per share of $39.20 and offers current shareholders the opportunity to own up to 30% of the new company.   With the support of Highfields and Fidelity at a shareholders meeting, a deal is much more likely consummated….but even so, regulatory issues will likely delay a final vote until the end of the summer by which time, pricing or market conditions might warrant further adjustments to any proposed offers.

In the meantime, while its future is anything but clear, Clear Channel Communications is busy with operational and sales efforts.  On May 21st, the company announced they will launch an advertising-supported (e.g. no cost to listeners) program that will let radio listeners send text-message song requests from their cell phones and get real-time traffic updates.  Listeners will also be able to participate in contests and polls via text messages.  This new effort will mark a change from a pilot program run in September wherein a $2.99/month service fee gave Cingular customers access to live streaming broadcasts.

This new mobile initiative will be tested with five New York area radio stations.  Anyone with a SMS-enabled cell phone will be able to participate. If successful, Clear Channel has plans to launch similar offerings at as many as 100 other radio stations over the next one to two years.