As we reported, Gary Schonfeld, President of Westwood One’s Network Radio Division, is leaving the company to return to his company, ADLARGE Media. Rod Sherwood, President of Westwood One, will oversee Network Radio, including all operations and sales. We had heard someone important was leaving the company soon on 8/20, but Westwood One Chief Marketing Officer Chris Miller had denied it. Now, in the space of days, both Chairman Norm Pattiz and Schonfeld are gone. So why did Schonfeld leave?
An RBR-TVBR source tells us the reason may have been his strategy of revenue guarantees to producers – in the tens of millions of dollars – with CBS, NBC News, CNN, Olympics, The Weather Channel, Oprah, Sports USA, Wall Street Journal and NFL. They may be having trouble making these cash guarantees, the source said. We had also heard Schonfeld’s strategy to corner the market by buying up all of the games to block Compass Media Networks may have backfired. They may not have been able to sell enough advertising to cover the costs in this environment. No doubt, Compass CEO Peter Kosann (previously WW1 CEO) and Westwood One have been battling it out for sports games rights for a while now.
Doing our due diligence once again, we asked Westwood’s Chris Miller about what we heard. She tells us the source’s information is “Completely incorrect. Gary has made contributions to the network’s growth since he joined the company – which we appreciate. He is a wonderful person and we wish him well back with his company –AdLarge Media.”
If indeed revenue guarantees was the strategy, it could be risky business in this rough economy. If you look at Westwood’s Q2 report, The Gores Group is infusing $20 million into the company. That money may be desperately needed.
RBR-TVBR observation: We also hear WW1 does not have a deal in place with the NFL for Primetime games yet – and this, as the upfront is approaching. That may have been a reason Norm Pattiz voluntarily quit as WW1 Chairman – he didn’t want his legacy with the network to be tarnished if they lost NFL Football.