2008 by Target Market News Inc. All rights reserved
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closes its doors, leaving Katz as only national radio sales rep firm
By Erik Sass
Mediapost.com (October 24, 2008) There is now one national radio rep sales firm in
the United States, following Friday's announcement by Interep that it
would be closing up shop by the end of the year. This will leave Katz
Media Group the sole player in the previously binary national radio
sales rep market.
The news of Interep's demise comes after years of financial hardship
capped by a declaration of bankruptcy at the end of March. On Friday,
the company elected to have a court convert its Chapter 11 bankruptcy
declaration from late March into a Chapter 7 filing, which calls for the
liquidation of the firm's assets and breakup of the company.
Interep's woes can be traced, at least in part, to an ill-advised
poaching expedition against rival Katz Media Group, a subsidiary of
Clear Channel Communications. In an unusually overt bid to undermine
Katz, Interep tried and failed in 2003 to lure away Katz's senior
executives and over 100 staffers--who would presumably bring many of
their clients with them.
While both companies affected appeared to be unruffled by the
altercation, insiders said it initiated a period of bitter competition.
Interep lost its contracts with Cumulus and Radio One in the second half
of 2005; both clients switched to Katz.
At the company's closing, CBS was Interep's sole remaining big client.
It's unclear whether CBS would be willing to work with Katz, given its
ownership by arch-rival Clear Channel.
After Interep was forced to deregister by the Securities and Exchange
Commission in April 2007, it brought in David Kennedy as CEO, with the
mission of staunching the revenue losses and rebuilding relationships
with radio broadcasters. However, Kennedy was unable to turn Interep's
fortunes around, forcing him to assume the role of breakup boss,
beginning with the declaration of bankruptcy this March.
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