CBS Corporation announced on Tuesday that it was putting its radio business on the block, as the media company aims to streamline its business to focus on its broadcast network, the premium channel Showtime and digital.
Leslie Moonves, the chief executive of CBS, said that the company was looking at a number of strategic options but provided few other details. Speaking at the company’s investor meeting in New York, he compared the development to CBS’s move two years ago to separate its billboard business in an effort to “unlock shareholder value.”
CBS owns 117 radio stations in 26 markets, which it estimates reach 70 million people in the United States each week. Mr. Moonves has been suggesting for years that he was willing to reduce the company’s holdings in radio. CBS has disposed of a number of stations already, such as through a deal with the Beasley Broadcasting Group in 2014 in which CBS traded 14 of its stations for five of Beasley’s.
Eighty-eight years ago, the company's founder, William S. Paley, bought the nascent Columbia Broadcasting System, and those radio stations became the nucleus of a budding broadcast empire.
But on Tuesday, CBS Chairman and Chief Executive Leslie Moonves said the company was exploring strategic options, including a sale or spinoff, of its entire radio division.
“The aim here is to unlock value for our shareholders,” said Moonves, who made the announcement during an investor day in New York.
The decision marks the end of an era and highlights the waning influence of commercial radio, which is no longer considered a growth industry. Young adults spend more time listening to digital music files, podcasts and subscription Internet radio services such as Spotify and Pandora. The shift has prompted major advertisers, including car dealerships, wireless phone companies and financial services firms, to steer more of their marketing dollars to digital platforms.