AirAmerica news...

(Added 16 April 2004)

From: DANA PUOPOLO
(a well-respected broadcast engineer and consultant)

Air America is 1000% in the wrong here.

What happened is this:

Air America leased both stations effective the first of the year. Their contract requires them to put something on them (in other words they have to fill the time; the stations can not be silent).

They weren't ready so they asked Mulitcultural (MRBI) to fill the airtime FOR THEM. MRBI did....with paid programming until AA was ready on March 31st.

Those are the facts...now here's where the stories diverge....

Air America claims that the $$ Multicultural got belongs to them. MRBI says that most or all of it belongs to them because AA allowed them to do this.

Does AA have a case? Who knows...

BUT here's where they (AA) F***ed up...

Instead of this dispute running a parallel with the LMA of the stations, AA merged them together...by stopping payment on the checks to pay for the LMA's of the stations for April. When the checks bounced, MRBI gave them over a week to make good on them, which they did not, so they pulled their programming at 7 AM on local time on Wednesday.

What AA SHOULD have done is persued their claims separately from the LMA...

Remember...this programming 'side deal' had NOTHING to do with the LMA, nor was it even mentioned in the LMA contract...

Basically they were playing poker with a pair of twos...and Arthur Liu called their bluff.

Now, AA is having a tantrum..calling Mr. Liu names like Liu-ficer, threatening to slam his head into a car door, etc. (see the Sludge report on the AA web site), libelling him in the press, and all sorts of other nasty stuff.

Let me assure you, their behavior will not help them get back on the air in Los Angeles and Chicago...in fact, I highly doubt they will be back on the MRBI stations there.

To put things into a nutshell, AA cut off their nose to spite their face and now there's a big, ugly scar there. Fact is, AA needs MRBI more then the reverse, yet they acted (and continue to act) WAY too arrogant.

I was at the AA studios this afternoon and everyone there was in shock about how badly their counterparts in NY were acting. The phrase "spoiled children" was used more then once.

There was a court hearing this afternoon in NY for an injunction. To my knowlege it was not successful...simply because by not paying, AA has breached the original LMA contract....and by their acting nasty, now MRBI does not want a new one....

Can you blame them?

From: Rich Wood
(Former head of the WOR Radio Network and consultant)

I don't think it has anything to do with politics. I think it's a collection of cocky TV people who have contempt for radio people. That became very clear when one of their honchos chose to make it public on the air. Extremely unprofessional, as is the "Sludge Report" on the web site. I've seen some dumb stuff in my time in radio and TV but this one takes the cake. They need those markets and they've made it almost certain no one is going to want to deal with them. The second dumb thing was the TV interview they gave where they bragged that they could lose money for years. If I were an investor I'd have a problem right about now.

Rich

From: "Timothy Mauch"
(Head of Mauch5 Broadcasting)

Most LMA contracts I've seen have clauses that say the programmer is responsible for providing the programming to the station, a definite period of advance notice if unable to comply, and "no refund" if sufficient advance notice is not given.

If MRBI had to find programming on short notice, then AA shouldn't get a refund for the missed air time.

I would imagine that the contract was with MRBI, not just the one LA station, so when AA stopped paying, MRBI had the right to pull all AA programming.

MRBI has been burned by too many fly-by-night outfits during the last three years to put up with more of the same. When you contract to pay-as-you-play, you'd better pay, or you won't play for long.

Tim Mauch