DealBook: Clear Channel Names Pittman as Its New Chief

Shayla Harris/The New York Times

When Robert W. Pittman first joined Clear Channel Communications last November as the chairman of its media and entertainment business, he told the company that he was not interested in becoming chief executive.

Eleven months later, he has changed his mind.

Clear Channel announced on Sunday that it had named Mr. Pittman its new chief executive and executive chairman, ending a search to find a replacement for Mark P. Mays, a scion of the company’s founding family.

“It’s very rare that you get such a test drive,” Mr. Pittman said in a telephone interview on Saturday. “This is one of those companies where the closer you looked, the better it seemed.”

It is the latest leadership post for Mr. Pittman, who helped create MTV and later became a senior executive at AOL.

But leading Clear Channel, which is both the nation’s biggest radio station operator and an outdoor advertising giant, at a time when the company is under pressure from digital rivals and an uncertain economic outlook will be a new test for Mr. Pittman.

“The biggest challenge anyone faces is the macroeconomic picture,” Mr. Pittman said. “Anyone who does any business with the consumer and sells advertising worries about that.”

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Clear Channel, which was taken over three years ago by the private equity firms Bain Capital and THL Partners, is also laboring under $19.9 billion in long-term debt, giving it little room for error.

The company has shown some improvement of late. Its second-quarter revenue rose 7.6 percent over the same time last year, to $1.6 billion. And its net loss during the same time has shrunk 38 percent, to $53.2 million.

Radio revenue for that time period rose about 4 percent, to $780.9 million.

“He has already generated a renewed sense of confidence and direction not only at Clear Channel, but across the entire radio and media landscape,” Scott M. Sperling, a co-president of THL, said in a statement.

Mr. Pittman, 57, first joined last year after investing $5 million of his own money in Clear Channel. He became a senior adviser to the company’s sprawling radio business, with a special interest in overseeing the expansion of its digital strategy.

Chief among his initiatives was building out iHeartRadio, a Facebook-linked service that made Clear Channel’s 850 radio stations available both online and in smartphones. With iHeartRadio, the company sought to push back against the rise of Pandora Media and other Internet radio services.

Despite competition from Internet and satellite, terrestrial broadcast radio remains a strong draw for listeners and commuters. Last week Arbitron, the industry’s standard ratings service, said that 241.4 million people 12 or older listened to the radio each week in the United States, an increase of 1.7 million from a year ago.

Last month, Clear Channel presented its first iHeartRadio Music Festival in Las Vegas, a two-day concert with Lady Gaga, Coldplay, the Black Eyed Peas, Jay-Z and many others, to publicize its app and demonstrate to advertisers the strength of its reach.

Mr. Pittman said that iHeartRadio would become the central consumer brand for Clear Channel’s stations. “That has been a real win for us,” he said.

Richard Greenfield, an analyst at BTIG Research, added that Clear Channel had been surprisingly successful in competing against the latest generation of Internet start-ups.

“IHeartRadio illustrates how Pandora is more of a feature versus a stand-alone business, with iHeartRadio being able to combine the appeal of terrestrial radio with the functionality of customizable Internet radio,” he wrote in an e-mail.

Clear Channel has also formed partnerships with other companies, including a forthcoming music service on Microsoft’s Xbox Live and streaming the music for Zynga’s collaboration with Lady Gaga.

It has also made some small acquisitions, including Thumbplay, a digital music subscription service that was folded into iHeartRadio. Mr. Pittman said that Clear Channel might strike more deals in the future, but that he would focus in large part on organic growth.

Mr. Pittman will also oversee Clear Channel’s outdoor advertising business, which owns or operates some 190,000 displays in North America. It also has operations in nearly 30 countries in Asia, Australia and Europe. That business has fared well, reporting a 12 percent rise in second-quarter revenue from last year, to $789.2 million.

Mr. Pittman, who entered the media business as a 15-year-old radio announcer in Brookhaven, Miss., helped create MTV in 1981 and later worked at Time Warner and Century 21 before joining AOL in 1996. He became the chief operating officer of the newly merged AOL Time Warner in 2001, but left the next year.

Since then, he has become a venture capitalist, co-founding the Pilot Group in 2002. The firm was an early investor in Zynga, the online game titan, and it sold DailyCandy to Comcast three years ago for $125 million.

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