Note: This article was conducted prior to Clear Channel's corporate renaming to iHeartMedia, which was announced earlier today (Sept. 16).
It's less than 10 days until the fourth iHeartRadio Festival hits the MGM Grand Garden Arena in Las Vegas, and Clear Channel -- now iHeartMedia -- programming chiefs John Sykes and Tom Poleman are already anticipating the "magic hour" -- when special guests pop in unexpectedly to top the previous year's surprises. In 2012, Prince played guitar for Mary J. Blige; a year later, Fun's Nate Ruess joined Adam Lambert and Queen for a show-stopping bow. And with a bill that this year includes Iggy Azalea and Nicki Minaj, let your imagination run wild.
The event was conceived as an experimental take on WHTZ (Z100) New York's long-running Jingle Ball concert, showcasing heavy-rotation acts on the pop station (one of 800 frequencies owned by Clear Channel, which is privately held by Bain Capital and Thomas H. Lee Partners since 2008 and based in San Antonio), and also doubles as a promotional vehicle for the iHeartRadio app -- a streaming FM tuner that brought an old-school, localized approach to the Pandora model. The power of the radio giant helped attract an impressive lineup for the fest's first run in 2011, including Lady Gaga, Kenny Chesney, Coldplay, The Black Eyed Peas and Jennifer Lopez. And it appears to be paying off. In July, CEO Bob Pittman announced that the app increased registered users -- now 50 million -- by 50 percent year over year. The festival's third year accumulated 21 million listeners and 1.1 million tuned in to The CW's edited two-hour telecast (Yahoo is iHeartRadio's streaming partner). Clear Channel revenue also grew during the second quarter, helping boost a 1 percent revenue growth to $1.6 billion. (With 20,000 employees, Clear Channel carries $21.1 billion in consolidated debt, according to financial analyst Fitch Ratings, a sign that its events portfolio aims to groom the company for potential sale.)
Sykes, 59, and Poleman, 49, oversee some 50 employees, as well as their own households of media-savvy offspring -- Poleman has two kids, Sykes three. Before the execs took off for iHeartRadio's Sept. 19 and 20 event (Taylor Swift and One Direction are on the bill), they sat down to talk about expanded brand franchises, future events in the Latin and EDM genres.
How do you assess the current health of the radio industry?
Sykes: Whenever I had money to market any show at VH1, I spent it on radio [because] I knew radio could deliver bodies to the television set. Radio is like the power company: It's everywhere, it's in everybody's car, yet people tend to take that for granted. But when you push the button, you can get someone elected or break a record -- it's still the biggest reach platform. Radio's problem is it has never really promoted itself well, and that's changing with things we're doing here.
Poleman: The technology is in a really interesting place where we can embrace it, or we can fight it, and this is a company that is very consumer-centric and gives people what they want regardless of how the entertainment is delivered.
Clear Channel took on the role of promoter with 2013's Jingle Ball arena tour and helped singer Katy Tiz get signed. Any desire to formalize those offerings through a touring arm or label?
Poleman: Music's the lifeblood of our product. I don't see it as trying to become promoters, managers or a label. I just think we're in business together and trying to reach the same consumer. Any way we can help each other is good for all.
The iHeartRadio Awards debuted in May to mixed reviews and 5.4 million total viewers and were recently renewed by NBC. Looking back at their first year, how might you adapt them for next year?
Poleman: It was a great learning experience. We doubled NBC's ratings from the previous Thursday night and they're going to put us on a Sunday night, which is great. [The skepticism] is similar to the first year we did the iHeartRadio Festival. The music industry didn't understand what we were trying to do, but when they saw it they were like, "OK, I get it."
John, your broadcast deal with The CW for the festival and other specials is up at the end of 2015. How satisfied are you with the ratings performance at The CW thus far?
Sykes: One thing that we love about their audience is they have a high concentration of young people. So while they're not the highest-rated in the broadcast business, they have a purity of audience that hits a young artist trying to break a record. When you can reach millions over four plays on the CW, chances are that person's 28 years old and buying music. We see them as a great partner for our live events.
Sykes: The amazing thing about that country festival is it literally books in a day. Country artists love playing with each other. It's a mutual admiration society, and the firepower that turns out is pretty impressive ... Because we reach so many segments, we're looking at a couple other areas that maybe won't reach the scale of the iHeartRadio Festival, but they'll be amazing evenings or weekends of music that get into different genres.
The Las Vegas lineup features a slew of A-list artists. It needs to be asked: Is there an implicit fear that if you don't perform at the festival, you don't get as much radio play?
Poleman: It's complete church and state. Our program directors decide what gets played on the radio based on the interest of their listeners -- this show is just about creating an incredible night of music and bringing the iHeartRadio music app to life onstage. We're at a point where the artists come to us now. Paramore has been wanting to be on the show for a while; Nikki Sixx, who's one of our on-air personalities, he'll be playing with Motley Crue and has wanted to be a part for some time. Even Taylor Swift asked if she could come back.
There's a battle for the dashboard right now between many of the music services and in-car audio deals.
Poleman: We have a whole [department] focused on that, and it's incredibly important, not only for iHeartRadio, but for the industry at large. The AM/FM tuner will always be there, but as additional stations are available, it's another way for us to have real estate on the dashboard.
What music or radio do you listen to for personal enjoyment?
Poleman: I've been involved with Z100 since 1996, so I always start my day with [morning host] Elvis [Duran].
Sykes: For the last five years, [former MTV Networks CEO] Tom Freston and I traded iPod playlists, and he'd trump me with this eclectic iPod loaded with 3,000 songs. But in digging deeper on the iHeartRadio app, I've discovered all kinds of music you wouldn't find on a closed-wall iPod.
This article first appeared in the Sept. 20th issue of Billboard.