Infinity Broadcasting Corporation
Infinity Broadcasting Corporation was an American radio broadcasting company founded in 1972 by Michael A. Wiener and Gerald Carrus through the acquisition of KOME, an FM station in San Jose, California.[1] Under president Mel Karmazin, who joined in 1981, the company pursued an aggressive growth strategy by acquiring underperforming stations and enhancing programming to target diverse audiences, eventually operating over 180 stations across 41 markets, primarily in the top 50 U.S. metropolitan areas.[1][2] It pioneered formats such as sports talk radio with stations like WFAN and featured high-profile syndicated personalities including Howard Stern, whose 1985 hiring by Karmazin after his WNBC dismissal helped drive ratings and revenue but also attracted Federal Communications Commission scrutiny for indecency, resulting in fines totaling millions of dollars against Infinity-owned stations.[1][3][4] The company expanded into outdoor advertising via the 1999 acquisition of Outdoor Systems Inc. and underwent major consolidations, including a 1996 merger with Westinghouse Electric Corporation forming a entity with 83 stations and $1 billion in revenue, followed by integration into Viacom in 2000; it was rebranded as CBS Radio in 2005.[1][5][2]History
Founding and Initial Operations (1972–1980)
Infinity Broadcasting Corporation was founded in 1972 by Michael A. Wiener and Gerald Carrus, both former executives at Metromedia, with the explicit purpose of acquiring underperforming FM radio stations in major markets.[1][6] The company's inaugural acquisition was KOME-FM in San Jose, California, purchased in 1972 (with FCC licensing finalized in 1973), a station that broadcast to the San Francisco Bay Area and emphasized an innovative rock music format targeting young listeners.[7][8] Under Wiener and Carrus's leadership, Infinity focused on revitalizing such stations through targeted programming in album-oriented rock, capitalizing on the rising popularity of FM radio during the 1970s as it overtook AM in audience share for music genres.[1] Initial operations centered on operational efficiencies and format specialization at KOME, where the company implemented strategies to boost listenership among 18- to 34-year-old males by prioritizing uncensored rock content and local talent, avoiding the homogenized top-40 playlists dominant in AM broadcasting.[1] This approach reflected a first-mover advantage in recognizing FM's technical superiority for stereo sound and the untapped potential of niche markets amid regulatory changes like the FCC's 1964 Docket 16682, which encouraged FM experimentation.[1] By maintaining lean staffing and direct management from founders experienced in sales and programming, Infinity achieved modest profitability at KOME without significant debt, positioning the station as a model for future expansions.[9] Expansion remained limited through the mid-1970s, with Infinity holding only KOME as its sole asset until 1979, when it acquired WBCN-FM in Boston for an undisclosed sum.[1] WBCN, already established in progressive rock, aligned with Infinity's strategy of acquiring stations with established audiences in the 18-30 male demographic and enhancing them through aggressive promotion and format consistency.[1] By 1980, as FM penetration reached approximately 50% of U.S. radio households, Infinity's portfolio of two rock-oriented FM outlets demonstrated early success in niche dominance, though the company remained privately held and small-scale compared to larger networks.[1] In December 1980, Infinity agreed to purchase WKTU-FM, WJIT-AM/FM in New York, and WYSP-FM in Philadelphia from SJR Communications for $32 million, marking the onset of broader market entry but still within the founders' initial operational framework.[10]Growth and Acquisitions under Mel Karmazin (1981–1997)
In 1981, Mel Karmazin joined Infinity Broadcasting Corporation as president, initiating a period of aggressive expansion through targeted acquisitions of radio stations in major markets. Under his leadership, the company shifted focus toward undervalued properties with potential for high-profile programming, particularly in sports, talk, and rock formats, leveraging personalities such as Howard Stern to drive listenership and advertising revenue. This approach emphasized decentralized management, local advertising sales, and syndication opportunities, contrasting with the era's broader skepticism toward radio's viability amid television dominance.[1][11] Early acquisitions included WXRK-FM and WZRC-AM in New York, along with WYSP-FM in Philadelphia, bolstering Infinity's urban presence. By 1983, the company added KXYZ-AM in Houston and WJMK-FM and WJJD-AM in Chicago, expanding into the Midwest. In 1986, Infinity went public to fund further growth, acquiring KROQ-FM in Los Angeles, WJFK-FM in Washington, D.C., WQYK-FM/AM in Tampa, and KVIL-FM/AM in Dallas, which diversified its portfolio across rock, adult contemporary, and country formats. The company was taken private in 1988 by Karmazin and executives, citing undervaluation, followed by additions like WOMC-FM in Detroit, WLIF-FM, and WFJK-AM in Baltimore during the late 1980s. These moves grew station holdings from six to over a dozen, with revenue climbing amid tighter operational controls.[1] The early 1990s saw renewed public listing in 1992, raising $100 million to fuel acquisitions, including WFAN-AM in New York for $70 million, Infinity's flagship all-sports station launched in 1987. In 1993, the company purchased WUSN-FM in Chicago, WZLX-FM in Boston, and WZGC-FM in Atlanta for a combined $100 million, plus WIP-AM in Philadelphia, further entrenching dominance in top markets. Revenue increased from $135 million in 1991 to $234 million in 1993, yielding a $14 million profit—the first sustained profitability since the mid-1980s—driven by deregulation enabling cluster ownership and high-profile talent contracts. By 1996, Infinity operated 44 stations, culminating in its $4.9 billion acquisition by Westinghouse Electric Corporation (parent of CBS) on December 31, 1996, which Karmazin had positioned as the largest U.S. radio group. Stock value rose from $17.50 per share in 1992 to $170 by 1996, reflecting the success of Karmazin's acquisition-driven strategy.[1][11]Merger with CBS Radio (1998)
In August 1998, CBS Corporation announced plans to spin off its radio broadcasting and outdoor advertising operations into a separate publicly traded entity named Infinity Broadcasting Corporation, reviving the Infinity brand two years after CBS had acquired the original company for $3.8 billion.[12][13] The restructuring, driven by CBS's need to reduce debt accumulated from prior acquisitions and capitalize on elevated radio asset valuations post-Telecommunications Act deregulation, combined CBS's radio holdings with the former Infinity assets under the new structure.[12][1] The spun-off Infinity operated 161 owned radio stations across major U.S. markets, forming the world's largest radio group by reach, supplemented by extensive billboard and outdoor advertising through subsidiaries like TDI Worldwide.[14][15] In 1997, these operations generated $1.87 billion in revenue and $160.5 million in adjusted profits; projections for 1998 indicated revenues approaching $2.3 billion, underscoring the division's robust cash flow potential amid industry consolidation.[16][17] CBS retained an 83% ownership stake post-spin-off, selling 19% of shares via an initial public offering on December 9, 1998, which raised $2.87 billion at a $21 per share price—the largest media IPO recorded at the time and the third-largest overall that year.[14][18] Shares rose 12.5% on the first trading day, valuing Infinity at approximately $19.4 billion.[19] Mel Karmazin, architect of Infinity's pre-1996 expansion and then CBS president and COO, was appointed chairman and CEO of the new Infinity, enabling continued strategic alignment between the entities despite formal separation.[12] This arrangement preserved operational synergies, such as shared management and programming efficiencies from the 1996 asset integration, while allowing Infinity independent capital access for further acquisitions in a competitive radio landscape.[1] The spin-off incurred a $50–70 million third-quarter restructuring charge for CBS but positioned Infinity to leverage its scale for syndicated content and market dominance.[12]Viacom-CBS Merger and Integration (1999–2004)
On September 7, 1999, Viacom Inc. announced a merger agreement with CBS Corporation valued at $37.3 billion in stock, positioning the combined company as the world's second-largest media conglomerate behind Time Warner.[20] This transaction brought CBS's radio assets, including its majority-owned Infinity Broadcasting Corporation (acquired in stages starting in 1996), under Viacom's control, expanding the entity's reach to encompass 163 radio stations alongside Viacom's cable networks like MTV and Paramount Pictures.[21] The deal required FCC approval amid concerns over media concentration, but proceeded due to anticipated efficiencies in content distribution and advertising sales.[22] The merger closed on April 26, 2000, with Viacom issuing approximately 0.588 shares of its Class B common stock for each CBS share, resulting in a final enterprise value exceeding $40 billion including debt.[23] Mel Karmazin, who had led CBS since 1997 following its initial consolidation with Infinity, assumed the role of Viacom's president and chief operating officer in May 2000, directing the operational alignment of broadcast and cable divisions.[24] Infinity's stations, focused on talk, news, and music formats in major markets, integrated into Viacom's broader portfolio primarily through shared advertising platforms and cross-promotional opportunities, such as leveraging CBS radio airtime to promote Viacom cable programming.[25] To achieve full ownership, Viacom initiated a tender offer in August 2000 for Infinity's remaining 36% public minority stake, proposing 0.564 shares of Viacom Class B stock per Infinity share, implying a total valuation of about $15.5 billion for Infinity.[26] The offer faced shareholder pushback over valuation amid fluctuating Viacom stock prices, leading to a revised exchange ratio of 0.592 Viacom shares per Infinity share in November 2000, reducing the implied value to $12.5 billion.[27] Viacom completed the acquisition of these shares in 2002, eliminating Infinity's separate public listing and fully subsuming it as a wholly owned subsidiary within the CBS radio unit.[28] Throughout 2000–2004, integration emphasized cost controls and revenue synergies under Karmazin's oversight, with Infinity's operations retaining autonomy in programming and sales while benefiting from Viacom's scale in national ad buys.[29] However, internal frictions emerged between Karmazin's broadcast-centric strategy and Viacom chairman Sumner Redstone's emphasis on cable growth, culminating in Karmazin's resignation as COO on June 1, 2004.[30] During this era, the radio division generated stable cash flows from Infinity's established stations, though it faced nascent competitive pressures from digital media, contributing to Viacom's overall media revenue without major structural overhauls until later divestitures.[31]Dissolution and Transition to CBS Corporation (2005)
In June 2005, Viacom Inc. announced plans to split into two separate publicly traded companies to enhance shareholder value, with the transaction set to complete by December 31, 2005.[32] The division separated Viacom's high-growth cable and film assets (retained under a new Viacom entity focused on MTV Networks, BET, Paramount Pictures, and related properties) from its more mature broadcast and radio operations, which formed the basis of the renamed CBS Corporation.[33] Infinity Broadcasting Corporation, as Viacom's radio division comprising 179 stations across major U.S. markets, was allocated to the CBS Corporation side alongside the CBS and UPN television networks, Viacom Television Stations Group, and Viacom Outdoor advertising.[34] This allocation reflected Infinity's strategic fit with CBS's established broadcast identity, stemming from its earlier 1998 merger with CBS Radio assets.[35] On December 14, 2005, in anticipation of the split's completion, CBS Corporation rebranded Infinity Broadcasting as CBS Radio Inc., effectively dissolving the Infinity name while preserving operational continuity.[36] The rebranding aligned the radio unit with CBS's corporate branding, adopting the slogan "CBS Radio: We'll Be There" and integrating it fully under CBS Corporation's structure effective January 1, 2006, when the original Viacom Inc. was renamed CBS Corporation.[37] Joel Hollander remained as president and CEO of the rebranded entity, overseeing a portfolio that generated approximately $1.4 billion in annual revenue from advertising and syndication.[34] The transition involved no major asset divestitures or leadership upheavals but marked the end of Infinity's independent corporate identity, which had been retained post-Viacom's 2000 acquisition primarily due to FCC ownership regulations.[38] This restructuring streamlined CBS Corporation's focus on traditional media amid declining radio ad revenues and regulatory scrutiny, positioning CBS Radio as a core pillar with synergies in cross-promotion with CBS television properties.[39] Post-split, CBS Corporation's market capitalization emphasized the stability of its radio holdings, though Infinity's legacy of edgy programming, such as The Howard Stern Show, continued under the new banner until Stern's departure to Sirius in 2006.[40]Key Personnel and Leadership
Founders Michael Wiener and Gerald Carrus
Michael A. Wiener and Gerald Carrus, both executives formerly with Metromedia, co-founded Infinity Broadcasting Corporation in 1972 as a vehicle to acquire and revitalize underperforming FM radio stations in major U.S. markets.[36][1] The partnership targeted "oceanfront" properties—prime broadcast signals in coastal or high-value areas—with an initial focus on rock-oriented formats appealing to young adult audiences.[36][41] The company's launch centered on the acquisition of KOME, a San Jose-based FM station licensed in 1971, which the founders purchased around 1972–1973 and repositioned as a leading rock-and-roll outlet.[9][1] Wiener, a Brooklyn native who had risen to executive vice president of sales at Metromedia, contributed seed capital including $5,000 from the sale of his father's stamp collection, supplemented by personal loans from family and associates.[9][42] Carrus, Wiener's business partner from Metromedia, shared operational responsibilities in the early station turnarounds, emphasizing cost-effective programming and sales strategies to boost profitability.[41][1] Through the 1970s, Wiener and Carrus maintained day jobs while overseeing Infinity's initial growth, quitting full-time employment in 1979 to commit exclusively after successes like KOME's market dominance.[9][1] That year, they expanded by acquiring WBCN in Boston, an ailing FM station they reformatted into an album-oriented rock powerhouse targeting males aged 18–30, which became a model for their acquisition playbook of buying distressed assets and enhancing revenue through targeted demographics.[1] Their hands-on approach laid the groundwork for Infinity's portfolio, culminating in the 1996 sale of 44 stations to Westinghouse Electric Corporation for approximately $4 billion, though the founders retained involvement in the business post-transaction.[9] Wiener continued in leadership roles until later years, while Carrus's contributions remained centered on the foundational operational and strategic framework.[9][1]Mel Karmazin's Role and Strategies
Mel Karmazin assumed the role of president of Infinity Broadcasting Corporation in 1981, recruited from Metromedia to lead operations amid the company's early expansion efforts. At age 38, he accepted the position for an annual salary of $125,000 plus equity incentives, applying an aggressive management approach that emphasized profitability in competitive urban markets.[41] Under his leadership, which extended until the 1997 merger with CBS, Karmazin transformed Infinity from a small operator into a dominant radio group, overseeing steady revenue growth driven by targeted investments.[1] Karmazin's core strategy centered on acquiring high-value stations in major metropolitan areas, which he described as "oceanfront properties" due to their superior advertising revenue potential compared to smaller markets. This focus enabled Infinity to prioritize stations with large audiences and high profit margins, avoiding dilution across rural or mid-sized outlets; by the mid-1990s, the company controlled approximately 44 stations concentrated in top markets like New York, Los Angeles, and Chicago.[43][44] His acquisition model capitalized on deregulation trends, such as the FCC's relaxation of ownership limits in the 1980s and 1990s, allowing consolidation that boosted economies of scale without commensurate cost increases.[45] A pivotal element of Karmazin's approach involved syndicating high-profile talent to maximize reach and revenue across owned stations and affiliates, with the Howard Stern Show serving as the flagship example. Starting in the mid-1980s, Infinity syndicated Stern's program to multiple markets, leveraging its controversial content to generate top ratings and premium ad dollars in urban demographics; this strategy turned Stern into a central profit driver, as the show's syndication fees and local airtime sales far exceeded production costs.[46][47] Karmazin balanced such investments by negotiating performance-based contracts that tied talent compensation to audience metrics, ensuring alignment with financial outcomes. Complementing expansion, Karmazin enforced rigorous cost controls, including centralized back-office operations and streamlined administrative functions across stations to reduce overhead while preserving on-air quality. This efficiency focus yielded high operating margins, positioning Infinity as one of the radio industry's most profitable entities by the mid-1990s, with strategies rooted in data-driven market analysis rather than broad diversification.[48] His hands-on oversight extended to direct involvement in programming decisions, fostering a culture of accountability that prioritized listener retention through format discipline over experimental risks.[49]Other Executives and Transitions
In 2001, Mel Karmazin appointed Farid Suleman, previously executive vice president and chief financial officer of Infinity Broadcasting, as the company's president and chief executive officer.[1] Suleman, who had joined Infinity in senior finance roles following the 1998 merger with CBS Radio, oversaw operations amid ongoing integration with Viacom's broader media portfolio.[50] Suleman resigned in February 2002 to become chief executive of rival Citadel Broadcasting, citing a desire for greater operational autonomy; he also stepped down from his concurrent role as executive vice president and chief financial officer at Westwood One, Infinity's syndication affiliate.[51] [50] John Sykes, a former president of VH1 and network development executive at MTV Networks, succeeded Suleman as chairman and chief executive officer of Infinity, serving from 2002 to 2005 and focusing on content synergies within Viacom's entertainment divisions.[52] [53] A major leadership transition occurred in December 2005 following the split of Viacom into separate CBS Corporation and Viacom entities, under which Infinity Broadcasting was fully integrated into CBS and rebranded as CBS Radio; this ended the Infinity name and shifted oversight to CBS executives, including president and chief operating officer Joel Hollander, amid efforts to streamline radio operations independent of Viacom's cable and film assets.[36] The rebranding erased vestiges of prior Infinity leadership, such as Karmazin's influence, aligning the division more closely with CBS's broadcast television priorities under chairman Les Moonves.[37]Business Operations and Expansion
Radio Station Portfolio and Markets
Infinity Broadcasting Corporation's radio portfolio originated with the acquisition of KOME-FM in the San Jose/San Francisco market in 1973, marking its entry into the rock-oriented FM broadcasting segment.[1] Under Mel Karmazin's leadership starting in 1981, the company pursued aggressive expansion into major urban markets, acquiring clusters of stations to capture diverse formats such as rock, talk, and adult contemporary, which enabled operational synergies and dominant market shares.[41] By the early 1990s, Infinity owned 26 stations across 13 of the largest U.S. radio markets, including New York, Los Angeles, Chicago, and Philadelphia.[41] Key acquisitions during the 1980s and early 1990s solidified Infinity's presence in top-tier markets. In 1981, it entered New York with WXRK-FM and WZRC-AM, and Philadelphia with WYSP-FM; by 1983, Chicago (WJMK-FM and WJJD-AM) and Houston (KXYZ-AM) were added.[1] The 1986 public offering funded further growth, including KROQ-FM in Los Angeles, WJFK-FM in Washington, D.C., WQYK-FM/AM in Tampa, and KVIL-FM/AM in Dallas.[1] Subsequent purchases encompassed WOMC-FM in Detroit and stations in Baltimore (WLIF-FM, WFJK-AM), while 1992-1994 additions included WFAN-AM (New York sports talk), WUSN-FM (Chicago), WZLX-FM (Boston), WZGC-FM (Atlanta), WIP-AM (Philadelphia), and KRTH-FM (Los Angeles).[41] By 1993, the portfolio had reached 22 stations, emphasizing high-revenue urban clusters.[1] The Telecommunications Act of 1996 deregulated ownership limits, allowing Infinity to nearly double its holdings by year's end through opportunistic buys.[1] In 2000, it acquired 18 stations from Clear Channel Communications, further densifying coverage.[1] At its peak around 2001-2002, Infinity operated over 180 stations in 41 markets, concentrated in the top 50 U.S. metropolitan areas such as Boston, San Francisco, and Atlanta, prioritizing audience reach and advertising revenue over smaller rural outlets.[41] This market-focused strategy yielded economies of scale but drew scrutiny for reducing local programming diversity.[1]| Major Markets | Key Stations (Selected Examples) |
|---|---|
| New York | WFAN-AM, WXRK-FM |
| Los Angeles | KROQ-FM, KRTH-FM |
| Chicago | WJMK-FM, WJJD-AM, WUSN-FM |
| Philadelphia | WYSP-FM, WIP-AM |
| Boston | WBCN-FM, WZLX-FM |
| San Francisco | KOME-FM |
| Washington, D.C. | WJFK-FM |
| Dallas | KVIL-FM/AM |
| Atlanta | WZGC-FM |