UPI to Sell Radio Unit

Here's an Aug. 5, 1999, story from The Washington Post (written by Frank Ahrens) on the sale of UPI Radio:

United Press International is planning to sell its radio news operation -- the heart of which is a client list of more than 400 radio stations -- and exit the radio business, according to a source at the company.

The sale could be completed as early as next week, putting 55 employees in limbo. The buyer has not been identified.

For current and former UPI radio staffers, the sale is the latest bulletin in a seemingly endless ticker of bad news for the once-proud wire service. UPI President Arnaud de Borchgrave, a former Washington Times editor in chief and Newsweek correspondent, says he is trying to change UPI from a conventional wire service to an Internet newsletter agency.

"In radio, you have to produce stuff that I'm not at all interested in producing," de Borchgrave said. "Producing headlines every hour on the hour is very manpower-intensive and not the kind of effort you'd like to expend on a wire service that is positioning itself for the next century, one that is entirely Web-based."

None of UPI's other news divisions are for sale, the UPI source said.

When de Borchgrave took over UPI in December, he said he wanted to refashion the 92-year-old wire service -- which has been losing $1 million to $2 million a month -- from a mass media news provider into a subscription-based Internet newsletter service focusing on diplomacy, intelligence and political issues. The proposed radio sale suggests that the news service is no longer willing --or able-- to compete against The Associated Press, Reuters and niche-oriented news services, such as Bloomberg's business reports.

Industry analysts said UPI's diminished client list would appear to be of little value except to longtime rival AP, which would essentially be paying UPI to get out of the radio business.

"You've got to be talking about only one bidder and a bidder who's not all that enthusiastic about buying an asset they figured would probably go away on its own," says Jack Messmer, executive editor of Radio Business Report in Alexandria.

An AP spokeswoman had no comment.

National Public Radio, a UPI client, would not disclose how much it pays for the service. As a comparison, however, all-news WTOP (1500 AM) pays more than $10,000 a month for its AP service, says Jim Farley, the station's vice president of news operations. He speculated that UPI would cost less.

The pending sale has not been announced to UPI staffers at the company's H Street headquarters, and none who were contacted would speak for attribution. One staffer said that news of the sale had filtered down from UPI executives about two months ago. It was understood that the sale would occur by summer's end unless the radio network could show a profit. Yesterday, UPI radio employees were preparing resumes and calling friends in the business, looking for their next jobs. The UPI source said some employees will be retained.

UPI radio enjoyed its heyday in the late 1960s and early '70s, when its news reports were sold to more than 1,200 stations. The AP, which had focused primarily on newspapers, entered the radio market in 1974.

Some UPI staffers trace the demise of UPI radio to the early '80s, when radio deregulation allowed stations to carry less public service programming such as news. Since then, UPI has been in a slow death glide -- it was sold in bankruptcy to an Arab-language TV network in 1992 -- and has been losing reporters and editors to the more stable, better-paying AP. In the mid-'80s, some UPI reporters cashed their paychecks immediately upon receipt, for fear that they'd bounce. At UPI radio's lowest point, its clients numbered about 200.