How Do You Fix A Broken (Radio) Heart?

With listeners shifting to podcasts and music streaming services, radio giants like iHeartRadio are scrambling to adapt to digital and convert Wall Street skeptics.

- Paul Bond

As iHeartMedia — parent of iHeartRadio, home to nearly 900 radio stations and a robust digital platform — tries to fend off bankruptcy, its troubles have trained a spotlight on the entire radio industry, which is struggling against competition from internet music services like Pandora and Spotify as well as burgeoning podcast networks.

Five years ago, fewer than 5 million Americans paid for a streaming-music service, but in 2016 that number jumped to 22.6 million, according to the RIAA. And Edison Research says that a year ago a threshold was crossed when adults ages 18-to24 said for the first time that they spend more time listening to streaming music than they do traditional radio.

While incumbents like iHeartRadio, run by CEO Bob Pittman, and its chief rival Entercom Communications have embraced digital initiatives, so far Wall Street seems skeptical: Shares of iHeartMedia have fallen 21 percent since the company suggested April 21 that it might not survive another year unless it restructures its $20 billion debt. Entercom, which announced a merger with CBS Radio in February, has seen its stock price plunge 25 percent during the same time frame.