Tuning Out the News at CBS Radio

Editor's note: Oops! We inadvertently mentioned that CBS's lawsuit against Howard Stern after his move to Sirius Satellite Radio (NASDAQ:SIRI) was ongoing. In fact, that lawsuit has already been settled. We apologize for the error.

It isn't surprising that the chief executive of CBS's (NYSE:CBS) radio division has resigned, because his plans to do so were already in the works, but the fact that his move came before it was expected drew notice.

Joel Hollander of CBS Radio has resigned and will be replaced by CBS Radio's former president, Dan Mason. Hollander had been expected to leave by the end of this year, so he's leaving significantly ahead of schedule. Mason is no stranger to the industry or to the company; he had been doing consulting work for the company on digital plans in radio.

Since its split from former parent Viacom (NYSE:VIA), CBS has had its work cut out for it, with challenges such as aligning its broadcast TV segment with digital initiatives and dealing with the difficult industry that terrestrial radio has become.

Last quarter, one of CBS's weak spots was its radio segment. Its revenues may have increased by 2.5%, but its radio business revenues decreased by 8% amid programming changes and a tough ad market.

There's some speculation floating around that Hollander's early departure may mean CBS is getting ready to sell some parts of the radio business. Of course, that's not exactly a foregone conclusion (and I'd think the fact that his successor has experience suggests otherwise). Much has been made about private-equity buyouts these days, but such rumors don't get me excited. Look at radio rival Clear Channel (NYSE:CCU). It agreed to be purchased last November, but that deal seems to be sputtering out. Of course, the big questions investors want to ask is whether they believe terrestrial radio businesses have too many challenges to grow in the competitive climate; the major shareholders opposing the Clear Channel deal believe that the company is worth more than the offer, so it's obvious some would rather stick it out in a tough climate than accept what they perceive as a cheapskate offer.      

Regardless, Hollander's departure and his replacement may make news headlines and give reason to speculate on CBS, but it seems to me it's a lot of static for anybody pondering a stake in CBS at the moment. Maybe it's best to tune out the "what-ifs" and wait to see what this new(ish) executive dials up.

For related Foolishness:

• CBS's Radio Blues: Fool by Numbers
• CBS Can't Be Sirius
• Clear Channel's Iffy Deal

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Alyce Lomax does not own shares of any of the companies mentioned.