March 9, 2012 8:52 pm

Limbaugh carries on with limited advertising

Advertisers abandoned Rush Limbaugh’s syndicated radio show en masse this week, reacting to the conservative radio host’s attacks on Sandra Fluke, a law student who argued that health insurance should cover birth control.

Mr Limbaugh’s remarks about Ms Fluke sparked outrage and led to a social media campaign calling on advertisers to stop supporting the show, an effort that quickly went viral, shining a harsh spotlight on those companies still airing ads.

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A week on, at least 50 companies have stopped airing ads during the show, including big brands such as Home Depot, Netflix, JC Penney and AOL. At least two radio stations, in Massachusetts and Hawaii, have also stopped airing Mr Limbaugh’s talk show.

Mr Limbaugh initially dismissed the impact of the advertiser defections. On Monday’s show, he said: “So be it.”

But by Thursday, the online broadcast of Mr Limbaugh’s show carried just nine advertisements over three hours. In place of the ads were public service announcements from groups such as the United Negro College Fund and the New York Office of Emergency Management.

Mr Limbaugh’s show is distributed by Premiere Networks, a division of Clear Channel. Clear Channel is owned by Thomas H Lee Partners and Bain Capital, the private equity firm where Republican presidential candidate Mitt Romney made his fortune. Clear Channel was acquired by Bain after Mr Romney stepped down from the private equity firm, but Mr Romney still profits from the firm’s activities.

Clear Channel signed a $400m contract with Mr Limbaugh in 2008 that will keep him on air through 2016.

Mr Limbaugh suggested that those companies that stopped advertising with him were suffering from their abandonment of his show. “You can look at the stock price of some of these companies,” he said. “I’m not going to say any more.” Home Depot and AOL were slightly up this week, but Netflix and JC Penney were down in a flat market.

And while it may not be related to their pulling ads from the show, some research suggests that there may indeed be a correlation between companies targeted by boycotts and share prices.

“The evidence is that boycotts that generate a lot of media attention and are targeted against a specific company tend to hurt the market value of the company,” said Brayden King, professor at Northwestern University’s Kellogg School of Management. “There is a negative affect on their image and reputation.”

Late in the week, Mr Limbaugh remained defiant, denying reports that he would suspend his show. “They thought I would be off the air by now,” he said of his critics. “They can’t understand why I still am on the air.”

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