Rush Flushes Critics

Several months ago, law student Sandra Fluke boo hooed to Congress that without contraceptive coverage written into her student insurance, obtaining birth control pills would be expensive and difficult. Rush Limbaugh, who long ago decided that conservatives as well as liberals have a right to free speech, mocked her. He even called her a slut!


Conservatives pointed out that birth control pills were readily and cheaply available at a pharmacy within a few miles radius of her residence. Pictures surfaced of Ms. Fluke and her wealthy boyfriend on an expensive European vacation.

No matter--several advertisers, as is their right--decided to drop their sponsorship. And now, several months later, at least one, Carbonite, is admitting, uh oh, big mistake! Eliminating advertising on Limbaugh's show caused a significant decrease in revenue.

William A. Jacobson of Legal Insurrection, who "predicted that Carbonite had shot itself in the foot, and put political correctness before the interests of its shareholders" when they dropped Limbaugh, explains.

On August 1 Carbonite released its 2d Quarter 2012 results, the first full quarter after dropping Limbaugh in March. The results shocked Wall Street, as Carbonite did not meet its growth targets, causing multiple analysts to drop the target price. The stock dropped 15% in a day. (h/t reader W)

Most important, in a conference call held on August 1, the CEO David Friend admitted that dropping Limbaugh damaged Carbonite's growth, and is likely to do so for at least one or two more quarters.

The full audio is available here. The key passage is embedded below. (Transcription mine, official transcript not available yet)

(3:10) CEO Friend: "There were four factor that contributed to this slower growth. First, in March we stopped working with one of our top producing radio endorsers. While we recently contracted with three new radio personalities, it takes 3-6 months to ramp up new radio hosts so we probably won't see the full effect of this for another quarter or two."

(24:15) Q: "I guess I'm a little surprised that you were caught by surprise by the radio host change 'cause I know we've talked and I guess my impression was that it wouldn't be that impactful but I guess it was quite impactful.

CEO Friend: "Yeah, I'd say it turned out to be a bigger issue than we had anticipated. Because you know at the time there was a lot of noise, I mean we had a huge spike in web traffic around that time just because of all the interest in the whole subject. And it took close to a month for that to sort of die down. And meanwhile our metrics were, we really couldn't see what was going because there was so much noise around the website that we had no idea what the ultimate impact was going to be. It turned out to be a bigger hole in our revenue than we had thought when we initially did this. However, I don't think there was any, I'm not regretful of the decision, I think things would have been worse had we not done that.

As a public company, Friend had a responsibility to the shareholders; by dropping Limbaugh he negatively impacted his company's results because of personal reasons. That is irresponsible and not his right. As Friend said at the time,

No one with daughters the age of Sandra Fluke, and I have two, could possibly abide the insult and abuse heaped upon this courageous and well-intentioned young lady. Mr. Limbaugh, with his highly personal attacks on Miss Fluke, overstepped any reasonable bounds of decency. Even though Mr. Limbaugh has now issued an apology, we have nonetheless decided to withdraw our advertising from his show.

So just how is Rush Limbaugh doing after sponsors said they would drop him and listeners, who never would listen to him, threatened to stop listening to him? Why just fine, thank you. So glad you asked. Reports of Limbaugh's ratings demise have been exaggerated. Jacobson continues

Since that time the Stop Rush effort has imploded, with backstabbing and accusations among the participants. Limbaugh has had better numbers than ever, and the hype surrounding Mike Huckabee as a Limbaugh replacement has gone flat.

As Paul Bond of The Hollywood Reporter noted over a month ago

Reports circulating online Tuesday indicating a massive drop in Rush Limbaugh's audience - as much as 40 percent in some markets - might be premature.

The Arbitron data that was released to several reporters shows a decline from March to April -- presumably due to Limbaugh's characterization of law student/activist Sandra Fluke as a "slut" -- but only after a surge that was probably caused by the same incident.

In the meantime, the one per cent Limbaugh is laughing all the way to the bank, paying way more than his fair share of taxes first, of course.