How San Antonio's Clear Channel Communications is ruining radio in your townand in the rest of the country.
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If you have never heard of a San Antonio company called Clear Channel Communications, it’s because you aren’t listening. From its unlikely nerve center in south-central Texas, this once modest, family-run owner of a handful of radio and television stations has exploded into a media giant, dominating radio like no single entity ever has before. Unleashed by government deregulation in 1996, founder Lowry Mays shelled out billions for properties like Jacor Communications and Tom Hicks’s AMFM, formerly the biggest radio conglomerate in the country. Today one of every ten commercial radio stations in the United States belongs to Clear Channel—including six stations in Dallas-Fort Worth, eight stations in Houston, seven stations in San Antonio, six stations in Austin, six in El Paso—a total of more than 1,200 domestic channels in some 250 markets. Its closest rival, Cumulus Broadcasting, has 240 stations. (Texas Monthly‘s parent company, Emmis Communications, owns 23 radio and 15 TV stations and is another of Clear Channel’s competitors.)
Clear Channel’s manic, multimedia shopping spree didn’t end there. Last year it also bought SFX Entertainment, which owns the majority of the outdoor amphitheaters in America, including the Verizon Wireless Amphitheater near San Antonio, the Cynthia Woods Mitchell Pavilion near Houston, and a minority interest in the Smirnoff Music Centre (Starplex) in Dallas, as well as dozens of theaters and other performing venues. This instantly made the company’s subsidiary Clear Channel Entertainment the dominant concert promoter in the United States. And wait, there’s more: Clear Channel now has the second-largest number of billboards of any company in the United States, nineteen television stations, and nine hundred radio and TV Web sites. The company, which was founded in 1972, has doubled in size every eighteen months over the past five years.
All of this may sound like harmless, run-of-the-mill media giantism in the early twenty-first century. Unfortunately it’s not, especially the way the Mays family—Lowry and his sons, Mark and Randall, the company’s iron triangle—plays the game. In fact, they give new meaning to the phrase “control of the airwaves.” Their size and aggressiveness have given them unprecedented say not only over what you hear on the radio all over the country but in how music is sold, promoted, and performed. As the big guys on the block—who dictate programming at 1,200 stations—they are more responsible than anyone else for the cookie-cutter state of radio, where more and more stations sound the same, no matter where you go.
That may be good for business, but it almost certainly isn’t good for listeners. I love radio and its ability to be local, immediate, and mobile in a way that other media cannot. There is nothing more “local” in origin and impact than a hometown radio disc jockey or talk show host. But Clear Channel is changing that, bringing to the airwaves the hard, bottom-line logic of the fast-food franchise, and I don’t think it translates. Radio doesn’t need its own version of Wal-Mart. A listener in Tampa doesn’t necessarily want to hear the same oldies that are popular with listeners in Seattle, nor are classic rock, news talk, modern rock, or hot country all the same coast to coast.
Clear Channel doesn’t see it that way. In place of local hosts, the company is syndicating personalities such as Bob and Tom on their classic-rock properties or Kidd Kraddick on contemporary-hits stations they own in Texas and in other states. Some of these choices have been dictated by the company’s acquisitions. To achieve “synergy” from its purchase of Premiere Radio Networks, Clear Channel needs to employ the syndicated radio personalities that came along with it. A perfect example is Clear Channel’s hometown flagship station, WOAI-AM, which has altered its news-talk format by replacing locally hosted talk programs with the syndicated Dr. Laura, Rush Limbaugh, Phil Hendrie, and Art Bell, all of whom were part of Premiere Networks. That may have improved the station’s efficiency and affirmed Clear Channel’s synergy, but it has compromised WOAI’s ability to function as a true voice of its community.
Another practice that sacrifices local content to national business considerations is Clear Channel’s cross-promotion of radio and its entertainment properties. Traditionally concert promoters have worked with radio stations to promote events through giveaways and plugs that go beyond traditional advertising, a practice that benefits not only the stations and the concert halls but also the music acts. Clear Channel has made this arrangement proprietary: Its radio stations give priority to Clear Channel Entertainment-promoted concerts over non-Clear Channel ventures.
This has prompted a number of complaints by competitors in both radio and the concert business. Though many of the detractors have declined to voice publicly their dissatisfaction lest they offend Clear Channel, one Denver concert promoter, Nobody In Particular Presents, has gone to court accusing the San Antonio company of monopolistic and predatory practices by preventing the promoter from hiring touring musicians. They say that some of those musicians fear losing airplay on Clear Channel radio stations if they don’t work with Clear Channel Entertainment concert promoters. The company denies these allegations. One independent concert promoter says he’s found it almost impossible to work out promotion arrangements with Clear Channel radio stations because of Clear Channel’s policy. Sometimes the company takes this practice to absurd lengths: It once hyped a Michael Bolton show on a modern-rock station even though it likely hurt the station’s credibility with its audience.
Competitors who try to subvert Clear Channel’s control end up paying a price. A Washington, D.C., radio station that bought $3,000 worth of tickets for a Wango Tango concert in Los Angeles to give away to listeners was hit with a lawsuit by the concert’s promoter—Clear Channel Entertainment, of course—claiming that only Clear Channel stations could give away tickets to concerts it promotes, no matter where they are.
The way Clear Channel makes its will known to its far-flung holdings became apparent in the wake of the September 11 terrorist attack. In the week following the disaster, corporate headquarters circulated a list of songs it felt would not be suitable for airplay. Pat Benatar’s “Hit Me With Your Best Shot” or AC/DC’s “Highway to Hell” were predictable choices. But other songs on the list, such as John Lennon’s “Imagine,” the Beatles’ “Ticket to Ride,” Louis Armstrong’s “What a Wonderful World,” and anything by Rage Against the Machine makes one wonder what their programmers have been drinking. According to Mark Mays, Clear Channel’s president and chief operating officer, Clear Channel did not dictate such playlists to its stations. “As always, programming decisions are made locally by each station manager and program director,” he says.
Meanwhile, ticket prices for concerts—an industry in which Clear Channel Entertainment now controls about half of the business in the U.S.—are at an all-time high. I realize the company has to justify the inflated price it paid for SFX, but when consumers have to subsidize it with $7 service charges added on to each ticket purchased or $4 for a twelve-ounce bottle of water—as was the case this summer at the new Verizon Wireless Amphitheater—something is wrong with the picture. No wonder overall concert revenues were down 12 percent earlier this year at concerts by the top fifty touring acts, according to Pollstar magazine.
Mays says the criticism about Clear Channel is coming largely from disgruntled rivals who can no longer compete. “No one likes change,” he says in an interview at Clear Channel’s cool, casual corporate headquarters in the Quarry Market area in San Antonio. “How would you like to be the Z102 guy who gets fired because he’s being replaced by Bob and Tom? It is our responsibility to provide compelling programming to our listeners, and that requires change—which is always difficult.” Mays insists that Clear Channel is practicing good business and not playing out of bounds. The number of stations Clear Channel owns isn’t the issue, Mays contends, so much as the diversity of what is heard over the airwaves. He is emphatic in his belief that Clear Channel promotes more, not less, variety in radio programming. And Clear Channel is delivering the goods so effectively, he says, that those eating its dust are not happy about it.
“There is no question in my mind that the consolidation has increased the diversity of programming,” Mays says. “If we were a stand-alone operation, we would not be able to operate in the diverse number of formats that we do today.” Clear Channel’s success, he explains, is based on running each of its divisions as a separate entrepreneurial business unit under a centralized financial management umbrella. “We have created a platform that is very unique and very different for the business we’re in—operating like a little company with big resources.” He says his stations have plenty of autonomy. The lawsuits, Mays says, are just part of doing business. “Because of our ability to compete and be successful, someone is going to be upset about it.”
As much as I was impressed by my visit to Clear Channel’s offices—whose atmosphere suggests a small, successful family operation where the boss’s door is open to every employee—I still don’t buy Mays’s argument that the company’s approach is ultimately not bad for listeners. The bigness beyond the building is too hard to shake. The gargantuan scale of Mays’s “convergence, consolidation, and synergy” is on the verge of tipping that delicate balance between art and commerce that has characterized radio for the past half century. That is not a good thing. Since radio first came into existence, listeners have always had a clear option if they didn’t like what they heard: Change the channel. But what choice is there now, really, when everywhere I go it’s Bob and Tom?