The Effect of Clear Channel Radio
Your eyes blink. You try to stay awake. You can win. You’ve played fair, and you’re reaping in the benefits. You own Boardwalk and Park Place. It’s been a long night, but you’re not going to give up. You will win. However, you’re not playing a board game, you’re listening to the radio. Clear Channel Communications has this oh, so familiar mentality. Awake since 1996, the largest owner and operator of radio stations in the U.S. is playing a competitive game of Monopoly.
Spending over $30 billion in the past two years, Clear Channel now owns over 1,200 stations (Adler 2002). The next largest competitor, Infinity Broadcasting Corp., owns 183 stations (Anderson & Lowery 2001). The enactment of the 1996 Telecommunications Act deregulated radio, and allowed companies to own as many as 8 stations in one market, a huge change from the previous 40 station per company limit. Since 1996, Clear Channel has been in the public eye--a notorious target of the music industry, business professionals, station owners and citizens who feel radio has changed for the worse. The issue is complicated, as many people desire different outcomes. It is hard to please everyone when agendas are contradictory and needs are conflicting. Clear Channel has changed radio. Whether it is a positive or a negative change lies in the accessibility of recording artists, the ears of the listener, the pockets of Wall Street, and the minds of the reader.
How has Clear Channel Communications changed radio, and why should you be concerned? Music is an important part of our everyday lives. It relaxes us in a traffic jam, it empathizes with our last break up, it pumps us up for a night out on the town, and it helps celebrate the memorable moments. About 75% of students (ages 16-25) surveyed said they discovered new artists by listening to the radio (Berendt 2002). Repetition and commercial overload were the top two complaints. Therefore, radio possesses a huge responsibility in providing quality programming and music selection to its listening audience.
Clear Channel (C.C.) has stirred up numerous debates. Four main points need to be tackled when thoroughly examining the current practices and changes C.C. has implemented upon radio. Globalizing the product and creating more diversity are two of the positive issues. In contrast, homogenization and monopolization are the concerns.
Globalizing the Product
When you’re away from home and want a good meal, you know you can count on McDonald’s to provide that same menu of hamburger goodness. It’s nice to know what to expect, and C.C. believes that KISS FM will provide that same feeling of comfort. In an effort to jump-start this vision, C.C. plans “to create a national KISS brand in which stations share not just logos and promotional bits but also draw from the same pool of on-air talent” (Wilde-Matthews 2002). Randy Michaels, the chief executive of Clear Channel's radio division, says, "A McDonald's manager may get his arms around the local community, but there are certain elements of the product that are constant. You may in some parts of the country get pizza and in some parts of the country get chicken, but the Big Mac is the Big Mac. How we apply those principles to radio we're still figuring out." The globalization of radio allows big, syndicated on-air personalities (like Rush Limbaugh, Howard Stern, etc…) to be experienced by listeners around the country. Voice tracking is a practice used by many stations, where the DJ can pre-record their show in order to make it more precise and clean. Mike Glickenhaus, a Clear Channel vice president in San Diego, argues that voice tracking allows stations in smaller cities to hear these top radio talents at low cost. He said that it's no different than television stations airing Letterman and Jay Leno at 11:30 p.m. because they're better than inexperienced local personalities (Dotinga 2002). This vision is becoming reality, as C.C. now own more than 47 KISS stations in the U.S..
Because C.C. is so huge, it has the capability of experimenting on a higher level. The FCC (Federal Communications Commision) previously felt that independent owners would contribute to higher diversity. But after the Telecommunications Act of 1996, they state “too many independent owners will go after the ‘greatest common denominator’ of programming to solicit the most advertising, whereas a single owner will purposely create diversity to avoid overlap and cannibalization” (Pomerantz 2002). The founder of C.C., Lowry Mays, is “emphatic in his belief that Clear Channel promotes more, not less, variety in radio programming” (Patoski 2001). Peter Gutmann, a Washington lawyer who defends cases before the FCC, believes, "When you have one party that has lots of stations, it can try niches or more experimental programming” (Pomerantz 2002). Many people have argued that the variety of station formats has decreased since C.C. has ruled the airwaves. Yet, the FCC found in its industry survey of 2001 that while the selection of formats has decreased slightly in larger markets, it increased in the smaller areas (Pomerantz 2002). In Little Rock, Arkansas, the selection has risen from eleven choices to fourteen. In the Atlantic City area it is up from ten to fourteen selections. "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." Mays claims that the success of C.C. is “based on running each of its divisions as a separate entrepreneurial business unit under a centralized financial management umbrella” (Patoski).
“I don’t know what it is, but things have changed,” said Marika Krause, a 20-year-old CSU student, responding to what she thinks about radio since 1996. “I turn on the radio and hear the same five songs over and over again.” She also commented on how commercials are “…so annoying, I pretty much just listen to CD’s now.” This seems to be a common complaint among students who were surveyed. Can the blame for this be placed solely on C.C? Of the individuals surveyed, four out of the five most frequently listened to stations were Clear Channel Stations (Berendt 2002). Clear Channel dominates the top 40 format, and controls 60% of rock-radio listening (Boehlert 2002).
Repetition of songs has been blamed on payola, in which money or goods are exchanged for air-play. Although this is illegal, record companies have found a way to ‘cut the corners’. Indies are hired as middlemen to get stations to play songs. “Indies align themselves with certain radio stations by promising the stations “promotional payments” in the six figures,” (Boehlert 2001). Once a song gets added, the indie gets paid by the record label. Though more than 30,000 CD’s are released each year, national radio playlists are slimming down (Kot 2001). The top stations add around 16-20 songs per week, and spin the top songs more than 85 times each between the hours of 6a.m.-6p.m., Monday through Friday (www.radioandrecords.com/charts/playlist.htm).
In addition, even though voice tracking saves money, many argue that it takes away the essence and flair of local radio. When DJ’s are syndicated, a listener has no chance of calling and reaching a DJ to request a song. At promotional events, DJ’s aren’t at the remotes (because they might live in another city), and therefore they cannot meet listeners. “The thing that’s going to kill the radio industry completely is that there won’t be any local heroes for kids in college and high school,” said Mike Halloran, program director at San Diego alternative rock station KFSD-FM (Dotinga 2002). However, even if newcomers are inspired, voice-tracking is eliminating jobs, while saving stations money.
Clear Channel has played the game well. More competitive than any other company, C.C. has been able to dominate the radio and entertainment industry. “Clear Channel is delivering the goods so effectively,” Mays says, “that those eating its dust are not happy about it,” (Patoski 2001). Clear Channel owns SFX, an entertainment company that hosts concerts and promotional events. Nobody In Particular Presents (NIPP), a Denver concert promoter, recently sued Clear Channel in federal court. NIPP accuses the company of “monopolistic and predatory practices,” including claims that Clear Channel blocks other concert promoters from properly publicizing their shows on Clear Channel’s radio stations (Anderson 2001). Jesse Morreale, owner of NIPP, said he bought radio ads for the Warped Tour to run on KTCL (Clear Channel), but the station ran the spots at the wrong times or not at all. He said he tried to promote the show with an on-air ticket giveaway but claims the station gave the tickets to its employees. Morreale is not the only one having problems with Clear Channel. They are the nation’s number one radio chain, billboard owner, venue operator, and concert promoter. The company receives $5.3 billion in annual revenues, has operations in 63 countries, including some 1,200 radio stations, 19 TV stations, 770,000 outdoor ad displays, and 135 live-entertainment venues (Anderson 2001). The mom-and-pop stations just can’t compete on the same level. They don’t have the personnel, the money, and the force to contest the Clear Channel Boardwalk and Park Place.
Monopoly: it’s a game most love to play. And at the end a winner is a winner, and the competitors are left broke. Is C.C. creating a globally diversified product or a homogenous, monopolistic corporation? It’s a complicated issue, and a complicated game. But it’s going to be a really long night before somebody gives up and somebody actually wins.