Clear Channel revenues decline

Clear Channel Radio Revenues Down 6% For Q4

Clear ChannelRevenue fell 1% to $1.76 billion and radio revenue was off 6% to $909.4 million for CLEAR CHANNEL COMMUNICATIONS in fourth quarter 2005, the company reported TUESDAY. Profits rose from 2004's loss of $4.67 billion (loss of $8.15/share) to a gain of $461.6 million (86 cents/share), but excluding discontinued operations and major accounting charges that affected 2004's numbers, profits fell from 40 to 34 cents/share. The company's radio revenue decline was greater than the industry's pace of a 3% drop. Outdfoor advertising rose 7% to $734.6 million.

Rep. Fred Upton wants to ease ownerships restrictions

Thursday, Feb. 16, 2006
Lawmaker Wants Radio Ownership Rules Relaxed

Rep. Fred Upton, a House Commerce Committee member and communications subcommittee chairman, has asked FCC Chairman Kevin Martin to launch a proceeding to raise the maximum number of stations one company can own in certain U.S. markets.
In a Feb. 9 letter, the Michigan Republican suggested that the ownership limit in markets with 60 or more stations be increased from eight to 10 stations. He also recommended that the limit in markets with 75 or more stations be raised to 12.
"A modest increase would not result in undue concentration," Upton said. "Even with such modest relaxation, radio will remain an industry with very diverse ownership that falls far short of a level of concentration that would be cause for concern." He also believes relaxing the rules could lead to more program diversity. "Owners would be able to experiment with new formats that improve service to underserved segments of the population, or bring a new service to the marketplace for the first time."
Upton also stressed that in just the 10 years since the rules were eased with the Telecommunications Act of 1996, new competitors have emerged to challenge radio. "If free terrestrial radio is to remain a healthy industry capable of fulfilling its public interest responsibilities while competing against an increasing number of competitors, it must be able to grow," said the congressman. "I believe that the modest increases discussed in this letter will provide room for that growth."
Upton repeated his call for relaxed radio ownership rules during a speech delivered Thursday at Washington, DC's Media Institute. He even suggested that the industry might be better off with no ownership limits. "Today's marketplace makes a compelling argument for simply eliminating local terrestrial broadcast ownership caps, except perhaps in the smallest markets," he said. "But those of you who know me understand that I am a pragmatist; such a step will not pass the test of politics in Washington, DC today. I am making a far more targeted proposal because modernization can and should get done with year."
Upton continued, "Setting aside for just a moment the competition from other media, especially satellite radio, there is absolutely no public good to justify the same local radio ownership cap for Cincinnati as for New York City, Chicago and Los Angeles. Let's remember that ownership diversity is only a proxy for viewpoint diversity; America's largest markets are certainly not lacking in diversity of perspective and entertainment."
Thursday, Feb. 16, 2006
Lawmaker Wants Radio Ownership Rules Relaxed

Rep. Fred Upton, a House Commerce Committee member and communications subcommittee chairman, has asked FCC Chairman Kevin Martin to launch a proceeding to raise the maximum number of stations one company can own in certain U.S. markets.
In a Feb. 9 letter, the Michigan Republican suggested that the ownership limit in markets with 60 or more stations be increased from eight to 10 stations. He also recommended that the limit in markets with 75 or more stations be raised to 12.
"A modest increase would not result in undue concentration," Upton said. "Even with such modest relaxation, radio will remain an industry with very diverse ownership that falls far short of a level of concentration that would be cause for concern." He also believes relaxing the rules could lead to more program diversity. "Owners would be able to experiment with new formats that improve service to underserved segments of the population, or bring a new service to the marketplace for the first time."
Upton also stressed that in just the 10 years since the rules were eased with the Telecommunications Act of 1996, new competitors have emerged to challenge radio. "If free terrestrial radio is to remain a healthy industry capable of fulfilling its public interest responsibilities while competing against an increasing number of competitors, it must be able to grow," said the congressman. "I believe that the modest increases discussed in this letter will provide room for that growth."
Upton repeated his call for relaxed radio ownership rules during a speech delivered Thursday at Washington, DC's Media Institute. He even suggested that the industry might be better off with no ownership limits. "Today's marketplace makes a compelling argument for simply eliminating local terrestrial broadcast ownership caps, except perhaps in the smallest markets," he said. "But those of you who know me understand that I am a pragmatist; such a step will not pass the test of politics in Washington, DC today. I am making a far more targeted proposal because modernization can and should get done with year."
Upton continued, "Setting aside for just a moment the competition from other media, especially satellite radio, there is absolutely no public good to justify the same local radio ownership cap for Cincinnati as for New York City, Chicago and Los Angeles. Let's remember that ownership diversity is only a proxy for viewpoint diversity; America's largest markets are certainly not lacking in diversity of perspective and entertainment."

Newsday Miss Jones

Pols, activists rap Hot 97's Jones --------------------
BY RAFER GUZMANSTAFF WRITER
February 16, 2006

Hot 97 radio host Miss Jones is under attack again - and this time, it's personal.A coalition of New York City Council members and community activists gathered on Manhattan's City Hall steps yesterday , calling for the firing of Tarsha Nicole Jones, known on-air as Miss Jones, and Hot 97 program director John Dimick . A crowd of about 30 people listened to speakers lambaste the radio personality."I've met Miss Jones," said councilman John Liu (D-Flushing). "Miss Jones actually has no personality whatsoever."The rally was sparked by a recent broadcast on Hot 97 (WQHT/97.1 FM) . A crowd of about 30 people listened to speakers lambaste the radio personality."I've met Miss Jones," said councilman John Liu (D-Flushing). "Miss Jones actually has no personality whatsoever."The rally was sparked by a recent broadcast on Hot 97 (WQHT/97.1 FM) in which Jones called Transit Workers Union President Roger Toussaint a "dumb coconut," an apparent reference to his Caribbean roots."I couldn't believe it ," said Fendi Williams, 14, a Brooklynite at the rally. "My father is of Caribbean descent."The coalition, R.E.A.C. Hip-Hop (Representing Education, Activism and Community Through Hip-Hop ), has been hounding Jones since her broadcast last year of the so-called "Tsunami Song," which mocked victims of the Southeast Asian tsunami. Jones was suspended for two weeks last year for playing the song. Yesterday's speakers ratcheted up their rhetoric, accusing Jones, who is black, of betraying her community and serving as a pawn to the white corporate executives at Emmis Communications, which owns Hot 97.Jones belongs in the same company as "blackface and Amos and Andy," said councilwoman Letitia James (D, WF -Brooklyn). "She is being used. She is nothing more than a tool."Several council members announced they were introducing a resolution to condemn Jones' remarks and promised their own investigation into the recent payola scandal that has rocked the radio and record industries.Calls to Hot 97 and Emmis were not returned. Copyright (c) 2006, Newsday, Inc.

Payola Investigation

Hundreds Of Stations Under Investigation By FCC In Payola Investigation
February 10, 2006
Though ABC News has delayed airing its Primetime Live story on Eliot Spitzer's payola investigation, it has revealed that the FCC is now investigating hundreds of radio stations around the country as part of the scandal. FCC Commissioner Jonathan Adelstein told ABC News, "The FCC staff is working with voluminous evidence right now. It's a complicated and wide-ranging investigation." He added, "This is potentially the most widespread and flagrant violation of FCC rules in the history of American broadcasting. We've never seen evidence of such a systematic betrayal of the responsibility of broadcasters."
Spitzer himself told ABC News, "We have people in suits coming in with documents rather than cash payments under the table to a DJ."
Adelstein threatens the loss of stations' licenses through this investigation, saying, "I can't believe that radio stations are putting their licenses at risk. It seems to me they thought the FCC was asleep and they shot someone in front of the policeman. The policeman is obligated to act when evidence is so clear." He added, "While it's highly unusual for the FCC to pull licenses on first violation, depending on the severity that is one option that is available to us. These are criminal matters as well."
Commissioner Adelstein revealed that he has been in regular contact with Spitzer lately, and wants the FCC to handle the investigation, as opposed to just Spitzer and the state of New York. "We have a responsibility to get to the bottom of this. It's important that the FCC does its job and not let the states do it for us," he said.
ABC News also spoke to a number of industry stars at the Grammys earlier this week about payola, with none of them particularly surprised by the news. "Honestly, payola has existed since the beginning of the music business, so it's not like its some brand-new thing that never happened before," said Alicia Keys. Jessica Simpson's music has been mentioned in Spitzer's documents. Her father/manager Joe Simpson told ABC News, "All I know is we worked really hard to get the record on and it was as honest as I could be. So whatever happened above us, you know I have no answer for."
The episode of Primetime Live is now expected to air next Thursday, February 16.

Telecomm ACT of 1996's 10th Anniversary

Thursday, Feb. 9, 2006
Happy 10th Birthday, Telecom Act

Senate Commerce Committee Chairman Ted Stevens yesterday marked the 10th anniversary of the Telecommunications Act of 1996 by saying his committee is developing legislation that would increase broadcast indecency fines as part of its ongoing rewrite of the landmark act. While it remains to be seen what, if any, changes will be made to the current radio ownership limits, Stevens said lawmakers are mindful that changes to the FCC's media ownership laws will affect businesses.
"Our goal should be to get government out of the way, to encourage revenue growth, lower costs, cut red tape, and minimize government intervention in private agreements between entrepreneurs and their banks," Stevens said at a Wachovia-sponsored forum in Washington. "We want to encourage risk-taking; it's essential that that be part of this result."
Stevens said his committee plans to host a total of 15 hearings on the Telecom Act's rewrite, and promised the investment and securities crowd in attendance that the final session would be devoted to Wall Street. He added, "Congress can write laws, but if we fail to assure how this legislation will affect the American economy, we fail to achieve our mission."

ABC Prime

By BRIAN ROSS, RICHARD ESPOSITO and VIC WALTER

Feb. 7, 2006 -- ABC News has learned the focus of a two-year long payola investigation by the New York attorney general is turning to the nation's nine largest radio conglomerates.
Attorney General Eliot Spitzer says evidence he has gathered clearly shows some of the radio conglomerates have participated in the illegal practice of accepting payments from record companies and middlemen for guaranteed air play for certain songs.
"The behavior has been unethical, improper, illegal and a sanction of some severity clearly should be imposed," Spitzer told ABC News chief investigative correspondent Brian Ross.
Spitzer and music industry officials told "Primetime" that millions of dollars in payments, gifts and trips are exchanged each year to get music stations to add songs to their weekly play lists.
Spitzer says record company documents obtained in the investigation of Sony Music and Warner, both who have settled with the attorney general, reveal payments for songs that became major hits, including Jennifer Lopez's "I'm Real" and John Mayer's "Daughters."
Other artists whose songs are named in the documents Spitzer has obtained include Jessica Simpson, Celine Dion, Maroon 5, Good Charlotte, Franz Ferdinand, Switchfoot, Michelle Branch, and R.E.M.
Spitzer says much of the money went directly to corporate bottom lines, unlike payola scandals of previous decades when individual disc jockeys and program directors received the money.
"We have people in suits coming in with documents rather than cash payments under the table to a DJ," Spitzer said.
The nine radio conglomerates which have received subpoenas from the attorney general are Clear Channel, Infinity (now CBS Radio), Entercom, Emmis, Citadel, Cumulus, Cox, Pamal, and ABC.
The nine companies, together, control several thousand radio stations across the country. In statements to ABC News, five of the companies say they are cooperating with the attorney general's investigation and take the matter seriously. The other companies have not responded to requests for comment.
A number of other independent radio stations are also under investigation, according to state investigators.
In conducting a probe of payola, banned by federal law, Spitzer has assigned himself the role of hit man to the hit makers, using state consumer fraud and bribery laws to go after the practice.
The FCC says it is closely following the New York investigation although Spitzer says the FCC has yet to move forcefully.
"I would like to see the FCC more directly involved in addressing what is very clearly a payola scandal that has run rife through the industry," Spitzer told ABC News.
Virtually all investigations into radio practices, since the last payola scandal in the 1980s that implicated organized crime figures, have withered on the vine and vanished.
Spitzer's probe could be the most comprehensive to ever hit the industry. Warner Music Group has entered a settlement and contributed five million dollars to charity as part of that agreement. Sony music settled for ten million dollars. Warner and Sony both agreed to cease any questionable business practices and to comply with Spitzer in his ongoing probe.

Ciadel buys ABC

Monday, Feb. 6, 2006
Citadel Merges With ABC Radio

In a deal announced Monday afternoon, the board of directors at Citadel and the Walt Disney Company have approved a deal to combine ABC Radio's 24 owned-and-operated radio stations and the ABC Radio Networks for $2.7 billion. Radio Disney and ESPN Radio O&Os are not included in the transaction.
The newly combined company will take the Citadel Communications name and will be led by current Citadel CEO Farid Suleman. Citadel will now include 243 radio properties in more than 50 markets, and the transaction makes Citadel the third-largest broadcast company in the United States.
The billion-dollar merger involves non-Radio Disney and non-ESPN ABC O&Os including WABC & WPLJ/New York; KABC-AM & KLOS/Los Angeles; WLS & WZZN/Chicago; WJZW, WMAL & WRQX/Washington; WBAP, KSCS & KTYS/Dallas; WKHX & WYAY/Atlanta; WDRQ, WDVD & WJR/Detroit; KQRS, KXXR, WGVX, WGVY & WGVZ/Minneapolis; and KGO & KSFO/San Francisco. Through a 10-year licensing agreement, Citadel will deliver ABC News Radio programming, but ABC parent Disney will continue to distribute ABC News content in other formats such as broadband, wireless and satellite.
Suleman said, "We look forward to welcoming our talented new colleagues at ABC Radio who have a long history of strong market performance, and are eager to work together to integrate ABC's top-notch assets into our new strategically enhanced radio group." Disney CEO Robert Iger added, "Our ABC Radio business represents a premier set of assets that have been exceptionally well-managed. ABC Radio and Citadel are a strong strategic fit."

R&R backtracks on Cumulus reporting status

R&R Reinstates Cumulus Stations Feb. 02, 2006 By Paul Heine
Two days after temporarily suspending all monitored Cumulus Media stations from all of its chart panels, Radio & Records announced Wednesday (Feb. 1) that the stations will be reinstated beginning with next week’s charts. The announcement came on the same day that Cox Radio said it would cease reporting music adds to trade publications – the second large radio chain to do so in less than two weeks.

A January 23 announcement from Cumulus that it would no longer supply lists of music adds precipitated the short-lived removal of Cumulus airplay data from R&R’s charts. Cumulus executive VP John Dickey said the decision was “designed to give our program directors and our music directors more discretion and, ultimately, more creativity and leeway to add music and play music that they have strong convictions in for reasons above and beyond charts and callout research.”Cox CEO Bob Neil said the move was born out of the company’s annual review of its payola and plugola policies. “We want bright lines between relationships,” Neil told Billboard Radio Monitor. “We want to make sure that we’re completely above board, that there aren’t hazy issues and the best way for us to do that was just to not report adds.”

The decisions by Cumulus and Cox will not affect any Billboard Radio Monitor charts or features, which are based entirely on electronic monitoring of actual station broadcasts provided by Nielsen BDS, rather than reported play provided by individual stations.

Cox ends trade reporting status February 1, 2006

It's quite obvious that the Spitzer Payola investigation is turning up skeletons. It's no coincedence the Cumulus and now Cox are distancing themselves from record labels and reporting.Reporting music only helps labels build chart position and boost sales. Although in today's age of digital detection, radio spins can be easilyidentified.

Non reporting is going to make Billboard and others rethink their current system. Only time will tell if stations will stop playing the same titles that are still dictated by the label. I personally feel it is a fancy smoke screen, and business is still preceding as usual. Only timewill tell.