Faith-Based Consolidation

The eyes almost popped out of my head when I was reading Inside Radio the other day.

Clear Channel Executive Vice President Andy Levin is quoted as saying, "changes to the radio ownership rule are once again necessary".

Oh, it gets worse than this.

America's biggest radio consolidator and arguably the company that had the most to do with pushing a once thriving business into the doldrums wants Congress to save it from itself. After all, radio consolidators were given a virtual monopoly with passage of the Telecommunications Act of 1996 and they still couldn't make it pay off.

Shareholders are looking at embarrassingly low prices for the stocks many of them purchased at a much higher cost basis.

Listeners haven't been well served.

Consolidation hasn't fostered innovation, just cutbacks and false efficiencies.

The next generation has been allowed to walk away into the world of Internet and mobile devices without a well-financed and sustained attempt to keep them. That's how obsessed with cutbacks consolidators have been.

Loyal and talented managers, programmers and sales executives at first were asked to take on additional duties. Then radio's best assets were fired. Foolish programing efficiencies were implemented such as voice tracking and widespread use of national syndicated shows to save local salaries. Ask a manager what he or she does all day -- think of ways to cutback to the bone in the interest of quarterly earnings improvement and lately -- more firings just before the holidays.

Now get this. Clear Channel wants Congress to allow further monopoly by allowing companies such as Clear Channel and others to own as many as 12 stations in markets with more than 75 signals and ten in markets with 60 to 74 signals.

It would be laughable except -- with Congress these days anything is possible.

Poor consolidators.

I guess it didn't work out and it's everybody's fault but theirs.

Levin said radio is "still shackled" and by limiting the industry's growth, it also limits its local reach. Levin says before consolidation six in ten stations were operating in the red and now, after relaxed ownership rules, companies are still facing challenges with little or no growth over the past five years. Levin says, "This is unsustainable for our industry".

You could really cry for these screw ups, couldn't you?

you're not qualified to run a public company?

you've made a lot of mistakes (the rest of us have to admit ours, where's yours -- even one?).

Internet start-up companies are smarter and more able to compete than consolidated radio companies.

Their argument seems to be that unprecedented consolidation hasn't been enough to save radio so give us more.

No mention of the incompetence that has surrounded almost every decision from day one.

Now if I testified before Congress, I would say:

"Honorable members of Congress. I am here to ask for mercy for the unfortunate consolidators of a once vibrant radio industry. It seems that they bit off more than they could chew when you were kind enough to grant them what was tantamount to a virtual monopoly in radio markets nationwide. One of the reasons you may be reluctant to relax the rules further is because, like Congress, radio is a local medium and every attempt to make it more national meets with protest from our constituents. Listeners are missing the great things they used to get when radio was operated by companies that were more concerned with Main Street than Wall Street. In retrospect it was a mistake to grant a handful of operators the right to monopolize the public trust. Further attempts to get you to bail them out by allowing them to own even more stations will also fail. And the argument that radio is now competing with other media -- satellite radio, iPods, the Internet, cell phones -- is a weak and misleading argument. Radio always competed with other media except now that the local fiduciaries have been replaced by media barons they have failed a test in which they had all the advantages. And newspapers and television were replaced by iPods and the Internet. I urge you to not only resist the temptation to relax ownership rules further but to break up the large monopolies by allowing no group the ability to own more than 100 stations in total with a three in a market maximum".

FCC Chairman Kevin Martin -- a future lobbyist if there ever was one -- is reading the public contempt for consolidation accurately now and even he is discouraging any ownership changes.

But that's not enough.

This monopoly should be busted -- not only for the good of the people but for the poor consolidators who say their present shackles are unsustainable. Radio should be returned to the companies that want to run 100 terrestrial stations (and maybe Internet streams, mobile content companies, etc).

Now that would be a stock shareholders would invest in. Mixed media. No monopolies.

Let's tell the members of Congress that if you don't want to do this for us -- do it for them!

Put them out of their misery. Untie their shackles.

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