[Mb-civic] NYTimes Article: A Radio Giant Moves to Limit Commercials

[Ian]

I'm going to make a prediction - and remember, you heard it here first.

Although there may be some legitimate economic reasons for doing so, far
from being a magnanimous gesture in minimizing commercial ads on radio, this
is a first step by Clear Channel to control exactly which ads will be
"permitted."  In other words, I believe that Clear Channel - which is as
"friendly" to Bush and the Republicans as Fox News - is paving the way for
new rules that will be partial to conservative, right-wing ads, and
deliberately "stifle" as many liberal or "left-wing" ads as possible.  Yes,
there are rules and regulations in this regard that all radio stations must
follow.  However, mark my words: Clear Channel is going to attempt to make
an "end-run" around those rules, with the help of the F.C.C. - whose
Chairman, Michael Powell, is not only Colin Powell's son (and is, if
anything, more conservative than his father), but has already shown a
disdain for the "public" that ultimately owns the airwaves by chipping away
at the Telecomm Act that put greater media regulations in place.

Peace.

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A Radio Giant Moves to Limit Commercials
July 19, 2004
By NAT IVES

Clear Channel Radio plans to announce today that it will begin limiting the
number of commercials its more than 1,200 stations can play, in a move that
analysts say may ripple through the industry even before it takes effect on
Jan. 1.

John E. Hogan, chief executive at Clear Channel Radio, which is based in San
Antonio, said the sprawl of commercials throughout radio was causing clear
harm. "If
you have listened to the radio at all, you know that there is an amazing
amount of commercial and promotional inventory," he said. "So much so that
we have run the risk of diluting our product."

 Reaching for the tuner as soon as a D.J. says "Don't touch that dial" is
almost instinctual for many listeners, a fact that radio executives could
accept when revenue was soaring, like it last did during the dot-com boom.
But revenue since then has expanded with something like the speed of a
sloth, with combined national and local ad spending growing 4 percent in the
first five months of the year, compared with the same period a year earlier,
and rising 2 percent in all of 2003, according to the Radio Advertising
Bureau.

 The slow growth comes despite a long-term run-up in the number of minutes
in each hour devoted to commercials, said Laraine Mancini, a broadcasting
analyst at Merrill Lynch. "Radio wanted to take every dollar that was
getting thrown at them," she said. "And you didn't have to produce more to
do it; just take a song off and add commercials."

Solid figures on radio commercials are hard to come by because of the
difficulty in monitoring thousands of stations across the country, but Ms.
Mancini and others
offered rough estimates. Where 10 to 12 minutes of advertising each hour was
perhaps the norm a decade ago, some talk-radio stations now broadcast more
than 20 minutes of ads an hour, they said. Many music stations probably play
more than 15 minutes.  The expanding volume of commercials has bred
frustration among advertisers and radio audiences, Ms. Mancini said. "People
don't want to spend a quarter of their time listening to the radio listening
to ads," she said.

 The proportion of people who turn on the radio at least once a week remains
high. It was 94.2 percent last winter, compared with 95.8 percent 10 years
earlier, according to data on the top 100 markets compiled by Arbitron.  But
the average time that people actually listen each week has slid downward
during the same period, to 19 hours and 30 minutes from 22 hours and 30
minutes.

 Mr. Hogan of Clear Channel Radio, which is a unit of Clear Channel
Communications, said the company's new ceilings on ads, while national in
scope, would vary according to format and time of day.  For example, during
the morning drive, Clear Channel's country-music stations will broadcast no
more than 12 minutes of commercials an hour, take no more than 4 minutes for
any single commercial break and pack no more than six commercials into a
break.

 Such stations have been playing 18 minutes to 24 minutes of ads during the
morning drive, Mr. Hogan said. "This is a way for us to go to advertisers
and say we've heard you. We're going to give you a better environment," he
added. Enforcement efforts will rely on proprietary technology that will
monitor what Clear Channel stations broadcast, he said.

 Joseph W. Lenski, executive vice president at Edison Media Research, said
the new Clear Channel limits might create pressure for others to do
something similar.
"Since they are the 800-pound gorilla, when they make a public stand on
this, I think other groups in the industry will have to take notice," Mr.
Lenski said. "It's a lot like when one airline cuts prices, the other
airlines have to match."

 But Joel Hollander, president and chief operating officer at the Infinity
Broadcasting unit of Viacom Inc., said the Clear Channel model would not fit
Infinity stations. "We leave decisions of inventory in the hands of station
managers," he said. Mr. Hollander said, however, that Infinity had placed
new limits on certain stations since his arrival last summer. At KILT-FM, a
country-music station in Houston, for example, commercial time was reduced
to 12 minutes each hour from about 15 minutes or 16 minutes. "We've seen
positive results," he said, citing higher ad prices and stronger ratings.

 Another competitor, the Emmis Communications Corporation, could not be
reached by deadline, but it described its view during a June 30 conference
call on its first-quarter earnings. "We have acknowledged over the last two
or three years that we think spot loads, whether you look at Emmis radio, or
other groups, are pretty much at their absolute max," said Rick Cummings,
president at the radio division.

 Guy Zapoleon, president at Zapoleon Media Strategies, called the Clear
Channel move well-timed given threats like satellite radio and proliferating
sources of music and information.