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overview
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overview
This profile considers US broadcaster and outdoor advertising
conglomerate Clear Channel.
It covers -
introduction
US broadcasting Clear
Channel Communications claims to have
the
world's largest broadcasting portfolio, including the
Company's 1,189 owned and operated domestic radio stations,
equity interests in various international broadcasting
companies, a leading national radio network and 40 owned
or programmed TV stations.
It
has a presence in Australia through partnerships with
APN, Austereo
and DMG. It has grown through acquisition
of individual stations and major networks, which in turn
resulted from aggregation of smaller radio networks after
changes to the US regulatory regime in the 1990s.
In November 2006 it agreed to be acquired for US$18.7
billion by a private equity
consortium that includes Thomas H Lee Partners and Bain
Capital. (Lee is part of the consortium that acquired
Spanish-language broadcaster Univision Communications
for US$12 billion earlier in the year; Lee and Bain have
major stakes in Cumulus Media
Partners). Clear Channel put a total value of US$26.7
billion on the transaction, including US$8 billion in
assumed debt and announced that it would sell 448 of its
1,150 radio stations, along with its 42-station television
group.
Its corporate site is here.
the group
As of late 2005 Clear controls around 1,170 radio stations
and 19 television stations in the US - nothing, it seems,
exceeds like success - and has major overseas interests
(for example a stake in over 118 Mexican radio stations).
In 1997 it bought the Paxson
group's radio stations. During early 2001 it paid approximately
US$24 billion for 460 stations. It currently has stations
in 247 of the 250 largest US radio markets, throwing off
around US$3 billion in annual revenue.
As of 2004 it also owned
- the
largest US rock concert promoter, SFX Entertainment
(acquired for US$4.4 billion in 2000 and rebadged Clear
Channel Entertainment) - spun off as Live
Nation in December 2005
- over
135 concert venues,
- radio
research companies, radio trade magazines, regional
news networks,
- Premier
Radio Networks - syndicated programming
- Mediabase,
an airplay monitoring system
- Adshel,
an international outdoor advertising company with around
770,000 billboards.
The
group is the broadcasting equivalent of the Knight-Ridder,
Belo and Gannett newspaper chains in the US - lots of
small operations with strict cost control, an emphasis
on content sharing and what critics have described as
"cookie cutter" or sensationalist journalism.
Some of those criticisms feature in the ClearChannelSucks.org
site.
Growth has been driven by the availability of cheap finance
and the successive weakening of regulatory constraints
that formerly capped the size of broadcasting networks
and the number of stations they could own in a particular
market.
Clear had a substantial stake in Hispanic Broadcasting,
the leading US Spanish-language radio broadcaster (some
55 stations, including the top Spanish stations in nine
of the leading markets).
In June 2002 Univision - controlled
by Jerrold Perenchio, Cisneros
and Televisa - announced that
it would buy Hispanic for US$3.5 billion.
In 2006 Clear agreed to be bought for US$18.7bn by a private
equity consortium headed by Thomas H Lee Partners and
Bain Capital. Progress in that buyout saw announcement
during the following year that it had agreed to sell its
television group to Providence Equity Partners for US$1.2
billion. Sale of the 56 tv stations was finalised in 2008,
at a revised price of US$1.1 billion.
SFX and CKX
SFX Entertainment was acquired by Clear in 2000 for US$4.4
billion.
It had been founded in 1997 by Robert F X Sillerman, executive
chair of SFX Broadcasting (acquired that year by Capstar
for US$2.1 billion and thus absorbed by Clear in 1999
as part of the AMFM Inc takeover). In 2004 Clear announced
plans to wholly spin off SFX, with the temporary name
of CCE Spinco. As of 2004 it comprised entertainment operations
throughout North America, Europe, South America, Asia
and Australia, with annual 2004 sales of US$2.75 billion.
Sillerman concurrently announced establishment of CKX
Inc and a definitive agreement to acquire an 85% interest
in the Elvis Presley estate (including the Elvis personality
rights, operation of Graceland and revenue derived from
Presley's music, films and television specials).
In December 2005 SFX/Spinco was spun off as Live
Nation.
Display operations and Ackerley
Clear Channel Outdoor was established in 1901 as Foster
& Kleiser Advertising, experiencing significant growth
after 1995 as Eller Media Co. Eller was acquired by Clear
Channel Communications in 1997, along with US-based Universal
Outdoor (for an aggregate 88,000 displays in North America)
and EU-based The More Group.
Eller was rebadged as Clear Channel Outdoor in 2001.
Acquisition for US$850 million of the Ackerley group (formerly
the fourth largest US billboard operator) in 2001 provided
another 6,000 outdoor displays.
Ackerley Group comprised Outdoor Media (including outdoor
advertising in Seattle, Tacoma, Boston, New Jersey, New
York City, Portland, Salem and Eugene), Television Broadcasting
(owned and/or operated 18 stations in California, New
York, Washington, Oregon and Alaska, as well as Progressive
HD Mobile Productions), Radio Broadcasting (owned and/or
operated five radio stations in the Seattle-Tacoma market)
and Sports & Entertainment (including the NBA's Seattle
SuperSonics - sold to a consortium led by Starbucks magnate
Howard Schultz - and the WNBA's Seattle Storm).
By 2001 Clear Channel claimed over 700,000 displays on
roads, on taxis and buses, on trains, at airports and
other venues. Its earnings of US$1.1 billion in 2001 are
claimed as 22% of total US outdoor advertising revenues
of $5.2 billion.
Australian holdings
Clear's major Australian
presence is through its 50% stake in the Australian Radio
Network, half-owned by the O'Reilly controlled APN.
ARN stations include -
WS
FM - Sydney
MIX 106.5 - Sydney
Gold FM - Melbourne
MIX 101.1 - Melbourne
4KQ - Brisbane
5DN - Adelaide
MIX 102.3 - Adelaide
In
New Zealand, ARN has a one
third interest in The Radio Network (TRN), the leading
commercial broadcaster with 55 stations.
APN's Pan TV is a joint venture between ARN, public sector
broadcaster SBS and Australian
Capital Equity. Its World Movies pay tv channel is distributed
by the three pay tv carriers - Foxtel, Optus and Austar
- and accessed by about 15% of pay tv homes.
APN's outdoor advertising holdings include Adshel Street
Furniture (in partnership with Clear's Adshel group).
studies
Prior to 2008, which saw release of Alec Foege's Right
of the Dial: The Rise of Clear Channel and the Fall of
Commercial Radio (London: Faber & Faber 2008)
there were been no major studies of Clear or the Mays
family.
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