col Clear Channel seeks to mend image after difficult year
By Lisa Singhania
In the past 12 months, Clear Channel Communications has been accused of everything from monopolizing and homogenizing the radio industry to banning the Dixie Chicks and being a right-wing mouthpiece.
The negative publicity has meant the largest owner of U.S. radio stations, including four in Rochester, spends a great deal of time defending itself against what it says are lies spread mostly by critics, competitors and people who have lost jobs amid changes in the radio industry the past few years.
But Clear Channel, which denies any wrongdoing, says the bad PR won't change the way it does business, or stop it from buying more stations.
"I'd be kidding you if I'd say the scrutiny hasn't had an effect. We have to do a better job of communicating our position, telling our story," said John Hogan, chief executive of Clear Channel's radio division. But "we don't program the stations based on what Washington has to say or what The New York Times has to say. We program them on what our local listeners want to hear."
The company owns radio stations KRCH, KWEB, KNFX and KMFX, all acquired in a July 2000 swap with Cumulus Media. In that deal, at the height of Clear Channel's growth, the company traded seven stations to Cumulus in exchange for 35 stations. Besides the Rochester stations, Clear Channel also acquired stations in Mankato, Mason City, Iowa, and Eau Claire, Wis., in the deal.
Consumer groups ranging from the Center for Public Integrity to the Consumer Federation of America have accused Clear Channel of stifling local voices and diversity on the radio. The radio conglomerate has also been attacked for promoting a Republican agenda and using the influence of its 1,200-plus radio stations to decide what gets on the air; playing the music of artists who do business with its entertainment, advertising and TV divisions, while punishing those who don't.
Even louder is the reproach from Washington. In June, federal regulators relaxed overall media ownership rules but more tightly restricted radio ownership. The fate of those rules is now uncertain because of moves by the courts and Congress against the TV and newspaper ownership changes, but Clear Channel still has other problems. The Justice Department is investigating the company and, though it won't say why, the speculation is the inquiry is about alleged anticompetitive practices.
The controversies illustrate what a magnet for criticism the company has become.
"They were an easy target. Clear Channel started out as a very small company and it grew really fast," said Katy Bachman, a Mediaweek senior editor who covers the company. "They were unprepared and the radio business was unprepared for all the attention. They had no idea people would get upset, and there have been a lot of things perpetuated about them that are just not true."
Clear Channel is now trying to repair its reputation by meeting with reporters and correcting what it calls myths: The company says it did not ban the Dixie Chicks from airplay after one of the group's members criticized President Bush and the war in Iraq (that was rival Cumulus Media, and the temporary prohibition only applied to its country music stations.)
Clear Channel also says pro-war rallies held by some stations during the Iraq war were the work of individual radio hosts and managers, rather than a corporate directive.
Clear Channel has also made some corporate changes, including hiring for the first time a vice president of corporate communications and a Washington lobbyist.
This summer, the company cut off dealings with independent promoters after accusations that the relationships promoted "pay for play." The promoters are paid by record companies to tout their recordings to radio stations, and some lawmakers had alleged the practice influenced what songs got on the air.
A key complaint has been Clear Channel's ownership of radio stations. The conglomerate owns about 9 percent of the 13,000 total U.S. radio stations. But the concentration is much greater in some markets. For example, Clear Channel owns 13, or about 24 percent, of the 53 broadcast stations in the Lexington, Ky., area, according to the Center for Public Integrity, a consumer advocacy group.
Hogan says the company has done nothing illegal, and that he won't let critics hinder Clear Channel's growth.