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The laws of Economics, with a bit of political comment thrown in for the hell of it . . .



I have been reading the comments over the last couple of weeks regarding the
allegedly high ticket prices, in particular the $505.00 tickets at the
Hollywood Bowl.

Unless I didn't notice it when I read the Wall Street Journal this morning,
the laws of economics are still in full force.  You know (those of you, who
like me, slept through Introduction to Economics in college)--supply,
demand--small supply, high demand, price goes up--big supply, low demand,
price goes down.

A week ago Sunday, I witnessed the truth of this age old rule (OK, at least
as old as Adam Smith).  I stood in line at the Hard Rock Casino in LV and
purchased probably the last ticket for the June 28th show.  (Or at least I
think so, as no one behind me got one.  Quelle domage!)  That show, which is
apparently the most expensive concert (pricewise) in LV history sold out in
approximately 20 minutes.   Sure, the HRC could have charged $95 a ticket
which is what the face price for No Doubt tickets at the same venue.  Then
there would have been a sell out in what . . . 18 minutes??

Also, it should be noted that those $505.00 Hollywood Bowl tickets are all
sold out.  Guess some people are willing to put up with the lousy acoustics
of the Bowl.  Not me.  I'll leave that to Mr. English Boy.  (BTW, Mr. Boy,
the Sothwith Camel?  Jesus Christ!  Did they play "Snoopy and The Red
Baron"?  Thanks!  Ever since reading that, I can't get that darn song out of
my mind!  "10, 20, 30, 40, 50 or more, that bloody Red Baron is rolling up
the score, 80 men died, trying to end that streak, of the Bloody Red Baron
of Germany . . . ")

Now I was reading Jeff House's comment today that he "would bet one of (his)
paychecks that if Clear Channel had a Who to sell you and owned an oldies
station in the market, The Who would be an oldies band on that station."
Won't take that bet myself, as know I would lose.  There was an interesting
article in today's (February 25) LA Times about Clear Channel, and the power
they have over what we listen to on the radio and see in concert.  As the
Times takes current stories off its server (and makes you pay for them) very
quickly, I will attach it at the end of my comments.

I know this is a rhetorical question, but when did the public airwaves
stopped being the property of the public?  Thank you Ronnie and Pappy, you
senile old c**ts!  Enron my Aunt Fanny!  That was the tip of the preverbal
iceberg.  The Land of the Free is the Home of the Payoff!  God Bless George
W. Bush!  Then again, I really don't believe in God.

I don't have my copy of this morning's paper, but the article in the Times
had a list of radio stations in the Los Angeles/Orange County and
Riverside/San Bernardino markets they own, and I think it was approaching 15
stations, just in LA.  Recently, I started a new job, where I am subjected
to one of these stations (and perhaps the worst radio station ever
programmed), K-Big 104.  With the exception of disco during the noon hour,
there is probably a total of 40 songs on this station's playlist.  Do you
know how flippin' 'orrible it is having to listen to Turn The Beat Around
(not even the Vicki Sue Robinson version--I get Gloria Estevez and her boom,
chicka, boom, chicka) and what has to be the worst band of our time--Sugar
Ray!  Then again, from what I hear about a certain member of that group,
they should be called Marvelous Marvin!

If it wasn't for the occasional blast of sanity from that darn Nissan ad
(who is that band that plays on all of their commercials BTW??) and Pink,
because I CAN go for miles, if you know WHAT I mean . . . . I would jump out
the window!

Anyway, enough ranting for one evening.  Enjoy the article.

BW Radley
**********
Clear Channel: Empire Built on Deregulation
 Media: CEO L. Lowry Mays went shopping after Congress eased ownership
limits. Now the company's size is drawing complaints.



By JEFF LEEDS, TIMES STAFF WRITER


To see how deregulation can turn an obscure businessman into a sudden power
broker, look no farther than Texas radio billionaire L. Lowry Mays.

Six years ago, his modest San Antonio-based chain Clear Channel
Communications Inc. owned 36 radio stations, four under the legal limit.
Then Congress did away with most radio station ownership limits and Mays
went on a frantic shopping spree.

Today, his sprawling empire covers all 50 states, with 1,225 radio stations,
about 10% of the nation's total, plus the country's biggest live-concert
promotions firm, 19 television stations and 770,000 billboards. In a decade,
Clear Channel's sales have jumped from $74 million to about $8 billion last
year, a stunning 100-fold increase. But Clear Channel's rapid expansion is
provoking allegations that the radio giant is bullying recording artists and
skirting station ownership rules. Consumer advocates point to the
conglomerate as a symbol of the results of media deregulation--one that
should be examined after a federal court ruling last week that could open
the door to more consolidation in the television and cable industries.

"Our worst fears have been realized," Andrew Jay Schwartzman, president of
the watchdog organization Media Access Project, said Friday. "A lot of the
things Clear Channel is doing are the traditionally questionable industry
practices, now on steroids."

Clear Channel's executives say they have done nothing improper and tout the
benefits of continued deregulation.

Last month, Rep. Howard L. Berman (D-Mission Hills) urged the Justice
Department and the Federal Communications Commission to probe reports that
Clear Channel punished stars, such as Britney Spears, by refusing to play
their songs on Clear Channel radio stations because the musicians declined
to hire the company as their tour promoter.

If the allegations are true, such acts would "exacerbate the negative
effects consolidation has had on recording artists, copyright owners,
advertisers and consumers," wrote Berman, a senior Democrat on the House
Judiciary Committee.

Concern about Clear Channel's vast size also has spread to Wall Street.
Struggling under $9billion in debt, Clear Channel has racked up four
straight unprofitable quarters. It will report its annual results Tuesday.
Meanwhile, the company's stock closed Friday at $48.39, about half its
record high of two years ago.

Clear Channel says that cost cutting will cushion the company as it slogs
through the advertising slump and that it eventually will see increased
profit.

One cost-cutting strategy Clear Channel is betting on is repackaging radio
shows across the country. The conglomerate is using so-called voice tracking
on a scale that would have been unthinkable before deregulation.

In 48 cities, millions of radio listeners each week tune in to a station in
their market calling itself Kiss FM. Many of the deejays are in Los Angeles,
working for Clear Channel's pop powerhouse KIIS-FM, but listeners in smaller
markets across the country may hear Rick Dees joking about their local news
or Sean Valentine trumpeting upcoming concerts at their local amphitheater,
as well as a similar playlist laden with bands such as 'N Sync and Linkin
Park.

"Kiss" programming recorded in Los Angeles is exported to Des Moines and
Jacksonville, Fla., as a series of taped moments, from phone calls to song
intros, that are spliced together to sound as if the deejays are chatting
from a studio down the street.

The voice-tracked segments, music and commercials can be whisked from one
station to another on a digital network that is potentially available to 80%
of Clear Channel's stations. Producers cut and paste the segments to create
the appearance of deejays taking live requests and calls from listeners, or
even record half of a conversation for a live deejay to interact with.

Clear Channel touts this as a technique that delivers big-city deejay talent
to small markets that couldn't otherwise afford it.

*

Controversy Over Radio Program Repackaging

"Our Kiss brand is like McDonald's," said Todd Shannon, a Clear Channel
brand manager overseeing many of the stations. "When you see the Kiss ball
logo, there's no mistaking what you're going to get. It's a Top 40 product,
but they're all localized inside."

But competitors say the Kiss format doesn't benefit Clear Channel, listeners
or the radio industry.

In Chicago, Clear Channel converted an oldies station to a Kiss outlet that
now only offers a local deejay during the afternoon and evening shifts,
company officials said. "Everything else is the robot," said Todd Cavanah,
program director of competing pop station WBBM-FM.

"They're making radio into spoon-fed generic" junk, said Mike Spencer, who
programs rival pop station KLUC-FM in Las Vegas, where Clear Channel
introduced a Kiss station. "They're turning listeners off. It gives
listeners one more reason not to listen to radio but to turn on their
computer or use CDs," Spencer said.

Clear Channel's campaign so far has yielded mixed results--newly branded
Kiss stations have upset dominant pop stations in such markets as Cincinnati
and Boise, Idaho, but failed to gain much share in some bigger markets,
including Chicago.

Voice tracking also has prompted some concern among authorities in the past.
Two years ago, Clear Channel was fined $80,000 by the Florida attorney
general for misleading radio listeners into thinking that a national contest
was local, in part because the company dubbed a local deejay's voice into an
interview with a winner.

Clear Channel touts the benefits of cross-promotion, or leveraging one asset
to benefit another. Yet critics say Clear Channel's idea of synergy
essentially means it hoards radio programming, concert tickets, access to
stars and concert advertising dollars for itself.

Clear Channel owns Premiere Radio Networks, which has been shifting its
syndicated radio shows, such as Jim Rome's sports talk fest and Rush
Limbaugh's political program, from competitors' to Clear Channel's stations.

Artist managers also are nervously eyeing Clear Channel's expansion of
station-sanctioned concerts, commonly known as radio shows.

Representatives of various artists have said for years that broadcasters
coerce acts into playing the shows for little or no fee by refusing to air
their latest songs unless they appear.

Regulators have said the practice of trading airplay for an artist's
appearance without disclosing the deal is a violation of federal anti-payola
laws. Since 1960, federal law has forbidden broadcasters from accepting
money or anything of value in exchange for airplay without disclosing the
payment.

But Clear Channel executives say their events, such as KYSR-FM's annual "Not
so Silent Night" concert, fairly compensate acts and aren't forced upon them
with threats.

Running a radio powerhouse is a far cry from Mays' early days, when he
studied petroleum engineering in college. People who know Mays say the
65-year-old former investment banker never imagined he would control such a
sweeping empire.

Salesmanship always has been his forte, said John Barger, a former executive
of the company, who helped Mays and partner B.J. "Red" McCombs, run their
first small radio stations.

Before building a radio empire, Mays worked for a local investment house and
commuted to New York. The first stock he pitched was that of a small photo
processing company, Barger recalls.

To identify prospective investors, Mays paid a neighborhood youth $10 to
copy license plate numbers from cars parked in front of the company's local
store, then paid another youth to visit the Department of Motor Vehicles to
pull addresses for each of the cars, Barger said. Each one received a letter
from Mays suggesting they invest in the company.

Mays got into the radio business almost by accident.

In 1972, Mays and McCombs purchased an unprofitable FM station after a local
furniture dealer convinced Mays of its potential, Barger said. Two years
later, Mays purchased San Antonio's WOAI-AM--one of about 25 designated
"clear channel" stations, granted a frequency free from interference. He
turned it into a news-talk station and slowly added more properties.

Mays took the company public in 1984 and started to buy up stations,
developing a reputation as a cost cutter. Even now, critics deride the
company as "Cheap Channel."

*

Strong Ties to the Bush Administration

Mays also has a long-standing interest in politics, backing candidates
seeking everything from the San Antonio mayor's office to the White House.

While governor of Texas, President Bush appointed Mays to a state technology
council in 1996. Mays contributed $51,000 to Bush's 1998 gubernatorial
campaign.

Clear Channel also contributed $106,000 to the Republican National Committee
during the presidential election cycle, with Mays and his wife, Peggy,
donating an additional $37,000 to the party.

And the Justice Department's current antitrust chief, Charles James,
formerly headed the antitrust department at the Washington law firm that
represented Clear Channel when the company sought regulatory approval of its
purchase of radio broadcaster AMFM Inc. in 2000, when it also purchased
concert promoter SFX.

Buying entertainment giant SFX cost Clear Channel $4.4 billion, making it
instantly the nation's biggest promoter with $2 billion in live-event
revenue a year.

Among the thousands of concerts, family events, Broadway shows and other
events it took on after the SFX deal, Clear Channel also found itself
putting on Supercross motorcycle races. But last year Clear Channel and the
motorcycle industry's trade association began exchanging blows after
contract renewal talks broke down.

Senior officials at the American Motorcyclist Assn., which sanctions
Supercross races, say Clear Channel has sought to undermine the organization
since the association ended its contract with the company.

Clear Channel now is planning to promote its own Supercross series with a
European sanctioning body.

AMA officials hired a new promotion firm to run its events, and they say
that Clear Channel is pressuring stadium operators to sign deals
guaranteeing the conglomerate the exclusive right to promote motor-sports
events.

Ken Hudgens, vice president for marketing at Clear Channel's motor-sports
division, said the AMA "can go out and do whatever they want to do.... We do
what's right for our business."