Business Brief/ad news:
Clear Channel Empire Break Up
Clear Channel announced a spinoff of its concert division and an IPO of 10% of its outdoor-advertising unit.
The moves are an acknowledgment of the difficulties Clear Channel, which is set to announce its first-quarter earnings today, faced in trying to build an entertainment juggernaut whose radio and concert operations fed off each other. Clear Channel thought its combination of assets would create a powerful, across-the-board platform for advertising sales on its billboards, at concert and sports venues and on its 1,200 radio stations.Instead, the combination irked music fans, record labels and artists, who complained that Clear Channel used its might to punish artists who didn't play by its rules and contributed to the sharp rise in ticket prices at venues it controls. Clear Channel has denied such allegations, but it has never been able to shoo-away the notion that it had too much leverage in too many corners of the music world.
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Clear Channel figured its radio stations and billboards could shill upcoming concerts, and performers would gravitate to its venues for the extra marketing. The radio stations would push concert offerings in each market, and the concert and sports arenas could promote the radio stations.But Clear Channel didn't get the anticipated boost. Instead, its empire opened Clear Channel up to charges of monopolization and went on to become a public-relations disaster. Music fans -- already angry at the radio consolidation they believed had sucked the personality out of local stations and put too much control in the hands of a few big chains -- now latched onto the fact that the nation's largest radio owner now was also the nation's largest concert promoter. Rising concert ticket prices, to pay for larger artist guarantees, added to their disdain.
{Business}
