Clear Channel Communications, the parent company to SFX Entertainment and one of the world's leading radio broadcasters and billboard advertising companies got a boost this week from the FCC. On March 12, the agency addressed three quarters of the cases comprising a major "backlog" of merger reviews and gave its blessing to some 32 outstanding deals.
Clear Channel and Cumulus Media are the major broadcasters said to be affected by the government's sweeping merger approvals. A call to Clear Channel's headquarters in Texas was not returned by press time.
The approval of the radio station mergers reflects a change in policy for the agency, which is motivated to expedite its authority and issue determinations quickly under the new administration. The Associated Press ascribes FCC chairman (and Bush appointee) Michael Powell with a policy of acting quickly and stressing "the importance of speeding up FCC decisions, favorable to companies or not, so they can make appropriate business plans and not face uncertainty in a changing marketplace." The changing marketplace Powell describes is a euphemistic reference to the dramatic decline in the advertising business nationwide that began with the presidential election last November.
The radio mergers will affect the bottom line at Clear Channel and will have some indirect—but nonetheless measurable—effect on the overall financial health of SFX. On a broader plane, those opposing the FCC approvals say that regionalism is threatened when fewer and fewer broadcasters acquire singular control of local markets.
Both Clear Channel and SFX can be singled out for successful histories in terms of mergers and acquisitions and both companies have thrived in the less restrictive era that began with the passage of the Telecommunications Act of 1996. SFX was acquired by Clear Channel on Aug. 1, 2000. Clear Channel has also purchased radio broadcaster AMFM. The company now operates 1,140 radio and 18 television stations in the United States and has equity interests in over 240 radio stations internationally. Clear Channel also operates more than 750,000 outdoor advertising displays, including billboards, street furniture and transit panels across the world.
After an aggressive acquisitions campaign in sports and entertainment, SFX Entertainment established an early lead in marketing “live experiential” events. SFX develops and manages touring Broadway shows, and sells Broadway subscription series and individual productions in 55 markets. An integrated franchise that promotes and produces a broad variety of live entertainment events locally, regionally and nationally, SFX has 122 venues overall, and owns or operates venues in 31 of the top 50 domestic markets.
—By Murdoch McBride
