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Update: L.A.'s Mt. Wilson won't back down on Clear Channel anti-competitive charge
by Matthew Lasar  Mar 15 2007 - 3:10pm     

It is unclear whether Clear Channel has formally answered Mt. Wilson Broadcasters Inc.'s latest assertion that the radio giant uses its clout to monopolize radio advertising in Los Angeles.

"The facts are that some advertisers do allocate all of their radio advertising budget to Clear Channel stations and, further, that some advertisers understand that the 'better advertising rates and promotion packages' are conditioned upon the advertiser devoting 100% of its radio advertising budget to Clear Channel stations," Mt. Wilson writes in a statement filed with the Federal Communications Commission.

On January 19th, Mt. Wilson, which owns two radio stations in Los Angeles, filed comments with the FCC accusing Clear Channel of anti-competitive behavior. Specifically, Mt. Wilson charges that Clear Channel, which owns eight AM and FM radio stations in LA, demands a "quid pro quo" relationship from advertisers.

"The Clear Channel modus operandi allows the advertiser to utilize any one or all of the Clear Channel stations and, further, to receive discounts," Mt. Wilson's filing claims:

"The 'quid pro quo,' however, requires the advertiser to devote all of its radio advertising budget to Clear Channel stations and to refrain from placing advertisements on any other Los Angeles radio market stations."

To back this charge, Mt. Wilson's FCC filing included affidavits signed by Mt. Wilson President Saul Levine and the firms' advertising sales staff. The company's Petition to Deny asked the FCC to block Clear Channel's recent bid to go private by transferring its properties to BT Triple Crown Co., or at least to impose a condition "that it will immediately cease its anti-competitive conduct."

But Clear Channel denies Mt. Wilson's assertions and calls the smaller firms' comments "completely devoid of facts." The company's February 1st response included an affidavit from Jeff Thomas, Vice President and Director of Sales for Clear Channel, Los Angeles.

The Mt. Wilson petition, Thomas declared, "does not provide enough specific facts to allow me to research and address the seven encounters Mt. Wilson personnel allegedly had with certain local advertisers in 2003 and 2006."

"I can confirm that we do not have either an oral or written policy of requiring advertisers to devote all of their radio advertising budget to our stations," Thomas continued.

Mt. Wilson's latest response, dated February 12th, insists that whether Clear Channel has a clear policy or compels all of its advertising customers to stay with the company, it has in some instances put pressure on some clients to do so.

"Irrespective of the Thomas denial of a Company policy requiring 100% of the radio advertising budget to be devoted to Clear Channel stations," Mt. Wilson says, "the facts demonstrate that at least some of Clear Channel stations, Clear Channel employees led advertisers to believe/understand that the benefits/discounts offered by Clear Channel were conditioned upon the advertiser devoting 100% of its radio advertising budget to Clear Channel stations."

The filing suggests several options for the FCC: either an investigation of Clear Channel employee supervision, or FCC sanctions against the company.

"To ignore the Mt. Wilson Petition would be irresponsible and politically, defenseless," the statement concludes.

The FCC's database on this proceeding has yet to indicate a response from Clear Channel to Mt. Wilson's latest comments.

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