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Clear Channel, Tennessee broadcasters lobby FCC against XM/Sirius merger

by Matthew Lasar  Apr 14 2007 - 10:03am     

Clear Channel Communications is leading a small battalion of Tennessee area broadcasting groups against Federal Communications Commission approval of a merger between XM and Sirius satellite radio.

Clear Channel says the move will give XM/Sirius an "unfair spectrum advantage." But now the radio giant has to explain why media consolidation is good for the goose but not for the gander. The company has long protested FCC rules that limit to eight the number of radio stations that it can buy in a designated market.

Clear Channel, in tandem with three other groups, met with the FCC's Deborah Taylor Tate on April 6th to lobby hard against the proposed XM/Sirius union.

"The broadcasters noted their concerns with the XM-Sirius merger and its adverse impact on free radio and listeners," their public filing, dated April 12th, concludes.

Clear Channels' partners in this move include Whit Adamson, President, Tennessee Association of Broadcasters, and radio station owners Bayard "Bud" Walters of the Cromwell Group, and Craig Jacobus, President of South Central Communications.

During the meeting, it appears that Tate, a proud Tennessee native, posed the obvious challenge to Clear Channel Vice President Thomas English. Tate suggested that there "were questions regarding the reconciliation of your statements about the consolidation of terrestrial radio vs. the XM/Sirius merger," according to the Clear Channel public filing.

Or, to put it another way, how can Clear Channel oppose satellite radio consolidation as anti-competitive when it constantly lobbies the FCC to lift its cap on the number of terrestrial radio stations a single entity can own in big markets?

In response to Tate's concern, English asked Clear Channel's Government Affairs division to clarify the company's position, and included the statement in the April 12th filing.

The company's arguments "might be a little skewed toward our specific goals (imagine that) but I hope you find them helpful," English wrote in the introduction.

Clear Channel's variations-on-a-theme response to Tate makes the same case in three different ways:

• An XM/Sirius merger and the FCC's current local radio ownership rules "seriously distorts the marketplace."

The merger "would jeopardize the ability of free, over-the-air radio to carry out its core mission of providing local news and information," the company argues:

"Similarly, the current local radio ownership rules are so restrictive, especially in large markets, that they distort the marketplace by depriving companies of the ability to realize ordinary efficiencies of operation while providing no meaningful countervailing benefits."

• Letting XM and Sirius unite without letting Clear Channel consolidate radio in big markets gives the former "an unfair spectrum advantage."

XM/Sirius' alleged advantage would give the new company "the ability to reach 100% of satellite radio listeners both locally and nationally, transmit more than 300 channels into every local market, lock up quality programming, and siphon off advertising revenue (first nationally then locally)," the statement claims.

"Local broadcasters simply cannot compete in a meaningful way with such unequal regulatory treatment."

• "If the market is defined as all audio services, the proposed XM-Sirius merger would have one company controlling more spectrum in every market in the country than the AM/FM band combined," Clear Channel concludes.

Instead of giving XM/Sirius what they want, the FCC should focus on "how to ensure the continued vitality of free radio by moving forward on its review of reasonable relaxation of the local ownership rules."

The Clear Channel filing also responded to what it said was Tate's request for contacts at the University of South Florida "to discuss younger listening habits."

According to the filing, the company's Tampa, Florida market manager Dan Diloreto suggested mass communications professor Edward Jay Friedlander, media convergence specialist Kenneth C. Killebrew Jr., mass communications ethics scholar Larry Z. Leslie, and the University of Florida College of Journalism's Terry Hynes and Rebecca Hoover.


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