Radio's big bully

Dirty tricks and crappy programming: Welcome to the world of Clear Channel, the biggest station owner in America.

By Eric Boehlert

Apr 30, 2001 | In the late 1990s, while no one was looking, a corporate behemoth became the largest owner and biggest force in America's most venerable mass medium: commercial radio.

Radio stations that once were proudly local are now being programmed from hundreds of miles away. Increasingly, the very DJs are in a different city as well.

Want your record played on one of those stations? Be prepared to pay -- dearly -- for the privilege. Want your band's concert to be sponsored by a radio station? Be careful: If you pick a competitor, the behemoth might pull your songs off its playlists overnight -- from two, 10, 100 stations.

Looking for classy radio programming? Don't look here. The company is known for allowing animals to be killed live on the air, severing long-standing ties with community and charity events, laying off thousands of workers, homogenizing playlists and a corporate culture in which dirty tricks are a way of life.

Welcome to the world of Clear Channel -- radio's big bully.

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It was a bittersweet night last June for the 40 to 50 radio executives and on-air personalities from the AMFM Network, including countdown king Casey Kasem. The scene was the famous Spago restaurant in West Hollywood for a night of eating and drinking on the company tab.

It was sweet: Everyone was in town for the annual R&R trade magazine industry convention, and it was a rare opportunity to schmooze with colleagues face to face at the plush Sunset Boulevard eatery.

Bitter though, as well, because the dinner marked the end of 460-station AMFM as an independent entity. Its parent company was being purchased by Clear Channel Communications -- for a stunning $24 billion.

Many in the room recognized that in the compressed world of radio consolidation, AMFM as they knew it would cease to exist and many of them would soon be squeezed out of jobs.

Indeed, that same night at Spago, Clear Channel's radio chief, Randy Michaels, just happened to be holding court along with half a dozen minions of his own. A true radio original, Michaels had achieved legendary status inside the business as a shock jock (before there was a Howard Stern), and an effective but often tasteless programmer.

Michaels moved into management in the 1990s. Today, as Clear Channel's guardian of the airwaves, the bombastic exec is among the most powerful, not to mention colorful, men running the music business.

"Everything's a food fight with him," says one radio executive, who says Michaels is still a morning man at heart. "He's paranoid, disingenuous, pathological. That's what makes him so lovable."

The mood at Spago was cordial. Michaels even wandered over to the AMFM party to give a rah-rah speech about the upcoming AMFM/Clear Channel partnership.

As the party wound down and the crowd cleared out, two AMFM producers were unexpectedly waved over to the Clear Channel table by Michaels and his friend Kraig Kitchin, who runs Premiere Radio Networks, Clear Channel's powerful syndication arm.

According to industry sources, Michaels and Kitchin proceeded to grill the producers about AMFM shows and personnel. The producers, somewhat loquacious after an evening of food and spirits, spoke frankly, disparaging many AMFM initiatives and radio personalities.

Within days, AMFM Network president David Kantor heard from Kitchin. Kantor was told that once the merger was through, the two producers who'd spoken so bluntly would be let go. Michaels, Kitchin said, was not happy. Kantor was even given proof of the producers' bad-mouthing; the conversation at Spago had been surreptitiously recorded by a cellphone on the table. Kantor had been played parts of it.

"These guys didn't even work for Clear Channel yet and they were set up," says a former AMFM employee. "They used that conversation to fire them. Here's the head of Clear Channel and he's taping conversations? It's insane. It was a classic Randy Michaels dirty trick. He was just fucking with their heads; that's what they do."

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Radio companies used to be severely constrained from owning what from the government's perspective was too many stations. Companies could own only two in any one market and no more than 28 nationwide. Government policy enforced the notion that radio was broadcast on the public airwaves and had an accompanying public trust. Local stations were supposed to be assets to local communities. The ownership rules were designed to keep ownership as diverse as possible and keep the stations' focus as local as possible.

All that changed in the 1990s. Five years ago, President Clinton, pressured by a GOP-controlled Congress, signed into law the Telecommunications Act, which essentially did away with ownership restrictions on radio. Now, just a handful of companies control radio in the 100 largest American markets.

Of these, Clear Channel rules the horizon with 1,200 stations, which generate more than $3 billion annually in revenues.

How big is Clear Channel? The company owns stations in 247 of the nation's 250 largest radio markets. Clear Channel in particular dominates the Top 40 format (KIIS-FM in Los Angeles, WHTZ and WKTU in New York, KHKS in Dallas, WXKS in Boston, WHYI in Miami, etc.) and controls 60 percent of rock-radio listening.

While radio's mad dash of consolidation was perhaps inevitable, it has still sent shock waves through the industry. Indeed, it's hard to say which puzzles the industry more -- that one company has so quickly amassed such an enormous, 1,200-station roster or that a former shock jock like Michaels is running it.

Next Page: Playing hardball with Arbitron

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