I Can See Clearly Now

It’s a crystal clear Ozark morning. Yesterday, it was about 65 degrees and lovely. The day had a feeling of the true start of spring.

I don’t know why this media stuff fascinates me so, but it does.

Clear Channel and three lesser radio conglomerates have agreed to pay 12.5 million in a F.C.C. payola settlement. So, payola isn’t dead, you just need lots of cash. The big four (Sony, Universal, EMI, Warner) record labels, settled for 30 million. One wonders what kind of dough actually changed hands if the guilty parties cleaned their collective concsience with 42 mil.

With all of this payola and settling going on I guess they decided to “level” the playing field. In a seperate agreement with American Association of Independent Music ( a non-profit organization whose board of directors are execs for independent labels with major label distribution; or big 4 lite), the stations will be playing indie artists. The stations agreed to do 8,400 half hour segments, which works out to less than five segments per year per station; less than a pittance.

Meanwhile Clear Channel is trying to convince stockholders to go for a leveraged buy-out and it seems that the investors are smart enough to not fall for it.

Clear Channel has upside for two reasons.

First; the XM/Sirius merger. Even though Mel Karmazin is trying to convince the F.C.C. that a proposed merger will offer the consumer more choice, it won’t. XM/Sirius will cut costs by eliminating redundant programming and thus reducing satellite time. After all is said and done, there will likely be consumer backlash and listeners can always tune out and turn on the old Clear Channel. The irony, of course, is Clear Channel’s opposition to the merger based on anti-trust.

Second; billboards, Clear Channel Outdoor is a huge billboard outfit. With the advertising business in a panic almost as bad as the floundering music biz, the fact is, you can’t Tivo a billboard. Clear Channel Outdoor’s stock is up.

A tangled web for sure, it makes one curious as to who stands to proft from a buy-out. This is from a letter that was sent from Clear Channel to investors on March, 2.

â€œThe disinterested directors considered a full range of alternatives other than the sale of the company, including a sale or spin-off of CC Outdoor, a recapitalization, share repurchase and special dividend, as well as remaining as an independent company.â€

I’d keep an eye on the “disinterested directors”.