CLEAR CHANNEL’S CONSOLIDATED STATE COMES UNDER FIRE

The L.A. Times reports that some advertisers and competing broadcasters have petitioned the FCC alleging the conglom is "evading federal law and misleading regulators." It claims Clear Channel is controlling more stations than the 1996 deregulation law—which raised the number of stations in a particular market a single company could own from four to eight—allows.

The petition points to the San Antonio-based media giant’s deals with 75 stations to take over their programming, with joint sales agreements that allows them to sell advertising time. Clear Channel claims these arrangements are within the letter of the law, and small radio chains which have struck such deals insist they operate independently of the conglomerate.

The Times goes on to report most of the company’s involvement with such marketing and joint sales deals involves San Antonio lawyer Van Archer III, who has stakes in companies that own 15 radio stations, several in markets where Clear Channel is legally barred frown owning more. All 15 have sold back their advertising rights to Clear Channel and Archer has several other business ties to the company. He insists his arrangements represent "no impropriety."

One company, Texas-based Chase Radio, where Archer controls 49%, owns at least six stations, including KBRQ Waco—which Clear Channel was forced to sell after its merger with AMFM in 2000—allegedly still run by the radio monolith. Chase had asked the FCC to approve a plan to sell the station back to Clear Channel, but has since withdrawn its request.

Another sale which has come under scrutiny is Clear Channel’s attempt to purchase one-time Jacor station WKKJ in Chillocothe, OH. Jacor originally sold WKKJ to Secret Communication II, a small firm owned by one-time Jacor Prexy Frank E. Wood, which then handed control of its programming and advertising to Concord Media Group. An FCC petition alleges Concord Media is another front company for Clear Channel. In a legal filing, Concord Media said, "It would be very difficult to purchase a station in a market where Clear Channel does not have a presence."

You can say that again.

Consumer advocacy attorney Jay Schwartzman blames loopholes in the 1996 telecommunications deregulation for the current dispute. "It was supposed to end those evasions by making the broadcaster limits high enough to satisfy all but the greediest," he told the Times. "But the greediest have kept at it."

The FCC is expected to raise the number of stations a company can own in one market later this year. Insiders say Clear Channel has quietly been striking "arrangements" with several outlets they expect to acquire, effectively "warehousing" them until the regulations are eased.