City looking to screw taxpayers
Inside Liberty Watch Today - Aug. 17, 2005

Clear Channel Founders Never Welched On Anything.

Once upon a time (about 1975) in a place far, far away (San Antonio), three Texans acquired a radio station which was so powerful that it was assigned its own channel. A clear channel. This, not coincidentally, became the name of their company.

These were classic Texans.

Their word was their bond, you could take their hand-shake to the bank, and they always treated their friends and competitors alike with great respect. But they saved their best for their customers. So much so that even today, their corporate creed says, in part: "We believe in maximizing our customer's satisfaction, we will deserve and will earn their continued loyalty. Our goal is to have long term, mutually profitable relationships." L. Lowrey Mays, B.J. McCombs and John Barger all genuinely believe that.

Mays and McCombs are still with the company, Barger left for other radio ventures in the early 90’s and under Mays' leadership, Clear Channel currently owns more than 1200 radio stations, 36 television stations, 776,000 outdoor advertising displays and the leading live entertainment company and from a relatively small radio company, Clear Channel now has over 50,000 employees.

Fast forward to 2005.

It would appear that some of those employees haven't ever read their corporate creed, or if they have they seem to think that those values which Mays followed to build the company no longer apply. It seems that standing by a contract with the Commission for the Las Vegas Centennial (really the City of Las Vegas)-a contract which they already had to renegotiate once when they failed to perform-is too much trouble. Much easier to whine about how much money they lost in producing the Red Hot Chili Peppers concert last July and ask the city to make good their losses. Never mind that the failure to perform was entirely theirs. And never mind that in addition to the sales commissions they made-or could have made-selling sponsorships, they were also paid production fees out of the revenues of the merchandising.

The entertainment subsidiary of the biggest broadcaster in the world-a company which generated $2.4-Billion (with a B) in free cash flow last year-wants $627,209 as a rebate from the city. And there are at least a few people in city hall who might be silly enough to seriously consider that. After all, it's not their money.

Here's what really happened:

Clear Channel Entertainment entered into a deal which they couldn't live up to. The "leading" live entertainment company in the world had to renegotiate the first contract when they couldn't come up with a sponsor on time. And now, after the fact, they want to renegotiate the second contract. Now if this were a business in danger of a Chapter 11 filing, we might have some sympathy. But they're part of a company which earned $845-million on $9.4-billion in gross revenue in 2004. They are truly in a league of their own. And, to paraphrase a line from a movie of that name, "There's no whining in business!"

What has happened is that concert revenue is down and Clear Channel wants to spin off the entertainment subsidiary. So it would appear that every loss must be mitigated-even those less than a mere million dollars. Does Lowrey Mays know what is going on? Possibly not.

You see, among those 50,000 employees are a "chief communications officer" (public relations flack) who won't take phone calls and an assistant who needs to be prodded to return a call by another executive's assistant. She told the Penny Press that such questions were to be answered by the pr flack at the entertainment division. He then called (like he had intended to all the time) and said that "the company doesn't comment on its relationships with 'its clients'" (That means us.)

So, we're going to take the opportunity to email a copy of this week's newspaper to each of the executives who should care. And Lowrey Mays. Because we simply cannot believe that Mays (who built Clear Channel by answering his own phone) would allow business to be done this way at the company he founded.

FRED WEINBERG
Penny Press Publisher