Consolidation:Fact, Fiction and the Future

Ed KrampfRegional Vice President, Northern California

Is This Really Consolidation?

13,000 radio stations

3,800 owners

Multiple ownership voices in every rated US market

What Industries are Really Consolidated?

Top Companies / Market ShareWireless Telecommunications Companies – 8/87.2%

Car Rental Companies –6/93.5%

Automotive – 6/86.8%

Airlines – 10/91.3

Pharmaceuticals – 10/67.7%

Beverages – 10/63.4

Radio – 10/43.1% (revenues)Radio – 10/ 16.8% (stations)

Media Consolidation?

Record Companies – 5/84.5%

Movie Studios – 8/84%

Cable Television – 10/67.4%

Radio – 10/43.1% (revenues)

Radio – 10/16.8% (stations)

Clear Channel Radio is Centrally Controlled ...

Clear Channel Radio Corporate Staff in San Antonio:

15 Peopleincluding assistants

Clear Channel Radio is 275 Local Businesses

250 General Managers

300 Traffic Directors

900 Program Directors

750 Sales Managers

400 Engineers

30,000 local employees working at:

1,229 local radio stations

Glenn BeckRallies for AmericaGlenn’s Rallies promoted on all affiliates’ airwaves

Clear ChannelABC/DisneyInfinityEmmis

They were Glenn’s Rallies – Not Clear Channel’s

Clear Channel Has a Political Agenda

Prohibited titles after 9/11?Didn’t happen

Banned Dixie Chicks after Natalie Maines’ statement

Wasn’t us

National politically motivated playlists?There aren’t anyNever have been

Clear Channel Has a Political Agenda

Clear Channel Personalities Promote a Single Political Agenda

EntertainingCompelling ContentInformativeHold Their AudiencesHigh-ProfileUnique & Consistent PerformersDeliver Results

It’s Not the Politics!

Just likeThe demise of the 30 minute radio dramaRecordsDisk JockeysRock & RollThe death of the single takeSplicing tapeThe ETThe radio cartThe CDThe digital editor

Technology is Ruining Radio ...

The younger generation has been ruining radio for the last 75 years!

To Every Old Radio Warrior ...

Clear Channel alone:

Over 2 million research calls

Over 10,000 regularly scheduled annual local research reports

Local market research - Spend over $1million locally

Test thousands of individual titles

Response to hundreds of local radio personalities

Measure desires of thousands of radio listeners

More local research than ever before

Radio is Too Homogenized ...

More Musical DiversityBetween January and April 1999 radio exposed

Just over 33,000 songs performed byJust over 7,000 artists

Between January and April 2003 radio exposed

Almost 58,000 songs performed by

Over 11,000 artists

Radio is Too Homogenized ...

Only on monitored stationsOver 1,000 never-aired artists in the last 12 monthsKKSF new artist showcaseArtists like ...

Radio Doesn’t Expose New Artists

Buddy JewellDierks BentleyJimmy WayneHeather HeadleyKelly Clarkson

DJ SammyTamyra GrayClay AikenJustin GuariniRuben Studdard

Diversity

Talent Development

Local Service

Format Variety

Consolidation Has Been Bad ...

Format Diversity

In 1993, The M-Street Radio Directory listed 32 recognized radio formats

In 1999, 34 are listed

In 2003, M-Street lists 83 radio formats

The Facts

Dominant #1 Choice OfDominant #1 Choice OfAfrican-Americans !African-Americans !

Arbitron, San Francisco Metro, Spring 2003, Mon-Sun 6am-12mid, Black AQH Shares,KCNL Is A Chase Radio Property In A JSA With Clear Channel

0.5

1.5

5.1

7.1

18.3

50.8

Susquehanna

Disney

Bonneville

Infinity

Inner City Bdcstg.

Clear Channel Radio

2.2

2.9

2.9

8.6

24.6

44.0

Disney

Susquehanna

Bonneville

Infinity

Inner City Bdcstg.

Clear Channel Radio

3.0

3.2

4.0

8.1

25.1

41.3

Disney

Susquehanna

Bonneville

Infinity

Inner City Bdcstg.

Clear Channel Radio

BlackBlack AdultsAdults 18-3418-34

Black Adults 18-49Black Adults 18-49

Black Adults 25-54Black Adults 25-54

Clear Channel Radio Delivers Clear Channel Radio Delivers The #1 Share of African-Americans Across All DemosThe #1 Share of African-Americans Across All Demos

#1 Choice of #1 Choice of Hispanics !Hispanics !

Arbitron, San Francisco Metro, Spring 2003, Mon-Sun 6am-12mid, Hispanic AQH Shares,KCNL Is A Chase Radio Property In A JSA With Clear Channel

1.5

1.6

3.9

8.2

11.0

24.0

25.6

Disney

Susquehanna

Bonneville

Infinity

Entravision

Hispanic Broadcasting

Clear Channel Radio

Hispanic Adults 18-34Hispanic Adults 18-34

2.0

3.7

3.7

9.3

11.5

19.7

22.6

Disney

Susquehanna

Bonneville

Infinity

Entravision

Hispanic Broadcasting

Clear Channel Radio

Hispanic Adults 18-49Hispanic Adults 18-49

2.7

5.1

5.1

10.3

11.0

18.2

18.3

Disney

Susquehanna

Bonneville

Infinity

Entravision

Hispanic Broadcasting

Clear Channel Radio

Hispanic Adults 25-54Hispanic Adults 25-54

Even Beating The Spanish StationsEven Beating The Spanish Stations

Ethnic Composition Mirrors The Market !Ethnic Composition Mirrors The Market !12+ Ethnic Composition12+ Ethnic Composition

Arbitron, San Francisco Metro, Spring 2003,Mon-Sun 6am-12mid, Persons 12+, Cume Persons %,

KCNL Is A Chase Radio Property In A JSA With Clear Channel

Hispanic20%

Other 68%

Black12%

Clear ChannelClear Channel

MarketMarket

Hispanic18%

Other 74%

Black8%

More News & Information available than ever9/11ColumbiaIraq

Ability to venture into formats that single-station owners can’t riskBetter Neighbor with More to Offer the Local CommunityRaise Millions to Serve Millions

The Facts About Consolidation

12th Annual Mariachi Festival Gay Pride 2003 PuebloAIDS WALK SF George Washington HS Free Dance Rape Awareness Hotline - East Bay

AIDSWALK 2003 Girl Scouts of America Red Cross Aisles of Smiles / Albertsons Glide Memorial Redwood City Multicultura Festival

Alameda County Social Services Golden State Spirit Association Renel Birthday Benefit: Breast Cancer, Heart Disease, United Alta Bates Summit Foundation Henry Gunn HS AIDS Dance Fundraiser Richmond Music on The Main

American Heart Association & Stanford Vascular Research HIV / AIDS Hep C Nightline Richmond Youth CenterAmerican Lung Association Hunter's Point Bay View Community Center Ride Muni Free

ARIS Hunter's Point After School Program Rock The VoteAsian American Recovery Services IAM Benefit show for local Toxic Epidermal Necrolysis Victim Rubicon Foundation

Avon Breast Cancer Walk Industry Next San Francisco Carnaval Avon Breast Walk James Lick HS Car Wash Fundraiser San Jose Cinco De Mayo

BAJobs.com Jim Lange Golf Tournament, Alzheimer's Association San Jose Downtown AssociationBaskin Robbins Book Charity Juneteenth Celebration Committee Oakland / SF San Jose Juneteenth

Battle of the Best Ballgame Kids Conquer Cancer @ Six Flags San Jose Mexican American Community Servicee Agency Bay Area Hispanic Heritage Awards KTEH Public TV Auction Santa Clara AIDS Coalition Walk for AIDS

Bay Area Scores Las Iseballas Mother's Day Walk Santa Clara Sheriff's DepartmentBay Roc Las Isebelas Mother's Day Walk Second Harvest Food Bank

Bay View Hunter's Point Family Resource Let's Swing - Teen Dance Company, Palo Alto Seneca CenterBeach Blanket Babylon Lovelife Foudation SF AIDS foundation woman and Family Center

Bill Wilson Center Macy's Passport Teen Night Show to Fight HIV SF AIDS Foundation/samplerBill Wilson Center Marin Abused Women's Services SF AIDS Walk

Black Diamond Dynsaty Marin Memory Walk - Alzheimer's Association SF and East Bay Food BanksBlack Infant Health Mayor's Annual Young Women's Health Conference SF Gay Pride

Blockbuster Kids Day MCC Breast Heakth Clinic SF Mayor's Neighborhood SvcsBone Marrow Drive for Jacob Dagnina MDA Benefit Sharks Foundation

Books Not Bars Minority AIDS Project Sharks FoundationBoys and Girls Club of SF Martin Luther King Day Organization Sharks Foundation

Boys and Girls Clubs of SF Mother Wright's Foundation San Jose Holiday ParadeBrothers against Guns Move Against AIDS Spanish Immersion Program

CA College of Arts and Crafts Multicultural Festival in SJ St. Anthony's Penny PitchCesar Chavez Parade and Festival SF NAACP Bay Area Sunburst AIDS CampCharlie Wiedermeyer HS Allstar Game National Diabetes Susan B Koman

CHUY's Music drive for the Troops National Veterans Foundation Sutter Health Job FairCity of Hope Negro College Fund - KISS Tall Tales Reading with the Warriors

City of Hope - KIOI NEI Project Teen Pregnancy Prevention DanceCity of Hope's "Walk for Hope" Breast Cancer Oakland Children's Hospital Toys for Tots with the US Marines

City of Vallejo Oakland Community Safety and Empowerment United Negro College FundCityTeam Oakland Youth United United Playas

Colon Tour Occupational Therapy Training Program Urban Youth Services YMCA - SFColorectal Cancer Prevention One Warm Coat Used Book Drive, Barnes & Noble

Community Justice Network for Youth Operation Clean Slate USS Hornet Museum- MVPA International ConventionCommunity Violence Solutions/Rape Crisis Center OSH Earth Day Vanished Children's Alliance

Cotu of Richmond Park and Rec OSH Vaccinations Day and Child ID Program Western Region Puerto Rican CouncilCounty of Alameda Health Out of School Youth Program World No Tobacco DaysDiablo Clinical Research Pay for Play - Biletnikoff Foundation YMCA Urban Services- East Bay

east Oakland Youth Development Center Pistahan Pilipino - SF Yo! Youth Outreach - SFEast Palo Alto Carnival Princess Project

Eastbay Works Business Center Princess Project Dress GiveawayFirst Book Benefit Project Vote Smart

For the Boys, Collected items for US Troops Provocoture Fashion Show @ Ruby SkyeFoundation Fighting Blindness PTA Old School Dances

Foundation for Fighting BlindnessFurry Friends Rescue

9859 mentions =

$5,915,800

Serving advertisers betterMore to offerMore solutionsEffectively elevated radio in the media mixWorking for local businesses

The Facts About Consolidation

Serving Radio Employees BetterMore opportunities for personal growth without geographic disruptionBetter facilitiesBetter trainingBetter financial opportunitiesMore benefits for employeesMaking more moneyServing more people

The Facts About Consolidation

Serving the radio business better1996 – 60% of all stations losing money

Radio’s share of total advertising up from 7% to 9% during the past 7 years

The Facts About Consolidation

It has absolutely changed radio

Absolutely necessary

Beneficial

It’s the key to continued growth

The Facts About Consolidation

The Future ...Fact & Fiction

SacramentoDiamond RadioKMBM#4 12+#2 18-34

San DiegoMidwest GroupKFMB#6 12+#3 25-54

Little Guys Can’t Compete ...

RiversideAnaheim Broadcasting

KOLA

#4 12+

KCAL

#6 12+

Little Guys Can’t Compete ...

PhiladelphiaWEAZ BroadcastingWBEB#1 12+

DallasService BroadcastingKKDA#1 12+

Washington, DCHoward UniversityWHUR#6 12+

Little Guys Can’t Compete ...

Great passionGreat talentGreat executionGreat radioThat’s what’s always won and will continue to win

The Key to the Futureis Found in the Past ...

Be flexibleBe willing to changeContinue to find great people

Advice

FocusServing the listenerServing the advertiserNot on the competition

Advice