Agencies that buy radio advertising have the edge when negotiating ad costs with Clear Channel Communications this summer because the radio company has refused to pay Arbitron Inc. for station listenership estimates.

        Clear Channel's eight stations in Greater Cincinnati landed in ratings limbo from the spat between San Antonio-based Clear Channel and New York City-based Arbitron over subscription fees to determine how many people listen to programming. (Clear Channel's radio division is based in Covington.)

        Because Clear Channel, the nation's largest radio company, refused to pay Arbitron's subscription fees, Arbitron in turn prohibited media agencies and other subscribers from revealing Clear Channel audience estimates.

LOCAL CHANNELS

The company owns 1,170 radio stations that reach 110 million listeners each week. Locally, it owns four FM stations: WOFX, WVMX, WEBN and SKFS; and four AM stations: WKRC, WLW, WCKY and WSAI.

        Without those estimates, Clear Channel executives could not justify rate increases by, for instance, showing growing audience share in a report from an independent survey.

        “In terms of gleaning advertising dollars, Clear Channel will be at somewhat of a disadvantage and will be negotiating blind to some extent because they can't utilize those numbers,” said Sally Shoquist, senior vice president of Empower Media Marketing, a strategic media and marketing agency based in Columbia Tusculum.

        What nagged Clear Channel was that high-power signals such as WLW had listeners in multiple states and were great buys for national advertisers, but Arbitron's ranking reflected only a Greater Cincinnati audience.

        “So Clear Channel threw its weight around a little bit,” said Mark O'Brien, executive vice president at BIA Financial Network, a broadcast financial-consulting company based in Chantilly, Va. “This has been been basically a high-stakes game of poker.”

        Clear Channel will be at a disadvantage in the short term because the company can't use assessments like frequency of listenership, or average quarter-hour number of listeners, said Robert K. Riggsbee, president of Inside Media, a multimedia management, planning and buying firm based in Cincinnati.

        “How can they justify going from $250 for a spot to $275?” he said. “When a company can't use Arbitron, sales people are going to have to be out there selling the sizzle and not the steak because they can't rely on the numbers.”

        Although Clear Channel listenership percentages were still rated by Arbitron, the ratings company refused to share those figures with Clear Channel and has fired off stern letters warning of repercussions if others share those numbers.

        “Talks continue,” said Thomas Mocarsky, vice president of communications for Arbitron Inc.

        “There are some Clear Channel stations that are not receiving ratings because they do not have a contract, and that's all I'm going to say.”

        Clear Channel was Arbitron's largest radio ratings subscriber and represented more than 22% of Arbitron's revenue in 2000 with revenues estimated at $14 million in 2001.

        “We are still in negotiations,” said Pam Taylor, corporate spokeswoman for Clear Channel Radio.

        Cindy Jarrell, associate media director at Northlich, an integrated communications and brand consulting firm, said companies that buy advertising directly from Clear Channel stations are most likely to be affected by the impasse.

        “We will still have the data and will spend the advertising money widely,” she said. “This is going to present some challenges for companies that rely on Clear Channel to give them the data.

        “And some real big agencies could start doing more of their own ratings.”
       

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