Cracks in the Clear Channel Empire

Cracks in the Clear Channel Empire

Media Giant Loses $90M in Chicago suit

Hot on the heels of word that Clear Channel had posted a $4.7 billion loss for the 4th quarter of 2004 comes this news that the radio behemoth is facing additional expense: a Chicago jury has awarded another $90 million to a plaintiff who sued CC. The suit stemmed from a battle over who had rights to produce motorcycle events, which might surprise those who think CC is only dead set on ruling radio. 

In a slightly ironic twist, the plaintiff in the case was JamSports, which got its start more than 30 years ago promoting rock concerts in Chicagoland.

That market has been devoured by Clear Channel since it bought SFX, a massive concert promoter, in 2000.

The Chicago jury rejected the claim that Clear Channel had violated anti-trust laws, but the rewarding of part of Jam's claim is a sign that the media company might not move as freely in other facets of the entertainment business as it once had.

Logic dictates that Clear Channel will have to cut corners to make up for lost revenue. (This verdict will be appealed, but the suits are starting to add up.) Even money says it's the concert promotions division, which is heavily responsible for some $8 billion in debtload the company carries.

Local club scuttlebutt here in Minneapolis supports this, ever since local booking mastermind Rich Best was shipped out to LA earlier this year (second item), the implication being that the company can't crack the market here like it needs to.