The joining of the two companies sole purpose is to drive digital growth, increase radio listening and guarantee exposure of Warner Music Group artists. This partnership is also the first time that Clear Channel will pay broadcast royalties to a major record label. Neither company has disclosed much information, but Clear Channel supposedly will pay for terrestrial and digital broadcast rates. Clear Channel consists of over 850 radio stations, which drove in well over 243 million monthly radio listeners and over 60 million visitors digitally, thanks to iHeartRadio. Clear Channel has clearly saturated the radio market with advertisements, billboards and national events.
Warner Music Group will be able to promote their artist on all platforms associated with Clear Channel, including radio, live events, online streaming and the ever so popular, iHeartRadio. There had been talk of Clear Channel developing sometime of platform for consumer to purchase music from their favorite artists that are played on the radio.
In my opinion, the partnership is an unfair monopoly and leaves competitors at a disadvantage. It seems like a legal form of payola that should be challenged and dismantled. Everyone made a big deal when Pandora purchased a terrestrial radio station to help lower the royalty rates. This deal is no different than the Pandora deal. Obviously, this deal is unfair. Clear Channel will favor Warner Music Group artists over artists on other labels. They are paying for plays, while they cut Clear Channel in on some of the profits from the platform. Who really knows the specifications of the deal? With such an unfair advantage, where will it leave the other three major labels?