Ticket Masters: The Rise of the Concert Industry and How the Public Got Scalped by Dean Budnick & Josh Baron

Ticket Masters: The Rise of the Concert Industry and How the Public Got Scalped by Dean Budnick & Josh Baron

Author:Dean Budnick & Josh Baron [Budnick, Dean & Baron, Josh]
Language: eng
Format: epub
Tags: Music, Business Aspects, History & Criticism, Business & Economics, Industries, Entertainment
ISBN: 9781101580554
Google: zRtSI84258EC
Publisher: Penguin
Published: 2012-04-24T16:05:13.572267+00:00


CHAPTER 7

Bigger Bangs for Your Bucks

LOWRY MAYS SAID HE NEVER intended to get into the radio business. And yet by the turn of the millennium his seemingly happenchance career found him at the head of the world's largest radio broadcaster, Clear Channel Communications.

In 1972 Mays was made an offer by Tom Moran, a local businessman. Moran wanted to buy San Antonio, Texas radio station KEEZ-FM. Mays, an investment banker at the time, politely declined but said he would be willing to cosign a bank loan for him, an offer Moran happily accepted. Ninety days later the bank called Mays to inform him that --- surprise --- Moran didn't have the money. Lowry Mays, against his initial wishes, had just purchased a radio station for $125,000. He was now in the broadcasting business.

To help salvage the situation, Mays partnered with local car dealership owner Red McCombs, whose businesses had been well served by radio advertisements. The duo soon began buying other radio stations in the south before branching out to the rest of the country. The company took its name from a standard industry term for an AM station operating on a specific frequency that could not be shared by any other station.

By 1984 the company had acquired enough holdings to go public. By the time the new millennium began, Clear Channel owned or controlled more than 1,000 radio stations, 550,000 outdoor billboards and nineteen television stations. Its reported net revenue was $5.345 billion.

Mays had turned his perceived misfortune into an unparalleled media powerhouse.

THE MILLION DOLLAR QUESTION --- or rather, the $4.4 billion question, based on what Clear Channel Communications paid for SFX Entertainment in 2000 --- is whether SFX CEO Bob Sillerman created SFX to flip it. Ask most anybody in the concert business and they'll tell you, "Of course he did." And, as rather valid evidence, they'll point to Sillerman's history in the radio business, which saw him flip various broadcasting groups back and forth before eventually exiting the business with a $2.1 billion sale of SFX Broadcasting to CapStar Broadcasting in 1997.

But ask anybody who worked closely with Bob Sillerman and they'll tell you, "Absolutely not." It's a fine but critical line of distinction between the "dids" and the "did nots." Ask the question a different way --- did Sillerman do whatever he could to increase shareholder value? --- and both sides will agree: yes.

Brian Becker, who was tapped to be the CEO and chairman of SFX Entertainment after the sale to Clear Channel, had joined SFX from Houston-based PACE Entertainment and served as part of Sillerman's upper management team. "To me, this is not a serious question," he says today of whether or not Sillerman rolled up concert promoters to flip them. "Bob is always very clear: he builds shareholder value, period. If he could build it and turn it into a substantial publicly traded company --- if that was the best way to build shareholder value --- great. If the best way to build



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