Urban Warfare

he point of a monopoly is to eliminate competition. Clear Channel's entry into the Memphis radio market -- in particular, the so-called "urban" or African-American radio market -- is a case study in the principle. When the San Antonio-based media company added KJMS-FM to its already strong lineup of WHRK-FM and WDIA-AM, one of the last competitors to those stations was eliminated. KJMS' Magic-101 format and WHRK's K-97 were traditional rivals, competing for the same segment of young urban listeners, and therefore, for the same advertisers.

As soon as KJMS was acquired, however, Magic-101 was history. It became Smooth 101, a station that catered to an older audience, complementing rather than competing with K-97. It worked like a charm. Smooth 101 surged in its target demographics during its first rating period on the air, and Clear Channel's monopoly seemed complete, as WDIA, WHRK, and KJMS grabbed a combined share totaling more than a quarter of the Memphis market.

Enter an unlikely competitor. Flinn Broadcasting has been something of a joke in recent years, floundering around with its 107.1 frequency from format to format: alternative, then blues, then R&B. But in early May, the station, whose call letters are now KXHT-FM, became "Hot 107" and all that changed. After only six weeks with a new "hip-hop and R&B flavor" format, Hot 107 cracked the top 10 in the ratings and grabbed a 4.2 share of the market, according to Arbitron. Not only that, but trend information shows a station on the rise, and it's a good bet that it will hit the top five in the next quarterly ratings, due out later this month.

That a new urban format could make such a strong showing against Clear Channels' formidable hold on the market might seem surprising, but the media giant's bid for monopoly control has as much to do as anything with Hot 107's existence.

For example, when Clear Channel took control of KJMS late last year, many high-level employees were dismissed as the station's operations were integrated with those of WDIA and K-97. Among those let go was program director Terry Base. Base was hired by Flinn, and under his brief tenure, Hot 107 was ushered in.

And Base is not the only KJMS alum to head to 107.1. Deidre Williams, who goes by "D Rock" on the air, is a former KJMS personality, and former KJMS sales manager Jerry Bafford returned to Hot 107 earlier this week after a three-month battle over a non-compete agreement he had signed with Clear Channel that forbade him from working for a competitor within six months of leaving the company. The matter was dropped by mutual consent last week, allowing Bafford and R.J. "Groove" Johnson to work wherever they please.

After Hot 107's strong showing in the spring ratings, Bruce Demps, general manager of Clear Channel's urban stations, shrugged off the numbers, saying that the station's audience was too young to pull any significant advertising. It appears, however, that Clear Channel has made attempts to use its influence to quash the upstart station.

Aside from trying to enforce non-compete agreements with former employees who go to work for Flinn, some say Clear Channel has been throwing its weight around with advertisers.

John Doyle, owner of the Barking Dog Agency, an ad agency that places spots for Crumpy's Comedy Club, says he was told by Demps that he wasn't welcome to run ads for Crumpy's with the Clear Channel stations after he began a promotion for the comedy club with Hot 107. "My understanding," says Doyle, "is I'm still not allowed, as long as that promotion is running, to advertise on their stations."

Furthermore, Doyle says he was never alerted of the policy beforehand, and that he's never encountered such a policy before. Although he says it won't affect his decisions to place ads for other clients, he disagrees with the practice. "They were damaging their advertisers who had been throwing money to them to get at their competition," he says. "You don't attack your competition by attacking your client." Asked if there was such a policy, Demps had no comment.

The irony, then, is that Clear Channel's attempt to exert monopoly control of Memphis' urban market has lent ammunition to its competition in the form of personnel and advertising. As Doyle notes, he would have never discovered what a good buy Hot 107 was if Demps hadn't refused his ad.

Meanwhile, Chuck Woodson, general manager of Hot 107, says he thinks the station's strong numbers will overcome any "deliberate obstacles" presented by the competition.

"In some cases advertisers are not sure what they should do," he says. "But as we become a major player in the market, advertisers will pay more attention to why they should advertise with us and less to rhetoric about why they shouldn't."

Certainly, turning away advertisers is a gutsy move, and one that only large companies like Clear Channel can afford. Hot 107 is outsized in every particular -- wattage, rating, and revenues -- by its competition, and only time will tell how it will fare in the first round of urban radio warfare, and whether it will emerge as what it claims to be: The Bomb.