Clear Channel Streams Again

In a sign that ad insertion is finally making inroads, Clear Channel announced on Monday that it was putting the streams of many of its radio stations back online. Clear Channel is using Hiwire’s ad insertion technology to insert new ads and replace the existing broadcast advertising. Financial terms of the exclusive deal were not announced.

For Clear Channel, this means that its stations will come back after two months of being taken down after disputes with AFTRA. In April, AFTRA reminded stations of a provision that called for artists in commercials broadcast over the Internet to be paid 300% of its regular fees. In response, major companies like ABC, Clear Channel and Emmis took down many of their terrestrial streams. In recent months, many stations are streaming again, but instead insert music-- or in extreme cases, dead air--while terrestrial ads are played.

Clear Channel said that Hiwire (www.hiwire.com) will provide ad insertion for all of its radio properties in the top 50 U.S. markets and will roll out 250 stations beginning in July 2001.

Aside from coming back online, the ad replacement technology gives stations (and Hiwire) a potential source of new revenue for Internet-only ads. And with targeted ads, stations can target specific listeners or demographics, making for higher potential CPM rates.

"With the remarkable growth of Internet audio over the last several years, Clear Channel vowed to find a comprehensive approach to streaming that made both legal and financial sense," said Kevin Mayer, CEO of Clear Channel Interactive. "Hiwire has a proven track record of serving ads for Internet radio and has the infrastructure in place to handle our significant ad inventory."

Other customers of Hiwire include NetRadio and MusicMatch, as well as other independent stations. Hiwire has previously worked with Clear Channel’s World Class Rock Internet station, also.

"To generate advertising revenue through streaming, you need critical mass," said Warren Schlichting, CEO of Hiwire. "Adding 250 Clear Channel stations to the Hiwire network brings our ad serving reach to over 40% of the entire streaming audio market."

In related news, Loudeye (www.loudeye.com) acquired privately owned Addition Systems, a server-side streaming ad and content insertion solutions. Terms of the deal were not disclosed. This bolsters Loudeye’s radio initiative, which it is currently working on after buying the assets of radio webcaster OnAir Networks.

Loudeye said that Addition Systems can target geographically as well as to demographics. It will offer the ad insertion technology as a stand-alone product and as an integrated product.