Friday, December 13, 2013

Cumulus Flirting with Anti-Trust

Cumulus is the second largest radio company in the country (locally they own WLS AM/FM) and they've been on a buying spree lately. Their most recent purchase of Westwood One, however, does have some potential anti-trust implications. Tom Taylor explores that asterisk in his newsletter...

Justice could still weigh in with some post-closing “remedies” to what it might call an anti-competitive situation. This NOW Newsletter continues to hear from folks who’ve been interviewed by the DOJ, and several say the agency’s focusing in part on the satellite-provider situation. Cumulus buying the former Dial Global means that Cumulus now owns two satellite delivery platforms. That’s a classic anti-trust question – will the merger raise prices for its third-party customers? Here’s what Cumulus said officially, last night – it “believes the merger does not raise any anti-competitive issues [but] it continues to voluntarily assist the DOJ with its evaluation.” Then comes the safety clause – the company “cannot predict if the DOJ will elect to seek, or obtain, any remedies.” Hypothetically, those might include requiring Cumulus to continue servicing WestwoodOne customers at their existing rates, for a period of time. Or requiring it to offer access to new customers.

My thoughts on this matter are well known. If you don't know them, read "$everance".