iHeartMedia 2004 Annual Report Download - page 7

break. In addition to reducing commercial capacity, we also reduced and limited the amount of promotional interruption on all of our radio
stations. The specific ceilings will apply to every radio station and will vary by format and time of day. We believe this new strategy will
improve the listening experience for consumers while providing advertisers more effective opportunities and value for their advertising dollar.
We compete in our markets with all advertising media including television, newspaper, outdoor advertising, direct mail, cable, yellow
pages, Internet, satellite radio and other forms of advertisement. Therefore, our radio strategy also entails improving the ongoing operations of
our stations through effective programming, reduction of costs and aggressive promotion, marketing and sales. Our broad programming and
content across our geographically diverse portfolio of radio stations allows us to deliver targeted messages for specific audiences to advertisers
on a local, regional and national basis. We believe owning multiple radio stations in a market allows us to provide our listeners with a more
diverse programming selection and a more efficient means for our advertisers to reach those listeners. By owning multiple stations in a market,
we are also able to operate our stations with more highly skilled local management teams and eliminate duplicative operating and overhead
expenses.
Outdoor Advertising
Our outdoor advertising strategy is to expand our market presence and improve the results of our existing operations to help us compete
across all advertising media including radio, television, newspaper, direct mail, cable, yellow pages, Internet, satellite radio and other forms of
advertisement. We implement this strategy by acquiring additional displays in our existing markets, expanding into new domestic and
international markets and helping our outdoor advertisers creatively use our outdoor advertising inventory. We focus on attracting new
categories of advertisers to the outdoor medium through significant investments in sales, marketing, creative and research services. We take
advantage of technological advances and the growing and dynamic possibilities advertisers have to display unique, engaging, creative
advertisements. Our talented management team is committed to sales force productivity, improved production department efficiency and
further developing the quality of our product.
Live Entertainment
Our strategy is to deliver quality entertainment products and enhanced fan experiences from music concerts, Broadway and touring shows,
specialized motor sports events, museum exhibitions, family shows and venue operations. We attempt to increase revenues by increasing the
utilization of our entertainment venues, the number of tickets sold per event and by effectively marketing the variety of sponsorship
opportunities we offer. We strive to form strategic alliances with top brands for marketing opportunities. This connection builds brand loyalty
and consumer affinities, thus helping our advertisers succeed with their marketing efforts and helping us compete with all advertising media
including radio, television, newspaper, outdoor advertising, direct mail, cable, yellow pages, Internet, satellite radio and other forms of
advertisement.
Recent Developments
On March 10, 2005, we entered into amended and restated employment agreements with our three senior executives, L. Lowry Mays (as
Chairman), Mark P. Mays (as President and Chief Executive Officer) and Randall T. Mays (as Executive Vice President and Chief Financial
Officer). These employment agreements amended and restated the existing employment agreements dated October 1, 1999 between us and
these three executives. The changes to the original employment agreements reflect the fact that Mark Mays now serves as our President and
Chief Executive Officer, L. Lowry Mays now serves as our Chairman of the Board of Directors and that the offices of Chairman and Chief
Executive Officer are no longer combined. The amended and restated employment agreement for L. Lowry Mays also reduced the minimum
annual salary and stock option grant to which he was entitled. The amended and restated employment agreements for Mark Mays and Randall
Mays also reduced severance payments significantly by eliminating certain severance payments to be paid in the event that their employment
was terminated under certain circumstances. In addition, changes to all three agreements provide each executive with the choice of receiving a
number of shares of our common stock based on a formula which attempts to be economically neutral to Clear Channel as part of a severance
package in lieu of a stock option grant in cases where the executive is terminated without cause or resigns for good reason.
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