David Kantor, former ABC Radio Network president, is senior VP of AMFM, which probably will be launched by March on the backbone of Chancellor's 99 stations, a group built up through recent mergers with Evergreen Media and Viacom Radio Group. Other affiliates also will be sought.
Mr. Kantor said the stations will most likely be split into two networks, one serving a youth market and one for adults.
Ad agency media buyers expressed confidence in Mr. Kantor and applauded the addition of another option in a market dominated by the combined CBS Radio/Westwood One and ABC Radio. CBS assumed sales and marketing duties for Westwood in April, stirring industry concerns about increased concentration of ownership leading to limited choices and higher ad rates.
TIMING IS RIGHT
"There's definitely room for more national programming with all the consolidation going on now," said Peter Harrington, network radio manager at BBDO Worldwide, New York. "The timing is good."
"Chancellor decided it had reached a critical mass and wanted to play in a new arena," Mr. Kantor said, adding that he thought the new network would strengthen the medium by adding a lot of previously unaffiliated stations.
'ENTREPRENEUR AT HEART'
Mr. Kantor explained he left ABC last month because "I'm an entrepreneur at heart [and] there's nothing like a start-up."
ABC appointed Lynn Andrews, formerly senior VP-sales and marketing, to replace Mr. Kantor.
Gale Metzger, president of Radar, also noted the growth potential for a new network.
"The problem for advertisers today is reaching audiences through a mass medium," he said. "This is good for business."
Radar is the network radio industry tracking organization, which currently rates 13 networks on a twice-a-year basis. That may soon change to quarterly.
The move comes at a time of rebound for network radio, which experienced a 7.6% audience increase in Radar 55, the spring survey period. Media buyers reported a strong year and unusually tight fourth-quarter inventory.
Revenue increased 7% to $504.1 million for the six months ended July 31, according to Competitive Media Reporting.
Some industry observers said they expect more new networks may soon come along because of the new radio megagroups.
AMFM's first priority is getting its affiliates rated by Radar, with programming details to come later. Nonetheless, with network radio's upfront sales marketplace already beginning, the new group is approaching major advertisers about getting on board, Mr. Kantor said.
SHOWING STRONG INTEREST
Even without program details, Leslie Sturm, VP-associate director of network radio at the Media Edge, New York, showed strong interest in the network.
"I don't think it's about programming, it's about stations," she said. "If I make a commitment upfront, I know [Mr. Kantor] will make good. Network radio is exciting again."
Chancellor has a strong presence in the top 30 cities, controlling more than a quarter of the market in Chicago, Philadelphia, Detroit, Washington, Houston and others. It was recently ranked second, with $816 million in revenue, behind CBS'