JUSTICE DEP'T. TO SHOPS: HELP US MONITOR MERGERS

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At this week's American Association of Advertising Agencies media conference, the assistant chief of the Justice Department's merger task force will call on agency media buyers for help in monitoring the wave of radio and TV mergers.

Reid Horwitz and Charles Biggio, senior counsel to the assistant U.S. attorney general, told Advertising Age that while they prefer hearing about potential marketplace problems before deals are completed, Justice also wants to hear of major problems after they take effect.

POTENTIAL PROBLEMS

"If [media buyers] are experiencing problems, they should bring it to our attention," said Mr. Horwitz, who will speak at the conference Feb. 13. "But hopefully rather than waiting for the shoe to drop, if they see the potential for it to occur they should let us know when we are doing the initial investigation."

Mr. Horwitz said the Justice Department sees media buyers as the experts who deal with the media every day and can feel market effects.

Mr. Biggio added Justice would not rule out taking action against combinations put into effect years earlier, if they have anti-competitive actions.

"Whenever we look at a merger, we look to see if it is likely to reduce consumer choice significantly. After the merger, are the stations in a position to raise prices or lower quality?" he asked.

AT `GROUND ZERO'

"We need to talk to the people who are at ground zero," he said. "That is the advertisers and the advertising agencies."

The kind of assistance the Justice Department needs is changing as markets go through drastic changes, he noted. The first wave of radio mergers that followed lifting of limits on station ownership by Congress now is being followed by a second wave, where a market with one company holding a big share of advertising through an earlier deal gets a second player trying to acquire a major chunk of what is left.

In the "second wave of acquisition the important topic of concern is, when a second guy gets in, what is the competitive response going to be?" said Mr. Biggio. "Is the previously established big firm going to be more willing to compete? Or are they going to be more willing to go along at higher prices? "

Mr. Biggio acknowledged that the Justice Department has rarely gone back to examine old deals and, in some cases, he noted, the agency doesn't even get notified of joint sales agreements.

He drew a distinction between anti-competitive market conditions and high pricing.

"We are not going to be price regulating," he said. "We are in the business of challenging transactions that alter market structure."

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