Analyst: Google should buy stake in Clear Channel
David Bank of RBC Capital Markets has some advice for Google: Buy a stake in Clear Channel Communications.
Radio broadcaster Clear Channel recently said it would explore strategic alternatives in the face of sluggish stock prices.
Investing in Clear Channel could give Google--which is expanding its online ad platform into radio and other outlets--ad inventory in the airwaves, RBC Capital Markets analyst David Bank wrote in a research report released this week and reported on in BusinessWeek.
Earlier this year, Google bought DMarc Broadcasting, which works with advertisers in the sales, scheduling, delivery and reporting of radio ads.
Google has been adding "high profile" radio sales people in New York, Washington, Baltimore, Atlanta and Chicago, according to Bank. Now it just needs the airtime on which it could place ads for customers as it moves aggressively into the local search market, which is considered highly lucrative, he said.
"The radio market is by definition a local market, deriving 80 percent of its revenue from local advertising," he wrote. "So the radio market would be a logical add-on for Google."
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