Clearing the clutter

Clear Channel, the nation's largest chain of radio stations, made two significant announcements. In the first, posted here, the San Antonio based company will limit the number of commercial time. In one market, advertising breaks were reduced from 16 to 12 minutes. However, the article does not mention whether this will include house advertisements. In other words, will the station reduce its clutter? Also, where will the reduction occur? During the morning and evening drive time? For all day parts?

In the second story, posted here, Clear Channel will spend $100 million over 10 years to test the feasibility of digital radio. The technology promises to deliver stronger, clearer signals.

Neither article really mentions the force behind these actions. XM and Sirius have achieved enough subscriber mass for Clear Channel to perceive the two satellite operators as competitive threats. Although XM and Sirrius carry commercial stations, its competitive advantage comes from a commercial-free service with a sound quality perceived as superior to FM or AM stations.

Are Clear Channel’s two strategies examples of sustainable competitive advantages? Will these decisions make its time inventory more desirable to media buyers and marketing strategists?