To avoid being squelched by satellite radio, conventional broadcasters say they have joined forces to promote digital programming.
Clear Channel (CCU - Get Report), the Infinity unit of Viacom (VIA - Get Report), Emmis (EMMS - Get Report) and Cumulus (CMLS - Get Report) are among the broadcasters who have formed the High Definition Radio Alliance.
The group says it will spend $200 million in airtime to promote the shift to digital programming. Members vowed to work with radio and automakers to get digital radios into new cars over the next eight years.
The group, which announced the formation of its alliance at a press conference in New York Tuesday morning, is hoping to counter the success of satellite radio duo XM Satellite (XMSR) and Sirius (SIRI - Get Report).About 9 million users have signed on for satellite radio, which offers more than 100 channels of music, sports and talk programming. The local radio broadcasting sector has not performed well in the past two years, as satellite radio has captured the imagination of investors. The purpose of the big radio alliance seems to be largely aimed at not getting pushed off the dial. "We are competing with satellite, MP3 players and the Internet," says HD Radio Alliance president Peter Ferrara. "We are all about improving our tree in the forest." Clear Channel shares fell 6 cents to $33.02 and Emmis was unchanged at $20.30 in early trading Tuesday, while Viacom rose 6 cents to $34.54 and Cumulus fell a penny to $12.09.