The media world is recovering, and radio is assessing its rates, its supply, and its demand.
Apparently, so is Sirius XM, reportedly doing much better these days.
Maybe this is why:
$5 a month?
Do you get a remote with a DJ and interns with that?
|
|
|||
|
|
|
|||
|
|
|
|
|
Fred Jacobs is President of Jacobs Media, a media research and consulting firm. Jacobs Media clients have included CBS Radio, Premiere Radio Networks, Citadel, Greater Media, MTV Networks, Playboy, Amazon, Electronic Arts, NPR, Sylvan Learning Centers, and Taubman Malls. Learn more about the company here.
The media world is recovering, and radio is assessing its rates, its supply, and its demand.
Apparently, so is Sirius XM, reportedly doing much better these days.
Maybe this is why:
$5 a month?
Do you get a remote with a DJ and interns with that?
Who said this?
“We want to be in as many cars as possible. We’re beginning to embed internet radios in all the places where you traditionally have a broadcast radio. Ultimately, the choice we hope consumers make is they’ll opt for this instead of broadcast.”
Readers of this blog will recognize this quote from Pandora CEO Tim Westergren. It’s yet another indication that Pandora is doing everything it can to kick ass and take names in its assault on broadcast radio.
In our research, our coverage of Westergren’s meet-up in Detroit last year, our “take” on Pandora’s local sales initiatives, and particularly in this blog space, we have continually pointed to its threat potential.
Now with the advent of format-branded or genre channels, Pandora continues to laser-focus on broadcast radio. Long-time Pandora listeners know that the music discovery and depth features have been diminishing for some time now. Pandora’s research must have shown them the mantra that terrestrial radio has utilized for decades: “Play the hits.”
While there will always be adventurous consumers, Westergen knows they are in the minority. The masses want it dumbed down. They want a service that is simple, reliable and plays songs they know and love. The most popular satellite radio channels are the ones that play the hits.
Now Pandora is moving from esoterica to mainstream. In the process, broadcast radio is right in their crosshairs.
Yes, AM/FM radio has many challengers and groups that would celebrate its demise. But it is time to stop ignoring Westergren and Pandora, whose intentions continue to be transparent.
I was recently stuck on a long drive by myself through a less-than-scenic part of the country. For a time, I plugged my iPhone into the AUX jack on my Dodge Caliber, enjoying some of the radio apps we've created for stations as diverse as The Coast in Mendocino, as well as WWOZ, the great Jazz station in New Orleans.
But then I noticed the car entertainment system included satellite radio. And I hadn't listened for some time and had more than three hours left in my driving journey. And so I dug in.
And the good news was that I heard a lot of songs you simply don't hear on commercial radio anymore. And at times, that was exhilarating.
I perused many of the Sirius XM music channels, and heard lots of songs I simply had not heard in a long time. The Elvis channel was fun for a few minutes. (Where else are you going to hear the King these days?)
And by flipping though the '50s, '60s, '70s, '80s, First Wave, and Classic Rock channels, I was able to catch songs like these:
And this was just a taste of the songs that - at times, embarrassingly - I turned up the radio to excessive volumes. And conversely, when I heard songs that are quite common on commercial radio - Boston's "Long Time" or the Stones' "Miss You" - I kept looking for something a little different.
What's wrong with my list of "turn it up" songs above? Well, you can question my "guilty pleasure" tastes, but the reason you don't hear them very often on terrestrial radio is that they either don't test or there simply aren't mainstream formats that provide them a home. Yes, I realize that some markets have a Triple A station where some of this music may be heard. But in the main, there's simply not a place for most of this material on commercial radio, in spite of the fact these songs were all hits at one time or another.
If anyone understands how this process works, I do. I'm involved in music sorts where there's mounting pressure to not make mistakes in PPM or the diary. Thus, stations play the same 250-400 songs until there's money for the next test. In the terrestrial radio wars, it's hard to argue this logic because it just works.
But in the wider battles that we speak of frequently in this blog, this "play it safe" mentality is a big part of the reason why iPods and Internet radio have become more and more popular over the years. If you want to hear something different or new, it's less likely to happen on terrestrial radio. And perhaps as the competition becomes more diverse, this may be the smartest role for commercial radio to adopt.
Here's the other question you may be asking yourself: If Sirius XM is playing all these great songs that you don't hear on The Eagle, The Edge, or Z95, why isn't satellite radio more popular?
For starters, the proliferation of free Internet radio is one of the reasons. Streaming technology has leapfrogged the subscription satellite model. And the control factor of iPods is another. Even though there are many more channels on Sirius XM than in any commercial radio market, it's still radio. On many channels, there is still a DJ, a format that emulates terrestrial stations, and no ability to control the experience or even to participate for consumers/subscribers. While there was an occasional listener mention, I heard no real connections to social media or audience interactivity throughout my several hours of listening.
But it gets worse. In order to find the aforementioned group of songs, I was forced to frantically button-punch among these 7 or 8 channels. It was nearly impossible to stay with any of these specialty stations for more than a couple of songs. They either don't make a lot of sense formatically, or they play lots of bad songs along the way (because they can, I suppose), and their categorization is just odd.
Who says consumers are most comfortable listening to discreet decade stations? Doesn't taste tend to run more genre or style based? And this silo approach to formats almost forces wild button punching because every channel gets monotonous after a short time.
And the DJs? They're no better than what you hear on commercial stations in medium markets. And maybe not that good. The production? OK, but not stellar.
So what provides value in exchange for someone's hard-earned money?
On top of that, some of the messaging is just lame. I heard a jock chiding "terrestrial radio stations" for playing stand-alone :60 spots and for not being adventurous enough. It made me wonder why there's even a reason to make these types of Brand X comparisons? In the same break, he inferred that it was impossible to go back to terrestrial after you've experienced the quality of satellite radio.
If that's the case, I've just done "the impossible." Once I got within range of Detroit radio, it was comforting to hear a local jock talking about what was happening in Detroit this weekend, providing Tiger updates, and playing listener suggestions.
Now if someone would just play "Industrial Disease."
Throughout this past week, I would like to thank regular readers for indulging this series of posts about Pandora. If I didn’t believe that Pandora’s ascension was significant, I would not have devoted as much space and thought to this emerging media phenomenon.
As I have pointed out over the past several days, Pandora demands our thought and attention, just as MTV did in the ‘80s, and satellite radio did in recent years.
Radio does not exist in a vacuum. In simpler times, it really may have been about WLS versus WCFL. Today, broadcasters need to grasp the broader realities of media consumption and consumer needs and wants in an environment of seemingly infinite options.
So let’s look at some of the results from the newest Jacobs Media Technology Survey about Pandora. The study was fielded earlier this year across 78 rock-centric stations, generating more than 26,000 responses. These are hard core radio listeners – the types who actually join email clubs, carry meters, and contribute the lion’s share of listening. And their views are very germane, especially when they point to an emerging threat.
As our survey shows, among those who stream any Internet radio, nearly three in ten spend time listening to Pandora. If you program to fans of Alternative or Triple A stations, that percentage moves even higher.
We then went on to explore how these core terrestrial listeners who tune in Pandora compare the two products. As we’ve discussed over the past several posts, Pandora is being marketed as “radio,” in much the same way that XM pursued terrestrial radio listeners with its “Beyond AM…Beyond FM..XM” campaigns.
So putting Pandora head-to-head with commercial music radio, these core radio station database members’ opinions are clear and important: More than half contend that Pandora is a better option for music than most commercial radio stations:
Now that’s a finding, and it speaks directly to a message we’re getting loud and clear from some of radio’s most loyal listeners.
It is important that terrestrial radio broadcasters understand the changing competitive environment, so in a follow-up question, we asked respondents about the things they don’t like about Pandora. While many are satisfied, the lack of local DJs and hometown programming content are Pandora barriers – and local radio opportunities.
That is, if terrestrial stations are still willing to invest in the proprietary assets that put them on the map in the first place.
This isn’t about attacking Pandora or Tim Westergren. If anything, you have to respect what he and his staff have accomplished in defining a new brand of media entertainment.
It is about understanding the new digital chess board, not creating “Meatball Sundaes,” and crafting plans and strategies that can help broadcasters better compete in the months and years ahead.
There’s a new kid in town, and he’s growing up awfully fast.
Where is it going? That's always a big topic, and the blogosphere has no shortage of experts and geniuses who will tell you they have the answer to what's ailing radio, and what we'll all be doing in five years.
It's a lot like the stock market. There is the ongoing avalanche of analysts, many of whom have great credentials. But then there's Warren Buffett. Yes, he's had a tough year, but over the long haul, investing in his Berkshire Hathaway has been a pretty good bet.
Google has amassed a pretty solid track record, too. Not all their experiments and projects have paid huge dividends - like radio advertising - but it's tough to argue with their track record.
That's why their recent purchase of AdMob caught my attention. For a mere $750 million in stock, Google now owns another piece of the mobile ad machine.
This is especially noteworthy because it signals another investment in the mobile space for Google. As we have learned at jacAPPS - our mobile application division - there is an abundance of optimism, and it's backed up by industry metrics.
Paul Palmieri, CEO of Millennial Media chimes in with his view: "Today Google validated what many companies including Millennial have thought for years - that mobile is a different market with a huge potential for advertising; possibly a bigger opportunity than online media."
It's interesting that we first started our mobile division, and then actually went to school on this space. My best teacher has been a Finnish consultant, Tomi Ahonen. He now lives in South Korea, and is the author of Mobile as 7th of the Mass Media.
This guy totally "gets" what's happening in mobile, especially in more advanced countries outside the U.S. (as odd as that sounds). It is more than a little interesting that in in other parts of the world, credit cards are becoming rare while more and more consumers are paying for everything with their mobile devices.
This is where the action is. In a recent article, "What Hath Apple Wrought," Inside Digital Media president, Philip Leigh, notes that "outside America, most people connect to the Internet over a mobile device. At 1.2 billion units, worldwide mobile phone sales are about four times those of personal computers."
And it is mobile that has turbo-charged the recent growth in Pandora sign-ups. More than 45,000 of the 65,000 new daily registrations for that Internet radio channel come from its various mobile apps. "Our future is going to be more mobile-centric than I had even thought, and sooner," says Pandora founder Tim Westergren.
And all this at a time when some broadcasters are still debating the wisdom of streaming. The winds of change are blowing hard, and there are no signs of a letup.
Mel Karmazin thinks this Christmas will signal a significant rise in the sales of satellite radio. My money is on mobile gadgets - iPhones, Droids, and the like. With WalMart, (Radio) Shack, BestBuy, and Costco all selling more affordable iPhones and iPod Touch devices, the forecast calls for an even more ubiquitous mobile environment.
You don't need a weatherman to know which way the wind blows.
Our recent “Superheroes” blogs apparently touched a nerve, especially with the scores of radio pros who have found themselves on the beach in the past year or so. (“On the beach” is a quaint term that is an injustice to those who are out of work with no prospects in sight.”)
<CLICK HERE FOR "SUPERHEROES WANTED" BLOG>
<CLICK HERE FOR "SUPERHEROES WANTED 2" BLOG>
On top of this, my remarks at the NAB’s “Stimulus Czar” session directly addressed the need for radio to use its night and late night real estate to grow new talent, rather than voicetrack. Between the economy and PPM, owners and CEOs have less incentive to develop new shows to replace aging franchises, much less to promote the great brands they already have on the air.
But the real issue is simply how many wonderfully talented jocks, teams, and personalities are idling away on the shelf with no place to go. While not every station should be personality-driven, neither should there be 10 juke boxes in a market either. And with all those HD2 channels wasting away, you could put together some pretty killer personality content from just the “spare parts” that are out there looking for a job.
Or you could make the case that these under-utilized HD resources could become the incubators for fledgling high school and college kids who are dying to entertain and hone their crafts. (Think Kimmel and Conan.)
But the first group – unemployed all-stars – is the focus of this blog. And with no offense meant to anyone who appears on the list below – or those who don’t – here’s a little game I started to play. What would a very cool and competitive station sound like, made up solely of talented jocks who are out of work?
So, here’s my first pass at what would be a very potent lineup (yes, some players are out of position, but hey, it’s a fantasy radio league, right?). I think this group could compete in any market in America. And they’re probably more affordable than you think.
6-9a Adam Carolla
9a-Noon Tommy Griffiths
Noon-3p Cerphe
3-6p Stoney and Wojo
6-10p Dave Lawrence
10p-2a Tony Magoo
2-6a Warren Kluck
And to manage this menagerie, let’s put Larry Sharp in the PD’s chair, with Chris Crowley as APD. And to handle weekends, and music director duties, how about Marci Wiser?
This was easy, and I know I’m missing some incredibly talented folks, so perhaps that’s where you come in. What does your radio fantasy team look like? And if you’re an unemployed all-star, please submit your team and don’t be bashful about inserting yourself in the starting lineup.
For an industry that claims to be about content, it is truly amazing how many great content creators and producers are riding the bench.
Radio-Info's Tom Taylor and I exchanged emails after his story ran about how the Sirius XM iPhone app passed the 1,000,000 downloads milestone.
But there's another angle on apps that most of us in radio aren't used to facing - continuous, accessible, transparent listener reviews. In Sirius XM's case, their app's bulk download stats are illusory because when you study their ratings, and read the reviews in iTunes or in the App Store, there are many, many irate consumers.
Check out their ratings (below), and you can readily see the problem. When your "1-star" ratings outnumber your "5-star" grades by more than 4-to-1, you have some serious issues with iPhone and iPod Touch owners.
Then read the actual reviews, because while there are some happy users, most consider this a paid app even though it is listed as "free." It is clear that huge numbers of iPhone/iPod Touch owners downloaded the app thinking they were going to get all these great satellite radio channels.
<CLICK HERE FOR SIRIUS XM APP AND USER REVIEWS>
But if you're not a subscriber, it'll cost you $3 month, and even subscribers are required to be in the "premium" category in order to listen - otherwise they have to pay an additional $3/month over and above whatever they're already paying.
Here's the official explanation of "free" on the Sirius XM FAQ page for their iPhone app:
What is the cost of this application?
The application is FREE. Streaming to iPhone and iPod Touch is FREE with a paid Premium SIRIUS Internet Radio or Premium XM Radio Online subscription. You can also sample great SIRIUS & XM content with a FREE TRIAL. Visit siriusxm.com/oniphone for more details.
No wonder people are pissed, and they are taking it out on Sirius XM with their 1-star ratings, and their scathing reviews. Above and beyond the costs, there is also the obvious disappointment with the absence of Howard Stern on the app.
So, beware of those download stats because they don't tell anywhere near the entire story.
In the App Store, you can't hide. If your app sucks, doesn't work well, is perceived to be a ripoff, or doesn't live up to its promise, it's there for all the world to see. (By the way, a look at iheartradio's app tells an interesting story, too. While better than Sirius XM, their 1-star ratings outnumber their 5-stars, which supports the notion that mega-downloads alone don't make for a great app.)
At jacAPPS, we are using these user reviews to learn more about the benefits or problems with the apps we've developed, and this process has led to updated versions with improved features. And we've launched a web survey, supported by many of our app clients, because research is an important component in providing customers with the optimal experience.
We also have a "5-star" goal for all our apps - whether they're for commercial, public, or Internet radio, personalities, events, or games. Customer satisfaction is a key in any business, but especially when it comes to apps. We are already learning - not a shock - that word of mouth is a major driver because when iPhone owners talk to each other, the question is usually, "What's your favorite app?"
We are rapidly learning that just having an app in the App Store is insufficient in order to be competitive with Pandora, Facebook, and the myriad of other channels and outlets that will be in the app business soon. Apps - like broadcast radio itself - have to be reliable, high-quality, user-friendly, and deliver on the promise.
In the case of the Sirius XM, that long wait for an iPhone app was apparently not worth it.
Some big news out of the satellite radio camp this week.
First, in the middle of the recession and at a time when subscribership is on a downward trajectory, Sirius XM is raising prices to accommodate music royalties. At the end of July, the monthly fee gets jacked up $1.98 to pay for the performance royalty tax. At a time when our Tech Poll shows that satisfaction with Sirius XM is going down, and the propensity to continue subscribing is also headed south, passing along this burden to consumers cannot be perceived as a positive.
Then there's their new iPhone app. Finally, after months of development, Sirius XM channels can be accessed on iPhones. This comes at a particularly propitious time as the new $99 iPhone hits the market. Along with the new 3G S, how many more millions if iPhones will be in circulation throughout the rest of 2009?
But, of course, it's not that simple. If you're a Sirius XM Premium Online customer, the app is free. But to upgrade to that status, it's an additional $2.99 on top of what these subscribers are already paying for satellite radio.
With me, so far? But that's not all because even after absorbing the additional $3, the app still doesn't deliver what you really want from Sirius XM on your iPhone - MLB and NFL play--by-play, NASCAR, and some guy named Howard Stern. You can already read the "reviews" on iTunes from many less-than-thrilled subscribers.
So, the good news is that Sirius XM finally got its brand and a lot of its content on a different (hotter, cooler, etc.) platform. The bad news is that it will cost subscribers even more than they're already paying in a business proposition that has become steadily shakier. And for all that, the King of All Media apparently doesn't include the iPhone in his slogan.
Pass.
I'm sure this has happened to you. You're at a gathering with non-radio people, and inevitably the conversation turns to what you do for a living. And how many times have you been asked, "Isn't satellite radio killing you guys?" Or "How is AM/FM radio doing now that satellite radio has become so popular?"
Perception versus reality. Sirius and XM did such a great job in the early years, while broadcast radio sat around (or ran their commercials), that the buzz they generated continues to resonate to this day.
The problem is that the bloom has been off the rose for a long time now. And the most recent release of Sirius XM's first quarter results shows that they're shedding subscribers - this time, by 400,000 or about 2%.
The company blames poor auto sales, and while they're cutting costs, it doesn't change the fact that satellite radio has been leap-frogged by other technologies, and no longer is the "got to have" gadget.
We have been tracking this for years in our Tech Polls, where subscribership has been flat, but there are other signs of trouble. In last year's survey, we discovered the ugly truth that if satellite radio came with the vehicle that you purchased or leased, your commitment to continuing to pay was not very strong.
This year, we're tracking Sirius XM's subscriber satisfaction, which has been steadily decreasing since we began our surveys.
Based on current subscribers to Sirius XM
And the commitment to subscribe continues to be troublesome. This year, only half of Sirius XM customers say they "absolutely" will keep paying through the end of the year. Not a good sign.
Based on current subscribers to Sirius XM
Does this mean that satellite radio is over? No, because they still have some impressive content, major personalities, and they have always thought big. They have some options because of their assets, but with technology moving at such a rapid pace, and given this economy, there are lots of other new media threats of more importance to terrestrial broadcasters.
So, the next time you're at that backyard barbeque, graduation party, or baseball outing, and someone asks you whether Sirius XM will replace broadcast radio, you've got some fresh statistical ammunition.
You're Major League Baseball. You have a great product that has huge interest around the country, not to mention around the globe. You're trying to get your games on as many platforms as possible, while building revenue along the way. Sure, you're on satellite radio. But with all the troubles they have, and the lack of mobility (for the most part) with this medium, how do you address the growing mobile device business that provides true portability? (The portable transistor radio, by the way, wasn't so bad.)
So, you create an iPhone app. And you charge $9.99 for it, a small one-time price to pay for every streaming ball game from the Yankees to the Mariners. Even for folks who don't like to purchase apps, this is a pretty attractive deal in order to receive every game all season long. And it's not just the broadcasts - there are stats, interactive features, instant video highlights, and all the things that a baseball fan could want, in addition to choosing from the home team or the away team's announcer team.
You've made your choice. Yes, you cut a sweet deal with satellite radio, but you know all too well that with the meteoric growth of the iPhone ("There's an app for that"), you'd better get mobile and get cool in one fell swoop.
You're a fan. You have a strong interest in following your team (as well as others that compete in their division). So, you do the math. $12 a month for satellite radio - forever. Or you buy an iPhone for $200 (or a Touch if you're stuck with T-Mobile or something), and for an additional $10, you're good to go. You can take the device with you wherever you may roam all summer long.
Of course, on satellite radio, you get all those cool music channels. But on your iPhone, you get AOL Radio, Pandora, thousands of commercial stations, streaming channels, and the "cool factor" that comes with this device.
You're a radio broadcaster. The whole world is moving mobile. There are now 3 billion mobile devices out there - more than the number of TVs, radios, and computers on this planet. It's an industry that is looking pretty recession-proof. Consumers replace their phones every 18 months, many carry more than one, and more and more, they are inseparable. (Most teens sleep with their phones.)
You're streaming, and you're watching those statistics grow, but for the most part, this activity is limited to "tethered listening" on a desktop or laptop. You know you need to start thinking mobile, and every time you open the trades or USA Today, there's another big brand launching their iPhone app. You watch those iPhone commercials on TV, and you very much want to be on that hot-looking desktop.
You want your listeners to be able to take you anywhere - just how radio was when you were growing up, listening on your Walkman. But you've seen the Jacobs Tech Polls, the Arbitron/Edison "Infinite Dial" studies, and you've watched the "Bedroom Project" videos. You know that radio is losing its portability.
Apple may have cut you out of the iPod, the device that eroded radio's mobility, but they're letting you have presence on the iPhone. And It can be done, and for very little money. There are some attractive aggregated apps out there that any broadcaster can become a part of. If you've got a great brand, these can be good places to be, as long as consumers will go through the scrolling effort to find you. Of course, along the way, they may run into many other stations they enjoy, too.
There are also "stationalized apps" - what we're doing here at Jacobs - that will put your station right on the iPhone desktop. Beachfront property where your next door neighbors are Google, YouTube, Facebook, and Pandora.
Major League Baseball knows what it's doing. Just keep your eye on the ball.
As mentioned in an earlier blog, I attended Radio Ink's tech conference a couple of weeks back. The strong turnout was one of the most impressive aspects of the event. At a time when companies discourage convention attendance for any number of reasons, a big meeting room was jammed for two full days. It is a tribute to Eric Rhoads and his staff, and to everyone who found a way to get to San Jose for this conference. Obviously, there are many radio professionals who are still searching for answers, trying to learn how to integrate technology into this industry of ours.
As enlightening as some of the panels were, however, I couldn't help but wonder how radio is going to turn that next big corner and truly reinvent itself. As we watch venerable media outlets like The New York Times struggle, as hundreds of magazines fold, and as Sirius XM flirts with bankruptcy only to be bailed out at the Eleventh Hour, radio is still groping for answers.
It was noteworthy that many of the smartest professionals in our industry are groping around, and trying to unlock the monetization key. While it is clear to just about everyone that streaming, access on mobile and Internet devices, and texting are all mandatory at this juncture, how to get it all paid for continues to be the mystery of mysteries. Panelist after panelist circled around the issue, but there are painfully few war stories that broadcasters can simply take home and plug in to their markets.
Maybe part of radio's "answer" is to get back to where we once belonged. It was interesting to me that amid all the gadgets and technologies, several of Convergence's luminaries talked about the importance of being local and making a difference to listeners and communities. Both Guy Kawasaki and Craigslist's Craig Newmark talked about this value, especially as it pertains to customer service.
And it was also interesting to me that both of these Silicon Valley geniuses have their terrestrial radio favorites. For Guy, he couldn't stop talking about Classic Rock K-Fox and morning guy, Greg Kihn. And for Craig, he went out of his way to laud radio podcasts, and mention NPR's "On the Media" - a show he said he'd pay to listen to. These are hi-tech mavens who could occupy their time with a myriad of new content offerings, but in each case, they love aspects of broadcast radio. And Gordon Borrell reminded us, once again, of the power of radio's cume to drive thousands of consumers to any number of websites.
So, I left Convergence with mixed feelings. On the one hand, too many smart people recognize radio's promise, but in the process, warn against losing that local, community identity.
Local towns and cities are especially hurting these days, and it's hard for us not to notice those among us who are out of work, restaurants and local businesses that are closing, and factories that are shuttered. There's never been a better time for radio to turn its focus to the communities and towns that supported us all these years.
It may be a case of doing well by doing good.
While Sirius XM was being bailed out by Liberty Media yesterday, another key announcement was overshadowed by the news. The NAB's negotiation with SoundExchange for more than reasonable royalties on radio's Internet streams is an open invitation to broadcasters. Consumers aren't about paying for satellite radio. But they want to simply receive audio entertainment on a wide array of devices and gadgets - from computers to phones.
This new deal paves the way for radio to transcend towers and transmitters, and get serious about providing its content in new places, from desktops to laptops to iPhones. Radio has been struggling in the "location department" for several years now, but can now effectively compete in offices, cars, and while consumers are on the go with mobile devices.
But there's a catch. Radio needs to step up the quality and reliability of its streams. Too often an afterthought, we have seen up-close-and-personal what happens when stations produce inferior streams. We have now launched more than 30 iPhone apps (with more than that number currently in production). Sadly, we receive many complaints from users who are subjected to unreliable and poor quality streaming services.
It would be unthinkable for a terrestrial station to produce a signal that is inconsistent and poorly processed, but somehow when it comes to streaming, too many broadcasters haven't gotten the message. The Internet has democratized streamers. Everyone has the potential to be the equivalent of a 50,000 watts/clear channel online, whether it's a station owned by a big company, one run by a mom & pop outfit, or even streaming-only enterprises. But when broadcasters fail to step up by providing quality streams, they do themselves a major disservice - and they drive the digital audience elsewhere.
Don't buy iPhone apps or promote streams that will simply discourage users from coming back. There are too many great choices on the Internet, and too little time for disappointment. The NAB/SoundExchange deal is an important step that makes streaming for local radio affordable. But that assumes that radio companies will get the message, and do the basics that can make them competitive in the digital arena.
Mark's a good friend and a great observer of the media landscape. But in this morning's blog, he disparages the individualized radio station iPhone application, and instead, lauds RadioShiftTouch, an app that he says can get any station anywhere - for $9.99. So, you can get thousands of radio stations - terrestrial, streaming, etc. on your iPhone...
Versus your station - for free - on your iPhone, alongside Pandora, YouTube, Google Maps, and AOL Radio.
As Mark points out, "The iPhone is not about you, it's about your audience and what they want."
Precisely. And our nationwide Tech Polls continue to show that your audience wants to stream your station on their computers and handheld mobile devices. Yes, some of your more adventurous listeners might want to seek out that Ska station from Ireland, or a station they grew up with back in Omaha. But by and large, they want to be able to - simply - find your station on computers and phones, and listen whenever and wherever they want.
Big aggregator sites that offer thousands of stations aren't about the listener - they're about making lots of money by combining many, many stations together. The tyranny of choice is one of the reasons why satellite radio is failing. While subscribers have a couple of hundred stations available to them, the fact is that most people just tune in a handful. Similarly, that's the way most of us watch cable or satellite TV. We find our handful of favorites, and that's where we gravitate. The fact that there are hundreds of available stations is irrelevant to most people.
But even if you believe there's value to being a part of a Wal-Mart "big box" site, there are cheaper ways to be there, such as FlyCast (free) versus having to pay $10 for RadioShiftTouch. Most iPhone owners aren't crazy about paying for most apps to begin with, and this one's more expensive than most.
So an app that contains hundreds or thousands or an infinite number of streaming stations for $10 isn't really a service to most consumers. In fact, it's confusing and relatively expensive. A real service to your listeners is making it easy to receive your station on popular handheld devices.
I frequently agree with Mark about most things digital and media. But not this time.
And by the way, why wouldn't stations want both - their own individual icons on iPhones and being a part of aggregated sites?
Full disclosure - we are selling individualized iPhone apps, they are selling fast, they are working wonderfully, they are positively reviewed by consumers, and we couldn't be happier to be able to bring this service to an industry that could use a little good news.
It is fascinating that as the recession deepens, and media outlets big and small recalibrate their losses, radio continues to look good - in certain metrics. New national Arbitron data indicates that while TSL has dropped, overall listenership in the U.S. has jumped from 232 to 234 million this year to last. That's not a bad story overall, when you consider that "flat is the new up."
And why shouldn't the radio story get even better? As consumers reassess everything, there is increasing evidence that media and entertainment expenditures are under intense scrutiny. This is especially true for media that people pay for. We're all going through it, asking ourselves the ever-present question: What do we really need and what would be best left for better times?
Comcast is experiencing this right now as customers are calling the company looking for relief from high cable bills. They have developed more inexpensive cable bundles that limit channel access, while lowering monthly outlays. You have to believe that Sirius XM operators are taking similar calls from nervous subscribers.
A recent study from Nielsen Mobile indicates that more and more consumers are questioning why they have a cell phone and a landline. And many of them are in the 35-54 age range, not struggling college graduates or twentysomethings.
This is more evidence of the importance of our annual Tech Polls, the fifth of which is planned for February. As the recession alters media habits and expenditures, it will be even more important for radio to seize available opportunities. How are consumer habits changing? Are we possibly looking at lowered numbers for satellite radio and even iPod purchases in 2009?
Meanwhile, a free medium that offers so much entertainment and information may be perfectly cast for recessionary times. Radio could actually glean even larger audiences in the next year or so, especially if it more effectively makes its case to consumers - and advertisers.
There is a marketing campaign here. After all these years of satellite radio redefining our industry, isn't it time for radio to step up and aggressively take pride in what it does best, while pointing out radio's inherent assets? Is it "Radio Heard Here" or is it "Free Radio NOW?"
Lately, there's been a lot of focus on Detroit, and how Ford, GM, and Chrysler will pull out of this mess. There are a lot of factors in play, from the quality of their cars to union wages. But for those of us who live in and around the Motor City, there's also a sense that the marketing efforts from the Detroit 3 have been uniformly abysmal.
A case in point is the incessant promotion of satellite radio. Our Tech Polls - and now just about every media and technology pundit in America - continue to tell us that Sirius XM isn't the "X factor" that will sell new cars and trucks. Yet, you continue to see satellite radio touted in commercial after commercial.
We know these ads could be much more effective if they promoted the ability to plug one's iPod into the vehicle’s sound system. For so many consumers, that's a key selling point.
So why should we be surprised by the results of a study from Prosper Technologies that suggests that a new media allocation model is long overdue in the automotive industry? Surveying more than 17,000 consumers, they conclude that there's a "disproportionate allocation of spending on TV versus other media."
Yes, the advertising mavens tend to spend about 40% of their automotive budgets on TV, and yet, which medium does the Prosper model suggest is more effective?
As James Geoghegan, President of Media Head, points out, "These findings are nothing short of a complete re-think of media planning." Well, I guess so. And yet, radio takes a distant back seat to television in automotive media advertising. And it's looking more and more like the Internet could be the big winner in 2009. So what's the problem?
Some of radio's CEOs have submitted that it's all about perception. While many would take exception to that claim, in this case, they may be right. As the Prosper model shows, "the amount of radio consumed, its influence to purchase, combined with lower costs makes it a stronger media option, which according to consumers is under-utilized."
Sadly, radio is making a lot of negative headlines these days. Ongoing layoffs, the firing of popular personalities, and other events continue to put the medium in a bad light. And yet, the intrinsic value of radio - which was always overlooked even in good times - remains as an incredibly effective way to sell just about anything.
Even Impalas.
Today's guest blog is from our own Bill Jacobs, who provides reasons for us to listen to terrestrial radio. Why, you ask? Because it's free!
You don’t need me to tell you that we’re living in a very unique time, one that none of us could have ever imagined. With the exception of gasoline (which is definitely nice to see), prices are high or rising and so is unemployment. Concurrent with that is the reality that consumers are spending less on nearly everything – auto industry sales are plunging, and the Christmas retail season is looking scary. Satellite radio's woes are well documented, and an industry where subscribership has historically held up well - satellite television - Dish Network is experiencing declines.
All of these subscriber-based services cost money. Yet, terrestrial radio does not, and that remains one of its key selling points during this unprecedented economic tsunami. Few things in life (that are any good) are free. Douglas Gomery, the emeritus professor of journalism at the University of Maryland, notes that in rough economic times, two winners -- at least should be television and good old terrestrial radio. For the same reason that low-cost providers such as Wal-Mart (the lowest prices) and McDonald's (dollar menu items) appear to be weathering the economic storms, it stands to reason that, “TV and radio will both do well during a deep recession," according to Gomery. He goes on to state that “A poor economy is not likely to be kind to satellite radio services XM and Sirius – even as merged.”
In recent months, radio stations have faced tremendous cutbacks in all areas, but the expectation of viable entertainment every time a consumer punches up a station hasn’t waned. That, coupled with the fact that radio is arguably the best free media proposition, means that broadcasters must maintain a level of quality and consistency, even in difficult economic times. And while staying positive is a challenge, it's a must.
Should radio stations go on a full blown on-air campaign touting the fact that we're free? That’s a station-by-station call but certainly there’s a lot to be said for pointing out this very fact:
“WHO says the best things in life are free? WE DO – Rock 102, always on, always rockin’, and always free.”
As consumers continue to cut back on many entertainment options, it is crucial to remind listeners they get the most bang for their buck from radio:
"Cost of a new iPod? $299”
“Cost of four tickets to a Lions game? $200 and unending aggravation.”
“Cost of going to a movie with the entire family? $50.
“Cost of listening to Rock 102? Not a dime, though if you’re inclined to send us some money, we’ll gladly take it.”
How's that for a little free advice?
Schadenfreude. We all feel it from time to time, some of us more than others. It's that emotion that causes us to feel good when someone else suffers. Many people are feeling it about Wall Street brokers and the Detroit 3 CEOs right now. Whether it's rational or even nice, it's hard not to sometimes get a nice glow from someone else's pain - even if you aren't doing especially well yourself.
That's probably how a lot of broadcasters are feeling when they look at Sirius XM stock. When I wrote this blog, their stock was sitting at about 15-cents a share. So while most other radio broadcasting stocks aren't doing much better, you know there's a little schadenfreude going on, especially given Mel's famous quotes about how a company's share price ought to determine how it should be judged.
But here's a little piece of schadenfreude that isn't so snarky because it is well deserved. It turns out that Sirius XM is furiously working on an iPhone app (called StarPlayr). It sounds pretty cool, and the developers are frantically trying to make sure that it technically works and that it receives approval from the Apple Supreme Court.
Yet, it's not out, and "old media" broadcasters have been able to produce a solid iPhone streaming product for months now. Between aggregated sites like AOL Radio to FlyCast, groups of stations are available on iPhones. Isn't it interesting that satellite radio - always positioned as the future, the next big thing, and so much better than good old AM and FM - has fallen behind when it comes to technology? As their business model has been leapfrogged by new media and cool gadgets, satellite radio has been tethered to the way they've always done things.
And terrestrial radio has now moved even a step better. Pardon a little shameless self-promotion, but Jacobs Media's "stationalized" app allows individual stations to have their brands right on the desktops of iPhones all over the planet. Since we released our app last week - ahead of Sirius XM's - we have received dozen of inquiries, even in this lousy economy. Broadcasters big and small from the U.S., overseas, as well as Internet stations, quickly understood the beauty of this killer app. New stations will be coming online every week, as soon as we can get the simple process going. We are also getting stats that the downloads for the first "stationalized" app - WRIF's - are through the roof, reinforcing our belief that radio's best brands will excel on cell phones, in this case, iPhones. This begins radio's dream of being easily and attractively accessible on mobile devices. By the way, apps for WBOS (Radio 92.9 - Boston) and WRAT are also "up."
As for Sirius XM, dream on.
First, analysts of the radio business started getting fired. Many of you remember Deutsche Bank's James Dix, who was a fixture at radio meetings and conventions. Yesterday, Citi let radio analyst Tony Wible go.
Now, it's the demise of radio columnists in daily newspapers. Before this year is over, the famous Robert Feder (Chicago Sun-Times), John Smyntek (Detroit Free Press), and now Clea Simon (Boston Globe) will shut down their word processors, and radio reporting in their respective papers will come to an end.
While this says a lot about the health of print media, it also makes a statement about the state of radio. If the industry was making news, generating buzz, and dynamically impacting local markets, there would still be ample coverage. But when publishers and editors sit down to evaluate what parts of the paper consumers are reading, radio is falling by the wayside.
The loss of Howard Stern to a medium where he has become essentially invisible, radio's lack of marketing and promotion, and the overall talent drain that has seen great programmers leave for different pastures all conspire to keep radio off the media's radar screen. If you think about, most of the headlines from this year have revolved around PPM squabbling, rather than innovative programming, new formats, and initiatives that radio has initiated.
The fact that most radio stations have essentially stopped marketing makes this situation even more difficult. At least in many cities, newspaper columnists wrote about jocks, stations, formats, and rumors - all topics that keep the average consumer talking and thinking about us. Those days are clearly waning.
We cannot simply wait for the next natural disaster to illustrate the power of radio. Until we start making news of our own - with dynamic formats, breakthrough personalities, and technical innovations - radio is destined to fall even further off the map.
I know - today's post title sounds like the opposite of a Sally Field speech at the Oscars. But these days, it's a little rough out there in Radioland.
We're not feeling a whole lot of love from anyone - the agencies, the press, and even one another.
This is why I drew some gratification from some focus groups I conducted recently among young college-aged types. I went in expecting radio to be pilloried. I walked out thinking that there is still opportunity - if we went about it the right way.
As we have discovered in other research we've conducted at Jacobs Media, young consumers continue to stare at bright shiny objects. And that's not what radio is today. Whether it's the ubiquitous iPods, TiVos/DVRs, their cool new "can't live without them" phones, or even hot video games, there's no shortage of distractions and attractions for their entertainment time.
And where does radio fit in? Well, we're still there in cars, and from time to time, we score points for strong personalities, exposing local music, and community service. But it's a far cry from the role we played in their lives just a decade or so ago.
And we have to get our heads around that changed reality - and then we need to start making adjustments.
It's difficult out there, to be sure, but now is not the time to cut back on content creators, personalities, research, and any resources that can make for a more compelling product. While they may enjoy Pandora for a time, and the 3,000 songs on their iPods, radio still has that unique ability to be unpredictable, interesting, and a guide for what they should be listening to, and where they should go for entertainment.
Because a byproduct of rampant choice is decision stress. This is why the most popular satellite radio music channels are always the ones that play the biggest hits. Consumers are often confused about where to spend their money and their time. A smart, plugged-in radio station can play an important role in helping guide them through the morass. Who is the hot local band and where are they playing? Is the Aerosmith edition of Guitar Hero worth the money? A great radio station ought to be able to answer these questions, while guiding them through many others.
But not if we're voice tracking in more dayparts than we're live. And not if the jocks are involved in too many different jobs. And not if there's one poor web master doing the sites for all six stations in the cluster.
This is not the time to stop marketing. Maybe one of the reasons why radio creates as much excitement as hot running water or flipping on the light switch is that we have conditioned listeners to take us for granted. When we don't make a big deal out of our big brands, why would marketing-driven consumers take away a different message? By not doing anything, we're saying a lot about our stations, and essentially inviting listeners to think elsewhere when it comes to fun, excitement, and entertainment.
Radio still has some monster brands, but you'd never know it by the way they are often hidden from listeners and from advertisers. Only in radio do the highest rated stations so often get overlooked when it's time to dole out those precious marketing dollars. In radio, you don't get medical care until you get sick. The incessant HD Radio campaigns and their inability to stir consumers to purchase radios should suggest to us that marketing is about more than just running promos on our own air.
Isn't it interesting that a "new media" company like Apple continues to carpet bomb us with ads on "old media" outlets? Steve Jobs uses outdoor, magazines, and television to communicate messaging and imaging about hot products like iPhones. He realizes that marketing isn't evil. In fact, traditional advertising is the best way to build and sustain great products.
If Mel Karmazin can get his merger, and continue to run multi-million dollar ad campaigns to support a business that has never made money, surely there has to be a way to convince the geniuses on Wall Street that terrestrial radio needs to reinvest in its product, its people, and its marketing in order to realize the essence of what this business can truly produce. Unlike Sirius, terrestrial radio is already a great distribution outlet that reaches well more than 90% of Americans each week. As an advertising vehicle and a way to drive web traffic, its long-term viability has been proven. It just needs to adjust to the technical and cultural change that has taken place, and invest accordingly.
I will step off my soapbox now, but I invite all of you reading this blog to join us in Austin for Summit 13 as part of the R&R convention. We have some great sessions lined up, but the one that addresses some of the points that you've just read is our "President of Radio" panel. We are assembling nine of the brightest minds in radio and media to talk about how this business needs to address these daunting challenges. Our "Presidents" may not be the typical people you see on convention panels, but that's exactly the point. And our 10th "President" will be chosen from the entire industry because we've opened up the process to everyone and anyone in radio. We will name that person later this week, and I think he/she will bring excitement to an already compelling session.
We need to think differently. See you at the Summit.
In a new brief filed at the Supreme Court by some of the most influential people in broadcasting - Former FCC Chairmen Newton Minow and Mark Fowler, along with former FCC Commissioner Jim Quello - the FCC's attack on indecency has been referred to as a "Victorian crusade." Along with other top legal and regulatory mavens, the brief goes on to say that Commission policy squelches creativity and vibrant programming, and will lead to more bland broadcasting. It goes on to say that live broadcasts are an endangered species under the FCC's aegis.
Back in '04, we launched our own protest of the FCC and Congress' witch hunt to rid the world of Janet Jackson's breast, and words and ideas that might inflame the most radical conservative groups going after radio stations, and particularly, morning shows. Called Save Radio Now, we received a great deal of support from broadcasters, but little attention from the FCC or members of Congress that interface with the Commission. We have long believed that this ridiculous period in the history of the FCC is part of the reason why talent like Howard Stern departed for the more friendly confines of satellite radio.
It's nice to see the return of some sanity on this issue, and we can only hope that the November election brings a new attitude to the FCC.
XM's first quarter numbers are out, and what do you know? Its losses widened to nearly 6 percent, even though revenue is up. For the quarter, XM hemorrhaged $129 million, and their customer acquisition costs rose to $73 a subscriber (up from $65 last year).
And this is a business that deserves to be rescued by the DOJ and FCC? Is it just competition from other media or has XM (and Sirius) proved perhaps that over-spending on the programming side just isn't good business? Or does it cost so much to "acquire" (or subsidize) new customers that this business model just doesn't make sense.
To make matters more surreal consider Silicon Alley Insider's Peter Kafka's statement that “XM Satellite and Sirius, stymied by regulators for more than a year in their attempt to merge, are doing their best to press their case. XM’s latest move: Turn in yet another lousy quarter, which proves that it can’t survive as a standalone company.”
Now there's an interesting business strategy - keep losing mass quantities of money, and the government will be more encouraged to bail you out.
Or maybe consumers just don't want to pay for radio.
Speaking of "Radio's Hot New Team," which that we talked about last week, one of my favorite quotes of the year came from Jeff Haley, CEO of the RAB:
"Let's agree here and now that our goal will be to have radio on every mobile phone, PDA, and MP3 player in the next five years. On-air, online, on-site, and on-demand, radio must be anywhere and everywhere there is a speaker or headphones."
And it couldn't come any sooner, because as we see in our Tech Poll IV, more and more radio listeners are using the many technologies and gadgets at their disposal.
Plus, the competition isn't resting. XM announced recently that BlackBerry customers can subscribe to 20 channels. Of course, they're charging $7.99/month for the privilege, so we wish them good luck with this venture.
But it underscores the urgent challenge facing broadcast radio operators in their quest to spread their content to other devices. Haley's heart is in the right place, but the industry will need to move quickly in order to keep up with the Karmazins.
Our Tech Poll has provided us with some fascinating insights about the satellite radio threat during the past four surveys, and this new report is no different. As reported in yesteday's New York Times "Drilling Down" feature, XM and Sirius have some challenges retaining subscribers.
In the past, we've been able to track satellite radio growth among Rock radio listeners, as well as Howard Stern's impact on Sirius. Last year, we noted that XM and Sirius growth had stalled out.
This year's survey provides us with some great data. Here are some headlines:
1. The merger doesn't appear to be of great interest to non-subscribers. For the vast majority, there is indifference or a lack of information about the coming together of XM and Sirius.
2. Overall growth is up - from 12-13%, but interest in satellite radio among non-subscribers is at its lowest point since the first survey in '05.
3. As has been the case in past polls, satisfaction with Sirius is stronger than for XM. This could be due, in part, to Howard Stern who is obviously a big reason why our Rockers opted for Sirius in the first place.
But the big takeaway from this new '08 study comes from a question we've never asked before - how subscribers became subscribers. It turns out that while about four in ten made the choice themselves, about one-third tell us it came with the vehicle they bought or leased, while one-fifth received satellite radio as a gift.
And here's the rub - if you made the choice yourself, the odds are good you'll continue the subscription. But if it was pre-installed in your car or truck, or it was a gift, chances are better than you're not as enamored with satellite radio.
The implications of this are important because it suggests that not all satellite radio subscribers are created equal. And with half being introduced to XM or Sirius because it came with a car or it was a gift, these consumers are considerably shakier.
This "churn" with satellite radio continues to put pressure on a business model that has already had difficulty turning a consistent profit. And it speaks to the ongoing challenge of keeping subscriptions plumped up, in the face of some obvious attrition.
Commercial radio has some challenges, to be sure. But the subscription model is a tough putt, made all the more difficult by the plethora of new - and old - entertainment choices. While many traditional broadcasters have long been concerned about the growth of satellite radio, this data suggest that our challenges are clearly coming from other sources - notably, iPods, cell phones, and the Internet. Of course, these areas spell opportunity for broadcasters, and we'll continue to cover these topics in upcoming blogs.
Three years ago, this news story from late last week would have created massive "water cooler talk" in and out of radio:
In case you didn't hear (and you probably didn't), Artie Lange walked off the Stern show last Thursday after an incident with his personal assistant. This would have been the radio buzz, but instead, the entertainment headlines were all about Michael Johns getting booted from American Idol, Katie Couric's status at CBS, and a new Keanu Reeves movie that opened this past weekend.
It's about environment. While Stern's CPA is obviously reading this blog and laughing, the fact is that by placing himself on a much smaller stage, Stern has taken himself out of the mainstream of American media. People don't talk about his show because most of them can't hear it. Compare that to his terrestrial radio reign where even celebrities who were terrified of him went on the Stern show to promote their movies, books, and sitcoms.
We even saw this while working for Stern stations over the years. On the really well-positioned, solid stations, Stern pulled in those boxcar numbers that everyone remembers. But on the dogs - stations that were poorly programmed, also-rans, and or simply doing a lousy job - his ratings were not impressive at all. Even Howard couldn't compensate for being on a losing team.
Many personalities and operators make these same faulty assumptions when analyzing talent and environment. The aforementioned Katie Couric is either mis-cast on the CBS Evening News or the reality that she's moved from a great gig like Today to a much tougher putt in her new job is something that even she cannot overcome.
Many have suggested that terrestrial radio needs Howard Stern, because few personalities (if any) have stepped into his void. Or is that Howard Stern needs terrestrial radio?
This blog was inspired by KISW's Dave Richards, the guy who has most successfully replaced Howard Stern at his Entercom/Seattle station. He's still a big Stern fan, by the way.
The RIAA continues to keep its war with broadcast radio at a high-pitched level. Recently the CEO of the RIAA, Mitch Bainwol, applauded the XM/Sirius merger as "a powerful validation that competitors should play by the same set of rules. On the heels of this decision, the logic for a performance right for terrestrial radio has never been clearer." Wait - because the DOJ says that satellite radio competes with terrestrial radio, AM/FM stations should pay the same copyright royalty?
Bainwol should also check out the ratings if he wants to compare the impact of satellite versus terrestrial. In most markets, XM and Sirius earn small shares of listening (divided, of course, by the 200 stations they offer), while AM and FM stations capture the big box shares recording artists need to sell their product. Label execs know the difference in how a song/album sells in markets where the big FM stations add their product - or opt not to play it.
There's nothing level about this playing field. Satellite radio has struggled to reach 18 or 20 million consumers, while hemorrhaging money every year it has been in existence. It needed this government sanctioned merger in order to stay afloat. Terrestrial radio continues to reach 90-something percent of the population, while always been profitable, ubiquitous, and a sure-fire way to reach America, locally and nationally.
How can he compare the benefits that recording artists reap between satellite and AM/FM radio? It's logic like this that underscores why the recording industry finds itself in so much trouble, as its business model has been totally eroded by new media and empowered consumers.
AM/FM radio has been the best friend to recording artists over the past 50 years. The basic symbiotic relationship has always been very simple (payola aside). The recording industry provides free product to radio, and radio provides the lion's share of the airplay exposure and promotion. When labels actually paid for advertising schedules on radio stations, the game had elements of being fair.
Today, radio continues to provide free and enthusiastic airplay for artists, new and old alike. When an artist comes to town, stations in the same format fight for the "presents," providing hours of free advertising time promoting the recording industry's brand names. When a respected DJ tells his thousands of listeners that the new Foo Fighters album is the real deal, it means more than a bunch of spins on any XM or Sirius channel. And in the case of Rock radio, to be sure, the artists often snub local stations, content that their music will be played, and their concerts will be promoted, whether they show up for an interview or not.
The recording industry has problems, to be sure. But biting the hand that has so happily fed it all these years continues to remind us just how clueless the RIAA truly is. If anything, you might envision the RIAA approaching radio to find ways that two old institutions might work together to achieve each other's common goals. Instead, the RIAA has become a toothless tiger, trotting out bizarre research studies, chasing after 14 year-olds, and issuing statements like the one Bainwol just made.
How much radio has added to the coffers of recording artists over the years is incalculable.
Jacobs Media's Tech Poll IV highlights are now available on our website. While we asked our usual techie questions in this fourth annual poll about everything from text messaging to iPods to satellite radio, we also included a section about the upcoming Presidential election.
While we have no trending data from past elections, we were astonished to find out that 84% of respondents - and we're talking about more than 27,000 interviews from 69 Rock radio station databases - say they're planning on voting this fall. That's an incredible number, and it echoes the exit polls and primary turnouts that America has witnessed in '08. By the way, this strong projected turnout runs across age, gender, and format groupings.
We also held our own "mock election" inside the poll, simply listing out the candidates (no matchups), and asking for each respondent's top choice.
Barack Obama comes out on top among our "likely voters" with 26%, followed by McCain (22%), and Hillary Clinton (18%). The poll was taken in late Feb/early March, so some of the developments that have occurred since (Reverend Wright, Hillary's Bosnia gunfire gaffe, etc.) aren't factored in.
So what does this mean to radio and its personalities? Many morning shows have been taught to avoid "talking politics" because it can be polarizing.
And done the wrong way, this can be the case. But when 80+% of the audience is engaged by the election and plans on casting a ballot, personalities and shows need to find a way to address this event on-the-air, reflecting the local market vibe.
Jacobs Media clients who purchased their local market breakouts have an edge, because they can see party preferences in the poll, as well as the candidates of choice among their station's participants. But even if you didn't take part in our survey, this is the type of information that is readily available by conducting a brief poll on your own among members of your database. In this way, you can help guide your personalities with information that is relevant and market-specific.
This also should translate to a station's web presence, too. The Sound (WSWD/Cincinnati) has a great election page, complete with useful links that direct its audience about how to register to vote, as well as information from the various parties, the electoral map, and other resources. It reflects their audience's interest in the election, and The Sound's essence.
Once again, email databases are a critical - and often underused - connection to the audience, how they think, and what they want. There's more to these clubs than just sending email blasts about upcoming bar nights. They are a truly valuable resource that enough stations effectively tap.
In the coming weeks, we'll have more specific breakouts and results from Tech Poll IV. In the meantime, with just over 200 days before the Presidential election, it's going to be an exciting summer and early fall in America.
After more than a year, the DOJ has spoken, and the dreaded XM/Sirius merger is finally off to the FCC, where it will undoubtedly be approved - in some form. For traditional broadcasters, this has been one of those gut-wrenching issues that has inspired much debate in boardrooms across the country.
But that's been the case with satellite radio from Day One. In a style reminiscent of old radio war horses like Randy Michaels, satellite radio began calling out broadcast radio from the beginning. Remember, "Beyond AM, Beyond FM...XM?" Why wouldn't AM/FM operators get a little nuts when they saw these ads?
But today, while satellite radio is an irritant, it has been losing momentum for a couple years now. We've seen evidence of this in our Tech Polls, conducted among 25,000+ rockers each year - just the kind of consumers that XM and Sirius have been targeting. In our newest poll, we're already seeing that when XM or Sirius ends up in the new car or truck you buy or lease, one's propensity to renew the service is much lower than average. And overall, we're only seeing about a 56% absolute commitment to retain XM or Sirius among current subscribers - not exactly the numbers they want to see, merger or no.
While we won't know the new restrictions that satellite radio might have to follow once the merger is approved, we can only look at the DOJ's next to last paragraph for a clue about what the future may hold:
Any inference of a competitive concern was further limited by the fact that a number of technology platforms are under development that are likely to offer new or improved alternatives to satellite radio. Most notable is the expected introduction within several years of next-generation wireless networks capable of streaming Internet radio to mobile devices. While it is difficult to predict which of these alternatives will be successful and the precise timing of their availability as an attractive alternative, a significant number of consumers in the future are likely to consider one or more of these platforms as an attractive alternative to satellite radio. The likely evolution of technology played an important role in the Division’s assessment of competitive effects in the longer term because, for example, consumers are likely to have access to new alternatives, including mobile broadband Internet devices, by the time the current long-term contracts between the parties and car manufacturers expire.
And that's precisely what AM/FM operators ought to be thinking about, too. If you want to worry about something, consider the day when most consumers have the Internet available in their cars. Where will our stations be positioned in that tech smorgasbord when that day arrives? If you're in denial about that eventuality or you've rationalized that it may be many years away, consider iPod/mp3 player penetration - right now. Our same Tech Poll tells us that nearly six in ten respondents already own one, including nearly three-fourths of 18-34 year-olds. What does that tell us about radio's continued ability to be the "go anywhere" medium? And what does it also signal us about the incredible potential for creating and monetizing programming in the form of podcasts for these devices?
There's a future out there for AM/FM radio, and while satellite radio just got a second wind, the true forces that will most clearly impact traditional broadcasters are far more ominous. But radio has the opportunity to play in the new media sandbox, if it focuses - once again - on creating great content, while providing multiple distribution outlets for that content.
Jim Cramer's done it again. This time around, it's a frantic, wild-eyed rave against radio companies and radio stocks. In a borderline hysterical rant, Cramer pillories broadcast radio as being the worst of investments.
And the numbers don't lie. As he points out, radio's Wall Street performance has been horrendous. But that's also because the stock pickers just don't understand radio's value in a digital world. Yes, radio's financial effectiveness is being challenged, along with the medium's ability to compete against new technology. But radio is still a great advertising vehicle that puts butts in seats and bodies in stores. That's why radio continues to perform well in medium and smaller markets, where such arcane "metrics" like store traffic and bricks & mortar purchasing means so much.
But the real underlying reason for Cramer's tirade is his defense of the satellite radio merger. And in that regard, he speaks with a forked tongue. In the last three years, XM's stock price has lost about 60% of its value, compared to a nearly 50% dump by Sirius. And when you look at the way these companies have flushed millions of dollars into lavish talent contracts and content, along with questionable advertising and marketing campaigns, it's no secret why they need a government approved merger to survive. Cramer, however, doesn't address these “minor” fiscal issues and extravagances.
And this same guy, who lambastes every aspect of the radio business, goes on "Today" and nearly bursts into tears during a discussion of Eliot Spitzer's inane actions. It's one helluva roller coaster performance. This guy needs to chill.
Amidst all the entertainment news about celebrity breakups and marriages was the big story of a media breakup - and marriage.
XM Radio and AOL broke up their relationship to stream XM's streaming radio stations. Instead, AOL will partner up with CBS Radio, thus providing the broadcaster with an entire new exposure/revenue base. It's a big win for broadcast radio, and the latest defeat for the mighty, mighty satellite radio machine.
In response, XM will offer its 80+ commercial-free radio channels for $2.99/month, which will increase to $7.99 after six months. Good luck. Consumers are even less likely to pay for online streaming radio than they are for the entire satellite package, especially given the availability of similar options on any number of sites from Pandora to Kurt Hanson's AccuRadio - and even AOL - at no charge.
This story is another great example of "old media" fighting back, and doing it in a smart marriage with digital technology. Congrats to Dan Mason, the CBS group, and Ronning Lipset Radio on one of the big media stories of 2008.
