How's Radio look in today's Audio World?

Edison Research has done research for a presentation at the NAB Radio convention in Orlando this week. Here's a bit of what Tom Taylor reported in his NOW Radio Newsletter today:

"So the car (at 70%) now beats home (67%) as a listening location.

“Work” is 17%.

As for total listening to radio, satellite, streaming, audio-on-TV, etc. – “on average, people 13+ spend four hours a day listening to music, news, personalities and sports,” says Edison.

Second, some notes and quotes from yesterday’s RAIN Summit presentation by Edison VP Megan Lazovick –

30% of those in the study say there’s no radio receiver in their house.

That percentage is close to 50% for those under the age of 35".

I'm sure there are some regulars on this board that will have some thoughts. Should be interesting!

Tall Thin One said:

30% of those in the study say there’s no radio receiver in their house.

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No surprise. Gone are the days when people bought home stereos or even home theaters. That's really as much a statement on the change in the consumer electronics industry as it is for radio, since they're related. The only company doing any innovation in the audio receiver business is Amazon. Why did it take a mail order company to come up with such a device? Of course Google and Apple have their versions as well. But where are the Japanese? No wonder Sony is in so much trouble. Their TV business is dead, their computer business is dead, and their home electronics business is dead. The only thing they have is PlayStation. But as I've said many times, imagine if a radio company had come up with Alexa.

But yes, people can't listen to the radio if they don't own one, and the fact is that local talent isn't a good enough motivation to get people to seek out radio receivers somewhere (a bigger challenge since consumer electronics stores have almost disappeared.) If home receivers are going away, then radio companies better have a streaming plan. If not iHeartMedia, they better call TuneIn. Because the Amazon Echo may be replacing home stereos, but they only receive internet radio, not transmitter radio.

DavidEduardo said:

Of course, the elephant in the room is the fact that listeners believe "radio" means Pandora, Sirius/XM, and any source of audio without pictures. Even Mr Pittman and Mr. Field neglected to fully address this changing environment in their opening session at the NAB/RAB convention, although both did mention that they were now platform-agile.

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Isn't cume "reach?" Isn't PPM measurement a cume metric? Asking without contention. It's been noted by more than a few research and ratings savants that radio has become a cume vehicle more than a TSL or AQH vehicle as a result of PPM measurement. The research published today is compelling. BTW, "platform agile." Right up there with "paradigm shift." Another "Megatrends moment."

Not sure exactly what this topic has to do with Buffalo, other than Buffalo is a city that has radio stations.

Seems like a topic for National Radio. Or Business of Radio. IMHO

TheBigA said:

Not sure exactly what this topic has to do with Buffalo, other than Buffalo is a city that has radio stations.

Seems like a topic for National Radio. Or Business of Radio. IMHO

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True. Someone should alert a moderator. Oh wait, there's one on this thread...never mind.

DavidEduardo said:

Even Mr Pittman and Mr. Field neglected to fully address this changing environment in their opening session at the NAB/RAB convention, although both did mention that they were now platform-agile.

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And what perhaps they could have said is they are the ONLY radio companies that are "platform-agile," as you put it, and thus positioned for this new media environment. Everyone else is moored exclusively to their towers and transmitters. Their only window to the streaming world is TuneIn. That's the only way to get on the Echo and other devices. Only iHeart and Entercom own their own streaming platform, and thus can control the way their content is presented. Same with podcasting. They are dependent on making deals with (and sharing revenues with) other companies and platforms to reach audiences with their content.

The real elephant in the room however is what happens if iHeart is combined with SiriusXM and Pandora and LiveNation and Ticketmaster into one huge music/media empire run by John Malone? What happens to everyone else and their towers & transmitters?

TheBigA said:

And what perhaps they could have said is they are the ONLY radio companies that are "platform-agile," as you put it, and thus positioned for this new media environment. Everyone else is moored exclusively to their towers and transmitters. Their only window to the streaming world is TuneIn. That's the only way to get on the Echo and other devices. Only iHeart and Entercom own their own streaming platform, and thus can control the way their content is presented. Same with podcasting. They are dependent on making deals with (and sharing revenues with) other companies and platforms to reach audiences with their content.

The real elephant in the room however is what happens if iHeart is combined with SiriusXM and Pandora and LiveNation and Ticketmaster into one huge music/media empire run by John Malone? What happens to everyone else and their towers & transmitters?

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Could antitrust come into play in such an eventuality? Although if Sirius buying out XM and becoming the only company in the U.S. that can offer satellite radio isn't a monopoly, I don't know what is.

CTListener said:

Could antitrust come into play in such an eventuality? Although if Sirius buying out XM and becoming the only company in the U.S. that can offer satellite radio isn't a monopoly, I don't know what is.

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SiriusXM is a government approved monopoly. There are no other satellite radio services. They are now buying Pandora. But SiriusXM is partly owned by Liberty Media, and Liberty had proposed buying a part of iHeart. So certainly as some point the government will get involved.

My point of mentioning this is, for the most part, the radio companies only own radio stations, except for iHeart and Entercom. Cumulus and Hubbard are involved to some degree in podcasting, but neither own their podcasting platforms. So IF the audio world is diversifying (and it is), and if only two companies are positioned for the new audio marketplace, where does that leave everyone else?

TheBigA said:

SiriusXM is a government approved monopoly. There are no other satellite radio services. They are now buying Pandora. But SiriusXM is partly owned by Liberty Media, and Liberty had proposed buying a part of iHeart. So certainly as some point the government will get involved.

My point of mentioning this is, for the most part, the radio companies only own radio stations, except for iHeart and Entercom. Cumulus and Hubbard are involved to some degree in podcasting, but neither own their podcasting platforms. So IF the audio world is diversifying (and it is), and if only two companies are positioned for the new audio marketplace, where does that leave everyone else?

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Lawyering up and trying to fight the inevitable to the death?

CTListener said:

Lawyering up and trying to fight the inevitable to the death?

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They'd be better investing that money on the future.

TheBigA said:

No surprise. Gone are the days when people bought home stereos or even home theaters. That's really as much a statement on the change in the consumer electronics industry as it is for radio, since they're related. The only company doing any innovation in the audio receiver business is Amazon. Why did it take a mail order company to come up with such a device? Of course Google and Apple have their versions as well. But where are the Japanese? No wonder Sony is in so much trouble. Their TV business is dead, their computer business is dead, and their home electronics business is dead. The only thing they have is PlayStation. But as I've said many times, imagine if a radio company had come up with Alexa.

But yes, people can't listen to the radio if they don't own one, and the fact is that local talent isn't a good enough motivation to get people to seek out radio receivers somewhere (a bigger challenge since consumer electronics stores have almost disappeared.) If home receivers are going away, then radio companies better have a streaming plan. If not iHeartMedia, they better call TuneIn. Because the Amazon Echo may be replacing home stereos, but they only receive internet radio, not transmitter radio.

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Exactly. This is the new reality. And I sometimes doubt the radio industry is cognizant of the changes ahead. Or how close they actually are.

Bongwater said:

Exactly. This is the new reality. And I sometimes doubt the radio industry is cognizant of the changes ahead. Or how close they actually are.

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I think "the industry" is, because "the industry" books a lot of futurists and technologists at their annual convention (which just took place last week).

However, I'm not sure the smaller radio companies or radio owners are taking this seriously. There are two groups of radio owners: Those who are prepared, and those who aren't.

TheBigA said:

No surprise. Gone are the days when people bought home stereos or even home theaters. That's really as much a statement on the change in the consumer electronics industry as it is for radio, since they're related. ...

But yes, people can't listen to the radio if they don't own one, and the fact is that local talent isn't a good enough motivation to get people to seek out radio receivers somewhere (a bigger challenge since consumer electronics stores have almost disappeared.) If home receivers are going away, then radio companies better have a streaming plan.

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You bring up the point that electronics are changing and improving. That has sculpted the market as much as content. Those are ultimately the two defining factors of any media.

In the 70s, you'd have to buy a large set up of receiver and speakers in order to get an excellent audio experience from electronics. Today, thanks to microarchitecture and other advances, you can get a fairly nice audio experience from small speakers and a computer, or a rather small am/fm receiver.

In the 70s, a large audio rig to give you a fair audio experience would set you back about $1000 in today's money. To get the same audio experience today, you need maybe $200-or-less (if you own a computer for audio content). And the modern stuff takes up less space and has more functions!!

But the reason so many electronics are failing to sell, and why the electronics market is changing, is ultimately that the CONTENT is not engaging people. Who would spend $5000 for an amazing TV-stereo-theater rig when there is nothing worth watching? Why buy any radio if all radio is boring? Despite electronics getting cheaper and higher quality per price, the content is dismissed by most people. (Yes, there is still a profitable audience in all media, but it is a much smaller audience these days than prior to online/streaming).

The laptop/desktop/phone/tablet is now a superior product because it lets you listen to audio, write mails, contact people, take photos, view photos, write papers, watch video, do work. So it is a premium quality device, and people will flock to content on there because it is fresh and connects people to a wider range of entertainment.

However, these computer-devices have lousier audio. No fear! Audio mastering and music has generally adapted people to lower-quality audio over the last few decades via compression and. "loudness wars" and distortion of instruments and sounds. So the fidelity of FM radio isn't valued by the audiences.

So now most people merely gravitate to the content and not the quality. But price plays a large factor: why would people pay when they can free-milk a cow? That is why terrestrial radio is still so strong! It would have vanished if other media was completely free. Many people will NEVER subscribe to satellite radio due to free radio being so accessible. There are many who will subscribe, because they have the disposable cash, but not as many as get free radio.

On the content side, FM radio is now massively conglomerated and homogenized. Most radio is McRadio, and even worse for radio sales--these McRadio stations are streamed online!! So why buy a radio? Younger people (cash strapped) merely listen on their all-in-one smart phone. Who needs an actual radio??

And an even darker side of content, the gateway to radio via internet streaming offers overly repetitive content, corporate-stale content, ridiculous sounding voices saying ever-decreasing levels of humor, intellectual content, worthy news, or engaging entertainment. It is a slurry of regurgitated culture and immature jokes or phony personalities.

Thus the results of. the Edison research. Thus the current state of radio.

What is the future? Online and ultra-local. The market will divide more and more into the future, as the iDevice generation/s get older. Everything will go online, but the unique mom-pop local-news FM content will have a strong appeal to the local audiences. If it isn't ultra-local, it will be online. Anything that is super-successful in the ultra-local market will most likely get pulled up to the McRadio online and pushed via streaming devices.

People will continue to buy radios, but they will be small, inexpensive, and multi-functional like many modern radios that cost $50, get AM/FM, connect to the smart phones, have alarms, etc.