tag:blogger.com,1999:blog-72213068644034812452024-03-13T01:10:45.839-07:00Navigate the FutureInsight into today's media consumerDave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.comBlogger55125tag:blogger.com,1999:blog-7221306864403481245.post-72583798797526831232010-10-29T14:02:00.000-07:002010-10-29T14:58:36.782-07:00The Performance Rights Issue Means More Work for ProgrammersDespite what you may read or think about the music royalty payment debate for terrestrial radio, it is highly likely, in this reporter's opinion, to become a reality soon.<br /><br />This will result in at least three significant changes in the radio industry:<br /><br />#1<br /><br />Stations paying more for the right to play music - especially new music - will force hundreds of stations to choose to change formats to no music/more talk or radio formats that will take advantage of the wealth of unlicensed, independent artists and groups that are producing some darn fine music.<br /><br />This move will inspire the rise in acceptance on FM of some current non-music formats such as news, news/talk, the new comedy radio format that was introduced in September and others that haven't been thought of yet.<br /><br />This will help radio operators in at least two ways:<br /><br />a) they will not be subject to unrealistic increases in music licensing fees and<br /><br />b) the move to non-music formats will save stations over 50% in their <em>current </em>music licensing fees (BMI/ASCAP/SEASAC).<br /><br />What a deal!<br /><br />#2<br /><br /><strong>More creativity</strong>. Added performance fees for stations that continue to program music will force those stations to play <em>fewer </em>songs in order for their business models to function in a positive zone.<br /><br />And as a very good friend and I were discussing over lunch the other day, playing fewer songs will force/encourage stations to develop other programming content that will not fall within the performance rights category.<br /><br /><strong>In other words, the performance royalty fee increase will force today's programming people to be more creative - to rely less on the easy use of music to fill the space between commercials and actually create new content that will be compelling for listeners.</strong><br /><strong></strong><br />Imagine being compelled to listen to terrestrial radio because it will be offering exciting, fun, entertaining and interesting content that is proprietary and not available elsewhere.<br /><br />This is starting to sound pretty OK!<br /><br />What the industry may lose on the added royalty fee it will surely benefit from with fresh "compelling content" which should generate more audience which should increase advertising billing!<br /><br />#3<br /><br /><strong>New music formats</strong> that take the added royalty into account. There are at least three never-before-heard radio formats ready to go that have been vetted in the field by Bridge Ratings & Research. Maybe some radio companies will find the courage to save themselves some money with exciting new radio programming.<br /><br />What a concept!<br /><br />So, ultimately, while the majority of the radio industry stands opposed to or at least doesn't see the fairness of the much-discussed performance royalty agreement, the industry will benefit from this forced "tax" by causing it to work harder to be better.<br /><br />Perhaps this is the straw that finally pushes terrestrial radio to the point of action after at least ten years of stifled creativity.<br /><br />Perhaps this will generate more jobs for the creative-minded programmers who have either lost their jobs over the last few years or left the business due to frustration.<br /><br />And perhaps it will even open the eyes of young music-fans seeking employment who will once again see terrestrial radio as a viable platform to present their ideas and bring fresh blood into a radio industry that has been struggling to find new talent.<br /><br />Yes, it's quite possible there is a silver lining to this whole new royalty thing...<br /><br />Who's up for the challenge?Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-36683630448237983832010-07-29T13:40:00.000-07:002010-07-29T14:37:25.909-07:00Why Do You Keep Asking That Question?<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtGX3LqzTcKkfWbGhgeeCMgkK3vmaaTjUYwHIS9UUXW6YECchlZ4J2awKlVL_WW46Cq7GfwiV_97teTEd49MifKQ9uaWPykp9D5b2TlV40uy6_Y5PPcnp-F46HQyBNvueQKYy8r4IpZ_fx/s1600/Caution+Sign.PNG"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 200px; FLOAT: left; HEIGHT: 120px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5499441044833467618" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtGX3LqzTcKkfWbGhgeeCMgkK3vmaaTjUYwHIS9UUXW6YECchlZ4J2awKlVL_WW46Cq7GfwiV_97teTEd49MifKQ9uaWPykp9D5b2TlV40uy6_Y5PPcnp-F46HQyBNvueQKYy8r4IpZ_fx/s200/Caution+Sign.PNG" /></a><br /><br /><div><br /><br /><br /><div><br /><br /><div><br /></div><div>"Is radio ready for a digital future?"<br /></div><br /><div></div><br /><div>It's a question that has had high visibility over the last six weeks.<br /><br /></div><br /><div>"Is radio ready for a digital future?"<br /><br /></div><br /><div>It's been the title of a <a href="http://www.bridgeratings.com/press.06.30.10.Social%20Media%20Impact.htm">Bridge Ratings Study </a>that was released on June 30, 2010.<br /><br /></div><br /><div>And the title of a <a href="http://www.blogger.com/www.tritondigitalmedia.com/knowledge/webinars.php"><span id="SPELLING_ERROR_0" class="blsp-spelling-error">webinar</span></a> I presented in July.<br /><br /></div><br /><div>So, why did I give the title to this blog and why should you care?<br /><br /></div><br /><div>Because after six weeks of <span id="SPELLING_ERROR_1" class="blsp-spelling-corrected">disseminating</span> this data across the web and in person, I'm finally ready to answer the question for you.<br /><br /></div><br /><div>This was the most important graphic from the study and my <span id="SPELLING_ERROR_2" class="blsp-spelling-error">webinar</span>:<br /></div><br /><div><br /><a href="ftp://www.bridgeratings.com/customer%20Interests-Satisfaction%20Attained%20-%20Copy.JPG"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 202px; FLOAT: left; HEIGHT: 141px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5499434323141378562" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgndYlqpZa4K2qR7rxY6i7KAsV3egfoScMSQXQNTjp3fnxtcGP0Eml9l2TaKGH3nE2vVECr7Aha4-DQ1L3n3IMjDFW216cRPNpJnFH6JemhHK59-ckR9kYaS7ze0bO9320DRB1EEi0n7wgj/s200/Consumer+Interests-Satisfaction+Attained.JPG" /></a><br /><br /></div><br /><br /><br /><div></div><br /><br /><br /><div><br /><span style="font-size:85%;">[click image to go to study]</span> </div><br /><div></div><br /><div>This chart represents just how well terrestrial radio is satisfying radio listeners' <span id="SPELLING_ERROR_3" class="blsp-spelling-corrected">Internet</span> needs.<br /><br /></div><br /><div>Not too good. (Pardon my <span id="SPELLING_ERROR_4" class="blsp-spelling-corrected">grammar</span>, mom)<br /><br /></div><br /><div>The answer to the question is....<br /></div><br /><div><br />No. Radio is not ready.<br /><br /></div><br /><div>Why?<br /></div><br /><div></div><br /><div>Though its perception among radio listeners is poor, radio has all it needs to make it right.<br /></div><br /><div><br />Radio is having a good year. That's what I read and that is what market managers tell me.<br /><br /></div><br /><div>Why not reinvest some of that new profit into the cost of setting up a qualified digital department?<br /><br /></div><br /><div>Remember the story of the squirrel storing his nuts for a cold winter?<br /><br /></div><br /><div>That's what radio's owners and operators are doing. Very few are taking the <span id="SPELLING_ERROR_5" class="blsp-spelling-corrected">new found</span> (and temporary) <span id="SPELLING_ERROR_6" class="blsp-spelling-error">flushness</span> and sinking it back into the product where it needs it.<br /></div><br /><div><br />Radio is gathering its profit nuts after a dismal 2009.<br /><br /></div><br /><div>Who can blame them?<br /></div><br /><div></div><br /><div>But still, the industry has the money to make some effort to build out a respectable digital division.<br /></div><br /><div></div><br /><div>It can hire the right people.<br /></div><br /><div><br />It probably has the right equipment.<br /><br /></div><br /><div>If it doesn't have the know-how, it can hire that, too.<br /><br /></div><br /><div>So, if all of this is true, why does radio management avoid making the commitment?<br />Because it takes <span style="font-size:180%;">courage</span>!<br /></div><br /><div><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg-fgVF5oLPsr4Bc2_2VSqJfWg2ueAjExLJPjfoRCZsXA9Swyd1psV_OSP1tWWSJWtxB3XkmdKCCdBfKo32sYJGiCOl3WsFh1Av8YFRSonsjsvjJtFBaY-iU1zrzIO-vCUYkSlAFpoEPEfG/s1600/Courage+1.bmp"></a></div><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhkcHd3zHj5qkFyXupjhtB2FkPkKl43UbsIfhK47qpDDmA9G6E4ciqC8gDhiUfAwoOFu_8fZe0u5mQwZL0qC-v1y0Z13WWyTGz0K3jpRN5KzF-7TB3fi_ZTk16tR6lgUHk1n6Wm4SJegLm6/s1600/Courage+1.bmp"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 107px; FLOAT: left; HEIGHT: 143px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5499437801730732530" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhkcHd3zHj5qkFyXupjhtB2FkPkKl43UbsIfhK47qpDDmA9G6E4ciqC8gDhiUfAwoOFu_8fZe0u5mQwZL0qC-v1y0Z13WWyTGz0K3jpRN5KzF-7TB3fi_ZTk16tR6lgUHk1n6Wm4SJegLm6/s200/Courage+1.bmp" /></a><br /><br /><br /><div><br /></div><br /><br /><br /><div></div><div></div><div></div><br /><br /><div>Yet, COURAGE is precipitated by a perceived threat. That's what Daniel Webster tells me.<br /></div><br /><div>So, "this must be it", I think to myself. This is why the industry as a whole is not moving itself forward fast enough.<br /><br /></div><br /><div>No courage.<br /></div><br /><div><br />Because there is NO PERCEIVED THREAT.<br /></div><br /><div><br />And despite the fact that the threat is clear from digital entertainment options, by the time terrestrial radio perceives the threat and act, it will be too late.<br /><br /></div><br /><div>The industry does have its handful of owner/operators who are investing as they are able.<br /></div><br /><div></div><br /><div>And, for that, I am grateful.<br /><br /></div><br /><div>But, it's the industry that is the concern.<br /><br /></div><br /><div>Time is running out and the radio industry's place may well be marginalized by this time next year.<br /><br /></div><br /><div>So, there. Asked. And answered.</div><br /><br /><div></div><br /><br /><div><br /></div><br /><br /><br /><div></div><br /><br /><br /><div><br /></div><br /><br /><br /><div></div><br /><br /><br /><div><br /></div><br /><br /><br /><div></div></div></div>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com1tag:blogger.com,1999:blog-7221306864403481245.post-63801990056561410532010-06-21T12:47:00.000-07:002010-06-21T16:11:53.017-07:00Losing the Great Advantage<div>Businesses have been trained for decades to beat the competition and to make a killing. Management principles are often taught using military strategies as analogies.<br /></div><div>Yet in the natural order of things, being at the top and having the competitive advantage is merely transitory. In the realm of entertainment, new technologies are part of the evolutionary process. And because we are not returning to the way things used to be business, media in this case, is being called upon to be different and to operate differently.</div><div></div><br /><div>The competitive advantage mass media such as radio have possessed for decades, is slipping away.<br /></div><div>In a study conducted earlier this year on <a href="http://www.bridgeratings.com/press_02.01.10.StreamingTrends.html">listener streaming trends</a> as well as a report published in <a href="http://www.bridgeratings.com/press_08.29.2007-MusicConsumption.htm">2007</a>, Bridge Ratings analyzed music consumption among radio listeners as well as <em>new music discovery.</em><br /></div><div>The essence of the 2007 study was that if traditional radio didn't respond to the new music discovery needs of its youngest listeners (12-24 year olds at the time), those listeners would find it elsewhere....and without hesitation.</div><div> </div><div>This has happened.<br /></div><div>The recommendation was for youth-oriented radio formats to take a much greater foreground approach to presenting and offering new music. At the time, and continuing to today mind you, programmers of these stations have done little to capture this new music curiosity exhibted by young music fans once the Internet introduced us to Napster, iTunes, Pandora and the dozens of other websites and applications that allow customized music consumption.<br /></div><div>But the Bridge Ratings study uncovered a jewel. Young listeners to traditional radio who had wandered to other sources for their new music habit, had higher expectations from terrestrial radio and actually wanted radio to offer more new music.<br /><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjFGaEC6RLuYjOn_T-6RbdXPG_cyiYkWBKP1jmLU-I5-d__Z_KjQvCXSUPyr1T0ABldRNXLnNqwU9SJQ5mzc-p34fFhPxcrs8HL8dAtR2izXhndxZx5BA1lHqFZr9DCYTqWO8reJKWZElqO/s1600/Discovering+New+Music+10.23.09.JPG"><img style="WIDTH: 200px; HEIGHT: 118px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5485322868294095922" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjFGaEC6RLuYjOn_T-6RbdXPG_cyiYkWBKP1jmLU-I5-d__Z_KjQvCXSUPyr1T0ABldRNXLnNqwU9SJQ5mzc-p34fFhPxcrs8HL8dAtR2izXhndxZx5BA1lHqFZr9DCYTqWO8reJKWZElqO/s200/Discovering+New+Music+10.23.09.JPG" /></a><br />Why?<br /></div><div>Because while searching on-line and using Pandora, etc., can be fun, it is also fatiguing and takes time. Young listeners to traditional radio kept coming back to FM radio to check in and see if there was more new music content. Unfortunately, what they found was uninteresting to them.<br /></div><div> </div><div>And in the intervening time since that study was published, little has been added to youth formats to return them to traditional radio.<br /></div><div>And now I fear it is too late. </div><div> </div><div>A soon-to-be published Bridge Ratings study will continue to show significant usage (time-spent-listening) attrition for traditional radio among young listeners. That may not come as any surprise to you.</div><div> </div><div>What may surprise you is those 12-24 year olds we surveyed in 2007 are now 15-27 year olds and radio's appeal to the 18-34 year olds is also fading.</div><div> </div><div>Over time these listeners have gotten used to going elsewhere for this music discovery. They want to learn about what's the best of the best new music released each week and use that knowledge to guide them as to what to download.<br /></div><div>It's no different, really, from when I was growing up. Seems my friends and I were trained by our Top 40 stations that on Tuesdays at 2pm, the new songs of the week would be featured in a countdown. We'd listen.<br /></div><div>And we went down to our favorite record store and purchased the ones we liked.<br /></div><div>Nothing has changed.</div><div> </div><div>Why does traditional radio ignore the signs that many research companies like Bridge Ratings continue to publish?<br /></div><div>I do not know.<br /></div><div>I know this much though.<br /></div><div><br />Contemporary music radio is rapidly becoming marginalized - pushed out to the farthest reaches of awareness and interest - because its audience is not being served. And as more alternatives become available, there is less desire to discover whether FM radio is responding.<br /></div><div>It is remarkable that in the face of so much new technology and alternative entertainment, there is generally a lack of aggressive content development and technical adaptiveness at traditional radio headquarters.</div><div> </div><div>CEO's have forgotten their business training. They have lost their courage to compete aggressively.<br /></div><div>Whether it is a product of false security or just obtuse planning, terrestrial radio is in a position to lose its traction with a dominant audience most digital businesses covet.</div><br /><div></div><div>A friend of mine at Harvard Business School has advised me that it is a good thing that radio is losing the competitive advantage.</div><br /><div></div><div>Why?</div><br /><div></div><div>Because, he says, sustainability in the new world order of digital media requires that the "old" lose their competitive advantage in order to shake its owners and management out of its doldrums and sense of security. This, in turn, is supposed to fire them up - dig deep within its creative teams to reinvent themselves.</div><br /><div></div><div>This, I am told, is how business in 2010 faces shifting competition.</div><div></div><br /><div>I have yet to see this "digging deep" that is supposed to reinvigorate the radio business.</div><div></div><br /><div>If it doesn't happen soon, traditional radio may find itself not only marginalized, but it may find that it is included in a business course case study called "Terrestrial Radio: How it Lost the Great Advantage".<br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEins_ILbJ_4KBZ0rgC0RB89CmP8NsIoQaKLEhB5WHeJjFX-FIRxjQkhtvcpnhb-sHqTL9s8vbqbcAHDbLUJTsyCvyHKsd5wXu_KDQbNaPfWe8-nXtuaIniA4c16pU68ipX96w2RfxUS4ymE/s1600/dvdsig2.jpg"><img style="WIDTH: 200px; HEIGHT: 108px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5485365151884717794" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEins_ILbJ_4KBZ0rgC0RB89CmP8NsIoQaKLEhB5WHeJjFX-FIRxjQkhtvcpnhb-sHqTL9s8vbqbcAHDbLUJTsyCvyHKsd5wXu_KDQbNaPfWe8-nXtuaIniA4c16pU68ipX96w2RfxUS4ymE/s200/dvdsig2.jpg" /></a><br /></div><br /><div></div><br /><div><br /></div><br /><div></div><br /><div><br /></div><br /><div></div><br /><div><br /><br /></div><br /><div></div><br /><div><br /><br /></div><br /><div></div>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-58592225630193439682010-05-24T10:17:00.000-07:002010-05-24T11:54:38.448-07:00Retracting a Mistake<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgBuoxwta-_tH-ve8DLc-LJ-sl2Bm7LCto7XY_cQkWgRNdOUKU1fdo_kLYfSoVxbWz7wI5i_7VAUSy6PkRlZDv2CvC4UDQvVWMZ1CGIY7e2TUPCuwebKKtXh2wv-45WqcRMgSY0XUJC4qM6/s1600/Crossed+Fingers.jpg"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 135px; FLOAT: left; HEIGHT: 135px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5474909966624906722" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgBuoxwta-_tH-ve8DLc-LJ-sl2Bm7LCto7XY_cQkWgRNdOUKU1fdo_kLYfSoVxbWz7wI5i_7VAUSy6PkRlZDv2CvC4UDQvVWMZ1CGIY7e2TUPCuwebKKtXh2wv-45WqcRMgSY0XUJC4qM6/s200/Crossed+Fingers.jpg" /></a><br /><div></div><br /><div></div><br /><div>Back in August of 2009, I wrote a blog called "<span id="SPELLING_ERROR_0" class="blsp-spelling-corrected">Optimism</span>: 2010's Secret Weapon". At the time, the point was that optimism will help turn around the business environment. And that would lead to clear thinking on the part of management. </div><div> </div><div>I think it's time I retracted that blog because optimism is steering management down a rocky road. </div><br /><div>As it turns out, optimism and an improving advertising climate have so far turned 2010 into a fairly positive environment for many businesses, and certainly for the media industry.<br /></div><br /><div>First quarter advertising improved 6% for traditional radio and was off the charts for <span id="SPELLING_ERROR_1" class="blsp-spelling-corrected">Internet</span> advertising expenditures, including <span id="SPELLING_ERROR_2" class="blsp-spelling-corrected">Internet</span> radio. A good sign, right?<br /></div><br /><div>Wrong.<br /></div><br /><div>The mood among corporate <span id="SPELLING_ERROR_3" class="blsp-spelling-error">CEO's</span>, terrestrial radio group heads and regional managers is positive but cautious. As they should be.<br /></div><br /><div>The revenue increases published for the first half of 2010 bring smiles to many broadcast operators, but comparisons to 2009 are deceiving.<br /></div><br /><div>The second half of 2010 will compare a bit less favorably with its 2009 counterpart and as 2010 closes in on another holiday season, the "comps" with 2009 will be less invigorating.<br /></div><br /><div>I think broadcast leaders understand this.<br /></div><br /><div>And that is why many are not reinvesting into their businesses this year; a year which is thus far the best revenue year in quite a few.<br /></div><br /><div>Not reinvesting some of 2010's profit is a natural strategy for business operators who found their companies down 20-25% in revenues in 2009 and 15-20% in profits. They now find themselves in positive territory for the first few months of 2010 - they are making up some of the ground lost last year and they want to hold on to it.<br /></div><br /><div>A fairly powerful argument can be made for that strategy - in a normal year.<br /></div><br /><div>But as 2010 goes skipping into the future, perhaps you have noticed the ferocious pace at which digital media is galloping along, breaking down the barriers to consumer adoption and putting the squeeze on traditional media. </div><br /><div>My concern is that the optimism that began blooming at the end of January of this year, has morphed into a conservative spending mentality which will leave traditional radio marginalized - at best - as 2010 turns into the year of the Rabbit. </div><br /><div>Digital media consumption has reached a tipping point; more average consumers are discovering all sorts of cool ways to get their media fix. And with radio's final bastion - the car - quickly being penetrated by <span id="SPELLING_ERROR_4" class="blsp-spelling-corrected">Internet</span> radio and devices that make it easy to consume, traditional radio could have an uphill battle in 2011. </div><br /><div>Bridge Ratings will soon publish its revenue projections for 2011 and the forecast is not as <span id="SPELLING_ERROR_5" class="blsp-spelling-error">rosie</span> as 2010.<br /></div><br /><div>2009 revenue was down 18%.<br /></div><br /><div>2010 traditional radio revenue will be up 4%.</div><br /><div>2011 revenue will be down 2%.<br /></div><br /><div>Comparisons to 2010 will not look as strong as they do this year.<br /></div><br /><div>The political advertising infusion which many are expecting during the second half of 2010 will be missing in 2010.<br /><br />Investment in traditional radio operations (digital development and advancement) will be hard to find. This cycle could be sustained for at least another two years. </div><br /><div>See what I mean? Marginalization of traditional media is a very real possibility with no aggressive business development in sight. </div><br /><div>Optimism is certainly refreshing after 5 or more years of dismal business trends.<br /></div><div>It's time to turn that optimism into purposeful re-investment and rapidly enhance traditional radio's ability to compete.</div>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-22867372020533541432010-04-23T08:52:00.000-07:002010-04-26T10:58:29.987-07:00The Clock is Ticking<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0ifwwAQZKEMgFbYtaB4o9oTUeT4yXCuQvF_Aqw1rvU4GqLcN7zfqsnBTOZoAPOKbLbYo3Gecs9sWJos9IGhkRXVrOCzAEMy3VSZ1hORpBHMc0HMFHB5eD08kMfA1Ho2Y8YfJQ4l5sP_AI/s1600/Dangerous+Cliffs+2.jpg"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 123px; FLOAT: left; HEIGHT: 82px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5463369326365589474" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0ifwwAQZKEMgFbYtaB4o9oTUeT4yXCuQvF_Aqw1rvU4GqLcN7zfqsnBTOZoAPOKbLbYo3Gecs9sWJos9IGhkRXVrOCzAEMy3VSZ1hORpBHMc0HMFHB5eD08kMfA1Ho2Y8YfJQ4l5sP_AI/s200/Dangerous+Cliffs+2.jpg" /></a><br /><br /><div><br /><br /><br /><div><div><div><div></div><div>First quarter revenues for the radio industry are UP. UP big time. Depending on whom you ask, advertising revenues are up close to 10% and the rest of the year is looking just as good! </div><br /><br /><div>Time to celebrate, right?<br /></div><br /><div>Not so fast.<br /></div><br /><div>Just think about this for a moment.<br /></div><br /><div>"Comps" or comparisons to last year's revenue are out of whack, i.e., 2009's growth percentages were in negative territory right out of the gate with double-digit numbers in negative territory. So comparing this year's revenue gains to last year's horror movie is deceptive, if anything.<br /></div><br /><div>Then there's the aura that was pervasive at this year's National Association of Broadcasters annual meeting in Las Vegas in April. The mood was light and there were smiles and optimism all around. </div><br /><div></div><br /><div>That's a good thing. Traditional radio took it on the chin mightily in 2009 and it wasn't that great for several years prior to that.<br /></div><br /><div></div><br /><div>Yet, the good natured radio broadcasters were not only pleased with advertising 'traction' thus far this year, but the implication that a large political advertising revenue windfall was forthcoming for this fall's elections.<br /></div><br /><div></div><br /><div>It may still happen. And should it be so, that is also a good thing.<br /></div><br /><div>But then what?<br /></div><br /><div>2011 is only a few months away and if 2010 ends up with double-digit revenue growth what will happen when the 2011 "comps" don't live up to 2010's growth?<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgJluGW-8RIftpPddLocsviGAx3xnzzraNlYJa82J7Y7KabvfeK-ENPNIVMh9mXtOIdbIsHWnb0EwDUMhRM0V8YSsITrecbnlHFAzjdf0KjpNmiQgTPz8iRQ9G5hCQFJYtxnpmfDtlnwaEd/s1600/Clock.jpg"><img style="MARGIN: 0px 0px 10px 10px; WIDTH: 89px; FLOAT: right; HEIGHT: 81px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5463367349456465554" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgJluGW-8RIftpPddLocsviGAx3xnzzraNlYJa82J7Y7KabvfeK-ENPNIVMh9mXtOIdbIsHWnb0EwDUMhRM0V8YSsITrecbnlHFAzjdf0KjpNmiQgTPz8iRQ9G5hCQFJYtxnpmfDtlnwaEd/s320/Clock.jpg" /></a><br /></div><br /><div>Here's a straight-forward note to radio operators: THE CLOCK IS TICKING.<br /></div><br /><br /><div>Your industry is still facing stiff competition for both audience and revenue. Digital appeal for both is accelerating while you read this.<br /></div><br /><br /><div>A recent <a href="http://www.bridgeratings.com/press.04.01.10.DeviceUsage.htm">Bridge Ratings study </a>called "Device Usage", shows traditional radio making some inroads into the digital landscape and capturing some lost AM/FM listening on their digital streams.</div><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhqX2653rU0bK_CqavKJUvUKPzUxYyeiJHNjzWPXokUc7xswHmIYe3EAAzHJ8KAsLc64XzHuG9TpFFbhoRRQgQJh6HlL9yuO59tOT8-KZSQQcdu2R13rxZXep8_LYfQjgxs026k_V5snDqz/s1600/Internet+radio.jpg"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 127px; FLOAT: left; HEIGHT: 75px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5463367870511176178" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhqX2653rU0bK_CqavKJUvUKPzUxYyeiJHNjzWPXokUc7xswHmIYe3EAAzHJ8KAsLc64XzHuG9TpFFbhoRRQgQJh6HlL9yuO59tOT8-KZSQQcdu2R13rxZXep8_LYfQjgxs026k_V5snDqz/s200/Internet+radio.jpg" /></a><br /><br /><br /><br /><div></div><br /><br /><div>It isn't nearly enough.<br /></div><br /><div>The time is now for radio companies to significantly increase their investments into their digital businesses.<br /></div><br /><div>Time cannot be wasted. The year is already rapidly moving along.<br /></div><br /><div>Reinvest while Dr. Feelgood is dispensing his positive revenue growth.<br /></div><br /><div>Because it is likely to be short-lived and if it is, radio operators will not feel in the mood to invest next year or even the year after.<br /></div><br /><div>And if there is no significant investment this year, radio's ability to compete will be deflated and the industry will be sequestered to the fringes.<br /></div><div>Left behind.<br /></div><br /><div>And in a world of rapidly expanding technology and digital capability where millions can create entertaining content in their bedrooms far cheaper than corporations can, if traditional radio loses one step more, it will be extremely difficult to keep up.<br /></div><br /><div>THE CLOCK IS TICKING.<br /></div><br /><div></div><br /><div>Save your industry now while you have the resources, the know-how and the audience.<br /></div><br /><div>Hire a vice president to oversee digital operations. Let them do their job. Give them time to make it work.<br /></div><br /><br /><div>Times seem to be good right now. Terrestrial radio cannot afford to let this opportunity - perhaps its last - to slip away.</div></div></div></div></div>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-41366181433861638892010-03-01T13:42:00.000-08:002010-03-03T10:02:17.788-08:00Radio Needs a Re-mixI was recently listening to the soundtrack to the Beatles' Las Vegas Cirque du Soleil show called "Love". In-person, it's a fantastic buffet of lights, sound and images in the typical Cirque way coupled with an amazing soundtrack of Beatles tracks remixed by the genious of George Martin and his son Giles.<br /><br />The soundtrack to this show is available on CD and when turned up, the music reminds you of how great this band was/is, but the remixes which took pieces of other Beatles songs in the same keys added to basic tracks we've heard hundreds of times, leaves the listener with a revitalized listening experience.<br /><br />This leads me to why I named this blog "Radio Needs a Re-mix".<br /><br />Traditional radio, like the Beatles, has been around for a great many years. And like the Beatles radio is a comfortable place for its millions of listeners to visit. According to many research studies, 93% of Americans still visit, but they just aren't spending as much time as they used to.<br /><br />So, why not a Radio re-mix?<br /><br />Like the Beatles "Love" soundtrack, radio's inspiration needs to be a few sessions of revitalization. I'm not suggesting, like the Martins did, to bring back some of the great old radio wisdoms of the past and insert them into today's programming.<br /><br />What I am suggesting is that radio owners, operators, managers - all of its employees, should shake themselves out of the creative quicksand of the last ten years.<br /><br />It's about time that radio leadership discontinue its sense of dread and investigate the creative juices that each company most surely has locked up in each of their employees. I believe that for most of them, the creative outlet may have been a part of the reason they are in the business.<br /><br />Creative brainstorming sessions used to be one of the most enjoyable parts of the radio industry.<br /><br />Egos were left at the door, people got into a room with other people they liked, and they started talking...about anything. Then someone in the room known for their 'crazy' view of things, allowed their stream of consciousness take over from the conversation and suddenly there was an idea on the table for a new promotion. People would start laughing at some of the more extreme ideas, but that laughter spawned further discussion until an hour or two later, the group emerged from the meeting with several new ideas and a sense of team effort which only created a more enjoyable working environment. And they'd do it again the next day, next week or next month.<br /><br />There's no reason this cannot happen today. In fact, it does happen today just not nearly in enough cities. Some of the greatest call letters in the land go through exactly this process weekly and their success and low personnel turnover reflect this culture.<br /><br />So, a remix is in order.<br /><br />The radio industry's potential is tied to its past in many ways. <br /><br />By overdubbing the technology and what we know about today's consumers on top of radio's foundation just might produce a renewed compelling listening experience listeners would never have expected until they listened to it again in a slightly new light.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-77015794104121469782010-01-21T13:40:00.000-08:002010-01-22T06:56:50.109-08:00Planting Brand SeedsRadio - all radio, AM/FM, Internet-Only/Internet Simulcast Streaming - is about to learn about its next great challenge for listeners in-car.<br /><br />It's no secret that AM/FM radio's final bastion of exclusivity - the car - is up for grabs.<br /><br />Today's <span id="SPELLING_ERROR_0" class="blsp-spelling-corrected">smart phones</span> have legitimately removed the need for <span id="SPELLING_ERROR_1" class="blsp-spelling-error">Wi</span>-Max/<span id="SPELLING_ERROR_2" class="blsp-spelling-error">Wi</span>-<span id="SPELLING_ERROR_3" class="blsp-spelling-error">fi</span> for streaming radio consumption in-car. With my iPhone, I can listen to any <span id="SPELLING_ERROR_4" class="blsp-spelling-corrected">Internet</span> stream through my car sound system.<br /><br />Ford's Sync system developed by Microsoft will be capable of providing in-car passengers the great personalized experience of Pandora.<br /><br />So, how does traditional radio or any audio content found on the Internet get a leg up on its competition?<br /><br />Ford's Sync system is a pioneer in in-car audio content delivery and its voice-activated capabilities, though limited for the moment, will expand very soon to provide for safer driver-audio system interaction. Most auto makers are making a 'reasonable effort' to minimize in-car distractions for motorists.<br /><br />Paul Green, a professor at the University of Michigan Transportation Research Institute who studies the effects of distractions for motorists says that Ford's system should make it easier for drivers to keep their attention on the road.<br /><br />This is why voice activation for selection of your personal audio entertainment is coming and all audio content providers must figure out how to tackle this challenge.<br /><br />If I want rock music and I simply say "Rock" to my in-car system, what type of Rock music will it select. Who will categorize these descriptors? Which streaming station will be fed to me? How will this work?<br /><br />All indications now are that motorists will <span id="SPELLING_ERROR_5" class="blsp-spelling-error">pre</span>select a limited bucket of 'stations' or channels they wish to have access to and thus the system will recognize the voice command. This may be as many at 50 preselected channels.<br /><br />So, brand continues to be the secret sauce in this ever expanding "infinite dial" of options for in-car entertainment and strength of brand will continue to dictate popularity.<br /><br />Meanwhile, radio's electronic measurement system - Arbitron's Personal People Meter - seems to be confining what traditional radio offers. The science of the device does not seem to encourage experimentation in programming and radio brands are becoming too generic which may inevitably hinder stations' ability to compete in the new world of <strong>voice search</strong> in-car.<br /><br />But the branding process starts long before the new car owner uses this voice activated system.<br /><br />Frankly, it starts long before now. It started yesterday.<br /><br />Consumer habits are being formed every day and brand trust and expectation will go a long way for any content provider to land-grab in-car real estate.<br /><br />If your company is competing in this brave new world, brand development and the delivery of the brand's promise should be job One starting today.<br /><br />Because what you sow today will surely bear much fruit far down the road.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com2tag:blogger.com,1999:blog-7221306864403481245.post-83398374353407069722009-12-16T06:22:00.000-08:002009-12-16T08:34:08.521-08:00The Decade of Radio Cannibalism<div>What is the most interesting/startling/eye-opening thing I've learned this year about the radio business?<br /><br />There are no leaders - only followers.<br /><br />The conversion of a highly independent-thinking, proactive industry to a defensive, lack-of-self confidence one didn't happen overnight. It's been nine years in the making. Sort of like James Cameron's "Avatar", only this time it ain't pretty.<br /><br />Up until 2000 when the Internet bubble burst, the radio industry was robust, creative and ballsy, i.e. it took on all 'comers' who wanted to threaten its very existence and it took each and every one on with gusto. It thrived in that environment and it made its members love their business that much more.<br /><br />The bubble burst and there were no more $1000 spot rates from Internet start-ups.<br /><br />9-11 halted everyone's business, but radio never recovered because around the same time Napster taught our kids that they didn't really need radio...<br /><br />The Internet proliferated as high speed access surpassed the tipping point of 50% of households... </div><br /><div> </div><br /><div>Internet radio, You Tube, Smartphones, subscription radio, technology and...<br /><br />Arbitron's PPM. The last straw.<br /><br />Audience measurement systems for any consumer product have always been a <em>reflection</em> of usage; no more-no less. Once delivered, it was up to the customer to interpret the data.<br /><br />What changed with the introduction of Arbitron's PPM service?<br /></div><br /><div>The methodology influences the business.</div><br /><div> </div><br /><div>PPM is arguably more accurate, yet it has its limitations just like the diary-system does.<br /><br />It allows programmers and managers alike to dissect audience movement down to the minute and to over-react to changes in listening behavior. The cause of that change in listening is not measured, yet programmers can make assumptions which may not prove accurate.<br /><br />The science of Arbitron's meter system has taken advantage of radio management's building inferiority complex by eliminating the 'long-tail' or product variety evident among radio's vast potential listening audience.<br /><br />The most mass-appeal stations are the victors in PPM rated markets.<br /><br />The stations that take the least risks to create exciting, compelling listening perform best in this metered world.<br /><br />PPM has surgically removed radio's best traits: it's abilty to respond quickly to consumer trends and to offer entertainment faster than any other medium. This ability to read its audience from gut and sound research, kept interest in radio at high levels before technology brought new competition.<br /><br />Perhaps the worst part of this is that the industry has been led by its nose into this quagmire without a fight. And now it has a ratings system which does not fully support its business potential.<br /><br />If the motion picture industry followed this path, we would be presented with only the most bland, smallest common denominator movies. And while there's certainly a place for them, consumers would never have been exposed to such interesting films as "Momento", "Eternal Sunshine of the Spotless Mind" or "Requiem for a Dream" over the last decade.<br /><br />And this secret sauce which the radio business held in high esteem is what is missing in today's newly competitive landscape.<br /><br />A new study from Bridge Ratings suggests that radio is not dying on the vine it's just sharing usage with other media and tune-in is as high as ever.<br /><br />This is the time for creativity, risk and reward. Results of this study show that radio consumers like the ease-of-use and the pervasiveness of over-the-air radio. In fact listeners of <em>all</em> ages are pulling for radio, and want it to be better, funnier, more stimulating.<br /><br />Consumers are pulling for radio because they know it can do better.<br /><br />The industry is ending a decade of cannibalism. We have seen the disease of "no confidence" coupled with "less courage" seasoned with a measurement system that doesn't support the creation and delivery of many potentially popular radio formats.<br /><br />During times like these it is strength, courage and the ability to think independently that is needed.</div><br /><div><br />Perhaps it is not too late to embrace those traits that brought the radio industry its greatest successes. There are options to Arbitron's meter methodology; options that would measure the totality of the interests of radio's consumer base.<br /><br />For 2010, we look for a more positive landscape for all business to operate, and the radio business, specifically, has a chance to be reinvigorated.<br /></div>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com5tag:blogger.com,1999:blog-7221306864403481245.post-17768540206090563062009-10-23T07:21:00.000-07:002009-10-26T07:17:23.870-07:00Radio's New Music Fantasy<span style="font-family:Georgia, 'Times New Roman', serif;">The recent headline "Google and MySpace will challenge radio’s music-discovery position," got me asking the question "What music-discovery position?" </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">In the years I have been analyzing consumer use of media, including broadcast radio, Internet and more recently smart phone behavior, radio has had the <em>potential </em>to capture the new music discovery crown. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Unfortunately, it never has lived up to this potential. </span><br /><br /><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtuswDPjnaahWvboEs9SGhytug8klJ_VFi2fEK1l3tHirowiMVKNOJ_5e4LRPTgPsrtgFysBDMbZ_uPiHM6s98cLXvWsZIQbxYkug3xfz1Kx9V1df60D3WnHTUmdIX6HozTHmQ6jlV_soK/s1600-h/New+Music+Discovery+SatisfactionB+10.23.09.png"><img id="BLOGGER_PHOTO_ID_5395900146670758370" style="FLOAT: left; MARGIN: 0px 10px 10px 0px; WIDTH: 320px; CURSOR: hand; HEIGHT: 191px" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjtuswDPjnaahWvboEs9SGhytug8klJ_VFi2fEK1l3tHirowiMVKNOJ_5e4LRPTgPsrtgFysBDMbZ_uPiHM6s98cLXvWsZIQbxYkug3xfz1Kx9V1df60D3WnHTUmdIX6HozTHmQ6jlV_soK/s320/New+Music+Discovery+SatisfactionB+10.23.09.png" border="0" /></a><br /><br /><br /><br /><span style="font-family:Georgia, 'Times New Roman', serif;">In 2007, Bridge Ratings conducted a series of deep studies of music consumers of all ages and, as you might suspect, found that 18-30 year olds were most interested in discovering new music though any means possible. In the category of where most of this discovery was occurring, broadcast radio followed peers and the Internet as the place to go to find great new music. </span><br /><br /><span style="font-family:Georgia, 'Times New Roman', serif;">However, in focus groups to dig deeper, radio had the <em>greatest </em>potential of all three for new music discovery due to its primary benefits: ease of use, accessibility and the fact that radio is free. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Yet radio never took the initiative. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">In the last two years I have discussed this notion of new music discovery with at least 100 radio programmers in the formats of Contemporary Hit Radio (CHR), Adult Alternative and Alternative. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Would it surprise you to know that none of them saw the wisdom of claiming the "new music" position in their markets by proactively promoting and <em>playing </em>new music by either established performers or undiscovered talent. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Radio's belief that it is the new music discovery destination is pure fantasy. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">There's a fabulous on-line worldwide talent competition called "Fame Games" which boasts two million worldwide listeners; 70% listen in the U.S. alone. I have had an interest in this five-shows-a-week talent competition and thought it would suit American radio just fine. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">"Fame Games" features unsigned artists of any cross-over genre competing for best track of the week and ultimately a major record contract. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">This is a well-produced, fun feature that pits two songs against each other vying for the votes of listeners and the program's judges. So, I took it to U.S. radio. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">American programmers won't go there. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Aggressively marketing one's radio station as the "place for new music discovery" would greatly bulk up a station's image if done properly and perhaps even draw young listeners back to a medium that is having its problems holding on to this important demographic. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">So, when I read that Google or MySpace will challenge radio's music discovery position, or when I read the RAB's Jeff Haley's concern about how radio has to protect this turf, I have to shrug my shoulders. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">As far as radio's listeners are concerned, there is no new music turf to protect. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">Radio had the opportunity to claim this territory for itself at least two years ago when audiences told us that radio's convenience would make it the most likely place to go to discover new music. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">It never took the opportunity and very well may find itself pushed out by new media which seems to take every opportunity to infringe on radio's weaknesses. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">This all points to radio's biggest challenge: getting back to creating and presenting engrossing and compelling programming....for all ages. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">The radio industry must build upon its rich history of being listener-focused. </span><span style="font-family:Georgia, 'Times New Roman', serif;"><br /></span><br /><span style="font-family:Georgia, 'Times New Roman', serif;">In its confusion in recent years, radio has simply forgotten how to compete. </span><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWIb_flJeBLUKV6LclzqAkRyOlRIHifShdxcX29i1CvqFbjnNBiyfWCXtcH9txwG7Ro4fZDqWBLr6mf94ws-QBD_p9-0FOwdqKjlSfXa90vDcYV2tXmbJbI_trWPHhI7OBVUqulGbyucgI/s1600-h/DVD+Sig0001.jpg"><img id="BLOGGER_PHOTO_ID_5396912152319462306" style="FLOAT: left; MARGIN: 0px 10px 10px 0px; WIDTH: 320px; CURSOR: hand; HEIGHT: 173px" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWIb_flJeBLUKV6LclzqAkRyOlRIHifShdxcX29i1CvqFbjnNBiyfWCXtcH9txwG7Ro4fZDqWBLr6mf94ws-QBD_p9-0FOwdqKjlSfXa90vDcYV2tXmbJbI_trWPHhI7OBVUqulGbyucgI/s320/DVD+Sig0001.jpg" border="0" /></a>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com1tag:blogger.com,1999:blog-7221306864403481245.post-35696882551731451052009-10-20T12:23:00.000-07:002009-10-20T15:21:34.656-07:00What's Really Next?<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg-TsvfwZXA5Taqh4HFU8nMCqXY8AZEvuwYfwycBi-lPTcBBJGdqnM-oXSywO065sUbW4S_LAFDS0UEU8mMXONG4Oa2gH8BWX5ZGCLkW2QpaSShFD-yjBf03KdVlglmUO_-3d2Kr6NXJ-WI/s1600-h/Staff+Reduction+Trends.jpg"><img id="BLOGGER_PHOTO_ID_5394805820812697586" style="FLOAT: right; MARGIN: 0px 0px 10px 10px; WIDTH: 320px; CURSOR: hand; HEIGHT: 180px" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg-TsvfwZXA5Taqh4HFU8nMCqXY8AZEvuwYfwycBi-lPTcBBJGdqnM-oXSywO065sUbW4S_LAFDS0UEU8mMXONG4Oa2gH8BWX5ZGCLkW2QpaSShFD-yjBf03KdVlglmUO_-3d2Kr6NXJ-WI/s320/Staff+Reduction+Trends.jpg" border="0" /></a><br />What's really next for media companies?<br /><br />Smaller - leaner - more outsourcing.<br /><br />The chart to the right reflects a related growth curve between staffing and corporate efficiency, or productivity.<br /><br />The way this applies to radio is at the core of its frustration with attracting more loyal listeners.<br /><br />There just has not been any investment in the product in over a year at a time when radio is competing with media that understand the importance of creative content.<br /><br />Radio has its own set of rules and at this point, generally, most radio companies can ill afford to invest in the one thing that will help their business grow: personnel and content creation.<br /><br />Economies such as the one we're experiencing in late 2009 no longer lend themselves to the operations models which allowed companies to staff more robustly.<br /><br />The benefit to that kind of structure is that if companies staff responsibly, employees reach their maximum potential to deliver for the company by reaching their own competency levels.<br /><br />What has led to this redesign of culture is the reduction in staffing and a reduction in quality output. Once highly-competent employees have found themselves delegated more and more work often outside their area of specialty or comfort.<br /><br />This tends to result in staff that are not competent at the new tasks and somewhat less competent at their old tasks. This amounts to a severe reduction in efficiencies and production which further drives down business cash flow.<br /><br />This cannot be sustained.<br /><br />Something's got to change. And this is what we're experiencing.<br /><br />Change can be uncomfortable.<br /><br />Ultimately, change is for the best.<br /><br />Therefore, the best option is to reduce workload to a more comfortable level where talented employees can do their jobs at levels that will again produce positively for companies. Operating in this culture will allow companies to regain traction and begin to rebuild.<br /><br />This means a shrinking of the business as a whole in every aspect.<br /><br />It may be "circle-the-wagons" time for the media industry - certainly it is for terrestrial radio - and concentrate on core competencies until things return to a less volitile marketplace.<br /><br />Yet, despite this reduction in services, companies must also understand they cannot grow by cutting. Business development can continue to be a part of the mix.<br /><br />For radio, an industry that still experiences respectable profit margins, this will mean figuring out a way to reinvest some of that profit margin back into their businesses.<br /><br />I'll reveal how to do that, in my next blog.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-14645295345454173512009-08-30T07:32:00.000-07:002009-08-30T07:50:49.386-07:00Optimism: 2010's Secret Weapon2009 has been a most difficult year.<br /><br />Most business leaders - including media professionals - have found themselves unable to lead.<br /><br />Perhaps for the first time in their careers. And when they lie awake at night in their own space they are terrified.<br /><br />They watch their organizations crumble under the weight of an unforgiving economy.<br /><br />They've cut their workforces so much that once-competent employees have been unable to perform due to overwork and distraction.<br /><br />But there is a way out and it starts with the organization's leader.<br /><br />Leaders are their most affective when they are most in touch with reality, and this happens when they are almost viscerally in sync with the people and markets they lead and serve.<br /><br />It's about being able to absorb reality and being able to lead accordingly.<br /><br />So, despite what you know, the mood your employees experience, is so important.<br /><br />An optimistic mood will help you communicate in a more effective manner.<br /><br />A leader's mood is infectious. It can spread like wildfire through an organization.<br /><br />You, as a leader, can poison or uplift the mood without realizing it.<br /><br />Be very aware of how your slightest signals can affect people when you are in a position of power (that's for all you formal leaders) or people look to you for a lead (for you informal leaders).<br /><br />No one wants to work for a grouch. Research has proven it: optimistic, enthusiastic leaders more easily retain their people compared with those bosses who tend towards negative moods.<br /><br />Numerous studies show that when the leader is in a happy mood, the people around him view everything in a more positive light. That, in turn, makes them more optimistic about achieving their goals, enhances their creativity and the efficiency of their decision-making, and predisposes them to be helpful.<br /><br />In more than one sense, then, leadership is truly viral.<br /><br />Become an optimist of the will and your organization can pull itself up.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-25781833374290723992008-08-09T15:11:00.000-07:002008-08-09T15:45:38.978-07:00An Open Letter to Investors in the Radio BusinessDear investor-person:<br /><br />I have tremendously good news to share with you.<br /><br />Our great national nightmare is over.<br /><br />After 12 years of consolidation that is the universal field theory of why the radio industry is in its current state of woe, the business that for decades was not only delivering better cash flow than just about any business you could find, but was also growing, is set for a renaissance.<br /><br />I haven't been hitting the tequila; I'm referring to the sudden flood of radio properties - generally excellent properties - that are on the market. With Clear Channel setting free 60 stations and Dan Mason & CBS putting up their 50, immediate reaction from some might be "the radio business must really suck, look at these major players bailing!"<br /><br />Not so fast.<br /><br />Finally, the radio industry is experiencing the first phase of its rebirth and that is the return to the transition phase of its business cycle to what amounts to 'circling the wagons and concentrating on the segment of the business that is delivering the best financial results.' Clear Channel and CBS should be proud of the fact that they actually have significant numbers of stations they can operate that are throwing off cash flow. By trimming the fat, these two companies can concentrate on running a number of stations that may be more comfortable for them.<br /><br />These 110 radio stations up for sale now offer an opportunity for two things to begin occurring: 1) the return of more intelligent operators who one way or another were no longer needed by those companies that were so greedy in 1996-2000 that they grabbed up as many radio properties as they could without a consideration as to whether they could operate them all effectively. They THOUGHT they could...but time has proven them wrong.<br /><br />And 2) many of the profoundly intelligent general managers, program directors and owners who got out of the radio business because they were forced or just gave up, will now start re-entering a business they have loved for years and who had become sickened by what we all have witnessed - the gutting of a business that lost its way.<br /><br />Yes, I am giving all you investors out there a BIG early tip now so you can start realigning your portfolios or - even better - if you've got money to lend and you've given up on the industry, now is the time for you to feel inspired.<br /><br />I can count on all my fingers and toes a partial list of highly qualified radio managers who at this moment could take a cluster of any of these soon-to-be-sold groups and make them profitable, compelling to listen to and maybe most importantly, return the fun to working in the radio business that got skewered by operators who saw an opportunity in the late 90's and 2000's but never had a clue as to the 'secret sauce'.<br /><br />Me and my compatriots who have been in this business since the good times (pre-1996), completely get what made the business such a great investment then and why it attracted some of our country's most creative minds through the years. The time may be coming when you see the return by these individuals to the business as operators. Smart operators.<br /><br />Expect those who have been on the sidelines in recent years to begin pulling money together and buying some of these stations. I know because I've spoken with them!<br /><br />Expect those Clear Channel and CBS stations that will be sold to out-perform under these new owners.<br /><br />Expect this to be the watershed we've been waiting for. 2009 will be the year of the turnaround.<br /><br />2009 will prove to be a great year for investment in the radio business.<br /><br />These new independent owners know more about the terrestrial side of the business than most of their peers who seem to have no clue what to do with this vast new frontier.<br /><br />They have been cooking up digital solutions that will expand the radio business.<br /><br />If they haven't been scared away for good; if they haven't given it up through disgust, this infusion of lifeblood into station ownership will be the beginning of a return to pre-consolidation days when men were men and radio ROCKED!Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com1tag:blogger.com,1999:blog-7221306864403481245.post-8881907469560189772008-07-04T15:02:00.000-07:002008-07-04T15:46:09.912-07:00Indiana Jones & Terrestrial RadioInteresting title for a blog, eh?<br /><br />If you're an Indiana Jones fan - or at least have seen one or two of the franchise movies - you know there is always a moment when Indie is faced with being left alone behind a sliding door with spiders or snakes. But, at the last second, he manages to pull out that trusty whip of his and snag it on a branch on the other side of the closing door and he is able to swing himself through to be alive for another day! Hurray!<br /><br />This happens in the latest Indiana Jones movie as well and it enabled me to visualize what is happening terrestrial radio. The industry is at a significant crossroad and is in severe danger of being left behind a impenetrable door.<br /><br />I've been researching the radio industry in earnest with my company Bridge Ratings since 2002 and have watched trends from a vantage point few have. Our projects cover everything component of radio listener usage. Over the last six years there were actually moments when radio's pulse increased as if its efforts to postpone or stop listening attrition were beginning to find traction, only to learn in a project 3 or six months later, that what I witnessed was a false revival or it was still-born.<br /><br />Now with six years 'visibility', and with multiple signposts struggling to show improvement, the industry's efforts may now be too little too late.<br /><br />What signposts do I pay attention to?<br /><br /><ul><li>Young listeners' time spent with the medium</li><li>The multiple alternate media listeners of all ages are using over time</li><li>Strategies used by media companies and how they play out</li><li>Stock price of terrestrial radio companies and how that price has been affected by corporate decisions</li><li>Media coverage of terrestrial radio</li><li>Changes in consumer interest in Internet, Satellite and <span class="blsp-spelling-error" id="SPELLING_ERROR_0">HD</span> Radio</li></ul>Of late, the most revealing signpost has been that of corporate radio's decision-making. In the period of 2002 to 2008, we tracked a greater number of missteps or no-decisions that hastened a company's inability to compete.<br /><br />Poor programming decisions, lack of marketing resources, reduction of key management personnel and slowness to adapt to changing technologies; these are all key contributors to terrestrial radio's current malaise and more of these contributors have had as their source the poor decisions and lack of focus at radio's corporate headquarters (a generalization). There remain a handful of broadcast executives who 'get it', but not enough. It's like an V-8engine running on one cylander.<br /><br />An objective observer to these trends would perceive (almost) that in many cases the industry had given up the fight or is simply resting on its aging laurels. And that wouldn't be far from the facts.<br /><br />Terrestrial radio can learn at least one thing from Indiana Jones and that is courage. Our fictional hero never seems to give up even in the face of some of the ugliest circumstances placed before him. And while terrestrial radio as a whole has a tougher time reacting to change than our celluloid hero, the industry cannot afford to be left behind that slowly closing door without a whip.<br /><br />Certainly the radio industry is hobbled by new technologies it simply cannot compete with, but it is being forced to change with the times which is a good thing. It can offer young and old a new blend of media that is better than its version before there were MP3 players, the Internet or satellite radio.<br /><br />It only requires the old Indie courage. Where will our heroes come from?Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com39tag:blogger.com,1999:blog-7221306864403481245.post-61618387457655038042007-12-02T14:26:00.000-08:002007-12-02T14:57:10.087-08:00Local, Local, LocalI've been at my new job at ABC radio for about a month now and it's great; I'm really enjoying the fact that as Vice President of ABC Radio Networks' Affiliate Relations department, I can interact with so many radio stations across our grand land.<br /><br />The lessons I learned through my years of working at Bridge Ratings I brought with me and after a few weeks communicating with a much more diverse group of stations than I ever have before, here's what I've learned:<br /><br />1. <span style="font-weight: bold;">Regardless of market size everyone has the same problems and opportunities.</span><br /> <br /> It wasn't always this way, you know. Before consolidation took our industry by storm, major markets and stations in the top 50 had far different considerations in operating their businesses than did operators in markets 51 and below. Pre-'96, top 50 market stations had operating budgets that included marketing, promotion and research. They also had personnel resources that allowed them to be extremely competitive and allowed them to keep their eyes on the various balls they had to juggle. Major market operators only recently have had to deal with managers overseeing multiple stations. Top 50 stations in those days actually had time to plan and strategize for the future and act upon those strategies. They also have years more experience operating multiple properties than do their big market cousins.<br /><br /> Medium and small market operators have always had to work harder at making their businesses work. They did so with good old fashioned sweat and creativity along with building relationships. They still do it this way today.<br /><br />2. <span style="font-weight: bold;">Medium and small market operators are more aware of the importance of reflecting the local audience</span>.<br /><br /> While this has been a staple of broadcast operations for-ever, somewhere along the line major market radio pushed it to the back burner. Now, I'm generalizing here because there are some major market operators who have not only remembered this important element of serving the public interest, they use their major market resources to make a difference in their towns and cities.<br /><br /> Local radio has always been compelling. The genericizing of American radio which has been pushed along by companies with such huge footprints as Clear Channel have literally taken the spine out of these stations which no longer sound like their communities. These stations provide impetus for all listeners - not just Gen-X, Y and Z - to seek alternative entertainment by virtue of the obvious lack of interest in their local communities.<br /><br />3. <span style="font-weight: bold;">Major market management drink their own kool-aid.<br /><br /> </span>These people are so impressed with their climb to the top many have forgotten their roots. I was visiting a small market operator a couple of weeks back and I was taken by his continued passion and optimism for our business. <br /><br /> On the other hand, not a phone call I have with major market managers doesn't include a doomsday outlook. Small market operators don't fear Internet and satellite radio like their big market brethren. Perhaps there is some legitimacy to this perspective since there seems to be wider consumer acceptance of these technologies in the larger markets, yet I have spoken with some major market management who understand that it is NOT Internet radio and it is NOT satellite radio that has caused terrestrial radio's ills.<br /><br />My view of the radio landscape is undergoing some adjustment simply because I am now exposed to a broader perspective and I love that. In fact, this broader perspective has allowed me to share some of the small and medium market wisdom with the big boys who seem to react positively to a fresh perspective.<br /><br />I look forward to being exposed to the inclinations of all of the broadcasters I come in contact with these days and sharing them with each other in a way that perhaps has never been done before.<br /><br />After all the things I learned through the consulting work I've done through my Bridge Ratings experience, I didn't have the ability to share with the industry the insight of so many others.<br /><br />The insight seems to be helping gain perspective which we can all use from time to time.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com1tag:blogger.com,1999:blog-7221306864403481245.post-39034656038352007412007-09-13T08:17:00.001-07:002007-09-13T09:03:04.096-07:00What's Good for the Radio Goose....Since February's announcement that Sirius satellite radio was interested in acquiring XM, we've seen many twists and turns in Mel Karmazin's effort to convince the FCC and others that a merger is in the best interests of consumers. In Mel's usual style, he has done an expert job of laying out the rationale and presenting it in an intelligent, non-offensive manner.<br /><br />However, as we near the end of 2007, we seem to be very close to a decision on this event and as I mentioned in an earlier blog, my money now is on the merger getting approved.<br /><br />The National Association of Broadcasters has done a respectable job of countering satellite radio's rationale in favor of a merger, but the time has come for the NAB to face the "Rule of Consolidation".<br /><br />The fact is that the NAB has lobbied for consolidation of the radio industry since the early 90's and got permission for radio companies to begin buying up each other in a 1996 act of Congress.<br /><br />The argument was that not only is consolidation good for the business - it's good for the consumer.<br /><br />Now, eleven years later, many in our business - even on Wall Street - believe that this wave of consolidation has had negative repercussions on the financial well-being of the radio business.<br /><br />Again, in the last two years, the major radio companies have been stamping their feet for further consolidation. It seems that owning 8 radio stations in the biggest radio markets wasn't enough. There are those who want to own 10 or more stations in the same market.<br /><br />Yet when it comes to satellite radio consolidating, the radio industry says "no".<br /><br />The radio industry is concerned about this proposed merger for many reasons...but none of them are truly onerous.<br /><br />If the radio industry manages their business properly...<br /><br /><ul><li>A merged satellite radio company will not significantly impact its listenership</li><li>A merged satellite radio company will not impact radio's revenues and profits</li></ul>This deal has been examined every which way and in the end, there are no grounds to prevent it.<br /><br />Bridge Ratings has been studying consumers' reaction to the proposed merger since it was announced in February. Over time and 5 studies, current satellite radio subscribers have become less concerned about the impact of such a merger. Potential satellite radio subscribers are confused, but most will delay their decision to subscribe until a decision is made. This is one reason why year-to-year satellite radio subscriber rates have fallen so precipitously in the last year.<br /><br />The only negative impact the merger has had on the satellite radio companies is that the news of a potential merger has derailed the sector's growth. That's only temporary.<br /><br />Satellite radio is a niche business and a merger will not automatically make it a broad-based appeal business.<br /><br />If consolidation was good for the radio goose why isn't it good for the satellite gander?Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com2tag:blogger.com,1999:blog-7221306864403481245.post-19220736026976981592007-09-05T16:32:00.000-07:002007-09-05T17:04:03.642-07:00Will Traditional Radio be Invited to the Wi-Fi Party?As a proud owner of an iPhone I was thrilled to hear that Steve Jobs had cut the price of the 8 gig iPhone by $200 just in time for the upcoming holiday season. Boy, that makes me feel just great!<br /><br />But wait....as radio broadcasters, we should we feel good or bad that Mr. Jobs didn't 'refresh' his new Fall iPods with FM radio receivers.<br /><br />The radio industry shouldn't feel slighted that FM radio seems to be at the back of the line of applications that are waiting to be included in America's favorite audio toy. We need to be realistic; it's just never going to happen.<br /><br />Why is this?<br /><br />Bridge Ratings has conducted studies over the past two years on iPod and MP3 use and believe me when I say that very few users of these devices want a radio in them. It just is counter-intuitive. Focus groups have been asking why it would make sense to put a radio in an iPod.<br /><br />Steve Jobs has seen the research too. He's not even contemplating adding a radio to his iPods. Because Mr. Jobs doesn't ever look back. He has the luxury of doing what radio management hasn't had the chance to do in over 7 years - look to the future.<br /><br />Of more concern to traditional radio is the new iPod Touch which comes with Wi-Fi capability and a Safari browser - the best mobile device browser out there. It's on the iPhone and it makes surfing the Internet effortless.<br /><br />And now a music-playing device has the ability to go to iTunes and download music direct to the player. How far away are we from a time when these same devices can surf over to an Internet radio website and in a Wi-Fi hot zone listen to Internet radio. Not very far.<br /><br />Generally, the radio industry has done a decent job and has dedicated some resources to its Internet radio efforts. This has occurred in mostly large and some medium markets. The remaining markets/stations haven't taken the step because they are intimidated by the streaming/copyright expense issue and they really don't know how to do an effective job of delivering an Internet radio product.<br /><br />But if you can feel that Wi-Fi enabled MP3 player train bearing down on you, you are not alone, traditional radio. It's coming and coming fast and as far as Internet radio is concerned, traditional radio's greatest weakness is the vast choice (thousands) of stations available on the Internet. Practically every taste is served. And soon it will be served in a small hand-held device.<br /><br />Traditional radio's greatest strength is its brand and the current distribution system of blasting its programming across metropolises (is that a word) up and down our great land. Radio's bright leaders should take these Steve Jobs press conferences to heart because each time Jobs steps on that stage, radio's exclusivity and relevance shrinks.<br /><br />If you have not instituted an Internet radio effort for your company or station, don't wait too much longer. The pervasiveness of portable devices that can bring the world of radio to a hand-held music player or mobile phone is on the horizon. In fact, some already do.<br /><br />You want to be invited to that party.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com1tag:blogger.com,1999:blog-7221306864403481245.post-53458027191480103342007-08-27T17:48:00.000-07:002007-08-27T18:26:06.366-07:00The Radio Fortune Teller: Teen Radio to ReturnI received two interesting calls in the last 24 hours - from 'kingpins' at high levels at two of the biggest advertising agencies in the land. They wanted to apologize.<br /><br />Apologies from such lofty men and women who control so much of the advertising dollar in the U.S. are hard to come by, so I promised that comments I may use in my blog or in research we do at <a href="http://www.bridgeratings.com/" target="_blank">Bridge Ratings</a> would be anonymous.<br /><br />One of biggest - and quietest - radio industry issues to come out of the last ten years has been the theory that one key reason radio is experiencing such attrition from teens and young adults is the perfect storm that was created as technology eclipsed radio's lack of compelling youth radio content. The logic goes that if radio had been a bit more aggressive with radio programming geared to 13-24 year olds over the last ten years, it is possible that radio time-spent-listening among this group would not have fallen so sharply.<br /><br />But, the chicken-and-the-egg fairytale dictates that radio would have gladly pursued such a course of teen programming if ad agencies would have supported it. No big ad dollars for teen radio - not likely money-hungry broadcasters would spend the resources required.<br /><br />So, what about those calls from ad agency big-shots?<br /><br />The calls (I just got another while writing this blog) were about the just-released report by TRU, a subsidiary of Research International, that revealed that teen spending in 2006 had reached $179 billion. That amounts to about $180 in disposable income per average teen per month. These media buyers have apparently awoken from a deep sleep (or deep denial) and were asking poignant questions about the possibility of a rebirth of youth radio and what would I recommend.<br /><br />I pointed them to a <a href="http://www.bridgeratings.com/press_041107.Format%20Trends2012.htm" target="_blank">Bridge Ratings' study</a> we published earlier this year that glancingly mentioned some new youth radio formats that had tested extremely well. Not really a mystery since the radio formats were put together and researched with the help of a pretty smart group of average 13-21 year olds.<br /><br />Formats of particular interest to these media buyers had working titles of "Youth News" and "Current Blend".<br /><br />"Youth News" is fairly easy to figure out - only you wouldn't believe how good it sounded in testing. That's because this new youth information format was written and delivered by no one older than 24 and it had music throughout.<br /><br />"Current Blend" is a bit more difficult to decipher. However, I can tell you that it's a music-focused radio format that is not currently heard anywhere on the planet on traditional, satellite or Internet radio!<br /><br />So, I'm excited because there seems to be a glimmer of anticipation on the part of some of the smarter media buyers about radio formats that focus on 13-21 year olds. <br /><br />It would seem that they have just been waiting for something like this to come along.<br /><br />I asked these buyers if radio stations began popping up around the country with these two ideas (and more), would they send more dollars - many more dollars - their way, and these buyers gave a profound "yes"! response...."...but only if they get ratings..." they concluded.<br /><br />I asked, "Where have you been placing youth ad dollars over the last few years?".<br /><br />They replied, "CHR and Rock stations, primarily. But we know we're missing a tremendous number of these kids because many of them don't listen to those formats."<br /><br />I have no doubt that traditional radio can regain some of the lost youth listening it has been faced with in recent years. And these formats will do amazingly well with both of Arbitron's methodologies (diary and People Meter).<br /><br />Which broadcaster(s) have the courage to step up?<br /><br />I'm waiting for your call. 818-291-6420.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-3114429879108538902007-08-20T12:23:00.000-07:002007-08-20T13:41:51.023-07:00HD Radio: Why Marketing MattersI was impressed with the British Invasion in the 1960's. "Those Brits are real good", I thought to myself as the whole string of music successes starting with the Beatles came across the 'pond' to invade America.<br /><br />Now, they're showing up America once again, but this time it's in the area of HD radio - or "Digital Radio" as they package it.<br /><br />In a survey just released by Britain's ratings service <www.rajar.org>RAJAR, more than 25% of the British population listen to digital radio, defined as Digital Audio Broadcasting, Digital Television and the Internet.<br /><br />At first glance, this is rather impressive. However, when combining those three digital radio sources in the U.S., the percentage of the American populous that listens to some form of digital radio is closer to 50%:<br /></www.rajar.org><ul><li>Internet radio - 60 million</li><li>HD Radio - 500,000</li><li>Digital TV - 90 million homes</li></ul>What is intriguing is the marketing of digital radios (comparable to the U.S. HD concept).<br /><br />Unlike the U.S. where broadcasters must market HD radio by themselves and with the help of the National Association of Broadcasters, the United Kingdom has a dedicated body: the <a href="http://www.digitalradionow.com/" target="_blank">Digital Radio Development Bureau</a>.<br /><br />It has become clear in our studies at Bridge Ratings that there is considerable consumer confusion in the U.S. about <a href="http://www.bridgeratings.com/press_08.08.07.HDvsInternet.htm" target="_blank">HD radio and its benefits.</a> Three quarters of the U.S. population has heard of "HD Radio". Less than 5% <span style="font-style: italic;">really</span> want it.<br /><br />So, the Brits and their Digital Radio Development Bureau are taking the U.S. broadcasters to school about digital radio. Here are some of the ways Digital Radio is marketed in the UK:<br /><br /><ul><li><span style="font-weight: bold; color: rgb(51, 51, 255);">More Choice</span> - <span style="font-style: italic;">"Because of the way it transmits a signal, DAB Digital Radio can double the number of radio stations you can get on FM. Many cities will pick up around 40 stations, and in London you can receive more than 50!</span></li></ul><br /><span style="font-style: italic;"> There are national, local and regional stations on DAB Digital Radio, and more than 85% of the population is covered by the DAB signal.</span><br /><br /><span style="font-style: italic;"> It's not just more of the same... there are new, unique stations on DAB with programmes designed for different segments of the population. So, rather than trying to be all things to all people, DAB means you can have stations dedicated entirely to dance, hip-hop, garage, rock, jazz, big band, country, pop, soul and disco. Or your can get stations specifically for young children, the mature listener, ethnic communities, news junkies, sports fans, lovers of the spoken word, world music and environmentalists, gays, classical buffs, ...in other words, something for everyone."</span><br /><ul><li><span style="font-weight: bold; color: rgb(51, 51, 255);">No Interference</span> - <span style="font-style: italic;">"DAB Digital Radio means interference free listening in digital quality sound. There's no hiss, crackle, or pop, no fading, no overlap, just great radio all the time. We've surveyed thousands of DAB owners and nearly 90% reckon DAB sounds great."</span></li></ul><ul><li><span style="font-weight: bold; color: rgb(51, 51, 255);">Ease of Use</span> - <span style="font-style: italic;">"Quick, what's the frequency of your favourite FM radio station? You'd be surprised how many people know the name, and kind of, sort of where it is on the dial, but waste time searching around for it. Some people are even afraid to change stations because they worry they'll never get back to their favourite. Others mark the dial with a pen, or sticky tape so they'll always be able to find their way home... a bit like a trail of breadcrumbs.</span><br /><br /><span style="font-style: italic;"> With a DAB Digital Radio there are no frequencies. Just choose the station you want by name from the text display screen. It's easy every time and you don't need to worry about getting lost."</span></li></ul><ul><li><span style="font-weight: bold;"><span style="color: rgb(51, 51, 255);">Control Time</span> </span>- <span style="font-style: italic;">"With some DAB Digital Radios let you pause and rewind live radio. And with some of the latest models, you can record radio to a memory card. For the first time this puts you in control of when you listen to the radio. You can stop time, go back in time, or set a timer to record a future programme."</span></li></ul><ul><li><span style="font-weight: bold; color: rgb(51, 51, 255);">No Re-tuning</span><span style="color: rgb(51, 51, 255);"> </span>- <span style="font-style: italic;">"National DAB Digital Radio stations, both commercial and BBC, are broadcast on the same frequency across the country, so you never need to retune when you're on the move."</span></li></ul>Does all this sound vaguely familiar to you? It should because it is almost exactly the Satellite Radio model. In the UK, though, the contemporary evolution of radio is focused on <a href="http://en.wikipedia.org/wiki/Digital_Audio_Broadcasting" title="Digital Audio Broadcasting">Digital Audio Broadcasting</a> (DAB) services, such as <a href="http://en.wikipedia.org/wiki/HD_Radio" title="HD Radio">HD Radio</a> rather than satellite radio.<br /><br />Much has been said of American radio's indecisiveness when it came to moving into the 21st century with HD/Digital Radio. It took so long, Satellite Radio took the position right away from U.S. Broadcasters. And now the fight to insert HD radio into the lives of Americans has become an offer of another product where there already is one.<br /><br />Yet, marketing may solve this problem - but it also may be too late.<br /><br />In our society we thrive on choice - too much choice - and the successful products that have identical competitors are the ones that market and position themselves most skillfully. Has anyone read Ries & Trout's <a href="http://www.amazon.com/22-Immutable-Laws-Marketing-Violate/dp/0887306667" target="_blank">The 22 Immutable Laws of Marketing</a>"?<br /><br />Oh, and one more thing. Digital radios in the UK start at about $58 (29 pounds).<br /><br />So, while the UK has managed to effectively launch Digital Radio, U.S. Broadcasters - who should know better - are fighting a positioning battle which, frankly, is over.<br /><br />HD Radio in the U.S. is a niche market out sized by Internet Radio and Digital TV music services. And portable digital radio will be real with the arrival in the near future of wide-area-wireless Internet or <a href="http://en.wikipedia.org/wiki/Wi-max" target="_blank">Wi-Max.</a><br /><br />This lesson has been difficult to learn - but it is time to face the facts.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com2tag:blogger.com,1999:blog-7221306864403481245.post-65931536814003032172007-08-15T07:51:00.000-07:002007-08-15T08:28:26.049-07:00The Last Brand StandingChoice is a good thing, right? Not so fast.<br /><br />Having choice has its place, but the staggering array of consumer goods from which we must choose overwhelms the average consumer, and in a 2005 book psychology professor Barry Schwartz argues that that's not such a good thing.<br /><br />In the book "The Paradox of Choice", Schwartz tells us that constantly being asked to make choices, even about the simplest things, forces us to "invest time, energy, and no small amount of self-doubt, and dread." There comes a point, he contends, at which choice becomes debilitating rather than liberating. Did I make the right choice? Can I ever make the right choice?<br /><br />It would be easy to write off this book as merely an extended riff on that well-worn phrase "too much of a good thing," but that would be a mistake.<br /><br />Part of the professor's point in the book is that rules and constraints in society help us make decisions and this is a good thing and should be embraced.<br /> <br />The book's concepts are easily applied to media consumption as well. Because of the growing number of choices we are presented with, consumers of media don't always have the time to look at all the information out there to make the best choice or to even consider all of the options. People expect certain decisions to be made for them.<br /><p>The term "decision stress" has also been tossed around by marketers over the years and Professor Schwartz's concepts hinge on similar rationale that when faced with too many choices a consumer will often "short-circuit" with too much information overload and tend to decide on what to purchase or read or listen to using the easiest method.</p><p><span style="font-weight: bold;">In most cases brand is the balm that soothes decision stress.</span></p><p>And it is for this reason that those of us running media companies in 2007 should consider just how powerful our brand is - or should be.</p><p>In our recent studies of media consumption - especially in the Internet radio space - Bridge Ratings has discovered that with tens of thousands of Internet radio options, most average consumers of Internet radio will gravitate to a brand they are familiar with. In many cases they do this to reduce or eliminate the "decision stress".<br /></p><p>We have seen new consumers interested in Internet radio go directly to AOL.com for their Internet radio experience without much thought about what else is out there. Why? It's a brand they know and it makes the process of deciding easier. <br /></p><p>This process of "going to the brand" is more prevalent in media than in other consumer products and services. Why? Because in most cases, media is simply a utility, something that doesn't hold significant importance to our lives and like the light switch on the wall, we as consumers of media tend to "throw the switch" on whatever media we are consuming without much thought.</p><p>Of course, this is a generalized perspective. There are passionate consumers of media that give great thought to what they watch or listen to, but generally, we have found that the average consumer has too many decisions they need to make each day and any time the decision process can be eliminated or reduced, most consumers will take that road.</p><p>Certainly, deciding on which radio station to listen to doesn't hold the significance in consumers' lives that selection of which doctor should be seen or which food product will enrich health, and therein lies the most key of all of the factors leading to "decision stress". The hierarchy.</p><p>To make the process of decision easier, consumers have an internal mental product ladder upon which they have placed their favorite brands.<br /></p><p>They go to a store looking for a product and, in most cases, when faced with too much choice, a consumer makes the easy choice - almost without thought - and goes for the brand they know.</p><p style="font-style: italic;">If brand building has not been a part of your business strategy, it is time to invest time, energy and yes, even financial resources, into building, maintaining, supporting and/or strengthening your brand.</p><p>Because media consumption isn't getting any easier for the consumer. Whether you run a radio station, and Internet radio business or produce content for other digital and mobile media, your brand will be they key to unlocking consumer use and recall.</p><p>The easier you make it for the consumer to make that choice, the more likely they'll choose you.<span style="font-weight: bold;"><br /></span></p><p><br /><span style="font-weight: bold;"></span></p><p><span style="font-weight: bold;"></span><br /></p>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-2859450986315687822007-08-06T07:53:00.000-07:002007-08-06T08:27:32.279-07:00The Radio Airplay DebateSince Bridge Ratings was one of the first to expose the truth about how radio airplay affects music sales, I think it only appropriate that I weigh in on this latest controversy that is brewing.<br /><br />Seems the music industry has forgotten the "partnership years" when radio and records virtually changed the way music was consumed. Performers and labels alike believe radio has a one-side relationship with the music industry.<br /><br />Programming radio stations was one of the favorite aspects of my career and a large part of those years was spent in the company of some of the record industry's best, most creative people. Most of the time those people where record company promotion people, whom I loved working with.<br /><br />Many of the relationships I had with these people turned out to be much more than the typical program director/record label promo people relationship where they would come by the radio station on Tuesday's and wait outside my office until it was their turn to "pitch" their latest and greatest artists or albums.<br /><br />Many of these people became good friends and I had the chance to learn just how hard they worked and how difficult their jobs were.<br /><br />But in the seventies and eighties, radio and records worked as a team of sorts. The record promotion people would provide data or insight as to the record's benefits. Remember, this was before the Internet so airplay data was difficult to come by - part of record promo people's gigs was to enlighten, and the program directors and music directors of the industry would assimilate that information and determine whether songs and albums were worthy of airplay.<br /><br />One music was added to radio playlists the relationship didn't end there. There were concert promotions, music store promotions and artist interviews, the two industries were connected at the hip in an effort to give momentum to careers of worthy performers. Sure it helped sell records, but the radio industry benefited just as well.<br /><br />The world seems to have changed since then and now it's coming back to bite the radio industry in the butt. Those that represent the music industry - both corporate and performers alike - feel it is time that radio's "free ride" is over. They want their money.<br /><br />See, radio pays licensing fees to ASCAP, BMI and SESAC based on the station's revenues. The better a radio station's revenue, the more fees that station pays. It has always been a common belief that radio stations that rely on music for their ratings should pay music publishing houses for the right to use the music that drove revenues for the stations. Fair enough.<br /><br />Now, the performers - who have not been receiving any special licensing or royalty from radio - want to pluck from the "money tree" they think radio is. It is, they claim, time for the performers of songs to benefit from the years of airplay.<br /><br />Radio's argument is that the two industries have worked in tandem to benefit the music industry. Radio has - and continues to be - a wonderful promotional vehicle for artists who write and perform music no matter the genre.<br /><br />In 2005 Bridge Ratings conducted a study to determine the influence radio airplay, Internet airplay and MP3 plays have on the consumer. Due to this current controversy, we just completed an update on this study.<br /><br />Here are a few facts:<br /><br />*88% of radio's total audience listens to music radio at least once a week<br /><br />*50% of these listeners consider music radio to be their primary radio experience.<br /><br />*Nearly 90% of these "music primaries" agree with the phrase: "I have purchased music I have heard on the radio."<br /><br />*32% of these radio consumers have purchased music through brick and mortar stores or on-line in the last 30 days.<br /><br />Does this sound like the radio's relationship with the music industry's artists and performers is one-sided? No.<br /><br />Perhaps the more appropriate step is for the music labels to offer all performers new or updated agreements in order to include them in the cash flow from music sales.<br /><br />Radio influences music purchase. There is no doubt in my mind.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-26271647267578795952007-07-29T18:37:00.000-07:002007-07-29T19:31:07.611-07:00The Little Merger That CouldHere we are six months down the road from the first announcement by <span class="blsp-spelling-error" id="SPELLING_ERROR_0">XM</span> and Sirius that they intended to merge these two companies to form a singular satellite radio company.<br /><br />From the beginning, Bridge Ratings has examined the response by the consumer - both current and potential satellite radio subscribers - to better understand the <span style="font-style: italic;">perceptions </span>about such a merger.<br /><br />From the start, the mood among both groups of consumers was not positive. In fact, they were very near equal. The general consensus was that it would be bad for the public. The current subscribers we interviewed were more concerned than the potential subscriber group, but I think that had more to do with the passion current subscribers have for their preferred service and an emotional response to change.<br /><br />Now, six months later, the mood has generally moved to the more positive side by current subscribers while potential subs have not moved much off their initial "monopolies aren't good for consumers" position. Perhaps the difference in perceptions by these two consumer groups has more to do with the satellite companies marketing to these subscribers. I think they simply did a better job internally marketing the coming merger.<br /><br />And as Congress considers Mel <span class="blsp-spelling-error" id="SPELLING_ERROR_1">Karmazin's</span> statements and all the supportive paperwork associated with both sides' reasons for merging or not, there are two signs now that are much clearer for me which point to the approval of this merger.<br /><br />1) God love David <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Rehr</span>, President of the National Association of Broadcasters (NAB). He has been on the job only a short time and done a great job. He has certainly made a case for his passion for the radio business and his willingness and ability to be direct and confrontational in defense of all things radio.<br /><br />As a great consumer products CEO once told me about products of all kind, "Products have strengths and weaknesses...and in most cases, one's strength is also one's weakness."<br /><br />In the case of the NAB and Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Rehr</span> in particular, he doth protest too much.<br /><br />In his passion to protect radio in the case of a satellite merger, Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_5">Rehr</span> has firmly <span class="blsp-spelling-corrected" id="SPELLING_ERROR_6">crystallized</span> Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_7">Karmazin's</span> point that a merged satellite company is not a monopoly because the "marketplace" is varied with many competitive offerings. <br /><br />The whole merger approval likely will hinge on a singular point: the definition of the competitive market in which satellite radio competes. Is their market satellite radio? Or is it all audio radio which today is defined not only by satellite radio, but traditional radio, Internet radio, <span class="blsp-spelling-error" id="SPELLING_ERROR_8">iPods</span>, <span class="blsp-spelling-error" id="SPELLING_ERROR_9">iPhones</span>, <span class="blsp-spelling-error" id="SPELLING_ERROR_10">Podcasts</span>, cell phones, etc., etc.<br /><br />Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_11">Rehr's</span> enthusiasm has confirmed for Congress that terrestrial radio is so concerned about the possibility of a merger, that the louder Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_12">Rehr</span> protests, the more obvious it is that traditional radio considers satellite radio a competitive medium thereby defining the market.<br /><br />The second reason I think this merger will go forward?<br /><br />The early departure of <span class="blsp-spelling-error" id="SPELLING_ERROR_13">XM's</span> brilliant CEO Hugh <span class="blsp-spelling-error" id="SPELLING_ERROR_14">Panero</span>. He was to leave his post at the point the merger occurred, but the news is so encouraging, Hugh has set an August date for vacating his office in order for the cleaning crews in DC to get his office ready for Mel. There's confidence there that cannot be denied and it is backed by encouragement from Capitol Hill.<br /><br />Now with everything I know, I believe that between <span class="blsp-spelling-error" id="SPELLING_ERROR_15">XM</span> & Sirius, the combined entity will offer a solid consumer product, will not diminish the current experience and will encourage potential subscribers - especially those buying cars and trucks - to go forward with their choice.<br /><br />And, oh yes, I forgot: Howard Stern will attract an additional 500,000 to 800,000 new listeners over the next 18 months. XM subscribers who have missed him.<br /><br />Was the approval of this merger terrestrial radio's to lose? I think so. The strategy was wrong. The NAB made the case for the other side.<br /><br />Radio should now forget about satellite radio as a competitor, get back on track (it's been distracted for five years) and look to developing better content, re-hire its best talent that has left the business and market its digital platforms.<br /><br />Your comments are always welcome.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-15955650753698100602007-07-23T07:51:00.000-07:002007-07-23T10:02:50.805-07:002010: A Radio OdysseyDid you see the film "2010", the sequel to 2001: A Space Odyssey? A joint American- Soviet expedition is sent to Jupiter to discover what went wrong with the U.S.S. Discovery against a backdrop of growing global tensions. Among the mysteries the expedition must explain are the appearance of a huge black monolith in Jupiter's orbit and the fate of H.A.L., the Discovery's sentient computer.<br /><br />It was released in 1984. Good times.<br /><br />That was before the Internet, before rap replaced pop, before iPods replaced discmans, file sharing changed music purchase habits, satellite radio, digital music, Internet radio, and terrorism was something that happened overseas.<br /><br />Hard to believe we're closer to 2010 now than we are to 2001.<br /><br />And 2010 will be a tipping point for radio in many ways.<br /><br />From developing behaviors of radio listeners, changes in the ways they use radio are occurring more rapidly than perhaps is commonly known. Much like time-lapse photography where you don't recognize change unless you piece together views of behavior over long periods of time, the change in media has truly been a rapid development over a short period of time and radio's 'light at the end of the tunnel' is more likely to be an on-coming train than an end to difficult times.<br /><br />And like the movie "2010", if radio had had the ability to send a probe into the future back in 1984 to learn what went wrong, hindsight would most surely have kick-started an industry wide reaction that would have perhaps led to a different outcome.<br /><br />For here we are a mere 29 months from 2010 and radio is running out of time.<br /><br />Running out of time to remain competitive.<br /><br />Running out of time to develop its people.<br /><br />Running out of time to adapt to the digital universe.<br /><br />Running out of time to learn how to microtarget.<br /><br />Looking back over the last 6 years of work with clients of Bridge Ratings, it is becoming agonizingly clear that while the radio business has made solid efforts to grow its industry and to adapt it to the changing technological realities, it truly has not done enough. And this is what concerns me: current senior management at radio's best companies is not embracing the fact quickly enough that the future of our business rests solely on their shoulders - on their watch.<br /><br />Today's senior radio managers will be long gone leaving their trainees the keys to the kingdom. It is the opinion of many that the next generation of radio leaders, in general, do not have the technical and operational knowledge or experience to lead this business into the future.<br /><br />Left in the hands of less experienced, inappropriately trained and myopic junior management, the industry will struggle to maintain status quo.<br /><br />There is little going on in the area of strategic development in our business: programming development, creative sales development, new revenue stream development, marketing development and personnel/management development.<br /><br />Frankly, I'm flummoxed (great word) about why this industry doesn't respond to the implications of its future.<br /><br />Certainly, there has been plenty of coverage of multiple future forecasts about impending change and how fast it is occurring and the impact of audience attrition. So, it isn't non-awareness - and it isn't stupidity.<br /><br />It is inertia more than actual resources that is the problem. And inertia in many ways is a much more difficult quagmire to be free of.<br /><br />Yes, 2010 is coming fast and radio seems less prepared to exist in a technologically accelerating world.<br /><br />It does, however, have a resource most of its competitors covet: its people. And its people are what just might save the radio industry from being swept over by the tide of change.<br /><br />Let us hope that the powers that be know this too.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-71774029845711310492007-07-13T07:57:00.000-07:002007-07-13T09:01:50.868-07:00How to Guarrantee HD Radio's SuccessWhat's 2 years old and doesn't get any respect? HD radio.<br /><br />Radio's theoretical saving grace is five years too late and by all the data we can see at Bridge Ratings, it will be a smaller consumer niche than satellite radio...if it continues down the path it is currently on.<br /><br />And with the hundreds of thousands of dollars being spent by American radio companies to upgrade their existing equipment for HD capable broadcasts, there is a dire need for HD to be the technically next great thing for terrestrial radio. But how does this get done?<br /><br />The answer lies in taking a look at the FCC's mandate for HDTV and applying it to radio.<br /><br />The <a href="http://en.wikipedia.org/wiki/FCC" title="FCC">FCC</a> notified U.S. television broadcasters that the standard for transmitting TV over-the-air would permanently change from <a href="http://en.wikipedia.org/wiki/Analog_television" title="Analog television">analog</a> to <a href="http://en.wikipedia.org/wiki/Digital" title="Digital">digital</a>. While there are many technical, political, and economic reasons for and implications of this change, the end-result for the American TV audience is a dramatic improvement in picture and sound quality.<br /><p>According to the original FCC rules, all full power stations were to convert to digital by the beginning of <a href="http://en.wikipedia.org/wiki/2007" title="2007">2007</a>, followed by shutdown of analog broadcasting. An escape clause stipulated that 85% of receivers in the service area must be "capable" of receiving digital signals before the shutdown could occur. At the time of analog shutoff, one of the channels (digital or analog) would then be returned to the government, with the other channel remaining as a digital station; the freed spectrum could then be used for other TV stations, with UHF channels at the high end of the band being decommissioned and sold for other uses.<br /></p><p>The 2007 deadline could not be satisfied under many interpretations of 85% "capability" of digital signal reception. So....<br /></p> <p>On February 8th, 2006, President Bush signed into law the "Digital Television Transition and Public Safety Act of 2005". This law mandated a hard shut-off date of <a href="http://en.wikipedia.org/wiki/February_17" title="February 17">February 17</a>, <a href="http://en.wikipedia.org/wiki/2009" title="2009">2009</a> for the end of all analog (NTSC) TV transmissions in the U.S.</p><p>A similar hard shut-off date for the end of all analog FM radio must occur in order for HD radio to get past its current consumer growth doldrums. The forced shut-down of analog radio will give America the incentive to adopt HD radio.<br /></p><p>Perhaps more importantly, like HDTV, a forced shut-off will force consumers to become more familiar with HD radio's offerings and benefits which will, in turn, motivate broadcasters to develop stimulating content.<br /></p><p>This is really the only way to quickly stimulate the rapid adoption of this new technology. One wonders why this wasn't the FCC's plan all along. Why place a mandatory transition deadline on television stations and not radio?</p><p>Even our British broadcast neighbors are beginning to lobby their FCC equivalent (Ofcom, the Office of Communications) to turn off the FM band by 2015 in order to force British broadcasters to become digital. They have said they fear being antiquated in the face of all digital audio technologies.</p><p>They have a point.</p><p>What do you think?<br /></p> <p><a href="http://www.ntia.doc.gov/otiahome/dtv/index.html" class="external autonumber" title="http://www.ntia.doc.gov/otiahome/dtv/index.html" rel="nofollow"><br /></a></p>Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com5tag:blogger.com,1999:blog-7221306864403481245.post-11952057880391618132007-07-09T08:54:00.000-07:002007-07-09T10:09:50.717-07:00Radio Moves Consumers to BuyOnce again, radio gets a bad rap.<br /><br />This one comes from the University of Texas professor Stan <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Leibowitz</span> who claims in a paper first published in January of this year that radio airplay can actually hurt music sales. I'm not sure what, if any sample, he used to come to this conclusion, but study after study we've done at Bridge Ratings is more than enough to convince me that radio moves music product. A variety of other industry research confirms this notion.<br /><br />Both physical <span class="blsp-spelling-error" id="SPELLING_ERROR_1">CD's</span> and digital downloads are positively impacted by radio airplay; that's what our consumer samples have told us. We've been doing these types of studies since 2002.<br /><br />In fact, let me reiterate a quote from the summary section of a study Bridge Ratings conducted in 2005 and confirmed again in '06: "Radio airplay - especially of new music - directly and positively affects consumers interest in listening to and subsequently buying new music. Digital downloads are the primary media of the young and early adopter young adults, and CD sales are still the media of choice for adults, especially those with younger children."<br /><br />Our studies have gone on to establish that a radio format leaning heavily on new music and structured in such a way as to allow listener input on the songs being played, would be highly successful with the 13-21 year old age group with bleed-over into the upper 20's. This is because (we discovered) that no matter what the age group, consumers use traditional radio stations to satisfy their need for "surprises" in the form of either unexpected programming or new music.<br /><br />And it is specifically the stations currently airing a predominance of current music that garner an audience whose number 1 reason for tuning in is <span style="font-style: italic;">music discovery. </span>Consumers of this type of radio use those radio stations as a filter, screening out the poor and playing the best of the rest.<br /><br />Yes, radio does sell music - and it sells tons of other consumer products. Music just happens to be easier to sell on the radio because the product is the commercial.<br /><br />Here's a calculation the record labels might want to consider:<br /><br />A <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Los</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Angeles</span> radio station with average ratings playing 8 current songs an hour is, in essence, playing 8 commercials for those artists and the record labels. We've proven music moves product.<br /><br />Over the course of a typical week, if that radio station received compensation as it would for its typical commercials, it should receive $2,150,400 for the value of the airtime <span style="font-style: italic;">that week alone</span>!<br /><br />Now, of course, these radio stations benefit greatly from accessibility to that music product given so generously by music labels. It is, after all, the station's programming content. And, truthfully, those stations garner ratings that generate revenue that generates profit. True. It's a symbiotic relationship this thing that radio and the labels have, but it works - has worked - and will continue to work.<br /><br />To say that radio airplay hurts music sales is a misguided statement which either needs to be recanted or at least better explained.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0tag:blogger.com,1999:blog-7221306864403481245.post-7094639216022247482007-07-01T15:14:00.000-07:002007-07-01T15:31:25.733-07:00Survivor: Internet RadioLast month's "Day of Silence" was an eye-opener on two fronts. First, it is clear that through the significant support of thousands of Internet radio stations - small and large - a message came through loud and clear to Congress, to the Copyright Royalty Board, music performers and the American public that the numbers don't lie, i.e. there is a huge passionate audience out there for Internet radio. That's the good news.<br /><br />Those I've communicated with at political levels were impressed by the thousands of calls but they don't think the noise created by unhappy Internet Radio fans will change congressional opinion. Congress is already convinced that something must be done to save the industry that could be wiped off the face of the earth with the Copyright Royalty Board's rate increases. It just needs to come up with a suitable compromise.<br /><br />The second eye-opener has to do with the data we collected at Bridge Ratings over the three days surrounding the "Day of Silence".<br /><br />1. We learned that 21% of the American public listens to Internet Radio on a weekly basis. That's up from 19% earlier this year.<br /><br />2. We learned that of this 21% that listen weekly, more than half (55%) did NOT listen to Internet Radio on Tuesday, the "Day of Silence".<br /><br />3. More interestingly, we found that 45% of that 21% DID listen.<br /><br />4. 62% of the sample found their <span style="font-style: italic;">preferred</span> Internet Radio station silent on Tuesday.<br /><br />5. What did this 62% do when they found out their <span style="font-style: italic;">preferred </span>Internet Radio station was silent? 72% of them found another Internet Radio station to listen to.<br /><br />6. By Wednesday, the day after, audience levels returned to normal. 89% of the 21% had listened.<br /><br />What's clear by this study is that even if the majority of Internet Radio stations go 'dark' should the royalty rates force them 'off the air', the consumer will find replacements in other surviving Internet Radio stations.<br /><br />Perhaps this is what some of the big boys who did NOT support the "Day of Silence" have been thinking. Elimination of the majority of the Internet Radio competition will generate larger audiences for those still standing. <br /><br />And even if the royalty rates skyrocket, perhaps it is feasible that these larger audiences will allow the remaining Internet broadcasters to monetize sufficiently to make the business work.<br /><br />This may be what SoundExchange and the performers are hoping for, but in all likelihood the consumer will once again get the short end of the stick.Dave Van Dykehttp://www.blogger.com/profile/02967705031141625453noreply@blogger.com0