been reading about the “death” of radio for far too long, and
would find it all most amusing if it were not so misguided and plain
wrong. Each commentary is as dire as the next. Each story is the same
and all you have to do is change the decade and the latest “threat”
to radio and it all goes something like this:
TV is killing radio. “It won’t be long now until radio is gone”
(Billboard Magazine, 1960).
Cassettes and 8 track tapes in the car will “kill radio, why would
you listen anymore?” (A music expert, 1970).
The Sony Walkman will “rapidly eclipse radio” (a major
Betamax and VHS will “erode radio listening substantially” (local
TV station, 1985).
The Internet will “destroy over-the-air radio listening” (various
Consolidation will “turn off listeners in droves” (various,
Sirius Satellite “will soon replace traditional radio within five
years” (various bloggers, 2007).
The iPod “will bring radio down … once and for all” (various
Pandora and “pure plays will cripple radio forever” (various,
In dashboard, “Internet radio” in cars “signals the death of
traditional radio” (various critics, 2011–2013).
for all its competition, known and imagined, from its long line of
“expert” critics as well as its own weak PR efforts, radio is
still having explosive growth in many sections of the U.S., and
especially in Southern California. In fact, I would call radio’s
momentum a “rebirth” … growing and adapting in ways all these
critics have somehow failed to see.
rants against radio reflect unprofessional journalism at a high level
and are not the true state of the radio industry today. Rather than
just offer my opinion, I think it would best if we all look at some
undeniable facts about radio and why it is more popular with
listeners and advertisers than ever before.
THE FACTS, MA’AM
First, there are now
more licensed radio stations in the U.S than ever before: 15,300, up
by 1,506 since 2004, when there were 13,794, according to FCC records
from May 2004 compared to September 2013.
listening for adults 12 and up in the U.S. continues growing and now
reaches 243 million Americans every week in 2013. That’s a reach of
93.2 percent of all Americans, as reported by Nielsen Audio, formerly
Arbitron. In 2003, radio reached 224 million Americans, while today
it’s reaching 243 million, a 9 percent increase in audience in the
past 10 years alone.
to local radio stations through mobile/tablet devices and/or PCs is
surging, with an 82 percent increase in listenership vs. a 19 percent
increase for all “pure plays” like Pandora, Spotify, etc., says
Triton Digital Metrics data. Radio’s online listening growth
percentage over the past 12 months is now more than double the “pure
play” numbers, also according to Triton Digital Metrics. That’s
right, double. Online listening does not erode radio’s audience, it
now, to really frame this debate to its proper form, please consider
the following additional facts that showcase radio’s ubiquitous
strength and how difficult it will be, now or in the future, for any
audio platform to overcome the evolving nature and tenacity of radio
as a powerful and ever-present consumer choice:
Research says that 84 percent of adults say they use “AM/FM radio”
while driving and 58 percent say they use radio “almost all the
time” in their cars. After 10 years of effort, Sirius/XM can only
muster an 11 percent reach of all Americans. Radio stands at 93.2
percent and growing, according to Nielsen Audio.
has stopped growing. According to Triton Digital, Pandora’s average
active sessions (signing on to their site) from January through
August 2013 have gone down slightly by 1 percent. A more ominous
indicator is their Time Spent Listening, which has dropped during the
same period from 37.8 minutes down to 35.4 minutes. This is not good
news for a start-up spending more money than it brings in. Pandora
will not discuss profit targets at this time.
newsletter Motley Fool urged its clients in July 2013 to “stay
away” from Pandora as more ads being inserted are costing them
listeners and subscribers won’t even pay a $4 fee to eliminate the
annoying ads. Their business model is just not sustainable long-term.
If the “inconvenient
truths” of the above facts are still not enough to turn your heads
about the compelling power and business model of radio in 2013 and
beyond, please consider this. As I write in late October, every
major, publicly traded radio broadcast company is trading near or at
its 52-week high. This clearly means that Wall Street and the
investment community are coming around again to the value of
the free, ad-supported business model of real time radio.
It certainly helps
to have a robust digital strategy in place as well, but clearly stock
values are tied to perception of an industry and intended future
growth, and radio once again has that “hidden value” quality for
July, Hubbard Broadcasting bought Sandusky Broadcasting and its 10
radio stations in Phoenix and Seattle for $85.5 million. As a result
of this sale, Hubbard will add 65–70 new jobs to support the two
markets (Inside Radio, July 18).
Do any of these
documented facts reflect a radio industry in trouble? Hardly. Indeed,
the opposite is true. Radio is growing and the smart investors know
and one more thing: BIA/Kelsey is still projecting that total on-air
and online advertising revenue for the radio industry will reach $17
billion by 2017, or a 4.8 percent growth rate over 2013’s estimated
$16.2 billion total revenue.
Imagine this for
just a minute ... Radio’s total revenue by 2017 still won’t equal
its all-time high of $17.9 billion, set in 2007, but that was right
before the great recession. Radio indeed rumbles on, and by 2017, the
industry will have climbed back to within 92 percent of its all-time
high, and at a time when our strategy and approach to our digital
radio assets are still in their formative stages.
any of this remotely sound like any industry in trouble?
to the most casual observer, it is clear that radio — with all its
extending platforms of growing online PC listeners, mobile listeners,
surging in-car listening, involving and local websites, rapid and
loyal social media feeds, podcasts, thousands of mobile apps and a
passionate listener base of 243 million people — is the king of all
audio, regardless of its platform, location, or technology.
IN A NAME?
finally, have you noticed how that everyone wants to be in radio and
call itself radio?
Sirius/XM, Spotify and every other digital newcomer tags itself as
“radio.” They are not radio. They are playlists, nothing more.
They do not inform, they are not part of any community, they offer no
help to flood or earthquake victims, they offer no charitable work,
they don’t offer any news, information, chatter, personalities that
interest us, and they don’t tell us why we are stuck in traffic and
that we will be late getting home to our families.
radio is radio:Engaging, local, informative, helpful and
always willing to turn over its airwaves in a crisis, providing
thousands of hours of community support to their towns, cities and
states. And there are no subscriber fees, set-up costs or yearlong
agreements to sign. It’s been free to all our listeners and has
been now for almost 80 years. Please, accept no substitutes!
did say free, didn’t I?
rumbles on, simply because it connects with humans on an intimate and
consistent manner. Our strongest weakness is that we are such good
friends and so easily accessible that our listeners consider radio as
always being there, much like electricity. Can you imagine a day in
your life without electricity or your favorite, local and free radio
are in a golden age for radio, and based on all the facts listed
above, a big, bold and robust future is ahead of all of us who are
fortunate enough to work in this creative and compelling business.
rumbles on like a sleek bullet train, powerful yet taken for granted,
loaded with enormous assets and a time-tested delivery system for
listeners and advertisers, and hurdling, ever forward … towards its
next destination. All aboard!
Callahan is president of the Southern California Broadcasters
Association. He is based in Los Angeles.