Be Careful What You Wish For

There was a story in CrunchGear that we found quite interesting.

Apparently Pioneer, the Japanese manufacturer which makes the popular Inno for XM, is voicing their objections to iBiquity's request that the government mandate satellite radio manufacturers include HD Radio.

Besides the usual complaints about how this mandate would increase costs for consumers and actually decrease performance, Pioneer took their argument in an interesting direction.

"Free terrestrial analog and terrestrial digital radio services should be allowed to compete with paid satellite digital radio services on an even playing field. Consumers should be allowed to choose radios which meet their needs, without undue government influence.

It is our belief that HD Radio should compete in the marketplace with other radio services: if free local digital terrestrial radio services are compelling to consumers, HD Radio technology will succeed in the marketplace. In this case, the free market is the best measure of the public interest."

We agree 100%!

Just a little ironic coming from an industry that spent millions on petitioning the government to allow the merger between XM and Sirius.

We would also caution Pioneer to be careful for what they wish for...

The free market appears to be already bypassing satellite radio for Internet radio.

Do You Heart HD Radio?

If you do not understand the title of this post, you have not been to Clear Channel's new beta music portal.

Besides our obvious issues with the name and some issues with the overall layout, we applaud Clear Channel for taking this next step.

From this music portal, users can listen to more than 750 of Clear Channel's radio station streams sorted by either genre or geography.

Allowing users to easily find streams is always a good thing. But it gets better!

Clear Channel has widgetized its Stripped performances so that users can embed the video into Facebook, MySpace, Google, Yahoo, and most other blogging and social networks.

Finally, CC gets it!

We have are big fans of widgets and know for a fact that many other people share our view as evidenced by the thousands who have downloaded the RadioSherpa Apple Dashboard widget.

Other features include on-demand music, lyrics and special features.

But we have one very big question:

WHERE ARE THE HD RADIO STATIONS?!?

Increase Power NOW

Another story that caught our eye last week that has everything to do with HD Radio.

Leslie Stimson at Radio World had a great article on the debate about increasing the broadcast power for HD Radio. This should not even be a debate.

We agree 100% with the radio engineers who said at the NAB Show:

"Life without such an elevated power increase is causing anxiety and even doubt about the success of HD Radio."

We have addressed with HD Radio reception issues a few times in our blog - sometimes with humor. But this is not a laughing issue.

We have told iBiquity that improved receiver sensitivity and obtaining permission from the FCC to increase the broadcast power of HD Radio is more important than anything else on its plate...including lower-power chipsets for mobile devices.

We realize that there are many people against this idea:

1) Those vocal opponents of HD Radio who feel that HD Radio is already interfering with adjacent and other low-power broadcasts (Yes, we hear you!)

2) The HD Radio manufacturers who have already invested in the development of the current generation of HD Radios.

3) iBiquity's current investors who are probably fearful of another FCC approval process. (Note that iBiquity appears to be actively fundraising again.)

All have valid concerns, but iBiquity and the HD Radio Alliance should not be worried about the 500K or so radios that are already in the market. The manufacturers would gladly trade their investment for radios that actually sell. And many consumers are probably not using their HD Radios anyway out of frustration.

Don't delay the inevitable...seek to increase the power now!

Something Smells with Pew Research

We have been out of pocket for a few days, so we expected that there would be quite a bit of new news to write about. Unfortunately, news on the HD Radio front remains quiet.

There were, however, a few stories that did catch our eye.

The first was from Pew Research.

The story had a provocative title, "Pew: Internet Playing Minor Role in Music Buying Decisions", and, as the title indicates, the key takeaway of the research was that online sources have little influence on music purchasing decisions. Pew found that 51 percent of the respondents in the survey said that the Internet carried no influence whatsoever on purchasing decisions, while 37 percent pointed to a minor impact.

Hmmm...this fact does not jive with what we see every day.

But then it came to us.

The study dealt with music BUYERS. A good chunk of the general public (and the majority of those under 25) are STEALING their music. These people are highly influenced by the Internet.

I wonder what the stats would look like if this fact was accounted for.

Nevertheless, the study did indicate that terrestrial radio remains very influential. We agree...particularly for the big hits.

The Internet is far more fragmented...as any major label head will testify.

Big Pimpin'

A few months ago, we wrote that radio broadcasters need to become more promiscuous. We urged stations to make the streams public so that developers could build new applications around them.

It appears that Clear Channel was listening.

Yesterday, Clear Channel announced that it was going to make more than 800 of its stations available on select tabletop Internet radios that use the Reciva's Internet radio modules.

Many of the Clear Channel haters out there will argue that tabletop Internet radios sell so few numbers that this announcement does not mean much.

We bet, however, that this was not an easy decision for them. Directing people away from their cash-cow terrestrial broadcasts may seem crazy given the relatively unproven business model of Internet radio.

But the status quo is no longer an option. Generation Y and younger are not listening to the radio as much and are increasingly turning online for their music. Clear Channel's deal with Reciva, and others like them, are their only option.

In fact, we would argue that radio broadcaster should make their streams (including their HD Radio streams) available to all developers. Now is not the time to be monogamous. The online world is extremely fragmented and broadcasters need to be in bed with as many players as they can.

In these uncertain times, I think Clear Channel would do well to heed the advice of world famous Rapper Jay-Z:

"Me give my heart to a woman?
Not for nothin, never happen
I'll be forever mackin."

And NOW! Another 30-minute jam-free commercial!

Ok, so I cannot take credit for that line...but you have to admit the line is pretty funny.

There is definitely quite a bit of hatred for Clear Channel out there. Only some of it warranted.

With all the rumors floating around regarding Clear Channel and Pandora, we missed the launch of another Clear Channel creation: Total Radius.

The site is primarily a promotional tool that tells advertisers why radio is still a viable medium for advertising dollars. But could the site eventually be the foundation for an online tool that allows advertisers to create low-cost radio ads?

Not clear...but it seems logical.

With increasing competition from online advertising, anything to lower the cost for advertisers is a good thing. Remember, cheap inventory is still better than unsold inventory.

Of course, if Clear Channel continues to reduce spending in the development of new content for HD Radio, there will no advertising to worry about....BECAUSE THERE WILL BE NO LISTENERS!

Is Clear Channel Marrying a Fraud?

As readers of our blog know, we have been very supportive of CBS Radio's recent moves...particularly its AOL deal.

We also think that the acquisition of Last.fm was a good move, although integration with CBS Radio is only beginning.

Now Billboard is reporting a possible relationship between Clear Channel and Pandora. Could this lead to an acquisition?

What to think?

1) Is Tim Westergren a fraud? He has been riding his high horse preaching about how staid terrestrial radio is, but now appears to want to sell out to CLEAR CHANNEL.

2) Anything to improve Clear Channel's online offering is a great step, but what is the cost? With Last.fm and Pandora potentially owned by the largest players in terrestrial radio, will innovation slow down?

3) Don't forget HD Radio. We are big fans of the Internet, but have argued before that Internet radio in the car is still some ways off. Radio should treat HD Radio as a platform to leverage their brands TODAY.

We are glad terrestrial radio is finally becoming aggressive, but some deals make you wonder!

Death of Primetime (and CBS Radio)

There was an interesting article today in the New York Times regarding the challenges facing prime time television. The author points out that audiences for prime time shows continue to decline as time shifting and web streaming become viable alternatives. But the author also indicates that the most popular shows (e.g., The Office, CSI) have 20-25% GAINS when DVR viewing is included.

“As a result of time-shifting, the biggest shows are getting bigger and some of the smaller shows are getting negatively impacted,” the senior television executive said.

What does this tell us?

Good content always wins. And those who have it, need to leverage it.

The same lesson can be applied to radio.

Morning/afternoon-drive (radio's prime time) radio shows will continue to lose audience to alternatives such as cell phones and the iPod. But as with television, all is not lost.

Those stations with great programs (music or otherwise) should leverage these brands by posting online and elsewhere. CBS Radio appears to understand this as it recently announced the syndication of its radio content for not only its own distribution network, but also other online networks.

If played right, new technologies do not have to result in a zero-sum game.

In a refreshing moment of clarity (and honesty), Alan Wurtzel, the head of research for NBC gave this gem to the Times:

“Honestly, if I could wish away the DVR, I would,” Mr. Wurtzel added. “But I can’t. It’s growing.”

The faster Radio executives reach the same conclusion regarding time shifting and online broadcasts, the better.

Too Many Cooks?

All the recent news about the Clearwire-Sprint WiMax deal, got us thinking again about this subject:

As we stated in March, we are definitely pulling for WiMax to become successful, but caution is needed:

1) WiMax that is being delivered today is a far cry from the story being picked up by the media. WiMax is currently a fixed wireless solution primarily for the last mile. I can assure you that cell phone companies are not losing sleep over WiMax right now.

2) We hate to say this but the syndicate financing this deal appears to be a collection of "also-rans". We understand why Sprint and Clearwire and Intel are involved, but it is not clear what the intentions are of the other players. If Google really wanted an open network, they could have put their inflated market cap to use and buy some spectrum. It is even less clear what the cable companies' motives are. Do they really want to see their cable modem lines replaced with WiMax?

3) The entire WiMax community blew a chance to move their technology to the more promising 700 MHz spectrum. Instead, Verizon and AT&T now have this prime real-estate for their 4G network.

Any competition for the carriers is a good thing, but Sprint and Clearwire have a long way to go.

The Mason-Moonves Line

With CBS under pressure to improve its bottom line, CBS Radio continues to be aggressive.

We applauded the CBS deal with AOL and approved CBS bringing back WNEW to HD Radio.

The latest announcement from CBS Radio regarding their new media player is also a positive...although hardly revolutionary.

We would argue that the features in the new media player that are being promoted are either expected (e.g., album art and HD Radio streams) or relevant only for advertisers (e.g., new ads).

Nonetheless, many other radio broadcasters are not even going this far.

Despite what Dan Mason says, there are pending threats to terrestrial radio. We agree that the iPod remains a different user experience, but Internet radio is/will be a real threat to terrestrial radio if not co-opted.

We are glad that Dan is actually not listening to what he states publicly.

MishMosh

Here is some news from the radio world that caught our attention today - Both Good and Bad.

First, the Good:

Edison Research announced today that 20% of Americans are listening to radio online. This is up from just 12% a year ago.

It appears that radio's recent investment in their streaming is starting to pay dividends. We wonder, however, what percentage of the 20% are listening to TERRESTRIAL radio streams.

Either way, it is a step in the right direction. These new streams should be treated just as seriously as their traditional analog channels. And these revitalized streams should find their way to HD2 channels for HD Radio.

Now the Bad, courtesy of AVS Forum:

"I love HD (when it works), and am proud to say that I work for a station that broadcasts in HD...although in a cruel twist of fate, I cant hear it where I live!"

This radio station employee goes on to talk about various antenna options that he has tried (in vain) to enable him to receive his favorite HD Radio station's signal 45 miles away.

As we have said before, these reception issues are real and need to be addressed!

Sounds Familiar, No?

Recent updates on Blu-ray sales brings to mind the continuing HD Radio saga.

All expectations were that Blu-ray players would see a nice uptick in sales after Toshiba pulled its competing HD DVD technology. But no such increase occurred.

Industry analysts, NPD, would not even release actual sales figures for standalone Blu-ray players out of fear that it would be easy to identify individual retailers.

These sales figures follow a report from ABI Research noting that many consumers see little difference in the picture quality between Blu-ray and standard DVDs.

Let's see:

1) Proprietary standard

2) Consumers not seeing a huge benefit in broadcast quality

3) Expensive devices

4) Little consumer interest

5) New digital formats over the web as increasingly viable alternatives

Yes, the similarities between HD Radio and Blu-ray are eerie.

Both also appear to be hoping that price decreases and improved distribution channels (e.g., cars for HD Radio and video game consoles for Blu-ray) will increase sales.

HD Radio, however, has one distinct difference. Live content. Make this content interesting and unique...and people will buy.