Calling broadcast radio a dying industry, experts and analysts have been telling broadcasters for years that radio is on a short list of major industries that will be transformed by the Internet.
Radio is officially dead, especially when wireless internet access comes to your car.
–Seth Godin, 2005
AM/FM radio has about five good years left, if that. And what we consider to be radio today will be on the Internet. And the Internet websites will be media stations.
-Michael Harrison, 2009
When what’s on the radio is solely the songs you’ve chosen — will anyone tune in local stations anymore? –FoxNews.com, 2011
By 2016, your transmitter will make up only a small percentage of your listening.
–Eric Rhoads, 2012
Well, with so many well-run radio stations still in positive cash flow, it’s still too early to eulogize radio. BUT… when the Connected Car becomes a reality (to be discussed in next post) and enough people have those cars, radio as we know it — RF signals in the AM/FM bands; licenses assigned by the FCC — will die.
Meanwhile, digital content wirelessly delivered is the biggest opportunity for broadcasting since the advent of radio and television. Online audiences are growing like crazy.
For broadcasters, the fight isn’t about saving end devices. When was the last time you went into a Best Buy and asked to see their Radio Department? The challenge is how to transition content creation and distribution to wireless networks with financial sustainability.
New revenue models
Broadcasters are still seeking an industry business model for digital content. One experiment that I’ve been following lately in the radio world is the use of ad insertion technologies.
For more than a decade, radio stations have been using ad insertion technologies in an effort to get incremental advertising revenue into their online streams. Apparently some are now seriously considering abandoning the technology and replacing it with their over-the-air signals.
Read all about it:
AD INSERTION TECHNOLOGY DISAPPOINTS BROADCASTERS
IS RADIO GOING BACKWARD ON DIGITAL?
“THE TECHNOLOGY PROBLEM IS ON YOUR SIDE, NOT OURS.”
I’ll leave it to others to determine if ad insertion is a long-term solution for sustaining online radio platforms. With technology and business cycles moving so quickly, however, I would suggest that broadcasters don’t have the luxury of waiting a year, much less ten, to determine if a new approach or technology will help finance a successful transition.
Fail, recover, try again
Media innovation has always been about “learning through trial.”
Digital testing doesn’t have to break the bank. Today, any size company can justify small-scale projects. If one technology doesn’t work, find a faster way to fail, recover, and try again. In the new media world it is said that the most successful companies will be those that are able to embrace failure in all of its forms: They must fail fast, fail early and fail often. Only then will they succeed.
Iterate, iterate, and iterate again until you find what works. Then, share the results with the community. Everyone will be strengthened.
But when I am afraid, I will put my trust in you.
Psalm 56:3
Broadcasters everywhere continue to face one huge question: How do they survive – and, hopefully, thrive – once terrestrial transmitters become outdated or obsolete?
If the broadcast industry is to survive another 100 years, broadcasters will have to reinvent themselves as something that will work for digital natives, who no longer consider traditional media essential to their every day lives. And prepare for a world where profits are much smaller and competition is much greater.