Next month will see the beginning of consumer promotion for digital radio. Will its take-up be fast enough to make the new broadcast technology successful, and which market segments will retailers target as it is rolled out? In the short term it may be a rocky road, but long term the change should pay off for the radio industry, reports Steve Ahern in this detailed analysis of the path to digital radio.
Radio is investing in its future with the move to digital radio. Analog radio is increasingly locked out of many audio devices because it is not compatible or not sexy enough to be included in new portable devices such as mobile phones and portable media players, but digital radio will seamlessly integrate into these devices, taking advantage of the screen capacity and better audio processing to extend radio’s reach. It will also overcome the growing problems facing AM reception in cities.
The success of digital radio will depend on getting digital receivers into listeners’ pockets, cars and homes through a combination of the right receiver products and a compelling consumer proposition.
Phone manufacturers such as Samsung and LG are interested in putting digital receivers into their phones, while Nokia has yet to be convinced of the value of bundling digital radio receivers without the existence of a single world wide standard.
Apple says it is unlikely to include digital radio receivers inside iPods any time soon, but several manufacturers already offer external receivers which plug into iPods and turn them in to digital radios. The iRiver, another type of mp3 player with a screen, does receive digital radio and will be on the shelves at launch date.
Special USB receiver sticks (dongles) will also be available to bring free digital radio reception to computers and the first GPS navigators to include digital radios are about to come on the European market this year.
And if consumers still want traditional radios there will be range of models available from manufacturers such as Pure, Revo, JVC, Philips, Pioneer, Samsung, Bush, Teac, Sanyo, Roberts, iRiver, Yamaha and Sangean. National retailers Harvey Norman, Dick Smith, Clive Peeters, Good Guys, NARTA, Big W, Domayne, David Jones and Myer will stock dozens of new digital DAB+ radios from mid year and will be anxious to target early adopters to get the first sales ticking over.
DAB+ radios will be backwards compatible with the older DAB technology, and most will also have FM receivers in them. WiFi internet radio is an optional extra at the high end of receiver models, but no DAB+ radios yet have the capacity to receive DRM digital radio signals.
In the 1970s, when free conversion to FM was offered to existing AM stations, some of them turned it down. Thirty years on, as AM declines, in hindsight you would have to ask ‘what were they thinking?’
Some industry observers say it was ‘stereo’ that made FM so successful when it was first introduced. If that simplistic analysis was true then AM Stereo broadcasting should also have been a success. It wasn’t.
The real reason for FM’s early success was a combination of factors including higher quality speakers and headphones, wider band receivers which delivered better bass and treble sound, stereo, and new format offerings targeted at new market segments. Lessons learnt from the introduction of FM point to where some of the early adopters will be as digital radio is born.
RECEPTION & QUALITY
Digital radio promises a similar level of audio upgrading as FM did when first introduced, so those seeking better quality, especially top end hi-fi enthusiasts, will open their wallets to secure this latest gadget now that they have already bought their 5.1 speaker systems and their giant plasma screens. DMG Radio’s Steve Adler, who characterises this market segment as ‘technoheads’ thinks it will be an important segment of early influencers who will convince others to buy the new receivers. Adler would not reveal what format DMG’s new network/s would adopt: “If I told you I’d have to kill you!”
Radio frequency interference in our ‘wired’ cities is creating increased reception problems for the century old AM technology. 3AW moved its frequency from the interference prone AM 1278 recently to a better spot on the dial at AM 693 to prolong its life, but it is still difficult to hear in the Melbourne CBD. So receiver suppliers like Pure Radio’s Graeme Redman think AM listeners wanting better reception, especially in Melbourne, will snap up the new digital radios for in home and in car listening.
NEW FORMATS
In the 1970s Austereo was a pioneer of new music formats, and the network is again at the forefront of new format offerings with the introduction of its unsigned artists channel Radar Radio. Community stations such as FBI Sydney, Edge Radio Hobart, Fresh FM Adelaide and Groove FM Perth have already demonstrated the success of the unsigned artists format, which Austereo now plans to commercialise. An interesting aside to Austereo’s new channel is that it may upset the New Artists to Radio competition by disqualifying new artists who want to enter the competition, which specifies that bands must not yet have had airplay on commercial radio.
The ABC was also an FM format pioneer in the 1970s, identifying, then splitting off one part of its Radio National audience, the classical music listeners, to give birth to Classic FM. Thirty years later, ABC Radio has identified other niches to split off from its main services and has developed ‘Dig’ radio for those who have outgrown triple j but are not yet ready for Local Radio’s talk format. They are also playing with the concepts of Kids Radio and other specialist niches.
Country music is the most popular radio format in America, but here in Australia there are no country stations in major markets any more. ABC Radio will launch a country music channel as part of its new suite of up to twelve new formats, and at least one commercial network is believed to be planning to launch a commercial country channel as well. ARN has its Hip Hop channel on The Edge and is toying with extending this format nationally on its digital multiplex channels.
Jazz will be another niche music format offered, because station executives know that jazz enthusiasts will buy anything that gives them more of the music they love. The same goes for live sport broadcasts, with at least one network expected to expand its offerings of live sport calls via a new channel.
Many of Australia’s ethnic communities currently purchase special radios to hear off-band and side-band stations broadcasting in their own language, so they are used to upgrading their radios to get the programming they want. So SBS Radio’s multi-channel language offerings will also drive early adopter set purchases in small but significant market segments across all capital cities.
ADDITIONAL SERVICES
Racing Radio listeners will be spoilt for choice when stations such as Sport 927 and 2KY split their feeds to broadcast races that currently can’t be heard because they conflict with other race meetings. Racing consumers will also snap up digital radios to see odds, scratchings and photo finishes displayed as part of the ancillary services possible on digital radio screens.
Among the early adopters who will see a compelling proposition for the new technology will be listeners who want to buy songs by direct download. Young people who are used to clicking and downloading when they are on the web expect more interactivity from their media than analog radio can currently offer.
Recent UK experience shows that early adopters will grow to value the ability to find stations via a menu, receive weather and traffic data, and see live stockmarket updates scrolling across the screen as stations offer additional functionality beyond audio. Digital radio consumers will also appreciate the convenience of storing dates, times and addresses of their favourite events when they don’t have a pen to jot down the details.
A simple yet powerful extra on digital radio sets will also be the ability to choose a station from a menu rather than having to remember your favourite station’s frequency. This menu driven EPG (electronic program guide) function has been a boon for tv viewers, and looks set to be just as powerful for digital radio.
Community radio listeners were leaders in the move to FM when it first began, but the sector today is beset by conflicting viewpoints about how it will approach digital radio in the face of uncertain funding. Nevertheless, individual community radio broadcasters will do their bit for the uptake of digital radio sets because they are radio enthusiasts who will just have to have the new technology. Once the sector sorts itself out, new innovative ideas will eventually emerge from community radio’s enthusiastic volunteers.
If digital radio had gone to air ten years ago, it would have been a ground-breaking new innovation that would have delighted those who understood it, but confused many ordinary listeners, who may not have bought the limited number of new devices available. These days digital radio is just one part of a suite of familiar multi-media platforms that broadcasting companies are using to reach their audiences, it is no longer a scary new technology or a surprise, in fact people expect to consume their media in digital form now.
So, as long as the early adopters are happy with the value-added offerings from each network, digital radio is likely to slip quietly into the consumer experience quicker than most people expect in the coming 12 months, then spread from these ‘influencers’ to the general community.