Comment from Peter Saxon
Back in the mid 80’s, I was a partner in Radiowise Productions, a syndication company that held the rights to distribute American Top 40 to around 60 stations across Australia.
It had a sister program called American Country Countdown which had an even greater penetration worldwide than AT40 but was less popular in Australia. In Sydney, though, it was broadcast by 2KY (now Sky Sports Radio) on Sunday nights. These were still antediluvian times for radio, in that everything was strictly analogue. The only thing that was “digital” was one’s finger pressed to the vinyl while cueing a disc on the turntable.
American Country Countdown (and AT40) was thus airfreighted from L.A. each week in individual packages containing four vinyl discs for each subscriber station. For its four discs of ACC rushed from the U.S., 2KY was paying the princely sum of $60 per week.
So, I was surprised when I got a call from the station’s veteran program director, the ever-affable Kevin O’Neil, to tell me that they were cancelling ACC due to budget cuts. While country music fans may be sparse on the ground in Australia compared to the U.S., they are an extremely enthusiastic lot. No sooner had 2KY failed to broadcast ACC on Sunday evening than a listener backlash began.
Mr O’Neil passed one of the irate callers on to me. He introduced himself as chairman of the Bankstown Country Music Association (sub-branch, chapter, verse etc.) and that their weekly dose of ACC was vital to the well-being of his members. Without it, well… anything might happen.
He went on to tell me that his committee had voted unanimously to purchase the program from us for the same $60 that 2KY had been paying. I explained that due to a complex set of copyrights, I was unable to provide the program to anyone other than a radio station holding a valid broadcast licence. However, if they were able to convince a local community station to broadcast the program and pay Radiowise for it, they could reimburse them their $60 and everything would be Kosher.
As much as this outcome left everyone a winner, I couldn’t help but wonder, ‘what is wrong with this picture?’ How is it that a mere dozen listeners from Sydney’s south-west can club together with $5 each a week to purchase an internationally syndicated show that was beyond the budget of a commercial radio station?
Wind the clock forward 35 years and I’m left wondering, “is there something right with this picture?’
In the UK, BAUER Media has just launched what it calls a Premium Radio Subscription service.
Their company’s presser says, “In a pioneering move leading European commercial radio broadcaster, Bauer Media Audio is reinventing radio for music-lovers. Radio stations Scala Radio, Jazz FM, Planet Rock and Kerrang! Radio are enriching and extending the live radio experience by launching premium subscription online radio services.”
Ang about… as the poms might say. ‘But aren’t Apple, Spotify, Tidal, Deezer Amazon and others already doing that?’
Yes, but, unlike the music streamers, this offering has real, live presenters. “Radio offers music, discovery and a live experience which is central to its enduring appeal,” says Paul Keenan, President of Audio, Bauer Media Audio.
True. But it seems that these internet-delivered premium subscription services will occupy a very narrow niche indeed between radio, as we know it, and AI-curated music streamers.
In the end, it will come down to how well they are packaged to appeal to a clearly defined audience. Here’s a taste of the Classical Station: Scala
Scala Radio is breaking the mould of classical music in the UK. Bringing you music from familiar masters such as Mozart and Beethoven to new works from composers Karl Jenkins, Rebecca Dale and Max Richter, while shining a spotlight on bright young artists like Sheku Kanneh-Mason. Expect to hear contemporary works including film, TV and video game scores and instrumental re-workings of pop and rock songs by the likes of Justin Timberlake, Led Zeppelin and Dua Lipa.
Listen to presenters including:
Penny Smith – Weekdays from 4pm- 7pm
Angellica Bell Saturday and Sunday – 10am –1pm
Mark Kermode – Film Music Show – Saturday 1pm -3pm
Mark Forrest – Weekdays from 10am -1pm
Simon Mayo’s Essential Albums – Saturday 3pm – 5pm
You can also listen to Scala Radio on Digital Radio across the UK, Smart Speaker and App. Find out more at scalaradio.co.uk.
If I were Bauer, I’d be looking to launch a country music station next. I know at least a dozen people in Bankstown who’d be willing to part with seven bucks a month to listen to it.
Scala Radio Premium, Jazz FM Premium, Planet Rock Premium and Kerrang Radio Premium are available across web, app and supported smart speakers for a free 7-day trial followed by a payment of £3.99 (approx $7.16) a month.
Peter Saxon
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In the belief that there is nothing new under the sun, in 1923, the earliest radio service was the sealed set system where the listener possessed a radio that was tuned to a particular station. The receivers could be hacked to receive other stations. The sealed-set system was a failure with only 1400 subscribers, ref https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/Media_ownership/1923-1938 .
A subscription to the four Bauer Media services cost AUD $7.16. Seems reasonable enough. In a similar vein to the sealed set system of 1923, will there be enough subscribers to break even, at least cover the cost of the wages of the presenters, power, administration, royalty fees?
Subcription radio in the US, is alive and well with over 34 million subscribers to the Sirius XM satellite services. https://www.statista.com/statistics/252812/number-of-sirius-xms-subscribers/. With monthly subscription rates ranging from US$10 to US$19, that would be an expected annual turnover of between US$4.2 billion to US$8 billion, source https://m.siriusxm.com/servlet/Satellite?c=SXM_PageDetail_C&childpagename=SXM/SXM_PageDetail_C/OpenContent&cid=1283879531775&p=1283872687292&pagename=SXM/Wrapper .
The range of channels is between 80 and 175 channels with the premium package offering online IP radio. Thats between $10/80 = US $0.125 per channel and $19/175 = US $0.11 per channel per month or AUD $0.15 and AUD $0.16 per month per channel.
For the British offering, that is $7.16/4 per month = $1.79 per channel per month, which is 10 times the price of the US offering.
Despite a slight drop in consumers for subscription radio in the US, the market is larger. Whether the market for subscription radio can be sustained in the smaller UK market, I doubt that subscription radio could be sustained in Australia.
There has to be a great reason to subscribe to paid radio. The pulling power of Foxtel/Kayo is the sports content. For general entertainment, Foxtel faces competition from streaming VOD services, whether paid or subscription. Paramount pictures is offering a VOD subscription service.
If sport is the 'pulling power' to attract subscribers to Foxtel/Kayo, then sport may be the pulling power for subscription radio.
But alas, the FTA services of ABC metro, Grandstand (DAB), Nine Radio (2GB, 3AW), 2SM, SEN, and MMM would make it hard to want to flick over to subscription radio, especially for sports offerings.
That's unless the subscription service does a larger deal greater than the accumulated offerings of the FTA broadcasters such that the only way to listen to sporting coverage is via subscription radio.
For Bauer Media's subscription service, time will tell whether there are enough subscribers to sustain its four musical channels. It would have to compete with the fourth largest commercial radio network in the UK, Classic FM, https://www.classicfm.com/contact/advertise-with-us/. By classic FM, it's music equivalent to ABC-Classic and 2MBS (Fine Music), NOT Classic Hits.
Thank you,
Anthony of exciting and analytical Belfield
Apple Music has real live presenters. Zane Lowe, Matt Wilkinson, Nadeska, Kelleigh Bannen, Estelle, and Hanuman Welch all present live shows. And their live country music station features weekly shows presented by a large number of country artists that I'm sure our friends in Bankstown would appreciate!