This guest column is contributed by Larry Rosin, President of Edison Research. It was first published on The Infinite Dial blog.
In my first post in this series, I discussed the data that indicate that radio simulcasts are not performing well in the competition for online audio. In the second post, I focused more narrowly on the mobile environment, where radio station simulcasts are proving to be even less competitive with ‘pureplays’ such as Pandora, Spotify, and others.
Today I would like to list all the reasons I think this is happening. Then, my final post in this series will contain some recommendations to radio companies on what they can do to make their offerings more competitive.
By no means do I think the list below is exhaustive and I welcome comments, additions, and disagreements. Just put your thoughts in the comment box below. The reasons seem to break into two general areas – those related to content and those related to technology … but even those are intertwined.
Easily the most noted argument is the differential in commercial time per hour between most commercial music radio stations and the upstart purveyors. And with good reason – the difference is stark. The economics of music FM grew in an era of monopoly power, and few fully realized the vulnerabilities that were created as spot loads grew in the late 1990s to 14 minutes or even more of commercials per hour.
By contrast, Pandora still has fewer than four minutes of commercials per hour and most ‘pureplays’ are in that same area or even less. This ten-minutes-per-hour (or more) differential can seem massive.
And yet, the research we have done leads me to believe that spotloads are not the only reason simulcasts struggle in this competition, and likely not even the main reason. There is some validity to the argument that listeners have come to expect and even grudgingly accept the load they hear from FM music radio stations (and that these ad breaks are even more accepted on speech-based broadcast stations). In addition, there is clearly some truth that ad breaks on the ‘pureplays’ just seem more intrusive. Perhaps it’s the lack of dj’s and avoidance of radio’s typical ‘clutter,’ but when a commercial comes onto one of the pureplay streamers it does feel different.
The spotload issue does point out the length-of-break issue. Pandora has certainly trained its audience that breaks will be maybe 45 seconds at the longest; FM radio breaks often run as long as eight minutes. Once a listener tries Pandora those eight minutes can seem interminable.
And yet, I’m not prepared to just slam the gavel down and say: “It’s the spotloads – case closed.” These are clearly a major issue, but there seems to be more to the story.
Here in the USA, where some broadcasters are injecting different commercials into their streams, and some are attempting to cover spots with more songs during the breaks, many streams remain, frankly, a mess. It blows my mind when I listen to the stream of a major-market radio station and hear 30 seconds of silence, something that still regularly happens. And mind you this isn’t buffering or a break in the stream; this is a flaw in the ad-replacement technology that is leading to nothing playing. As I wait through these breaks I often think to myself that I must be the only person still tuned – and that’s only out of morbid curiosity.
And it’s not just the ad-insertion or song-insertion that is a mess – there still seem to be issues at times with buffering. Not being an engineer, I always think buffering should have gone away – about when dial-up went away.
It is rather amazing how untended so many radio station streams remain. Program Directors would be fired instantly if the ‘over-the-air’ product sounded one-tenth as bad. Meanwhile – when do you hear complaints about Pandora buffering? When does it not sound smooth and clean?
Song Repetition and Other Content Issues
So much of the comparisons we see when we talk to consumers seem to stem from the ‘native’ location of each service. The content that radio programmers have honed for broadcast over the decades just doesn’t seem to sound quite right in the online space, and at this point the pureplay format is what consumers seem to expect in the mobile/online environment.
As my colleague Tom Webster has pointed out, the mathematics relating to song repetition – informed by PPM measurement – have appeared to be proved ‘right’ for the broadcast environment but wrong for online. Tolerable levels of repeat in the ‘ten-minute-listening-span’ PPM world appear to become maddening in the smartphone environment.
Apps, Part One: Station-branded Apps
Of course apps are the key to mobile strategy and I strongly believe every station needs to have its own app, regardless of whether the station is also available on an aggregation app.
I have spent parts of the last several days looking at the iTunes App Store pages of hundreds of branded radio station apps. It’s an exercise you might want to consider too. While there is a mix of ratings, some radio stations’ branded apps get many negative ratings and lots of comments about buffering. When one reads these comments it seems likely they are not comments about the apps as much as they are comments about the streams they are serving.
People have lots of apps on their phones – they are going to default to the ones that bring them joy. So if a user’s favorite station has a poor app, or has a perfectly good app serving a poor stream, that could limit listening to that station on your phone or tablet. You want proof? The broadcasters involved with promoting the FM Chip in phones throw their own apps right under the bus. Listen to the commercial where Erik Estrada says, “They want you to pay to stream radio instead: you know, delayed, choppy, buffered streaming radio that drains your battery.”
Apps, Part Two: Aggregation Apps
When one considers all the reasons that radio simulcasts in America aren’t competing with pureplays in the mobile environment, one has to consider the role of the aggregators (such as iHeartRadio, Radio.com, and TuneIn). On one level the aggregators are great in that they allow for high profile marketing opportunities – for instance iHeartRadio’s concerts and Radio.com’s spots on the Super Bowl and Grammys.
However I have to wonder if the aggregation strategy is limiting the total growth of the simulcast sector. With station apps – the steps are: 1) download station app; 2) open app and hear station. With an aggregator it goes: 1) download app; 2) open app; 3) type station name into the search box; 4) find station (if you can – iHeartRadio has FIFTY-SIX stations named ‘Kiss’ on it); 5) open station and hear it.
So many steps! People are notoriously impatient in the smartphone environment. How many people are saying: “Forget this!” after some step and never getting to their intended stream?
But the bigger point is – shouldn’t stations have their own station-branded app and also be available on the aggregators? Isn’t that the answer? Not just aggregation and not just station-branded apps – both? Does the current situation, where if you type “Z100 New York” or “WIP Philadelphia” into the iTunes search you get nothing make any sense?
And one more point on aggregation – the iTunes page for iHeartRadio says: “iHeartRadio: Free Radio & Music. Listen to Streaming FM & AM Radio Stations, Top Songs, NPR, Podcasts, Live News, Sports & Comedy Shows.” Wow – that’s a lot of things.
Lack of Customization and Personalization
Even if the spotload and technical issues didn’t exist, simulcasts are competing with pureplay options that are adaptive technologies which veer from the one-program-fits-all ‘broadcast’ model. The pureplays take advantage of the digital revolution, the radio station simulcast, by contrast, seems outdated by comparison.
This is not to say that the problem is ‘radio.’ The problem is ‘simulcast.’ If I love Elvis Duran or Kevin & Bean or anyone else, I should be able to consume them however I want. For instance, I should be able to insert them into midday programming if that’s what I prefer. Hearing their highlights in a podcast should be an option too, but why is it not possible to create a seamless show that blends their content with the music I want as well?
Broadcast Radio rightfully makes its solid points about its role in the audio ecosystem and the relationship it has with its audiences. However, the idea that the only time one can listen to content is the exact moment one can tune in is just outdated in today’s environment. People are abandoning live entertainment television in droves because now they can. They can record it for viewing on their schedule or they can stream it on-demand.
Online simulcasts are suffering from the same issue. They are non-interactive linear streams of content trying to compete on devices that are simply built for interactivity and customization.
The bottom line of all this is that simulcasts just aren’t made for the smartphone environment. Just as putting a camera in the radio studio usually makes for bad television. Simulcasts usually have no interactive elements in a medium whose users expect interactivity. It is a linear stream competing with adaptive audio programs that will bend to your will.
But there are ways for the simulcasters to improve, and in my final post of this series, I will list some ideas.