Monday, April 18, 2011

Why Radio Needs To Jump On The Digital Bandwagon

From Rich McLaughlin For The Business Insider

Digital platforms provide opportunities to enhance a terrestrial radio company’s core competency. Yes, I’m referring to content! It might be inaccurate to claim that a lack of diverse and compelling content options on the AM/FM radio dial was singlehandedly responsible for the influx of new offerings and platforms as digital was born. Regardless, that perception certainly played a role in the eyes of the consumer.
Satellite and Internet radio found their wide audience, in part, by exploiting terrestrial radio’s reputation of having narrow and repetitive playlists. How? They emphasized the depth and quality of their content offering. Terrestrial radio must now do the same. Inevitably, superior content will merge with superior technology to form the optimal listening experience. That’s where this will all end up. Terrestrial radio must focus on fighting the content war, and digital platforms enhance the user’s experience.

Digital presents an opportunity, not a threat, for terrestrial radio companies. Contrary to what some industry executives might believe, radio listeners consume the same content digitally as when listening on a frequency. All that’s changing with online and mobile listening is the means by which they consume it. “The Infinite Dial 2011” report confirms the finding that online radio listening is a complement to over-the-air radio, not a substitute. The study concluded that 89% of weekly online radio listeners listened to over-the-air AM/FM radio versus 11% those who listened exclusively to online radio, and not AM/FM. While online only stations, commonly referred to as “pureplay” stations, are an effective means of adding depth and increasing listenership on a platform, they don’t do so at a cost to AM/FM streaming.

Finally, and perhaps most importantly, fighting the transition to digital is not a battle terrestrial radio companies can win. Rather than taking the failed record label approach of ignoring, or worse, attempting to force the hand of technological progress (I’m talking to you HD Radio), the radio industry should accept what it cannot change and use digital to its advantage.

Time will tell if the recent call-to-arms for a digital revolution from radio’s top ranks will galvanize the industry to make the transition with meaningful and significant urgency. The future success and relevance of terrestrial radio companies will depend on it.
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Rich McLaughlin is the Digital Program Director for Clear Channel's iheartradio platform.

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