> As I sat and thought about it, there is nothing they could
> put on HD2 that would make me want to run out and buy a
> receiver.
There are a lot of things I don't understand about this, but one in particular that puzzles me is why would commercial broadcasters want more channels on the dial for listeners to choose from? Radio is a business, and there is something to be said for not fragmenting your audience.
I can understand the enthusiasm about HD Radio from NPR/PRI stations, since they frequently have more programming available than they have hours in the day to run it. On the other hand from a commercial broadcaster's point of view, it seems less clear to me. As far as I know the idea is to make money by selling advertising. Those rates are usually determined by audience share as reported by Arbitron and others reporting services. Right?
So let's say your station had a 5.0 share over a week. That would seem pretty marketable. Now you sign on your HD-1 and HD-2 channels. Might not some of your listeners migrate to those new channels and lower your share? Now you have the task of selling three things, rather than just one. Do the three parts add up to be better than the whole? Maybe, but maybe not.
To make things more difficult, the mainstream formats are probably already spoken for so new secondary channels would most likely have to appeal to niche groups. These audiences can be great. They are usually very loyal listeners. But isn’t it difficult to market formats with low audience shares? It takes a lot of effort, and you must do it in the right market to make them successful. The problem of a small audience share is why adult standards, oldies and real jazz stations are dropping like flies. They are good formats, but they are hard to sell, except in certain communities. Maybe they will be saved by HD.
Unless you own most or all of the stations in a market, adding more channels seems counter-productive to me. I suppose that if a cluster sells packages including HD-2 channels, then it may work out financially, but keep in mind that they still have to remain competitive with other advertising media in the market. You can only charge so much. Adding a second or third channel is not free. Programming costs money, as well as the investment in the infrastructure to do it. From a strictly business point of view, I don’t see any immediate financial reward from doing this. I’d like to be altruistic and say everyone is doing this for the good of the general public. Unfortunately, that is not my experience with the current state of broadcasting. It is a business and it lives and breaths on cash flow.
I think it will be quite some time before the secondary channels are able to make money, just like in the early days of FM. In the 1950's and most of the 60's, FM stood for "Forget Money." What saved FM was new and innovative programming that could be produced very cheaply. Score one for Underground Radio with $2.00 per hour jocks. I guess that cheap but good programming is once again the task at hand. To succeed, HD secondary channels must bring back the listeners who have previously abandoned radio. You have to increase your market, not fragment it. If they can do that, then there is a chance for success. That’s a tall order.
It looks to me like the business model may work for big group broadcasters, but it is unlikely to work in favor of the small broadcaster who would be diluting his product. Or is that the plan?
Just curious. I'm wearing my asbestos Jockey shorts.
Chuck
