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FMeXtra "Jumps the Shark"

Yes folks, the system we all claim to know and desperately want to love has put Mr. Jaws in the fence, fired up the wetbike and now is awaiting young Ritchie Cunningham's pep talk, before it rides off into the broadcast sunset.

Based, I'm sure, on their dazzling market penetration, Digital Radio Express has apparetnly raised their price on their encoder to $15000. Along with that price is the REQUIREMENT that you purchase 100 Aruba Radios at $200 each. That makes your initial investment (Drum Roll Please) $35,000.

Along with your initial package you get 100 radios which cost 2 "C-Notes" each which you might as well give away. Then you could claim higher market penetration than HD.

Now you DO get a nifty system which has most likely never sold a single receiver in your area.

I heard this rumor on a mailing list a week or two ago and recently checked to see if it is true. Yep, it is.

For your $35K you get a complete system to broadcast to NO ONE. Imagine pitching this from a sales perspective. Can you visualize the prospective client questions? And what you'd have to ANSWER? Visualize this...

Client)Good to talk to you again, Mr Accoount Exec.

Q) Is this the HD system I've heard about on some of the other big stations?
A) No, this is a system designed better, which gives you more flexibility, better range and crystal clear digital sound.

Q) Wow, that's a nice ARUBA radio you have there. And the sound sure is nice. Does "it" receive those new HD stations?
A) No

Q) Does it get AM? While I can't afford it, a lot of my customers listen to Rush?
A) No, but it does get conventional FM Stereo and sound great. Listen in these headphones.

Q) That does sound nice in stereo. Does it come with another speaker?
A) No.

Q) Well it does sound good. I don't recall seeing these radios before. Where in town can I buy one?
A) Actually, I brought this one just for you. Take it with our compliments. Radios for the general public will be available for now at the Radio station studios.

Q) Sweet. Thanks. I'm assuming you're not giving them away to everyone.
A) Nope, but we are doing a lot of contesting and will be giving away 100 of them over the next couple of months.

Q) What will they cost if you want to buy one?
A) The Radio station will sell them for $200

Q) Wow, that's a lot. Any chance they'll be avialable in local stores.
A) We hope so. There they'll go for $300.

Q) I have a friend who has one of those "HD" radios who moved here from San Antonio. Can he hear your digital station?
A) Not the digital part, just the Analog.

Q) Well that's sorta sux. I guess it's like the Sirius and XM thing, right? 2 Different systems. Think they'll ever merge?
A) I haven't heard anything about that, but I guess it could happen.

Q) So I assume there are other stations using this in other areas. Where's the nearest station.
A) Well we know of a couple. One in Wisconsin and one in Michigan.

Q) Are they selling a lot of radios up there?
A) Actually they use the system for a studio to transmitter link. They only own 1 radio and another they use for a backup.

Q) Well how many of these radios are there in our town right now.
A) Well I've given away 4 to other perspective advertisers in my travels this week.

I think you get the picture. Meanwhile, on a small facility like I own, which uses a broadband antenna, I could spend $49,000 and have a much better answer to a lot of these questions. All without going into the radio "Selling" business.

http://www.ibiquity.com/i/pdfs/Licensing_%20Fact_%20Sheet_2008A.pdfLicense for primary HD - $25000
http://www.fmamtv.com/products/Radio/Harris-Crown%20HD%20transmitter.html $24000 out the door.

Using my existing broadband antenna - N/C.

$2K annual license for the pair of subchannels. (More if they make money)

The FMeXtra folks appear to have totally lost it. Any chance they seem to have had will need a serious marketing overhaul before anyone will look at it from a broadcaster standpoint, IMHO.

So sad. It's really DOES appear to be a good system. But not at Ibiquity prices.

Give the Fonz a "Haaaayyyyy!". They've jumped the shark.

Clouseau
 
KB1OKL said:
Yeah, I've heard that HD's a real winner. ;D.

Gee, KB, I know you have had issues with receiving HD signals in your area. If you'd like I could arrange to have you borrow my Aruba if you think you'd have a wider selection with FMX.

Clouseau
 
clouseau said:
For your $35K you get a complete system to broadcast to NO ONE. I

http://www.ibiquity.com/i/pdfs/Licensing_%20Fact_%20Sheet_2008A.pdfLicense for primary HD - $25000
http://www.fmamtv.com/products/Radio/Harris-Crown%20HD%20transmitter.html $24000 out the door.



$2K annual license for the pair of subchannels. (More if they make money)

..or you can broadcast to a half dozen people, at a fraction of the coverage of your station's analog signal, while simultaneously interfering with an adjacent channel or two and quite possibly your own analog signal for 100K and up (not counting ongoing fees for side channels, data channels and software upgrades) with HD Radio.

Wow! What a choice.

C5
 
Carmine5 said:
..or you can broadcast to a half dozen people <snip>... for 100K and up...

C5

Good point. To bad the original post didn't have links that say otherwise... Oh wait. :)

My point here was simple. The glorious alternative to our current system may very well have a worse business plan than iBiquity. (Is that actually possible?) I don't post this as a "Pro iBiquity" post as much as a "What the hell is DRE thinking" post. Regretably, it appears the Anti-HD "ClearCutters" just can't get by their HD hatred to rationally deal with another issue or alternatives.

(Shrugs)

Clouseau
 
clouseau said:
Carmine5 said:
..or you can broadcast to a half dozen people <snip>... for 100K and up...

C5

Good point. To bad the original post didn't have links that say otherwise... Oh wait. :)

My point here was simple. The glorious alternative to our current system may very well have a worse business plan than iBiquity. (Is that actually possible?) I don't post this as a "Pro iBiquity" post as much as a "What the hell is DRE thinking" post. Regretably, it appears the Anti-HD "ClearCutters" just can't get by their HD hatred to rationally deal with another issue or alternatives.

(Shrugs)

Clouseau

Well, the point as I see it is that neither digital system is the ideal solution. If I had an FM station I would just stay analog until the dust settles on the whole issue (or until I begin losing listeners strictly because the station isn't digital).

The EXB proposal makes more and more sense as a long term solution.

C5
 
clouseau said:
My point here was simple. The glorious alternative to our current system may very well have a worse business plan than iBiquity. (Is that actually possible?) I don't post this as a "Pro iBiquity" post as much as a "What the hell is DRE thinking" post. Regretably, it appears the Anti-HD "ClearCutters" just can't get by their HD hatred to rationally deal with another issue or alternatives.

(Shrugs)

Clouseau


Well, that is the problem, isn't it? If you thought Ibiquity had bad marketing, DRE is even worse. In a recent phone conversation with them, asking why the FCC doesn't consider FMeXtra as a "Broadcast Service," I was told that "Well, that's your problem as a broadcaster. You need to petition the FCC." Now that is a swell sales pitch. I really need another hobby.

Did I mention that I started the conversation out with "I'm interested in buying your system for our station?" No, I guess I didn't, but that's how it was. Instead of acting like I might be a cash-paying customer, I was told that I should launch a one-man crusade against the FCC to get them to recognize the potential of this system. Yeah, sure. I'm really going to do that.

I've seen the system. I've even had it installed on my station on a warm Saturday afternoon. It worked great. The "system” seemed to consist of a Dell two space rack mounted computer. It had a very unusual sound card added to an expansion slot, which was the heart of the system. Of course, it was loaded with the FMeXtra software, which was running on Windows XP. The computer (less monitor) looked like it might be worth $800 or so. I'm not sure how much crap you can load onto a card that fits into a single computer expansion slot, but I can't really imagine that it could cost much more than $200-300 or so.

I think inventors should be rewarded for their efforts. Selling $1000-1200 worth of hardware bundled with your special software for the original price of $8500 seems reasonably fair. To suddenly double the price seems like a very poor idea.

If this were my baby, I'd be doing what it took to get this system established in reasonable numbers. If that means reducing my profit margin and being happy that I was selling a lot of them, then fine. In my retail sales days, I quickly learned that "one quick nickel beats one slow dime." Those are words to live by. I'd much rather sell 1000 systems with a $4000 gross profit than sell 100 with a $14000 profit margin. It is pretty easy to figure out for those with basic math skills.
 
Holding long, rambling, complete conversations with yourself (as at the start of this topic) is a great way to convince yourself of your brilliance and that you have all the answers. Especially since you made up all the questions.
 
SUPERCASTER said:
Holding long, rambling, complete conversations with yourself (as at the start of this topic) is a great way to convince yourself of your brilliance and that you have all the answers. Especially since you made up all the questions.
I wouldn't know, Supe. Which of those hypothetical questions do you think is unrealistic or invalid?

You've personally made several fairly passionate pitches about FMeXtra in the past. I can pull them up if you like. I guess what I'd like to see is what OTHER questions do you realistically think prospective clients might ask?Or which of those I proposed is unfair.

Frankly, I thought the hypothetical was fairly full of softballs. I'd be GLAD to get questions or objections like those compared to some of the others I left out.

Is your total answer to the point I originally raised that I'm "Trying to convince myself of my own brilliance?" In your words elsewhere, I'll lob it "right back at ya double" and say normally when someone responds like you did with NOTHING but a criticism of how the question was askled, they have no rational answer or opinion. I was kind of hoping otherwise from you.

Clouseau
 
Chuck said:
Well, that is the problem, isn't it? If you thought Ibiquity had bad marketing, DRE is even worse. In a recent phone conversation with them, asking why the FCC doesn't consider FMeXtra as a "Broadcast Service," I was told that "Well, that's your problem as a broadcaster. You need to petition the FCC." Now that is a swell sales pitch. I really need another hobby.

I have not talked to DRE lately. I did exchange a few emails and phone calls many moons ago during the "FMeXtra Challenge" of almost 2 years ago. In that time, there have been exactly NO additional models of radios, no Car units and no portables. (The portables being a systematic issue with digital anything in radio it seems) The discussion I had with their big guy (Miller IIRC) back then was along thelines of what you report. I always kind of chalked it up to me having pissed them off with the "No Radios" thing.

Did I mention that I started the conversation out with "I'm interested in buying your system for our station?" No, I guess I didn't, but that's how it was. Instead of acting like I might be a cash-paying customer, I was told that I should launch a one-man crusade against the FCC to get them to recognize the potential of this system. Yeah, sure. I'm really going to do that.
They have an unusual attitude towards promoting their product. I think they're designers more than sales folks. It's like they have a "Sales prevention" department. :)
I've seen the system. I've even had it installed on my station on a warm Saturday afternoon. It worked great. The "system” seemed to consist of a Dell two space rack mounted computer. It had a very unusual sound card added to an expansion slot, which was the heart of the system. Of course, it was loaded with the FMeXtra software, which was running on Windows XP. The computer (less monitor) looked like it might be worth $800 or so. I'm not sure how much crap you can load onto a card that fits into a single computer expansion slot, but I can't really imagine that it could cost much more than $200-300 or so.

Well I'd bet they got a pile of R&D cost in there, but $15K for a computer with a fancy add on card is pretty steep. I'd also suspect even if their desire is to get radio receiver sales up, actually getting stations to use the encoder would be a first step. Even iBiquity figured that out.
I think inventors should be rewarded for their efforts. Selling $1000-1200 worth of hardware bundled with your special software for the original price of $8500 seems reasonably fair. To suddenly double the price seems like a very poor idea.

There have been those posters who think a low price devalues a product. however I've seen a guy posting on the broadcast engineering radio list who was looking for an alternative because of the cost of buying all those radios was too high. Strange.

If this were my baby, I'd be doing what it took to get this system established in reasonable numbers. If that means reducing my profit margin and being happy that I was selling a lot of them, then fine.

I would think "First encoder in the market for cost" might help their launch. Also a sub$200 radio would be nice, although that may not be possible without volume. And we're back to the chicken and the egg.

In my retail sales days, I quickly learned that "one quick nickel beats one slow dime." Those are words to live by. I'd much rather sell 1000 systems with a $4000 gross profit than sell 100 with a $14000 profit margin. It is pretty easy to figure out for those with basic math skills.

I used to own a production business. We had a saying. "High volume cures all problems". I'll bet that would hold true with FMX.

Clouseau
 
Carmine5 said:
Well, the point as I see it is that neither digital system is the ideal solution. If I had an FM station I would just stay analog until the dust settles on the whole issue (or until I begin losing listeners strictly because the station isn't digital).

The EXB proposal makes more and more sense as a long term solution.

C5

I have my Sony plugged into my 30 year old Marantz 2385, both with dipoles. I was listening to WZLX which was actually coming in today in glorious IBOC, I could hear little or no difference between the two stations' sound, in fact I think the Marantz sounded better and IBOC ZLX was locked in. The ONLY IBOC station I've heard that sounds really good is WGBH a 100K NPR station, but then again it also sounds great in analog. I bought this Sony which is supposedly one of or the best IBOC tuner on the market as an experiment and in my humble opinion the experiment has failed miserably. I have been told that my Sony is defective, don't think so, I think the IBOC system is defective.
 
KB1OKL said:
I have my Sony plugged into my 30 year old Marantz 2385, both with dipoles. I was listening to WZLX which was actually coming in today in glorious IBOC, I could hear little or no difference between the two stations' sound, in fact I think the Marantz sounded better and IBOC ZLX was locked in. The ONLY IBOC station I've heard that sounds really good is WGBH a 100K NPR station, but then again it also sounds great in analog. I bought this Sony which is supposedly one of or the best IBOC tuner on the market as an experiment and in my humble opinion the experiment has failed miserably. I have been told that my Sony is defective, don't think so, I think the IBOC system is defective.

I hesitate to even bring this up, but you know you are so far out in the 'burbs you actually don't live in the Boston Market, right? (No Chicken for you) :). You live in the Worcester, MA market. Complete with it's own arbitron survey and schedule. Radio as a whole is dealing with this problem. Note the issues with stations who were once great powers like WMCA. The market outgrow the station. In your case, the market even spawned another market.

Clouseau
 
clouseau said:
KB1OKL said:
I have my Sony plugged into my 30 year old Marantz 2385, both with dipoles. I was listening to WZLX which was actually coming in today in glorious IBOC, I could hear little or no difference between the two stations' sound, in fact I think the Marantz sounded better and IBOC ZLX was locked in. The ONLY IBOC station I've heard that sounds really good is WGBH a 100K NPR station, but then again it also sounds great in analog. I bought this Sony which is supposedly one of or the best IBOC tuner on the market as an experiment and in my humble opinion the experiment has failed miserably. I have been told that my Sony is defective, don't think so, I think the IBOC system is defective.

I hesitate to even bring this up, but you know you are so far out in the 'burbs you actually don't live in the Boston Market, right? (No Chicken for you) :). You live in the Worcester, MA market. Complete with it's own arbitron survey and schedule. Radio as a whole is dealing with this problem. Note the issues with stations who were once great powers like WMCA. The market outgrow the station. In your case, the market even spawned another market.

Clouseau

Yes you're right about that but that was not my point, which is that I could see no real discernible difference in sound between the IBOC signal and the analog signal which has been their selling point. WGBH does sound great as I posted but it is their production that does that I'm sure. The selling point of HD has been the supposed dramatic difference in sound between analog and digital, I don't hear it, I do hear it on AM but we all know how well that works and the synthetic highs and artifacts kill it for me. To be fair my Marantz does sound great and is in top condition and I paid a LOT more for it that I did my Sony, but that also means that I can really listen for the differences between the two as it's sound is very accurate and I'm also using the same amplifier and speakers. I can turn on the Marantz, set it to a station and leave it there all day, can't do that with the Sony, most consumers aren't going to put up with that, I know I don't so it stays off most of the time.
We have a Boston Market here in Worcester (or had) believe it or not. ;D
 
KB1OKL said:
Carmine5 said:
Well, the point as I see it is that neither digital system is the ideal solution. If I had an FM station I would just stay analog until the dust settles on the whole issue (or until I begin losing listeners strictly because the station isn't digital).

The EXB proposal makes more and more sense as a long term solution.

C5

I have my Sony plugged into my 30 year old Marantz 2385, both with dipoles. I was listening to WZLX which was actually coming in today in glorious IBOC, I could hear little or no difference between the two stations' sound, in fact I think the Marantz sounded better

That has been my experience in sampling HD Radio as well - no appreciable difference in quality over analog. Apparently many people have felt similarly.

Sometime ago, when Guy Wire wrote his infamous "thin the herd" commentary on HD-AM he did state one point that I thought made sense: that it would be better for AM stations to remain analog until there is a much deeper penetration of HD Radios. When that viable level of penetration of HD Radio has been achieved, then AM stations should flash-cut to digital.

I would say that this could be a good rule-of-thumb for FM as well, particularly small and medium market stations. I don't think equipping a station with HD Radio now is getting "a leg up" on the future since the future of radio, and especially digital radio, is so uncertain at this point.

C5
 
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