Slow HD rollout... Did the Alliance plan it this way?

[Radioman100]

The stars all seem to be aligning now for HD Radio. HD2 channels are plentiful in the top 100 markets, lower priced radios are making their way to market, and HD technology is finding its way into multi-purpose devices.

Of course, two years ago this wasn't the case. Even a year ago, this wasn't the case.

This makes me wonder if the totally ineffective (seemingly by design) ad campaign radio has been using up to this point with no unique selling proposition was designed to raise general awareness somewhat, but not really sell the product.

We all know radio is an effective medium for advertising. People have had a lot of success selling anything and everything on radio, including products that couldn't possibly work, like "male enhancement" products. Judging by the sheer number of ads you hear for products like that though, someone is obviously buying them.

So if radio can sell penis pills, do you really think it can't sell HD Radio? Unlikely! The problem is with the message radio has been using to sell HD Radio, or more accurately, the total lack of a compelling message.

There are a lot of bright people behind the HD Digital Radio Alliance. Do you suppose the lame promotion we've heard up until now might be intentional? Do you suppose they might be waiting for the rollout to reach a certain point, or a certain number of retailers to be carrying the product, or a certain number of automakers to be offering HD Radio before making their real push?

As crazy as it sounds, that approach makes a lot of sense. With HD Radio, the radio industry had a chicken and egg problem. Would you really want to develop an effective campaign and send millions of people out to buy an expensive gadget when you aren't yet providing enough of the service it depends on? Would that result in happy users and good word of mouth?

Forever now, I've been saying it's way too early to predict HD Radio's ultimate success or failure. Now I'm starting to think that was by design.

 

[Dighton Rockhead]

OH!, My Jesus' Mercy!!!......This has to be the most convoluted, twisted-pretzel logic I've heard in a very long time......almost ranks up there with the "New World Order" conspiracy stuff that floods the shortwave bands.

Does ANYONE out there really believe that the Alliance would deliberately spend (not in cash, obviously, but in the form of ad inventory)......millions upon millions of dollars to ineptly and ineffectively "non-promote" something they have invested heavily in???

All of a sudden, the fringe HD opponents don't sound quite so kooky now that I've heard THIS.

 

[Radioman100]

OH!, My Jesus' Mercy!!!......This has to be the most convoluted, twisted-pretzel logic I've heard in a very long time......almost ranks up there with the "New World Order" conspiracy stuff that floods the shortwave bands.

Does ANYONE out there really believe that the Alliance would deliberately spend (not in cash, obviously, but in the form of ad inventory)......millions upon millions of dollars to ineptly and ineffectively "non-promote" something they have invested heavily in???

All of a sudden, the fringe HD opponents don't sound quite so kooky now that I've heard THIS.

Well, tell me what the unique selling proposition of the current crop of HD ads is? What is it in the ads that would compel you to buy the product? Nebulous "stations between the stations?" Why would anyone buy a radio that can pick up something?

I don't think the Alliance was simply throwing away airtime (unsold inventory BTW) they were raising awareness in general. Next, they'll start selling specifics.

 

[Dighton Rockhead]

Why does this necessarily have to be some sort of "Grand Plan"? That might be giving the Alliance a little too much credit.

Couldn't it be just as simple as inept, ineffective marketing, not to mention its half-hearted implementation at the local level by programmers who have so much on thier dinner plates as it is, without having this added on?

The FM version, minor technical shortcomings aside, seems to work "well enough", and stands a decent chance to survive, and even thrive. Too bad the AM version is not really capable of coming along for the ride.

 

[LinoNYC]

Whether intentional or un..it's just as well.

Poor to mediocre first generation receivers.

Stations with sporatic programming.

Broadcasters seemingly learning on-the-fly about processing for iboc.

Some AM's finding out that it may not even be practical given unique circumstances.

As I see it, people who think this thing will just blast-off are expecting too much, iboc, if it survives in the marketplace will do so by becoming an enhancement...it's not a revolution.

Lino

 

[Radioman100]

Why does this necessarily have to be some sort of "Grand Plan"? That might be giving the Alliance a little too much credit.

Couldn't it be just as simple as inept, ineffective marketing, not to mention its half-hearted implementation at the local level by programmers who have so much on thier dinner plates as it is, without having this added on?

The FM version, minor technical shortcomings aside, seems to work "well enough", and stands a decent chance to survive, and even thrive. Too bad the AM version is not really capable of coming along for the ride.

Well, I did consider that it might just be ineptitude, but seeing how every major radio company is in the alliance, and they all know how to make decent commercials, it seems somewhat unlikely.

There's years upon years of marketing experience in the Alliance. If it did just "happen," surely at some point one of them had to stand up and say "Guys, this ain't gonna work!"

As far as the programmers go, for the most part, I have to agree with you. I think most PDs don't want the additional competition their own HD2 channels represent. For the Clear Channel PDs, there is no additional work. It's all done for them. The other groups? Someone is doing the work, though generally it's not PDs. I've heard of production directors, jocks, APDs and even engineers doing it. I've never heard of a main channel PD programming an HD2 channel. They may have some oversight, but not a lot of active involvement.

 

[vsa]

The stars all seem to be aligning now for HD Radio. HD2 channels are plentiful in the top 100 markets, lower priced radios are making their way to market, and HD technology is finding its way into multi-purpose devices.

Of course, two years ago this wasn't the case. Even a year ago, this wasn't the case.

This makes me wonder if the totally ineffective (seemingly by design) ad campaign radio has been using up to this point with no unique selling proposition was designed to raise general awareness somewhat, but not really sell the product.

We all know radio is an effective medium for advertising. People have had a lot of success selling anything and everything on radio, including products that couldn't possibly work, like "male enhancement" products. Judging by the sheer number of ads you hear for products like that though, someone is obviously buying them.

So if radio can sell penis pills, do you really think it can't sell HD Radio? Unlikely! The problem is with the message radio has been using to sell HD Radio, or more accurately, the total lack of a compelling message.

There are a lot of bright people behind the HD Digital Radio Alliance. Do you suppose the lame promotion we've heard up until now might be intentional? Do you suppose they might be waiting for the rollout to reach a certain point, or a certain number of retailers to be carrying the product, or a certain number of automakers to be offering HD Radio before making their real push?

As crazy as it sounds, that approach makes a lot of sense. With HD Radio, the radio industry had a chicken and egg problem. Would you really want to develop an effective campaign and send millions of people out to buy an expensive gadget when you aren't yet providing enough of the service it depends on? Would that result in happy users and good word of mouth?

Forever now, I've been saying it's way too early to predict HD Radio's ultimate success or failure. Now I'm starting to think that was by design.

Pure genius. You are absolutely correct! But you're not the first to discover this ingenious HD Alliance plan. Elvis Presley, who works as a Walmart greeter in an undisclosed American city, tried to tell me the same thing last year, but I refused to pay attention to him.

 

[davideduardo]

Well, I did consider that it might just be ineptitude, but seeing how every major radio company is in the alliance,

No, they are not. Not all of them.

 

[vsa]

Whether intentional or un..it's just as well.

Poor to mediocre first generation receivers.

Stations with sporatic programming.

Broadcasters seemingly learning on-the-fly about processing for iboc.

Some AM's finding out that it may not even be practical given unique circumstances.

As I see it, people who think this thing will just blast-off are expecting too much, iboc, if it survives in the marketplace will do so by becoming an enhancement...it's not a revolution.

Lino

HD Radio, is an enhancement (aka a sustaining technological development). The Internet ( and by extention Internet Radio) is a disruptive technological development. During these revolutionary times, placing your bet on an enhancement is a classic business mistake. Read Clayton M. Christensen's "Best Business Book of 1997". It's called "The Innovator's Dilemma - When New (disruptive) Technologies Cause Great Firms to Fail".

 

[Radioman100]

Pure genius. You are absolutely correct! But you're not the first to discover this ingenious HD Alliance plan. Elvis Presley, who works as a Walmart greeter in an undisclosed American city, tried to tell me the same thing last year, but I refused to pay attention to him.

With the anti-IBOC loonies saying things like this, I must be on the right track!

Gotta remember Mark... It was on Elvis's internet radio show. ;D

 

[vsa]

Pure genius. You are absolutely correct! But you're not the first to discover this ingenious HD Alliance plan. Elvis Presley, who works as a Walmart greeter in an undisclosed American city, tried to tell me the same thing last year, but I refused to pay attention to him.

With the anti-IBOC loonies saying things like this, I must be on the right track!

Gotta remember Mark... It was on Elvis's internet radio show. ;D

I'm only going to say this once. I assume you think I'm Mark Ramsey who is a researcher/consultant based in San Diego. I'm not him. I'm a radio broadcaster based in Los Angeles. End of story.

 

[Radioman100]

HD Radio, is an enhancement (aka a sustaining technological development). The Internet ( and by extention Internet Radio) is a disruptive technological development. During these revolutionary times, placing your bet on an enhancement is a classic business mistake. Read Clayton M. Christensen's "Best Business Book of 1997". It's called "The Innovator's Dilemma - When New (disruptive) Technologies Cause Great Firms to Fail".

Well, guess what? They're both methods of delivering audio entertainment. And guess what else? In the USA, there are more TERRESTRIAL RADIO users than there are INTERNET USERS.

Guess where I found that stat? Google! Just Google: "how many people use the internet in the usa" and choose the first non-paid link that comes up.

The answer? 234,788,864 in North America. The site doesn't break it down by country, so there are 234,788,864 internet users in the USA, Canada and Mexico. There's over 270,000,000 terrestrial radio users in the USA alone.

Radio is a better, cheaper, more efficent means of receiving audio entertainment than the internet. Radio offers better talent, researched music and a "use it ANYWHERE" delivery mechanism that works in any city or town with a radio station or 40 (80 with HD2.) What does internet radio offer? An interesting mix of a few internet radio operator's favorite tunes and begging for money to continue playing those tunes.

Yeah, HD Radio may be a sustaining technology, but with 270,000,000+ domestic users, I'll put my money on radio and HD Radio.

What has the internet brought us aside from e-mail? (Laced with obscene amounts of spam.) A fantastic platform for porn, and the DOT COM BUST. Yeah, sink your money into the internet! It's the INTERNET after all! It's where all the action is!

 

[Radioman100]

Well, I did consider that it might just be ineptitude, but seeing how every major radio company is in the alliance,

No, they are not. Not all of them.

Alrighty then David, what kind of brilliant marketing has Univision come up with? How are you driving listeners to your HD2 stations?

 

[LinoNYC]

HD Radio, is an enhancement (aka a sustaining technological development). The Internet ( and by extention Internet Radio) is a disruptive technological development. During these revolutionary times, placing your bet on an enhancement is a classic business mistake. Read Clayton M. Christensen's "Best Business Book of 1997". It's called "The Innovator's Dilemma - When New (disruptive) Technologies Cause Great Firms to Fail".

By that logic, stations should not invest in any new tech or upgrades It's all a sinking ship.

May be that is true, if so it's because mass appeal media is losing against custom media.

Why then would the thousands of internet stations fare better? The fact is that for the last eight years you have had the ablity to download any song you hear and program it into you own device. How will any pre-selected, formatted outlet compete with that?

What may come out of all this is the re-emergence of the "DJ" as an important value-added component of a station.

Take for instance people such as Vin Scelsa or Pete Fornatale, both may be out of the age group to connect with today's youth but used as an example here. They spend many hours each week listening to new and old music that they know will appeal to their listeners. They also provide considerable personal input via commentary and often interviews with the artists.

Now, ask yourself, which is better positioned to provide this approach, the shoestring Dell-in-closet operation with a few geographically scattered internet-bound listeners, or a radio station that knows the territory?

The biggest hurdle now is getting stations out of the defensive, cost cutting mode and into seeking and developing the sort fo talent that can make it relevant again.

No one should be under the illusion that we can go back to where we were 10-15 years ago, radio's share of the listener's attention is permanantly diminished but it has the ability to stake a claim for it's future once it stops cowering in fear of those touting it's demise.

Lino

 

[Kelly]

I think we all would agree that these couple questions have many different answers...

Regarding the original question, I believe the average consumer needs an easy-to-use, convenient for their lifestyle, and easy to understand way of using new technology. Whereas past consumer surveys of adults have indicated that average consumers would prefer more choices for free, verses pay services, (satellite radio). The big problem is that the younger generation with IPODs, MP3 players, etc. don't care about paying for subscription services, and are pleased to spend their allowance on portable devices that they can carry all their favorite purchased tunes on, with no chatty DJ's or commercials. Now with the new Ipod Touch, (my son's friends are buying them like crazy), they can also surf the Internet, and download songs straight to the device with the WiFi capabilities.

The research focus for HD Radio was clearly on the typical adult radio consumer that wants more choices for free, not kids. Next add in the combination of auto manufacturers not supplying the HD radios included in new car radios, and the consumer confusion within the marketing between satellite and HD radio, and you don't have a very good first impression nor interest at the average consumer level.

Now in my view, if radio, and the HD Alliance worked with companies like Apple, or Microsoft to provide a digital receiver within the latest portable device where a user could download and store their favorite music or programming, (NPR shows come to mind), via HD radio onto their IPod's or Zunes in a Audio On Demand method with commercial pre-rolls for free, then the younger generation may form an interest in radio, (well sort of). The "HD" bandwidth would be used for file delivery, not just more of the same traditional radio model on alternate channels.

One of the recent consumer surveys I saw while at the CES last year, showed that HD listenership had actually gone down from the first full year of launch. During the seminar, the thought was presented that the programming sampled by the early relatively small group of adopters was just not compelling enough to embrace, and the original radios were clunky, so they moved on.

This begs the question, are broadcasters missing one critical element that has attributed to the improvement and growth of radio and TV in the past? Remember who used to own the majority of large radio and TV stations? The answer is the same companies that also made the receiving devices, so there was a coordinated effort in delivery and marketing. Now offshore consumer electronic manufacturers are traveling down a completely different path from radio. I suppose the difference with TV is that the government is making the Feb 2009 transition happen, so the consumer electronics folks and broadcasters are forced to travel down the same road together.

As a funny side-note. While I was writing this reply, I got a E-mail offer from Radio World Magazine. The title says, (to the effect).."Take this short technology survey and win a new iPod Touch-Last Chance!" So it got me thinking, honestly which would you rather get for free, a new iPod Touch, or a HD radio? I sure would rather have the iPod, they're cool! Radio? Eh, not so much, I have lots of them laying around.

 

[clouseau]

Why does this necessarily have to be some sort of "Grand Plan"? That might be giving the Alliance a little too much credit.

Couldn't it be just as simple as inept, ineffective marketing, not to mention its half-hearted implementation at the local level by programmers who have so much on thier dinner plates as it is, without having this added on?

The FM version, minor technical shortcomings aside, seems to work "well enough", and stands a decent chance to survive, and even thrive...

I suspect we don't often agree. We do here. I think you basically nailed it. While Radioman100's take is intriguing, it does kinda make me want to get out a tin foil hat. I suspect it's mostly Tongue in cheek.

Clouseau

 

[Dighton Rockhead]

I suspect we don't often agree. We do here. I think you basically nailed it. While Radioman100's take is intriguing, it does kinda make me want to get out a tin foil hat. I suspect it's mostly Tongue in cheek.
Clouseau

On the contrary, Inspector. While I might not agree with you 100% on things, I think our views are closer than you might imagine.

Unlike the anti IBOC extremists on the board, I've made my peace with the FM version of HD. I might have preferred that some other system become the defacto standard, but the Alliance had the financial resources and political connections to make things happen for them. That's the real world.

I just happen to think that the AM version is such a technical mess, without much hope of making it really work, not to mentinon the high cost of admission to the "club" for those not in broadcasting's "front row".......which is exactly why YOU helped make the decision not to implement HD at your stations. I suppose I'm still holding out some hope that DRM (or an as yet unknown to us system) could help save AM......I admit, AM still holds a warm and tender place in my heart.

If only the extremists on both ends of this discussion could stop shouting and taking potshots at each other to do a bit of LISTENING......just maybe the dialogue could re-emerge here.

 

[davideduardo]

Alrighty then David, what kind of brilliant marketing has Univision come up with? How are you driving listeners to your HD2 stations?

We routinely crosspromote HD offerings, with the most successful one being our Tejano network on multiple HD-2s in Texas... a format with a following that does not justify a full analog signal today, but is driving listeners to HD because in markets like Dallas and Houston and Austin and McAllen and El Paso there is no Tejano except on HD. We also have a couple of TV stations that help promote these things, too.

This was never intended to be an "instant gratification" type of thing. It will take years to develop, but in large markets the cost of entry is minimal.

 

[vsa]

HD Radio, is an enhancement (aka a sustaining technological development). The Internet ( and by extention Internet Radio) is a disruptive technological development. During these revolutionary times, placing your bet on an enhancement is a classic business mistake. Read Clayton M. Christensen's "Best Business Book of 1997". It's called "The Innovator's Dilemma - When New (disruptive) Technologies Cause Great Firms to Fail".   

By that logic, stations should not invest in any new tech or upgrades  It's all a sinking ship.

May be that is true,  if so it's because mass appeal media is losing against custom media. 

Why then would the thousands of internet stations fare better? The fact is that for the last eight years you have had the ablity to download any song you hear and program it into you own device.  How will any pre-selected, formatted outlet compete with that?

What may come out of all this is the re-emergence of the "DJ" as an important value-added component of a station.

Take for instance people such as Vin Scelsa or Pete Fornatale,  both may be out of the age group to connect with today's youth but used as an example here.  They spend many hours each week listening to new and old music that they know will appeal to their listeners.  They also provide considerable personal input via commentary and often interviews with the artists.

Now, ask yourself, which is better positioned to provide this approach, the shoestring Dell-in-closet operation with a few geographically scattered internet-bound listeners, or a radio station that knows the territory?

The biggest hurdle now is getting stations out of the defensive, cost cutting mode and into seeking and developing the sort fo talent that can make it relevant again.

No one should be under the illusion that we can go back to where we were 10-15 years ago, radio's share of the listener's attention is permanantly diminished but it has the ability to stake a claim for it's future once it stops cowering in fear of those touting it's demise.

Lino

Lino, the radio business needs your kind of thinking. We must find ways to compete effectively into the future.

I grew up with AM and FM and continue to have a fond attachment for this kind of radio. However, I think about the music business and how it has been forced through more changes. They had to transition from vinyl, to 8-tracks, to cassettes to CDs. That last one was from analog cassettes to digital CDs. Imagine if they had insisted on sticking with cassettes by segueing to digital DCC cassettes instead? They probably could also have made digital vinyl records  and digital 8-tracks too. Radio is sort of doing that with HD radio. If this was 1987, HD radio would likely succeed, even with its shortcomings.

We are now approaching 2008. The record industry hasn't adjusted to digital downloads. Why? Because their whole manufacturing and distribution business model is becoming obsolete. And there is no new tangible media that customers are willing to embrace. Downloads, legal and illegal are just too convenient, and they're perfect for iPods. The added problem is that the records biz will have to make some drastic changes just to survive - and survival is not a given.

Radio needs to do two seemingly opposite things. It needs to dive into and fully embrace the Internet as a medium with all the excitement, enthusiasm and commitment of an Internet-only start-up while using it's current assets to fully participate in that push. Yet, it financially needs to maintain and even grow profits in its traditional business. Human nature and the culture within our organizations naturally fights this kind of thing. It's an almost impossible thing to do without creating a separate company. Most organizations just can't make this kind of change. That's why Eastman Kodak (late to embracing digital photography) is a shell of its former self. So is Western Union (not getting serious about telephones so AT&T could take over the phone business). So is Sears and IBM. And I'm only mentioning the names of companies that survived. Many many more just faded away.


     

 

[Radioman100]

Lino, the radio business needs your kind of thinking. We must find ways to compete effectively into the future.

I grew up with AM and FM and continue to have a fond attachment for this kind of radio. However, I think about the music business and how it has been forced through more changes. They had to transition from vinyl, to 8-tracks, to cassettes to CDs. That last one was from analog cassettes to digital CDs. Imagine if they had insisted on sticking with cassettes by segueing to digital DCC cassettes instead? They probably could also have made digital vinyl records and digital 8-tracks too. Radio is sort of doing that with HD radio. If this was 1987, HD radio would likely succeed, even with its shortcomings.

We are now approaching 2008. The record industry hasn't adjusted to digital downloads. Why? Because their whole manufacturing and distribution business model is becoming obsolete. And there is no new tangible media that customers are willing to embrace. Downloads, legal and illegal are just too convenient, and they're perfect for iPods. The added problem is that the records biz will have to make some drastic changes just to survive - and survival is not a given.

Radio needs to do two seemingly opposite things. It needs to dive into and fully embrace the Internet as a medium with all the excitement, enthusiasm and commitment of an Internet-only start-up while using it's current assets to fully participate in that push. Yet, it financially needs to maintain and even grow profits in its traditional business. Human nature and the culture within our organizations naturally fights this kind of thing. It's an almost impossible thing to do without creating a separate company. Most organizations just can't make this kind of change. That's why Eastman Kodak (late to embracing digital photography) is a shell of its former self. So is Western Union (not getting serious about telephones so AT&T could take over the phone business). So is Sears and IBM. And I'm only mentioning the names of companies that survived. Many many more just faded away.

I'm convinced more and more every day that you're a CONsultant. You seem to be really good at identifying a problem that doesn't exist.

Take a look at this website: www.kiisfm.com

There's station information, but there's also recorded interviews, celebrity news, station pics, interactive chat, streaming audio, charts, music videos, a myspace-like social networking portal and even HD Radio information among lots and lots of other features.

Radio has the internet covered in spades, but that's NOT a good reason to stop promoting its terrestrial signals. For all the reasons I cited in my last post refuting your nonsense, terrestrial radio is a FAR superior method of delivering localized audio entertainment compared to internet radio and it has a huge installed user base. HD Radio, as it comes of age, will be a similarly superior delivery mechanism but will offer more programming choices.

And if you hadn't noticed, radio designed for younger demos is doing very, very well. The listenership of the hit music stations in the biggest markets is actually increasing.

Radio doesn't need a "pro internet" messiah. Sorry! We already figured it out without your help.