Although millions of people were soon time-shifting
programmes through VCR's after their introduction, comparatively
few did the same when it came to radio. Much of this may have
been to do with the comparative ease to set up recordings
of one medium - programmable recording was built into the
recorders for TV but not for radio - and some of it because
radio programmes in general weren't felt by most people to
be worth recording for later listening but whatever the reason
there was no great impact on radio listening.
This began to change when digital technology and the growth
of the Internet, and in particular broadband, made it possible
to easily offer audio to and save audio on digital media.
Most of the initial change came because people were able to
record music easily and, more to the point for most it would
seem, almost for free via various file sharing technologies.
Downloads at this stage were a form of mass theft, showing
how large a portion of the population (younger ones in the
main as it happened because they had moved to the technology
more) were essentially dishonest or at least very limited
in their concepts of what boiled to theft.
Attention moved more towards radio with the advent of the
podcast, which in practical terms only dates back around two
years. Since then more and more radio companies, particularly
public broadcasters, had offered podcast cum MP3 downloads
of their shows allied with on-demand streaming audio.
The combination of being able to choose when to listen to
a show - the BBC, for example streams most of its output on
demand for up to seven days after a show - or to speedily
download it, either automatically or via a manual MP3 download,
for listening on any MP3 device - has certainly changed listening
habits for many.
We would see this trend continuing as more sophisticated devices
become available with a store and replay facility and the
growth of technologies such as wireless broadband and DMB
(Digital Multimedia Broadcasting) and audio availability on
cell phones makes it even easier to get other options than
a traditional broadcast signal.
Despite the above so far the new listening
technologies have not made great inroads into the audience
for terrestrial broadcasts, provoking much more concern from
the entertainment industry about piracy of music.
This could, of course, change as technology moves further
and in particular if wide-area wireless broadband takes off
since it would then be possible to listen to audio of choice
from stations all round the world while on the move, particularly
in an automobile.
So far only a few "Internet radios" that allow people
to "tune-in" to Internet stations without a computer
are on the market but this is likely to change if, as already
noted, wireless broadband in DMB and audio availability on
cell phones, becomes widely available - these and other developments
could lead to major growth make other options to traditional
For the moment we don't see them as likely to have any more
impact than satellite radio - currently with around 10 million
subscribers in the US, a twenty-fifth of the numbers who listen
to terrestrial broadcasters there- but the latter have audiences
that are static or in slow decline whereas other options,
including satellite, are growing quickly.
Forecasting is famously fraught with
uncertainties but despite the introduction of US HD channels,
which so far seem to be mainly cheaply produced jockless music
packages with a song purchase scheme added on in some cases
- there are exceptions as always and particularly for public
radio the option to offer continuing music stream as well
as news - we don't see terrestrial radio growing much and
we do see other technologies biting into listening.
Looking at the next five years and taking the US as a prime
example (and assuming the much-worried-about economic collapse
doesn't happen - not a very safe assumption in our view as
oil prices will almost certainly remain high and the current
administration seems to live in economic cloud-cuckoo land)
we would at the most expect terrestrial radio to retain its
audience numbers and the other options to at least treble
In addition the development of local online advertising could
well in our view bite into radio advertising income significantly
as it is likely to do for newspapers.
That leaves us expecting terrestrial radio income to follow
the listening and either fall or remain essentially static
(if the economy slumps all bets are off as that will hit all
media), satellite to potentially go into operating profit
and other listening income to grow fairly strongly if some
of the current paid podcasting trials perform well.
Terrestrial radio therefore has the choice of either accepting
lower profits to keep its programming up to scratch - we certainly
can't see it getting away with adding much more advertising
in terms of spots albeit Clear Channel's "Less if more"
strategy could boost the per-spot income - or cutting costs.
This latter we could easily see as turning into a very debilitating
spiral of less attractive programming competing with increasing
attractive options from elsewhere, particularly for music
For news, sports and talk, however, live is going to remain
largely irreplaceable by on demand, especially for in car
listening although for home listeners here push-news to cell
phones and other electronic media may well take some of the
audience here at times except when there are major events
in which case we would expect traditional media to get their
normal audience boost, if not a financial one.
The other modes of listening will, we expect, continue to
develop technologically as well as growing audience but they
are likely to face increasing pressure from the entertainment
industry and its lobbyists to grab as much cash as they can
for any music use so they could easily change emphasis in
some cases to being a front-end for musicians to promote and
sell their music directly, yet another area that was traditionally
a strength for radio albeit ground that many stations abandoned
to various degrees in favour of poll-led playlists.
What we regard as asset-stripping by radio conglomerates in
the way they have operated has therefore in our view come
near to the end of the road unless the accountants go for
a final burst of short-term profit taking: If they do, advertising-funded
terrestrial radio will survive but be weakened and other listening
options be correspondingly strengthened.
Expect many more attacks on funding for public radio from
commercial vandals over the next few years!