[opendtv] Re: Mark Ramsey Media: The Premature Death of HD Radio
- From: Craig Birkmaier <brewmastercraig@xxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Tue, 21 Feb 2017 08:02:12 -0500
On Feb 20, 2017, at 8:32 PM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
Interesting read. The comments are good too. There is one guy that doesn't
seem to know what he's talking about, when he says that HD Radios were
initially "plentiful." Nonsense.
Thanks for posting this Bert. Ramsey does a great job of answering the
questions I keep asking you about the need for digital radio. Frankly I am
somewhat amazed that you posted it, as it does such a good job of predicting
why HD Radio would fail...
I'll agree to one point. Internet radio is even better. For example, with HD
Radio, in this market, you have easy 24/7 access to BBC News. Didn't have
that with analog FM. But with Internet radio, you have access to all of the
BBC stations, not just World Service. And you have stations from the whole
rest of the world.
Exactly. Ramsey does the market analysis in the piece that Bert has refused to
do. He was focused on satellite radio in 2005, but correctly noted the
competition yet to come from the Internet and mobile devices. He did not note
two major factors behind the success of satellite radio, but gets around to it
indirectly when he explains why HD Radio cannot compete effectively. THose
factors are:
1. Avoiding commercials;
2. Service continuity while traveling
He did not predict that satellite radio would also be challenged by the
Internet as it offers consumers solutions to both of these factors as well.
The point I disagree with strongly is the one about choice. People are far
from satisfied with content choice on radio. That's the most common
complaint. "Always the top 40," or comments to that effect. The more niches
you can satisfy, the better. Some niches are bigger than others.
Once again, Bert is wearing his engineering blinders. Broadcasters cannot
compete in the niches, they must have broad appeal to attract meaningful
audiences for advertisers. Ramsey is 100% correct when he says:
a More choice? The vast majority of listeners already have enough choice –
all our research and ratings experience tells us that.
Bert does not understand this simple reality. It is also informative that
Nielsen does not provide rating s for HD Radio sub-channels.
As the comments clearly show, once people have access to it, they do like it.
No, the comments do not say this. They say exactly the opposite.
The closest he comes to saying something positive is near the beginning of the
article:
HD Radio requires that consumers buy new hardware. New radios. Not since the
dawn of our industry have we needed to drive sales of hardware. But we are
content providers. And we own the pipes. We deal with a distribution channel
that’s already in every car, workplace, and home – it’s universal. We don’t
know – and haven’t needed to know – how to sell radios. And if you think
selling these radios is as simple as “getting behind the effort,” talking it
up, and handing out free samples, please stop taking the brown acid now.
People will buy these radios for two reasons:
a Either the radios will piggyback on something they buy for other reasons
(i.e., I buy a new car and HD Radio comes standard) or…
b They will want the content that is available exclusively on HD Radio (and
nowhere else)
He then spends the rest of the article explaining why "b" above is the big
problem. It's the content stupid!
But content is not the reason radio is challenged. People tune to radio for
other reasons - news, weather, traffic and dare I say it, personality. Radio is
thriving where personalities add value to the content that is available
EVERYWHERE.
Near the end Ramsey concludes:
HD Radio is already competitively outfoxed, before it even gets out of the
gate
Bert concludes:
Mostly, those who have access to HD Radio without having to make a big
effort, are those who buy cars with HD Radio in it by default. And they like
it. Even in its current power-challenged state.
The article does not say this. But Ramsey nails it at the end:
If HD Radio fails it will be for one reason: We ignored good marketing sense
and allowed it to fail. But if it succeeds we’re still not out of the woods.
Radio’s long term relevance is not linked inextricably to the fate of HD
Radio. Our industry must understand that we have a seat at the table of
wireless audio – the biggest seat with the broadest distribution. And we can
use our influence and muscle and talent and resources to develop and own that
big seat until the end of time. But it will take vision and commitment and an
awakening to the realities of what business we’re really in and what
opportunities and threats are on the horizon.
Bottom line, analog radio works; digital radio adds nothing to the tools
broadcasters have at their disposal to compete.
Regards
Craig
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