Think Radio Is Challenged? Try TV

| May 16, 2016

By Holland Cooke
Radio Consultant

 

cookewriterBLOCK ISLAND, RI — It’s tempting to credit “House of Cards” for inventing binge watching.  But Netflix, Amazon, Hulu, Roku, and YouTube are following – not leading – consumers’ on-demand expectation, and their appetite for more than just more-of-the-same.

Radio is late to the party, playing catch-up as podcast TSL swells, and radio dollars leak to digital.  Ask any GM about car dealers; and how corporate is barking for more digital revenue.

Podcasting was a hack.

Already dated, the term “podcasting” originally referring to iPod.  Remember when, suddenly, everyone had one?  Then, just as suddenly, everyone didn’t?  iPhone not only put “a thousand songs in your pocket,” but does EVERYTHING else.

iPod was a music player…until self-published talkers reckoned that audio is audio, and started passing around “radio” not-distributed-by-towers.  Shelf space is free in the iTunes store, and every time a subscriber syncs they get the latest episode.  And the consumer footprint is everywhere, not just an AM or FM station’s 30-mile radius.

Now, think of the P-O-D in podcasting as “Programming On-Demand.”

Not that listeners don’t still want to hear “Sweet Home Alabama” available every X-number-of-hours on robotic FMs.  If anything, the cornucopia of long-tail talk podcast topics is info-overload, like that indecision conundrum I feel scrolling through Netflix.

What is “television” now?

As post-consolidation cutbacks continue, short-staffed radio is scrambling to exploit on-demand.  And with the FCC license no longer a distribution franchise, all broadcasters are sharing audience and advertiser attention with Internet channels unencumbered by debt service that’s hobbled stations.

TV broadcasters are even more challenged than radio.

  • YouTube viewing time is up 60% over a year ago (NOT a misprint).
  • 60% of USA homes have Internet-connected TV (58% in 2015, 51% in 2014).
  • Cable and satellite “cord-cutters” are using “Over The Top TV” (Hulu, Roku, Fire, etc.), and antennas!
  • 51% of USA homes subscribe to some sort of on-demand video. And you-know-who is #1…
  • 1/3 of the USA population has Netflix at home (and, of course, everywhere else, on any device).
  • Netflix along now accounts for 37% of Internet traffic.

[Sources: Consumer Technology Association, Edison Research]

To their credit (as though they had a choice), many TV stations are beefing-up local coverage, giving viewers something they can’t get from video interlopers.  As for radio?

Say it with me: “Local, local, local.”

Witness an ugly divorce as the NBC Television Network is moving to – I’m not making this up – channel 62 in Merrimack NH, dumping Boston’s channel 7 after 22 years.  Many AMs have been Rush Limbaugh affiliates longer.

When I started in radio, age 18 in my native Springfield, Massachusetts, every station there was staffed, live, 24/7.  With stars in our ears, we’d road-trip to Boston and New York to hear the big guys.  Back then, the-bigger-the-market the-better-the-radio.  Now it seems to be the other way around.

Example, and the number you’re about to read is proof that this isn’t just me-kissing-up-to a client: On October 9 — in 12 hours, on one day – WSOY, Decatur IL, a 1KW AM at 1340 – collected 1,271,080 pounds of food for distribution by Catholic Charities and the Salvation Army; and funds that enable other local charities to feed the hungry.  In market #265!  How many top 10 market stations accomplish things like that?

Don’t get me wrong.  WSOY is a Rush Limbaugh and Sean Hannity affiliate.  I do the promos, and we take pains to make THEM sound like part of OUR on-air family, rather than sounding like we simply patched-into The E.I.B. Network.  The Neuhoff Media corporate web site crows that “while our big corporate competitors are abandoning all the things we think make local media special — we’re doubling down.”

Follow the money.

Good News/Bad News:

  • This year, digital’s share of local ad revenue is forecast up, $48.3 billion to $65.8 billion, nearly 50% of all local dollars. Google might be out-billing all of radio in your market.
  • Radio is forecast down, $10.2 billion (8.9%) to $10B (7.6%).

And eMarketer reports that, in 2017, TV ad revenue will relinquish the top of the ad spending totem pole to digital.

Do the math: Local up, digital up, broadcast down.  Yet local broadcasters remain uniquely qualified to take advantage, and we’ll talk specifics this Friday at the TALKERS 2016; Bridging the Generations conference at Hofstra University.

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Holland Cooke (www.HollandCooke.com) is a media consultant, working at the intersection of broadcasting and the Internet.  Follow HC on Twitter @HollandCooke, and meet him at TALKERS 2016: Bridging the Generations this Friday (5/20), when he presents “Talk Media: The Next Generation.”

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Category: Analysis