NY Post Article Predicts The Demise Of Radio In Cars, Broadcast Execs Firmly Disagree
March 20, 2015 at 3:51 AM (PT)
An article in THE NEW YORK POST is sure to get the hairs on the back of radio executives standing up. The article begins, "Video didn’t kill the radio star, but SIRIUSXM and streaming services like PANDORA are taking it apart piece by piece. Terrestrial radio, after years of maintaining its vise-like grip as the dominant in-car entertainment provider, will soon see thousands of motorists turn it off, a WALL STREET report on WEDNESDAY forecasted."
The article points to radio's current success, noting, "Terrestrial radio still owns an 80% share of car listenership," but notes, "It will start to lose up to 1.5% a year of that market share as streamers like PANDORA enter the market."
The demise of radio has been predicted for most of the last 95 years, but there is a reason that 244 million Americans listen every week.
Technology is changing the choices drivers have in cars, with connected cars equipped with 4G wireless broadband technology expected to account for 39% of U.S. vehicles shipped this FALL. That number is expected to rise to 60% by 2018.
So what's radio future? "Radio’s endgame, according to the report by analyst AMY YONG of MACQUARIE CAPITAL (USA), will be to appeal to increasingly smaller markets. The large markets will eventually belong to SIRIUS and PANDORA, as well as other digital players with strong urban sales teams."
As one might expect, the folks currently running radio groups respectfully disagree with this perspective.
EMMIS COMMUNICATIONS Founder/CEO JEFF SMULYAN told ALL ACCESS, “Radio in automobiles is not disappearing, and in fact is about to get a major boost. In a partnership with IBIQUITY, NEXTRADIO has interest from nearly every automaker to develop an interactive, visual platform which will use the tuner which is in every automobile. Unlike streaming services like PANDORA and SPOTIFY, NEXTRADIO uses minimal data and is completely free to the consumer. As consumers grapple with costly data plans, the notion that they will gladly pay another data bill in the automobile is highly speculative, and even if they do, the ease and interactivity of free, local radio can be compelling. The demise of radio has been predicted for most of the last 95 years, but there is a reason that 244 million Americans listen every week and new options in automobiles will make the listening experience more compelling than ever.”
GREATER MEDIA Chairman/CEO PETER H. SMYTH dismissed the article, telling ALL ACCESS, "Another 'demise' prophecy for radio? I've lost count of the number of times radio has been declared in imminent danger of dying. What this latest prediction totally fails to take into consideration is the core value proposition for local radio. It's our connection to the listeners through our live and local on-air personalities across the country. It's the human touch, coupled with radio's ability to evolve and adapt, that will insure our vibrancy and relevance no matter what the technological channel of delivery. The radio community has been deeply involved in discussions about the changing dashboard and has already developed delivery methods to meet consumers’ needs. Smart broadcasters know that we need to be available wherever and however our audiences want to access us. Whether it's an exclusive station branded mobile app or an innovative consolidated effort such as NEXTRADIO, radio is creating the tools necessary to maintain its place in an evolving technical ecosystem. Our bet is that our people and our products will remain more compelling, informative, funny and timely than the best algorithm ever written."