The $45 Million Kiss

You scratch my back, I’ll scratch yours. You put radio in Sprint smartphones, and we’ll make it worthwhile by placing the weight of the radio industry behind it. $15 million a year for three years. The radio industry’s deal to promote Sprint and the NextRadio app seems to me like a giant win for radio. Why?

First and foremost, no one really knows what will happen when you put that many smartphones in the market with a radio built in. Will it be used? Will radio replace streaming listening? Will radio see an increase in listening overall?

There’s bound to be a bump in radio use, and that’s a good thing. If I have any concern at all, it’s that Arbitron’s PPM measurement won’t capture listening over headphones, the way most smartphone audio is heard. Still, more radio listening — and more response to advertisers — even if some of that listening is not recorded, can only be good.

But better still is that we, the people of radio, have a giant opportunity to show what radio can do to drive adoption of phones with radio on board. It’s a giant test to show how radio performs — and proof is critically important today.

Last, this will gain the attention of other phone manufacturers, which may also look to radio to boost their sales by committing to put radio chips in their phones as well.

Should radio continue to push for other smartphones with radio built in? Absolutely. Now is the time for radio to step up to the plate. This is a brilliant strategy, a reasonable quid pro quo, and a chance to keep radio in the hands of every American.

Congratulations again to Jeff Smulyan for his leadership and to the RAB’s Erica Farber and her board for making this commitment happen. Only good things can come from this.

 

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[Clint]

Hate to be a buzzkill, but as as an industry outsider, I think the outlook is a little grimmer than the author does. I'm a 37 year old audio nut. I spend at least 50% of my day actively listening to audio either in the car or over headphones at work. 80% of that is podcasts, 15% is streaming audio. A whopping 5% is radio. Let me chyme in on Mr. Rhoads' questions:

"First and foremost, no one really knows what will happen when you put that many smartphones in the market with a radio built in."

My guess, nothing much. Maybe a handful of users will give NextRadio a whirl, listen until the first ad spot or until they walk into a building and lose a signal, then quietly go back to listening to Spotify, Pandora, and Stitcher.

"Will it be used?"

I'd use it only when I'm not on WiFi and worried about my data cap, or in inclement weather. Once the novelty wore off I think my usage would be limited to emergency info and breaking news. It would never become my primary source of audio entertainment. Streaming and podcasts have irreversibly bred an on-demand/in-control mindset in the listening public. I want to listen to what I want, when I want-- uniterrupted by commercials (or at least very minimally interrupted by them). Outside of emergency situations, breaking news, and local sports coverage, nothing on traditional radio is compelling enough for me to deviate from my on-demand/in-control listening habits.

"Will radio replace streaming listening?"

Not a chance. Traditional radio no longer jibes with the iPod generation's listening behavior. I'd much rather pay $6 per month to subscribe to my favorite podcast or music service than hear radio's awful commercials. Again, this from a lover of radio and an apiring ham. But entertainment via traditional radio for me has become a novelty, an activity I engage in only when I see police lights ahead or want to feel old-school.

Will radio see an increase in listening overall?"

Absolutely not.

Can traditional radio change all of this? Probably, but not as long as the industry is so blind to the writing on the wall.

[Smitty]

So, Jeff ran his company into the ground for something that consumers don't care about - what a deal! Thirty million is a drop in the bucket, too. That safety issue was a was always a ruse. Of course, being an investor in iBiquity, Jeff's goal is ultimately to get that flawed HD Radio chip into cell phones, and have the iBiquity royalties passed onto consumers.

[Charlie Profit]

I have a Jabra Bluetooth headset with an FM radio in it, and I listen to radio when I am out and about. I just wish the battery life was longer!