Radios future is clear and varied

Updated: Jan 22 2007, 07:11am hrs
Radio is in the midst of a makeover. The sound you grew up withcomplete with the occasional pop, hiss or fizz that happens when analog signals cant get through clearlyis on its way out.

Replacing it is a sound said to be capable of making AM sound like FM and FM sound like a CD. And with it, broadcasters promise, will come a lot more variety.

As radio broadcasters continue battling for listeners with satellite, MP3 players, cell phones and the internet, theyre betting on digital technology to ensure their survival. But despite the companies investment, many consumers are unaware of the new technology.

This is the technological platform that radio is going to use to compete, said Lew Dickey, chairman and CEO of Cumulus Media, the countrys second-largest radio broadcaster in terms of number of stations owned.

A year ago, the US had just 89 HD, or high-definition, digital radio stations. Now there are more than 900, hundreds of which are capable of operating additional multicast channels piggybacked onto their existing ones. HD Digital Radio is a big piece of radio broadcasters strategy to improve programming, said Ted Schadler, principal analyst with Forrester Research Inc.

While many radio listeners may be unfamiliar with HD Digital Radio, major broadcasters, including San Antonio-based Clear Channel Communications, have formed the HD Digital Radio Alliance and committed more than $250 million in airtime to promoting digital radio this year. Last year, they spent about $200 million on those efforts.

If we limit ourselves to just AM and FM bands, were going to be very, very challenged, said John Hogan, president and CEO of Clear Channel Radio, the radio broadcasting arm of Clear Channel Communications.

Radio has had a terrific run, he said. It has been a great business for 50 or 60 years, but as technology has changed and created a greater number of distribution platforms, the technology that made radio greatthe AM and FM bandshas really limited it.

By 2008, Clear Channel plans to convert about 600 of the approximately 700 radio stations it expects to retain through its privatisation to digital, a move Hogan promises will bring more variety to the airwaves. Its all about choice, Hogan said. Consumers today, because of advances in technology, have much, much more control over what they listen to. The more choices we can give them, the better off we are.

Peter Ferrara, president and CEO of the alliance working to push consumers to adopt the technology, said listeners can expect stations targeted toward niche interests. Through multicasting, the process of broadcasting several content streams over a single frequency, companies can boost the number of stations available.

So far, multicasting has helped bring country music to the airwaves in New York City and Spanish oldies to Albuquerque, NM. The reason anybody wants to listen to the radio, generally speaking, is for entertainment, information or companionship, Clear Channels Hogan said.

Theres a very special, intimate, one-to-one relationship radio has with its listeners. This gives us the opportunity to expand that relationship and provide companionship in ways we havent been able to do before.

The HD Digital Radio format allows for the transmission of textual information, a benefit that may interest anyone who has ever wondered the name of a song and wanted instant gratification.

And through HD Digital Radio, consumers can have traffic information beamed directly to their vehicles GPS navigation system.

Unlike satellite radio, which Forrester Research Inc. expects will reach 32 million US households in the next five years, HD Digital Radio doesnt charge a monthly subscription fee.

Once you buy that radio, youll never have to pay another dime, said Bob Struble, president, CEO and chairman of the iBiquity Digital Corp., the company that developed and licenses HD Digital Radio technology. Still, for many consumers, the cost of buying an HD Digital Radio receiver just isnt worth it.

The majority of the people out there dont know what HD Radio is, said Bjorn Dybdahl, namesake of Bjorns Audio Video. As far as Im concerned, the rollout of HD Digital Radio is much tougher than the rollout of HDTV.

A major problem with HD Digital Radio, Dybdahl said, is that people can see a better-quality picture far more easily than they can hear a better-quality sound. Plus, he said there arent enough HD Digital Radio receivers from which to choose and that consumer education on the product is lacking.

Erik Thoresen, an analyst with Mintel International, said, Broadcasters have not done a very good job at all of educating the public on what HD Digital Radio is.

Bjorns sells only one tabletop HD Digital Radio receiver, the Boston Receptor Radio HD, which retails for $299.99 not including a $50 rebate option, according to the companys web site.

Its a price above what most consumers are willing to pay for HD Digital Radio, according to a 2006 report from Arbitron Inc. and Edison Media Research. Broadcasters insist that within about five years, most consumers will have an HD Digital Radio. Forresters Schadler doesnt believe it.

He expects that it will take about 15 years for HD Digital Radio to become a staple in American households. Its replacement technology, he said. Schadler, who focuses his work on consumer technology products, doesnt own an HD Digital Radio himself. The radio Ive got is perfectly fine, he said.

NY Times