Bring out yer dead.
I’m not dead.
He says he’s not dead.
Yes he is.
Well, he will be soon, he’s very ill.
I’m getting better.
No you’re not, you’ll be stone dead in a moment.
-Monty Python and the Holy Grail
Podcasting News reports today that podcasting and MP3 players are stealing listeners from traditional over the air radio. Cited is a study by Bridge Ratings, which predicts that by 2010, traditional radio’s current 94% penetration will have sunk to 85%.
According to the study, 27% of people 12-24 attribute their reduced use of radio to MP3 use; 22% attributed it to tired radio programming; 3% attributed it to podcast listening.
Other than the podcasting number, which seems about 10 times too high, those numbers sound pretty logical to me. I wonder, however, why there wasn’t consideration of the migration to satellite radio. My guess is that satellite radio, which is largely ad-free, will be the biggest threat to traditional radio.
Fred Wilson thinks HD Radio may save the traditional radio format. Perhaps, but I still say the desire for no ads will trump the desire for higher audio quality.
I believe that what’s killing traditional radio, and particularly FM radio, is its dependence on ads as the major revenue source. You can get away with ads for sporting events and other exclusive programming, but not music. No way. Not anymore.
The world is too flat for traditional advertising to fly. This is true in every media, and it is especially true for music. The smart PR firms out there are huddled in conference rooms thinking up some revolutionary marketing strategy that we haven’t seen yet. Mark my words- in 5 years advertising will be a lot different than it is today and in 10 years it will be a completely different industry.
Entire companies have been launched in the name of ad-avoidance. There’s simply no way people are going to continue to listen to over the top car ads and other nonsense just to hear the same songs they can hear without ads via an MP3 player or satellite radio. I often burn a CD-R with MP3’s and listen to it for a few days in shuffle mode. As the CD and DVD recording technology becomes more widespread and as auto makers continue to put better technology in cars, this trend will continue.
So what does traditional radio do? It has one major revenue source- and it is the exact one that will not work long term.
Traditional radio is dead. The only question is what will take its place.