Radio Ink Magazine just released its annual "40 Most Powerful in Radio" issue, and asked me to write an accompanying piece. Here it is:
This week, radio executives will get their much-anticipated issue of The 40 Most Powerful People in radio issue. Hate to say it, but the team at Radio Ink, while diligently assembling a list of the top radio executives, has missed several of the biggest names and biggest companies in the business.
Tim Cook, Daniel Ek, and Tim Westergren arguably are doing more to change radio than just about anyone else. Big companies including Apple, Spotify, and Pandora clearly want in on the business of audio. That is an affirmation that radio is alive, and attractive.
While the pages of various radio publications are often peppered with comments from radio’s leaders about how the new entrants are “not in the radio business,” it’s doubtful that listeners see or care about the distinction. In fact, all three use the word “radio” as part of their services. People certainly don’t care whether it’s broadcast, cable, or Netflix — it’s all TV. So let’s move beyond the “It’s not radio” argument.
And there’s another, far more powerful person missing from this year’s list. Arguably, this is the biggest person in the business and someone who is amassing power at an ever-increasing pace. This person is unpredictable and keeps changing direction, cagey and hard to pin down. A bit ruthless, and unapologetic. Completely in it for their own selfish reasons.
That person is, of course, today’s radio consumer.
They are the CEOs of their own listening experience and have an explosion of choices, whether it is another new streaming service, a podcast, owned music, or a radio station. The consumer is clearly in charge and willing to flex their listening muscle beyond AM/FM.
Change and choice are the two big themes in all media. And often the carnage is brutal, which is why everyone in the radio business should be deeply frightened by the number “93.” It was recently reported by Nielsen in its Total Audience Report that radio reaches 93 percent of Americans weekly. Indeed, it is a great story of media reach. Light applause. Short victory lap.
So what’s the concern? “93” is a dangerous number because it may lull broadcasters into a false sense of security, vitality, and victory amidst a giant wave of disruption. The numbers below the box-office “93” are compelling and shake the underlying fundamentals of how long and where people listen to broadcast radio. Change is in the air.
Market AQH is down in many markets by as much as 20 percent over four years. That’s a big warning sign. TSL continues to erode, especially in younger demographics. PUMM (persons using measured media) levels have dropped considerably. Some formats have significant age and structural issues. News/Talk, for example, is off 33 percent in adults 25-54 in the past four years. The format has an average age somewhere around 62 — the same average age as Bill O’Reilly’s audience on Fox News Channel.
At the other end of the age spectrum, teens, who are digital natives, now spend more time with streaming music than they do with radio. Edison Research recently released an alarming study in which most radio listening (two thirds) is done out of home, but most audio listening is done in the home (51 percent).
This means radio, which has long touted itself as the home companion, has been replaced by owned music, streamed music, podcasts, TV music channels, and TV morning shows. Most Americans no longer wake to a clock radio, instead using their smartphones.
Digitally, the trend lines are disturbing. In Triton’s monthly stream report, the biggest broadcasters’ digital streams are essentially flat while the pureplays continue to grow significantly. Pandora has seven times the session starts as the largest radio streamer. As more people adoptstreaming, they still tune in to radio, but many listen far less.
This is not some doomsday scenario. It’s hard to see a day when AM/FM goes away, but it is also hard to see a scenario in which new choices don’t continue to erode the status quo. TV is adapting to life in the on-demand world of the DVR, YouTube, and Netflix. Gone are the days of waiting until Thursday at 9 p.m. for Grey’s Anatomy.
The same transition is occurring in audio. People are choosing what to listen to and when to listen to it. It is an undeniable trend, with on-demand audio creating new buzz from shows like Serial to the President of the United States guesting on an audio podcast. In one week in June, 32 million people listened to a podcast and 94 million listened to streamed audio — and little of it was time-shifted or repurposed. The time spent with streaming on a weekly basis (13:19) exceeds radio’s 18+ number (12:58). New media requires fresh strategies, and radio needs to do better.
It is a lazy wish, shoving a three-hour morning radio show online and thinking the job is done. Ask local TV how the rebroadcast of their 6 p.m. news is doing on their websites and apps. TV sites and apps are vital and well trafficked, but the content differs greatly from their broadcasts. The same will likely be true in streaming and on-demand audio.
Each medium is different, and so are the underlying strategies and tactics. The radio business needs to move beyond its fixation on broadcast towers and embrace audio on all platforms. There are no better curators and creators of audio than radio people, but today the transmitter is only one way to receive audio.
In a cautionary tale: People are taking more pictures than ever, but Kodak went bankrupt. Top executives suppressed their own digital photography patents to protect the yellow box, raising the question as to whether Kodak was in the film business or the photography business. In another instructive tale, people migrated from Blockbuster Video to Netflix when they saw the benefit of convenience, choice, and price. Goodbye, Blockbuster.
Radio faces some of those same challenges, with bland programming and bloated commercial loads — in contrast to many of the new offerings. Radio has a magnificent platform, an unparalleled reach story, and a giant megaphone that can drive traffic to multiple platforms. In many ways, it is the most enviable of legacy media.
But those in the radio business should not be lulled by the 93 percent reach story. It’s a great thing, but it may be the undoing of many on this year’s Top 40 list if they fail to adapt, lead, and change.
Steve Goldstein is CEO of Amplifi Media, a new company focused on podcasting, on-demand audio strategies and content. Reach Steve at Steven Goldstein firstname.lastname@example.org
Read the item at Radio Ink HERE