An HD Radio.
CC licenced by Charlie @ Flickr

The globally-challenged Mark Ramsey has just posted another predictable attack on HD Radio, the US’s near-equivalent of DAB Digital Radio. It must be a Friday.

But in it is an interesting quote:
Oliver Media principal Denise Oliver says she’s yet to hear a consumer say they need to buy a HD Radio to listen to a specific station.

Now, clearly Mark is of the opinion that if a country doesn’t sell Twinkies it’s not worth writing about, so he’s not bothered to look at radio markets outside of the good old USA. But it’s interesting that there are considerable parallels between this statement from Denise Oliver, and what’s going on in the UK right now.

At its launch (which coincided with the launch of the sub-£100 DAB set) many people bought DAB Digital Radio receivers in the UK to get BBC 7, the BBC’s speech archive station. Similarly, research I saw from the DRDB many years ago showed that other BBC digital-only channels have also resulted in receiver sales. They’ve been promoted highly on BBC television and radio - nary a day goes past without hearing BBC Radio Five Live promoting their sister station Five Live Sports Extra.

But it’s interesting to look at the difference with commercial radio.

The Arrow is quite a decent digital rock radio station, run by Chrysalis Radio. I listen a fair bit to LBC 97.3, a quite decent speech station run by Chrysalis Radio. So, I’d expect to hear decent cross-promotion on the two, right? Er - no. I’ve never heard The Arrow mentioned on LBC.

Perhaps it’s an LBC thing? So, let’s nip over to Capital. They’ve two Capital spinoffs: Capital Disn– one Capital spinoff, Capital Life, which is on the national multiplex, so you’d have thought that it was ripe for cross promotion. But, and albeit I don’t listen to much Capital, I’ve never heard any.

So, lets scoot over to my old stomping ground, Virgin Radio. They run three other stations - Virgin Radio Xtreme (new rock); Virgin Radio Groove (disco/soul/Motown); Virgin Radio Classic Rock (class-oh, you guessed). Now I have heard Virgin Radio Classic Rock mentioned on Virgin Radio - when Tommy Vance passed away. And otherwise… not.

Without a few good exceptions, commercial radio doesn’t cross-promote. It doesn’t point from FM to AM; and certainly doesn’t point from FM to DAB.

There is a good reason for all of this, of course. Probably a few. Ad agencies are still interested in bulk, not niche - so one station with one million listeners is far more interesting to them than five stations with two hundred thousand each. Programme directors, and presenters, are incentivised on their own station’s results, not on the group. Flagship stations are seen as more important to shareholders than group results (witness the devastating effect of Capital’s woes on GCap). A listener to a flagship station is more valuable in terms of money than one on a niche station. Even the press focus on stations, not groups.

Now, from memory the DRDB’s research did show that people have bought DAB receivers for Planet Rock, too. But by and large, I would suggest that the quote Mark uses could well be used here, too, suitably amended. “Beer-loving radio bloke says he’s yet to hear a consumer say they need to buy a DAB Radio to listen to a specific commercial radio station.” - that type of thing.

Changing commercial radio’s unwillingness to cross-promote would be great news for DAB. However, it needs fundemental business change: both within and outside the industry. And I’m guessing exactly the same issues are responsible for HD Radio’s slow takeup in the US, a place where commercial radio, including NPR, is all there is.

One of my most-read blogs is also one of the most frustrating things I read.

Mark Ramsey posts a thoughtful but sadly xenophobic blog at hear2.com.

He posted a few days ago about getting radio into a Nintendo Wii as if it was a new thing - wondering why radio wasn’t doing it, and sounding alarmist. It’s depressingly familiar - not just because Virgin Radio did it a month ago (well, December, actually, but we only announced it last month) but because, as per usual, he’s ignoring what happens outside the US as not relevant to radio there.

I posted a too-clever-by-half comment, and I accuse him of ignoring, once again, what’s going on beyond the US. He replies, in part:

I do NOT dismiss what’s happening in Europe as irrelevant. I note that SOME things happening there are irrelevant because of market fundamentals. For proof of this, check the HD radio sales chart in the U.S.

The fact is that DAB is selling - albeit nowhere near fast enough - and HD isn’t, isn’t a marketplace issue; it’s much more fundemental than that. It hardly shows that the marketplace is different - it just demonstrates proof that Mark doesn’t understand what DAB offers and what HD doesn’t.

But Mark’s not alone. A few years ago, I met with many people from US radio, and I was disappointed that they simply didn’t listen to the knowledge we brought from the UK. Those that make it out of the US to NAB Europe, hateful though NAB Europe is, always express excitement at the ‘new ideas’ we have. I appreciate that Mark feels that there’s nothing he can learn: and I suspect he doesn’t bother reading this blog, or similar from Authentic Buzz, Nick Piggott, or the many fine contributors to the blogosphere from the BBC. I watch for his name in major European radio conferences - he’s never there. Which is a real shame.

The fact that an impressive amount of radio listening hours ARE NOT ON A RADIO (ranging from 12% to 28%, depending what station you look at, what survey you choose, and what methodology you want to play with) is pretty impressive. We’re leading the world in multi-platform listening, and it’s disappointing that nobody in the US feels it’s relevant to their marketplace. Playstations, DS lite, Wii, PSP, iPod, the internet - everything’s taking potential listening time away from us, the broadcasters. That marketplace is global.

True, there are differences; we listen less to the radio in cars here, and more in home. Commercial radio is in the minority for total radio listening: but in the clear majority for listening in ‘digital households’ (those with internet, digital tv, digital radio, regardless how they listen). This shows a healthy commercial radio industry (and that additional choice, whatever Mark claims, is important to listeners).

But the true similarity between the two marketplaces is that technologists like us are talking broadcast radio down. We say it’s doomed, and we point to new platforms such as the internet which don’t yet have the ubiquity, scale or business models to cope. We call jukebox services (like slacker.com, or last.fm, or Pandora) by the name of “radio” - when they’re nothing more than an iPod on intelligent shuffle. We jump up and down about the SoundExchange internet rates, yet somehow ignore the fact that the UK interactive rates are higher - or that people like last.fm have no agreement and have just gone ahead and provided a service that’s apparently unlicensed. We are talking our industry to death - literally.

That’s what makes me frustrated about his blog. Frustrated beyond belief that he’s a bright man, but ignoring so much knowledge from other marketplaces because he doesn’t deem it relevant to the land of the free. It’s so, so depressing, because there’s so much that we in Europe have done (and screwed up), and tried (and succeeded) that US radio can take advantage of.

Mark, because if you only looked further than your own shores, you’d see so many new ideas you’d be a millionaire. Trust me on this one: I’m a Brit.

In a post to his blog, Mark Ramsey warns about the dangers of choice.

Words of warning for those who think a zillion channels of anything - satellite, hd, or Internet radio stations - will give more people more of what they want and make them happier as a result.

Too much choice is a turn-off.

Read this piece from Australian TV

The Australian TV story talks about making purchases - and appears to claim that less people buy jam if there is more choice of jams to buy in the first place. I think it’s wholly irrelevant when you look at the media choices we make.

Contrary to popular opinion, satellite radio (in the US) or DAB Digital Radio (in the UK) does not succeed because it offers a gazillion extra channels. In London, my FM dial offers me around 15 channels, while my DAB Digital Radio offers me around 50. I listened to around four or five channels when I had an FM radio, and I listen to around four or five channels now I’ve a DAB Digital Radio. The DRDB’s research, from memory, doesn’t show that people with DAB listen to many more radio stations (although does show that they do listen longer than an average radio owner).

The point isn’t that I’ve three times the channels to choose from (I have), but that I now have three times the chance of finding a channel I like. That channel might be one also available on FM, but might also be one new to digital. For me, I listen more to BBC Radio Five Live (in analogue it’s on scratchy medium-wave), and LBC (in analogue it’s on an FM signal particularly badly affected by pirates), as well as the BBC World Service, a new-to-digital channel (in the UK, at least).

As radio businesses, we need to appreciate that it’s not just other radio stations that can steal our audience away: it’s everything from Pandora and last.fm, to iTunes and in-car CD auto-changers; and shortly, mobile TV. I’m a long-time reader of Mark’s insightful blog; but the benefits of adding more choice is clear - it allows radio businesses to retain current listeners and attract more listeners, even if they listen to one of your other digital-only services. (You *are* selling these as a network sell, aren’t you?)

Mark’s regularly posting against HD Radio; I’m not convinced that the technology is right, but the fact that it offers more choice is a benefit, not a drawback.

Incidentally, my favourite jam is Bonne Maman, but if that choice isn’t available, I’ll happily cope with Robertsons. If neither of these choices are available and I can only choose from the crappy supermarket brand, I’ll pass, thanks. I’m clearly in the minority in terms of jam buying, at least in Australia.