For this week’s Programming To Win column, Jacobs Media President Fred Jacobs gets in-depth with the topic of station streaming. Jacobs discusses the importance of a station’s stream and digs in to some data from his company’s most recent TechSurvey to illustrate the increasing growth of streaming.
Fred Jacobs
By Fred Jacobs
One of the hot topics in radio for several years – but reaching a fascinating moment in time – revolves around streaming. Broadcasters often find themselves caught between two worlds – their long-held terrestrial tradition juxtaposed with the creeping reality that streaming is becoming a more popular and common way of accessing audio infotainment. Especially among younger consumers.
To make matters even murkier for broadcasters, there’s that nagging statistical question about whether stations are receiving proper credit and compensation for their audience usage numbers.
As pure-plays continue to grow their reach, as radio grapples with single-line reporting, as the automotive world moves even faster toward a WiFi environment, and as consumers become even more comfortable with accessing audio streams, we are witnessing major shifts in content acquisition even among radio’s biggest fans.
Most of us remember that it was once a lot of work to stream a radio station. You had to get past a dial-up connection (the sound is still in my head), then go through the drill of accessing a stream, and hoping that it would last a song or two without crashing or dropping out. Those were the days of Windows 95!
Today, it’s an always-on Internet world. We’re all connected, hi-speed is everywhere, and streaming audio is no different than opening any other application on a computer – or a smartphone or tablet.
Yes, FM tuners in smartphones will help broadcasters, especially as the platform expands to different carriers and handsets. But it won’t stop the speeding bullet train that is streaming – something that AM/FM radio stations need to embrace, understand, and ultimately monetize.
After conducting Techsurvey9 and continuing to see significant growth for streaming as well as the acquisition of mobile devices, we urged radio to “eats its own dog food.” In this case, we mean monitoring your stream to experience it just like consumers do. Our recommendation is that programmers set aside one day, turn off their standard radios, and log onto their streams. In this way, they will put themselves in the shoes – or ear buds – of their listeners.
How does it compare with other streams they consume? Are the commercial breaks seamless? Is there excessive buffering, drop-out, or loss of quality?
As broadcast streams compete directly with pure-plays, it is essential that stations become as serious about the quality of their streams as they have traditionally paid attention to their on-air audio chains. A visit to most station rack rooms reveals a lot of expensive black boxes designed to sweeten, enhance, equalize, limit, compress, and boost the broadcast signal. But the stream? Few are paying close attention.
Beyond the CX – or customer experience – the stream’s contribution to a radio brand’s reach and image position is a big issue.
I was reminded of this the other day while reading an article in the Wall Street Journal. Kevin Reilly, Fox TV’s head of entertainment was speaking in front of a group of television critics, and noted that while overnight ratings are the key measure of winners and losers, this data is “becoming increasingly a sliver of the story.”
Reilly went on to note that TV is losing credit for viewership on DVRs, on-demand, and streaming video sites. Pointing to The Following, he noted that “the audiences are still enormous across multiple platforms.” But too many are just focused on traditional ratings.
Radio programmers and managers can relate, because in many cases, strong brands are attracting usage that goes well beyond listenership on traditional radios in cars, at work, at home, or at school. Of course, streaming is at the epicenter of additional listening.
A recent eMarketer study reaffirms streaming growth, noting that by 2015, a majority Americans will listen to Internet radio monthly. And much of the consumption will take place on mobile devices – the other sea change facing radio brands. Over 70 million people stream audio on their smartphones in this country, a stat that should be very top-of-mind for broadcasters.
To get a better sense for how this impacts the radio business, we built a usage question into both Techsurvey9 and its companion study for public radio, PRTS5. The idea was to have respondents think back to the previous week and how they consumed content from the station that sent them the survey. We provided a list of sources and participants assigned a percentage – totaling up to 100%.
Below is the chart from Techsurvey9, and while this is recall from the past week, we’re looking at core radio listeners, most of whom are members of radio station databases. The fact that an estimated 14% of their consumption to their favorite stations’ content offerings are on the digital side of the street is telling. And of course, it varies greatly by format, running considerably higher among fans of Sports Radio and Christian music stations.
So what are the implications here?
First off, the toothpaste is out of the tube. Some of radio’s biggest fans are accessing station content from computers, smartphones, and tablets – a trend that will only grow over time.
Secondly, radio needs to fully embrace the streaming platform as digital competitors actively seek out touch points, outlets, and channels.
Third, connected cars will make Internet streaming as common as pushbuttons have been for decades. Ensuring a great streaming experience in radio’s top listening location is essential for continued success.
And finally, there’s this issue of the Three M’s – the need to more accurately measure AM/FM streaming, merge it with usage data from broadcast radio in a format that is acceptable to agencies and buyers, and then monetize these bigger numbers.
That’s the Holy Grail of this rapidly integrating media world in which we live, where the need to bring ratings companies, streaming providers, agencies, and broadcasters together so that can all benefit from these changes is paramount.
Otherwise, Fox’s Kevin Reilly, and a bunch of guys named Westin, Weatherly, and Farley are going to continue to whine about not getting proper credit for their grand brands.
And they’ll be right.
Fred Jacobs is President of Jacobs Media. The Southfield, Michigan based firm consults many of America’s most successful Classic Rock, Mainstream Rock, and Alternative stations. Fred can be reached at (248) 353-9030 or fredjacobs@jacobsmedia.com.
