No sooner did I get done posting on this topic earlier this morning, but I found that consultant Mark Ramsey made an excellent closely-related post on his on blog yesterday. Great minds think alike? ;-) See Everything you need to know about FM radio chips in mobile phones at Mark Ramsey Media. He covers more ground than the title implies. Good reading. --Dennis
Steve Yasko, GM of WTMD in Towson, MD (Baltimore area) recently brought up this subject on two public radio lists which I would really categorize as scalability of listening by means other than an analog radio. Here’s my take on this and, as usual in things relating to public radio, comments here are my own, not NPR’s (see About).
Content is like water. Water flows through big channels nicely but also through smaller channels and cracks whenever it has a chance. Continuing the analogy, the effect of those smaller flows over time often makes the smaller openings larger. Radio content is flowing nicely through the broadcast channels we have – they scale very well, but it’s also beginning to emerge through other openings as well. And, just as well-drillers often fractionate bedrock to create more cracks for water to be released, new products for distributing media content are being developed constantly.
With some regularity, I listen to Pandora over my iPhone on my car’s sound system and to Northwest Public Radio’s folk music program while riding my tractor Saturday afternoons in Virginia. Some people to whom I (and others) mention this think, “Well, that’s cool,” and try it themselves, thereby testing a little more the limits of the wireless IP channels that were originally set up for voice calls. It should probably be like not telling your friends about that great little restaurant you found. Already, I can’t reliably do this inside the Washington beltway at most times of day, and it’s a non-starter during rush hour along major roads. Wireless providers are reaching the limits of available spectrum in major markets so are abandoning their “all-you-can-eat” plans (I’m grandfathered – heh, heh), at least for now. The reason mobile streaming is working at all during favorable hours or favorable locations is that so few people – other than us in the radio cognoscenti – are doing it.
But don’t take too much comfort from today’s limitations. They won’t last. The iPhone and iPad are garnering a well-deserved share of attention, but Android devices are now outselling iPhones and an avalanche of cheap Android tablets will almost surely do the same to the iPad in the autumn (WebOS, Windows Phone 7 and Linux tablets in there, too). There will be a lot of mobile media devices out there very soon. 4G systems are being rolled out by all major carriers and reclaiming spectrum from television and government users has a head of steam. The cracks through which content trickles now will enlarge to small channels and the small channels will become larger ones. Do we really want to bring out the Bondo and duct tape or do we want people to find us many places?
Broadcasters even have a (possibly interim) role in mitigating the current spectrum problems. Flo TV is providing white label television streaming services to Sprint and AT&T cell phones using broadcast-style transmission over spectrum that used to belong to UHF TV (seamless to the cell phone user). In radio, the NAB is advocating putting mandatory FM chips in cell phones while a credible research company report says that digital radio will benefit from the spectrum crunch by mid-2011 when carriers use it to mitigate IP audio traffic problems in smartphones. If we’re smart, broadcasters will use the time we have to develop hybrid IP/broadcast radios and/or RadioDNS-enabled radio receivers – not to mention find ways to make it easier for people to find us on their many IP devices.
It’s all about scale. We’ll see lots of strategies to manage it. Right now it’s pricing and the beginnings of non-IP delivery for media content. Soon it will be more IP packets delivered to your devices, and you can be sure that will impact pricing as well – likely in the more for your dollar direction. Carriers have a lot of knobs they can twist, so don’t judge today’s situation in pricing or capacity as significant for much longer than an eye blink in media time.
Update 11:15 Eastern: Coincidentally, consultant Mark Ramsey makes many of the same points plus others in an excellent new (somewhat mistitled) post on his blog. Link: Mark Ramsey Media.
NB: This starts out as a long story about publishing medical books, but I intend it as a way to illustrate the pace and degree of change in the media for the blog’s usual readers at the end. --DH
This spring I married a physician who has written or edited a fairly large number of medical books. Her background is both in clinical practice and research, she has an appointment as full professor at an area medical school, and she has way, way more letters behind her name than do I. Her most successful book is a sort of how-to manual for procedures in her area of specialty, the most recent edition of which came out in 2007.
So a few weeks ago, we were discussing a call she received from her publisher asking her if she wanted to do a 5th edition of the book. The last edition had a companion DVD that contained videos illustrating seven of the 53 procedures in the book. The videos are good, including some basic animations, but require a physician to go to a computer, find software that will play the odd format (with some trial and error, one of which crashed my PC, I discovered that RealPlayer could handle it), and hope that the procedure you need to do is one of the 13% in described in the book (the book does have helpful drawings and photos). You shouldn’t have to call the IT department before trying to bone up on intubations.
As a new iPad owner, I’d been very impressed with how tablet apps are creating a whole new category of book – or is it a whole new category of video – or is it some new medium we haven’t yet named? I’d heard great things about two such apps, so I downloaded them and they blew me away. One is Alice for the iPad by Atomic Antelope, a presentation of Lewis Carroll’s Alice in Wonderland. The other is Theodore Gray’s, The Elements: A Visual Exploration by Element Collection, Inc., a mesmerizing way (I kid you not) to visualize and learn about the periodic table of elements.
I showed these to my wife and her co-editor, and they got it instantly. In The Elements, not only do you get text and video but computations are also included in the app. The ability of a “book” to include text, audio, video, animation, and computation totally blows away the traditional atom-based professional book (imagine being able to enter patient parameters and instantly determine medication dosage). And the tablet format frees you from having to retreat to your office (perhaps at a different location), boot up a DVD through problematic software, and find the right video in multiple indexes. You can do all this in the hallway or even the OR if you want.
That led the three of us to have a conference call with the publisher, a leading company for this type of book. To give them the benefit of the doubt, they hadn’t viewed the same iPad apps that we had, and perhaps we weren’t the most articulate advocates, but it was clear that they were in the business of making books of paper and perhaps they could add some additional procedures to the DVD that’s bound into the book. If there was recognition that the whole conception of a professional book has changed, it wasn’t evident on the call.
Enough of the book publishing story. I don’t want to be too hard on them because those of us in other traditional forms of media are too often not much better at re-envisioning our products. But we must do that and, indeed, there is very good creative work being done toward that end. Let’s do more. --Dennis
Frédéric Filloux reports on a French study of the media usage habits of about 100 18-to-24 year olds, “Digital Natives.” He opens:
They see life as a game. They enjoy nothing more than outsmarting the system. They don’t trust politicians, medias, nor brands. They see corporations as inefficient and plagued by an outmoded hierarchy. Even if they harbor little hope of doing better than their parents, they don’t see themselves as unhappy. They belong to a group — several, actually — they trust and rely upon.
Link: Monday Note. The results aren’t directionally surprising, but the intensity is. Fascinating reading. --Dennis
There is necessarily a lot of interest in the future of internet radio, especially of the mobile kind, within the radio broadcasting community, public and commercial. I say necessarily because of the potential it has to, at a minimum, disrupt the current economics of broadcasters and, at the ultimate, to replace big tower radio with radio delivered by internet protocol (IP). We want to know: is internet radio irrational exuberance, to borrow Alan Greenspan’s coinage or is it something real?
There’s certainly exuberance about internet radio, some of it irrational, but I believe that it will have a real impact on broadcast economics. I concluded the post linked in the next paragraph with this:
… To be consequential to us, these services have to only skim the cream off our listening to harm the thinning margins that most stations are experiencing. …
I’m always interested in analyzing the mechanics of change. What technical and economic hurdles does a new technology have to overcome to be disruptive? Toward that end, I was interested in the issue of how to scale up radio listening in a wireless IP environment. In a previous post on this subject, Does radio need to worry about IP-delivered audio?, I looked at the very real technology issues relating to scaling up IP bandwidth for traffic loads comparable to current radio listening and posited some developments that could mitigate that.
So I’d like this time to consider economic hurdles, specifically the trend toward tiered data pricing. There’s a wide range of actual use among smartphone data users (¼ actually use no data, while the top 6% use ½ of all data). Streaming users are more likely to be heavy users, so in tiered pricing, they’re likely to pay more because their subsidy by light users goes away.
In a paper analyzing the telecommunications market over the next five years, IBM Global Business Services says that as IP-based high-speed mobile data standards such as LTE and WiMAX spread more broadly throughout the world, carriers will give up trying to stop over-the-top providers such as Skype from riding over their pipes and will eventually "enter into formal partnerships" with them. But because the carriers will be losing the revenue they once generated through minute-based cellular plans, they will have to make up for it by eliminating their all-you-can-eat data plans. ¶ "If people value connectivity then they must pay for connectivity," says Ekow Nelson, the global leader for the communications sector at the IBM Institute for Business Value. "With all-you-can-eat models there's going to be no way for carriers to compete. This will be an adjustment because most users have been conditioned to enjoy unlimited access to over-the-top services for free."
There will be some carriers that buck the tiered pricing trend, but IBM’s analysis seems pretty solid to me, especially since in this country it’s being lead by LTE rather than WiMAX companies (the former seems destined to dominate 4G). It’s likely that pricing for both light and heavy users will decline with time, but tiered pricing won’t help adoption of mobile streaming in the near term. Until that general price decline happens, tiered pricing will be a hurdle.
Happily for me, I’m grandfathered into AT&T’s all-you-can-eat 3G data plan, so I can continue to enjoy Pandora in my car from a double-tethered iPhone (audio and power) during low or moderate data use hours. It’s already largely replaced real radio for music listening late evenings and weekends. But it’s a long, long way from replacing traditional radio stations for my news, traffic and weather needs. --Dennis
FLO TV uses the old upper UHF TV band to provide primarily off-cable programming to customers through its own devices and through Verizon and AT&T smartphones. I noted here last month that it’s CEO said it hadn’t found the audience they’d hoped for, and now Michael Grotticelli is reporting in Broadcast Engineering that they’re now saying Qualcomm is open to selling the company.
Antony Bruno has a good article outlining Pandora’s economics and economic strategies. Of note to radio broadcasters is Pandora’s support of the Performance Royalty Act. Bruno writes:
The $30 million in performance royalties paid by Pandora last year represents 60 percent of its revenue. Compare that with satellite radio, which pays 15 percent of royalties for the same content, and terrestrial radio, which pays nothing. …¶… [the RPA] would force terrestrial radio broadcasters to pay performance royalties for the first time. While beneficial for labels and artists, such a requirement would also help put Pandora and traditional radio on more equal footing. ¶ To achieve the kind of scale that [Pandora founder] Westergren envisions would require expansion to new platforms, particularly to TV and the automobile. Most of Pandora's daily traffic -- about 60 percent -- still comes from computers, …
Link: Reuters. Thanks to tweet from @markramseymedia. --Dennis
Radio Ink is reports on Ando Media’s May webcast ranker which shows Pandora on top domestically in the 6a-8p M-F daypart:
… Pandora saw AAS of 402,978 in May, with session starts at 43.2 million and average TSL of 1.62 hours. CBS Radio is in second, with AAS of 166,644 and session starts at 148.4 million, with average TSL of .79 hours, while Clear Channel Radio came in third, with AAS at 117,828, session starts at 24.7 million, and average TSL of 1.38 hours. …
While CBS leads in all streams domestic and international, Mel Phillips says that Pandora isn’t measured there.