Impact Media

For the past 50 years, the media equation has most often been solved for the largest audience.

That is changing and its happening pretty quickly, brought on largely by digital media.

I think the media equation is going to get solved for attention, passion, relevance, and meaning going forward.

I need a good word for the combination of all of those metrics, but for now I am going to use impact.

I often come to these realizations by a series of conversations and this one was brought on by three of them.

The first was a lunch with a friend in the music business.

The second was an email exchange with my high school friend and frequent commenter Tony Alva.

And the third was an extended discussion about video blogging with Heather Green of the terrific Business Week blog called Blogspotting.

At lunch with my friend I heard how record labels have for years focused on radio to market their music and the impact that has had on the kind of music that the labels have chosen to market.

FM radio is a mass medium by virtue of the limited space on the dial.  In most major markets, there are maybe 15 FM radio stations.

Each station tries to build the largest possible audience it can for its chosen format.

The way they do that is by doing research on what the listeners like and dislike.

This research, called "call out research" is focused on finding music that will keep the listeners from switching stations.

The result is mainstream, bland music that nobody dislikes enough to switch stations.

The record labels have been so hostage to the radio stations that they have simply given them the bland boring music they want.

And so we have two industries fighting for their lives right now as a result.

Back to my friend in the music business.

He told me that radio is losing its grip on the record labels and music discovery and marketing are moving online.

Kids don't listent to radio anymore to find new music.

Bands don't wait for a record deal and radio to market their music.

The action is on MySpace, iTunes, MP3 blogs, Audioscrobbler, MusicMobs, etc, etc.

Smart record label executives know this and are turning away from the radio formula and embracing the Internet.

But there is no call out research on the Internet.

Instead there are link counts, page views, downloads, and a host of other buzz metrics.

And these buzzmetrics measure impact more than audience size.

The music that is working best on the Internet is not bland and boring.  It inspires hate as much as love.  But it has impact.

That's the future of the record business.

So back to radio.

When I told Tony Alva about the JD Powers report on HD Radio that I posted on yesterday, he said, "too little, too lae".

He thinks radio has lost the young listener and will never get it back.

I am not so sure.  And here's what I told Tony.

The radio dial of 2010 is not going to look like the radio dial of 2005.

You've got 100 channels of XM, 100 channels of Sirius, you've got HD FM which will allow as much as 5 channels of programming for each fequency on the dial using multicasting technology, so that makes something like 75 channels of HD FM, and you've got HD AM which will allow music programming due to improved sound quality.

So that's like 300 channels of audio instead of 15.

And the radios will be tri-mode by then and who knows if Satellite will stick to its paid model.

My bet is that we'll see a hybrid model where some of the satellite channels will be free and ad supported and others will be paid.

I suspect the same will be true of the mulitcasted HD FM stations.

So radio will look like cable television, with a huge amount of choice, most free and ad supported, some paid and advertising free.

In that world, my bet is impact will rule and "call out research" will be history.

And in that world, the record labels may return to radio to supplement what they are doing online.

On to the video blogging discussion.

Heather is working on a piece on video blogging.

She's done a ton of homework and I think its going to be really good.

I will leave it to her to tell that story.

In thinking about the impact of video blogging with Heather, it struck me that the next big move in cable and satellite TV is for the operators to put RSS subscription services into their set-top boxes and recievers, the way that iTunes just did.

Once they do that, TV viewers will be able to schedule and watch way more than what's in their channel guide.

Among other great stuff, they will be able to subscribe to the delicious funny video feed and be entertained every day by real people.

Talk about reality TV.

And I think the impact of this new form of video entertainment will be huge.

So that's what's been spinning around in my head the past week.

I'd love to hear what you all think about it.

Comments

[Tony Alva]

Another great post on this beloved topic...

Like you, I hope both radio and the labels find a way to embrace the ubiquity that technology has unleashed on them which has caused the upheaval in the past few years. Both sectors NEED rebuilding badly in order for the consumer/listener to win. Labels and radio have a unique opportunity to get a free ride on the wave of new technology by ensuring we don't get 300 pay/free channels of the same blah.

At great risk of sounding redundant, I think the Gov't missed an opportunity to infuse new competition into broadcast radio by not recouping the multiplexed channels and auctioning this spectrum vs. just giving it to the incumbents. Still don't know how the incumbents pulled that off, but they did. I think the added competition would have given an added kick to a content/format revolution in radio. Even still, doesn't mean that it can't be reborn with the big three running things, just might not move very quickly. A company like Infinity is not going to all of a sudden change their homogenized approach to what and how they broadcast now that they have three or four additional new stations (or sub channels) in each market. I think the cable TV biz is a very good resource and reference point for the radio industry as it undergoes this part of its’ evolution. There are bad things about cable TV: 300 channels of little worthy content, and good things about: HBO Series and On Demand. I know this is what I’d be studying if I were at Infinity right now.

Keep it coming my man...

[Fenton]

The radio has only lost listeners who are old enough to know how to download (15) but aren't old enough to have already stopped caring about record companies ripping off artists, about finding new music, or about buying music for reasons other than liking the single that was on the radio.

There's still a huge radio market in the teeny boppers and the people who are old enough to have better things to care about than new music (i.e., have a real job already).

If I were a big record company that wanted to manage for the bottom line, I would cut costs, give the teeny boppers and adults what they want, and stop pretending to be cool. Only hubris and inertia are keeping them in the "next big thing" game.

[Jesse Chenard]

This is a great commentary on where things could go but I have a somewhat different scenario that I have been touting for a number of years. In my estimation the current transport mechanisms for both satellite and FM/AM radio's days are numbered (broadcast TV too for that matter).

I truly believe the transport of the future for all of these mediums will be IP. Why you might ask, because it is a common denominator being built into pretty much every electronic entertainment device out there. When WiMax, 3G cell service, fiber and the other high bandwidth sources for internet access become as ubiquitous (not that far off by most estimations) as radio I would bet we start seeing a massive shift to deliver services over the internet. Not only that, but once the mass market is available over IP the costly frequencies and satellites necessary to deliver the audio will be a huge disadvantage. If I have a device (laptop, phone, pda, etc) that can reliably play back a simple audio stream wherever I am the need for satellite and radio (over the airwaves) vanishes. Not only that, but businesses who continue to use traditional delivery mechanism will be saddled with massive overhead associated with transporting their audio while delivery via IP will be relatively cheap. My guess is that this is a big reason why Sirius and XM are both struggling to re-invent themselves as content companies.

Of course in this scenario the need to clog up the airwaves with radio would cease and all of those spectrums would be available for, you guessed it, more services over IP.

[steve]

I think all such future views wildly undersestimate how little the average human being wants to have to *work* for their entertainment.

Sure, rich affluent educated folks with oodles of time and cash love to play with their toys, and get off on feeling they are programming their own media. I know -- I'm one of 'em.

But I have yet to meet an average person who wants more complex electronic gadgets requiring more study and more time -- and more *work* -- to take the place of a system they don't really object to -- a system where vast vast quantities and qualities of media choices are continuously beamed and streamed for them to graze and decide what they like and don't like, when they have a few spare moments.

Satellite radio is much bigger and growing much faster than ipods. Why? I would argue because the vast majority of homo sapiens don't want to have to select and archive and then select and listen (and then do it again and again and again.) They want to turn on, tune in, stretch out.

And yes, even kids. OK, youngsters are more affluent and have more time than average humans, which is why they consume so much media. But they all grow up, and suddenly have a lot more demands on their time and money and brain cells. And I predict the vast majority of all peoples will still want to have professionals create their media, and other professionals stream and beam at them, so they can graze.

Finally, does no one but me absolutely detest the notion that all my media -- all my likes and dislikes -- should be known by me in advance? I can't tag or download or consume stuff that I don't know exists, or that I don't think I like. I, for one, have a completely clear conscience when I tell my children, try it, you'll like it, even when they insist they already know they don't. ;)

[Tony Alva]

"Finally, does no one but me absolutely detest the notion that all my media -- all my likes and dislikes -- should be known by me in advance?"

Couldn't be a better question posed that represents what the old media people running radio stations and record labels are struggling to come to grips with now that the internet has taken all that control away from them.

It's all in the infancy stages, but the smart ones know it'll never go back to the way it was.

[David Gibbons]

"I need a good word for the combination of all of those metrics"

Suggest: "Participation"

[just.a.guy]

On the observation about RSS and video:

RSS for video is the technology that will enable individuals to take over the role of program director.

With proper metadata wrapped around video content, the problem of finding relevant needles in ever larger haystacks becomes tractable.

We've seen this before with the web ... portals ("channels") giving way to Search.

A program's position on the portal ("dial / channel") becomes less important than its position in the search... its relevance.

And then, "it's all about the content" -- as it should be. Hallelujah.

[Jackson]

'The result is mainstream, bland music that nobody dislikes enough to switch stations.'

Many of us dislike it so much we never turn on the radio to begin with.

'Impact' is a good word. Music should be impactful, eliciting love and hate in equal measures.

'Smart record label executives know this and are turning away from the radio formula and embracing the Internet.' A good move, almost as good as, say, hiring me to head up the 'new' A&R dept.

[Chris]

"Impact Media" strikes me as an effort to coin a phrase, or to unify with a theme, but I'm not finding new stuff that builds on trends -- these pieces have been out there for some time ...so why the phrase?

"Sell-Side Advertising" and "Cost-per-Influence" were memes that were additive to the conversation, but I'm not finding what's the "there there" with "Impact Media." Media is fractionalizing, coming "from the edge" and becoming more accountable due to better measurment, but mainstream business press was writing this up in feature stories last summer. Cetainly the notion of automatic scheduling and delivery of content is newER (a la podcasts), but that's not the whole of what I sense "Impact Media" is trying to capture.

I think there's a notion of "Social Media," whereby friends program their friends consumption for them (or share it on many of the social sites you listed in your post), and that might lead to "Edge Filtration," or ways in which folks share what they've consumed in advance of getting together in person (like Googling someone's name before a date, to know what you're in for), so that they can jump right into talking about it, saving the whole "Did you see ___?"

Just trying connect the disparate thoughts of the post (which may have been the point) with the notion of "Impact Media" (the meme-in-training) and coming short of finding a unified theme, FWIW.

[charlie crystle]

I hate the mainstream music industry. I had a record deal, toured a lot pre-web, and played some really great gigs at Jones Beach, etc.

I'm going to skip the rest of my rant--you know what happened because it used to happen to most signed acts. I still record and am finishing my 8th record next week during my vacation.

Leapfroggin past more context: what I want is from satellite radio is any radio station or podcast I choose on my own programmable stations. I want 15 of those programmable stations. I want the satellites to deliver to my car what I can get over the web--WHYY in Philly, KQED in SF, Tom's podcasts, etc.

I didn't read the other posts--sorry if I duped anyone.

[Bill Figenshu]

I have been watching with interest the rollout of a few HD radio stations over the past few months. If we're not careful we have a really good chance of making a mistake with this new technology. I believe the next 12-24 months will seal HD radio's fate with consumers. Kenwood is offering an car radio for $400+ in the Cruchfield catalogue. BMW has announced they will offer HD radio in the new 7 series cars next year. Others are here. http://www.ibiquity.com/hdradio/hdradio_hdproducts.htm

But before additional manufactures offer this new service, or consumers decide to buy an HD radio, we better have a talk with ourselves.

With apologies to the gifted engineers who have developed this technology and the masses of talented people who understand how it works, here’s my take on it. ( As any engineer from Citadel & Infinity will tell you, I know just enough engineering to be dangerous.)

Depending on who you believe, we will be able to offer up to an additional 5 channels of audio, data, and “stuff” that will be of digital quality from each of our current FM stations per market. So, in a market like Los Angeles, (with 75 FM signals scattered throughout Southern California) that means an additional 375 channels of audio with a signal strength equal to our current FM station. (for the moment, let’s forget about the AM stations, skywave, and the entire HD-AM issue.) Much more on the subject is available here. http://www.ibiquity.com/hdradio/whatishdradio.htm

At last, digital audio with the quality of CD’s or better. All delivered within our current analog signal using the same tower and coverage we have now. Great! But this newsletter is NOT about the techie side of HD.

If history is our guide, when it comes to technology, we can conclude " We’re not good at working together."

It's about the MARKETING of this changing technology. We are asking consumers to change their current use of the AM/FM band. Ok, fine!

Except for a small but significant issue. – WE HATE CHANGE!

We stink at rolling out new technology. Quadraphonic? People Meters (PPM) AM-Stereo? Even FM had to be mandated by the government to provide programming different from our AM stations of the 60’s. The FM Band was available in it's present form just after World War 2. We started picking up significant audience in the 70's. (20+ years later)

HD is expensive. (anywhere from 50 to 150k per station is my understanding) That's a big Cap-Ex bill for many broadcasters. But Clear Channel and Infinity along with many major broadcasters are clearly committed to it. http://www.ibiquity.com/about/invest_radio.htm And over the next few years it will be rolled out.

So we ARE going forward with it. But lets be honest, there are a few "issues" we must address first. So let's put them on the table.

Has anyone noticed that there are few HD radios out there? How do we get them into the marketplace? Why will people want to spend the money to buy them? What is the marketing plan?

What will we do to attract people to the new band? Quality? I can see many stations simulcasting their AM stations in HD to get people over to HD. There is an obvious quality difference. I recently had the chance to hear 740 KCBS-HD in San Francisco. Crisp, clean, and clear. For AM radio, this could be a good thing. (there is HD-AM but only during the daytime. At night, I'm told, AM stations must go back to analog to protect the skywave interference. This is like TV going to black and white every evening. ) Put the AM station on one of the FM HD channels.

But FM?

In all the research I have seen over the years, NO ONE has ever complained about the quality of a full power FM signal. Are people signing up for Satellite radio or buying I-Pods because of quality? Very few.

It's the content baby!

Are we all prepared to devote massive amounts of air time to get people to STOP listening to our high rated AM&FM stations and go to HD?

Our history as an industry suggests we won’t. We WON’T want listeners to leave our 80+ year old broadcast stations to go to HD. More audience fragmentation? We won't like that! Not one bit!

This will slow the growth of adaptation to the HD band.

How do we market the frequency of the band? Researcher Mark Ramsey has taken a hard line on this. And I think he's right.

(see Marks excellent blog on many radio subjects here. http://www.radiomarketingnexus.com/2005/08/hd_radio_set_to.html )

Look for this;

HD Radio set to botch its first impression.

What to call this thing? Country Kiss-FM HD 2 at 98.7-1? (I can see Dave Michaels www.davemichaelsradioart.com trying to come up with a logo for them)

Ugh! that will be tough to brand for sure! (Mark suggests 1 to 100 similar to the Sat guys. Not a bad idea. )

But here’s the big reason we will struggle with HD,

We will try to put the same programming on HD that is currently on AM & FM. The same type of music, commercials, DJ’s & marketing that drive (or don’t drive) AM & FM will be shoved at consumers in market after market. If this happens, HD will be a slow adapter.

Let's say you have the #1 FM station in the market. (Let's call it uh, Kiss Country 98.7 FM) And we put on the HD band 2 or 3 more versions of "Kiss Country". A "Classic Kiss" and a "New Country" Kiss. Where might those listeners come from? ( your FM perhaps?) Why will they go out and buy an HD receiver? (to get away from your "big" station?) And what will we do about the diary recall for Arbitron? (another bag O' worms)

We must start to employ out of the box thinking to attract the very people that will embrace the new band. Then they will buy HD. If there is a mere digital Classic Rock version of your current Classic Rock station (with loads of commercials and silly DJ’s) why would consumers want to go there?

(would someone like to get 12 to 34 year olds back to radio for a change? HD radio may be the chance.)

Do we have the creative thinking to avoid the mistake of our TV brethren? Hmmm, let’s see!

Did the traditional Networks grow Cable TV?

Who developed MTV, CNN, ESPN, HBO, PPV? The Networks? Nah! It was people who were everything the networks were not!

The networks were into protection. They didn’t want anything developed that will take audience from their affiliates. The bosses at CBS knew there should be a news channel on cable. But "Ted" did it first. A channel for youth? Bob Pittman (a former PD at country WMAQ-Chicago when it was owned by NBC) developed it at Warner Cable in 1979. Could he have pitched it to NBC-TV at the time? Would they have approved it?

Quick, name ONE currently successful cable channel developed by the traditional (NBC, ABC ,CBS) TV networks?

http://www.nielsenmedia.com/ratings/cable_programs.html

We in radio are capable of the same mistake. We may not be developing the best HD "radio" brands. Just re-cycled old programs. This may not be attractive enough for consumers to buy a new car radio for the old Ford Explorer.

What to do? (here’s the part you’re not going to like)

Major companies should create a separate HD Radio Division. NOT attached to the AM&FM Radio division. As current broadcasters we won't want people to leave our traditional stations. We are into protection. It's only natural for us to think that way, but it may not be the best way to grow this new radio band.

With the exception of offering the programming of low power, directional, daytimer, AM stations, the HD Radio division should create brands that are NOT part of the current AM/FM band. (check out on line independent streamers, I-Pod bloggers, and pirate programmers for inspiration).

Remember, there can be as many as 300 additional channels in a major market. So after we put on "Classic Lite" and "50's oldies" , now what? That leaves only about 270 channels left. (ok, so you can put your low power AM station on there. It will fill a few channels. )

Books on tape? (yes, playing the actual books for downloads) Health & Fitness, Technology, All Traffic & Weather Together? A travel channel devoted to your (and other) cities, local dining, home and car repair (done by local repair or classic car fabricators) "how to" stations. Local movie, restaurant, entertainment information, and much more.

The HD Radio Division should NOT generate revenue in a traditional way. (That’s what we AM/FMer's do!) In other words, no screaming car dealers or penis pump ads. A few of us remember when emerging FM station ran 6-8 units per hour. And then, the spots had to have a certain"sound" as not to emulate the AM stations.

David Field, President of Entercom has suggested many broadcasters combine their HD channels to offer pay radio to compete locally with XM and Sirius. Not a bad idea. Trying to get them all in one room could be interesting. Trying to get them to agree on programming choices could be really, really, interesting.

The HD Radio Division should employ mainly people who are NOT currently running traditional AM&FM stations. ( otherwise, “Jack” will have many brothers and sisters.)

If there is innovative, breakthrough, challenging programming, then, positioned and branded properly, and with marketing that give people a real reason to buy these new radios, the band will grow.

(hint - there may be new companies formed for the purpose of providing programming ideas to HD stations. Hmmm - wonder who might do that? ( www.figmedia1.com )

We May NOT be capable of doing it. We may need different thinking. We may need a different type of radio programmers, marketers, managers. Are we prepared to compete with our own current AM/FM stations?

(hint - the Sat people, phone companies, Podcasters, and other content providers are!)

We may need help!

Are we ready to admit it?

Check here,

( ) Yes, I’m ready for new thinking. Form a group of major broadcasters to tackle the band branding issue in cooperation with iBiquity. Then look to other programming ideas outside of the traditional.

( ) Pretend the issue is not there. Do Nothing!

( ) What! Are you crazy! We can’t afford that. Were using the same overworked staff we have now! If a GM, PD, Sales Manager can run this cluster, they sure can run a few little digital stations. Look, it’s just a matter of hooking up one of those I-Pod things to the transmitter and………

[jackson]

Write a book dude....Any body got any coffee?

[Kenneth Drake]

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