WiFi Radio: The Death of Broadcasting, Part II

The following article appeared in this morning's National Post. It uses the term "WiFi radio" to refer to the "internet radio" that I used in my blog on the "The death of broadcast radio":

Radio in tune for digital revolution: Deloitte

'It's The Future'

Grant Surridge, Financial Post Published: Wednesday, January 21, 2009

While the vast majority of radio listeners in Canada still tune in to old-fashioned analogue signals, some observers say the medium may finally be on the verge of a digital revolution. And radios that connect to the Internet will push such change forward.

"Radio is really the last medium to go from analogue to digital," John Ruffolo, Deloitte's senior technology leader, said yesterday.
The accounting firm predicted the widespread adoption of so-called WiFi radios as part of an annual list of predictions for media and technology trends.

The devices in question look like normal radios, with digital displays, speakers and tuning knobs. But they pick up thousands upon thousands of Internet radio stations from around the world free of charge.

"It's the future of radio," said Alex Bowden, a salesman at Bay and Bloor Radio in downtown Toronto. He said the store has seen an uptick in sales of the devices, especially over Christmas, as prices have gone down.

The cheapest units retail for about $200. They connect to the Internet on their own or through an existing wireless router.

Analogue radio has stood down the advent of television, satellite radio and various digital incarnations. But Mr. Ruffolo contends WiFi devices will present a solution to consumers who are unwilling to pay for satellite radio, but tired of a limited selection of analogue signals.

Jacques Parisien heads the radio business at Astral Media Inc., the country's largest radio broadcaster.

He said WiFi radios present an opportunity for broadcasters to expand their analogue audience.

However, for the time being, Astral remains focused on analogue radio, where the vast majority of advertising and listeners are still situated.

In the first three quarters of last year, the U. S. Radio Advertising Bureau said online ad revenues accounted for about 9% of total radio income.

Mr. Parisien said that figure is likely even smaller in Canada.
David Bray, a radio industry analyst based in Toronto, called the idea that WiFi radios would herald a widespread shift in the way people listen to radio "wildly improbable."

He said he expects that there will eventually be a digital shift in the radio business, but it is far too early to tell if consumers will spend several hundred dollars to buy new radios.

He said that where there is no WiFi coverage -- such as outside of large cities -- such portable devices would be useless. "You're limiting yourself to urban locations where WiFi coverage is in place," he said.

According to data from the Canadian Radio-television Telecommunications Commission, about two-thirds of Canadian households subscribe to high-speed Internet connections.

There are still issues to be resolved over tariffs broadcasters must pay to musicians to compensate them for playing their music over the Internet, Mr. Bray said.

The challenge for radio broadcasters who want to compete in a cyber universe filled with thousands of stations will be to organize themselves so that consumers can find them.

"They'll have to be categorized in an easily searchable format. Absolutely," he said.

Of course, I fully agree with Mr. John Ruffalo, the Deloitte analyst who wrote the report and predicts that WiFi radio will replace today's analogue radios. Although the cost of WiFi radio is relatively expensive when compared to analogue radios, the cost will come down as production ramps up. Remember when LCD TVs cost over $4,000? The same TV can now be purchased for less than $1,000.

Mr. David Bray missed the point entirely, however, when he states that WiFi (or Internet) radios will be useless in areas outside the Metropolitan regions where WiFi coverage is not available. WiFi radios will, I expect, be only used in conjunction with WiFi transmission from your own in-house wireless router, not with commercial WiFi services. And, although the penetration of wireless routers may not be that high yet, I expect that soon every household that has broadband internet will soon have a wireless router in the home. When every child in the house, not to mention adult, has their own laptop, it will become impractical to connect to the internet through wires - hence the widespread deployment of wireless, and wireless routers. WiFi radio will just ride this trend.

The other point not mentioned in the article, and the point that I was trying to make in my previous blog entry, was that WiFi radio (or internet radio, as I called it) will mean the death of broadcasting. A broadcast radio station could not, for example, play U2 exclusively since the audience within broadcast range would be too limited, and the resulting advertising revenue too small. However, if you can reach U2 fans world-wide, then you can tailor your advertising to that segment of the population which are also U2 fans, and who are in the target market segment for your product. This is, of course, the dream for every advertiser. So, with the emergence of WiFi radio, I expect that radio stations will move to the internet, expand their reach, narrow their focus and consequently be able to target their advertising more precisely. Thus the advent of narrowcasting, as opposed to broadcasting.

What has this to do with CBC Radio Two? Well, as you can see, CBC Radio Two has moved in precisely the opposite direction - becoming a 'broader' broadcaster, attempting to reach an even wider audience with its mish-mash of every conceivable musical genre available in Canada, in the end satisfying no one. CBC Radio Two is not evolving, rather, it is accelerating its own devolution into a dinosaur.

Articles from the "Audio Ideas Guide" Web Site

A reader of this blog was kind enough to bring my attention to some articles on the "Audio Ideas Guide" web site.

The first, "The Noo Radio Tiew, Amateur Radio Paid for by You", begins with the following letter to the editor from the Globe and Mail:

"When I was growing up, bodily functions were discreetly referred to as number 1 and number 2. In this vein, the new programming for CBC Radio 2 is definitely number 2.

Sandra Levy, Victoria"

Hah! That made my day. And it's still early in the day.

Other articles on the Audio Ideas Guide web site on the topic of CBC Radio Two are "Wrecking Radio 2: The Sequel & Growing Opposition" and "CBC Radio Two: Intelligent Music Selection becomes a Sausage Factory". Have a look. They're well-written, informative and funny to boot.

ABC - Australia Beats Canada? Anything but CBC?

No, ABC is "Australian Broadcasting Corporation". Similar to our CBC in Canada.

It has now been just over two weeks since I began listening to internet radio and I’ve quickly developed some preferences for the radio stations that I listen to.

I initially saved Ottava (Japan), Bayern 4 Klassik (Germany), RNE Radio Clasica (Spain), Radio Classique (France), Radio Stephansdom (Austria), Sveriges Radio (Sweden) and Radio New Zealand Concert FM into my list of favourites. But it is ABC Classical FM (from Australia) that has become my everyday, all day station.

Why? Well, first of all, it’s due to the selections that are featured on ABC Classical FM. Selections are played, for the most part, in their entirety. And it is not the “Top 40” classical format that you may hear, for example, on Classical FM in Toronto.

There’s also something enjoyable about hearing news from Australia. While you still hear the world news, you also get the local news stories from Australia that can be an interesting change, compared to the mundane local news available in Canada. And it’s refreshing to know, for example, that the high temperature will be 39 celsius in Alice Springs today, when it’s -30 degrees celsius in Ottawa.

The format of ABC Classical FM reminds me of CBC Radio Two, before the CBC’s disastrous attempts at restructuring CBC Radio Two. I became curious – just how successful is ABC Classical FM in Australia? To answer this question, I took a look at the AC Nielsen radio surveys in Australia.

There are some differences between the surveys done in Australia and the ones done by the BBM in Canada. For a start, there are eight surveys done each year in Australia compared to four in Canada. In Australia, both regions and major metropolitan areas are surveyed, whereas only major metropolitan areas are surveyed by the BBM.

So, I decided to compare the market share of ABC Classical FM in Sydney (population 4.2M) with that of CBC Radio Two in Toronto (population of the GTA 4.8M). I could have done similar comparisons between Canberra and Ottawa, perhaps, and Melbourne and Montreal, Brisbane and Vancouver, but I have only a limited amount of time that I can devote to this blog. So I only compared Toronto and Sydney.

Not surprisingly, both ABC Classical FM and CBC Radio Two had a similar market share in the S8 2005 (S4 2005 for Canada) survey – 2.2%. But, as you can see from the graph below, the trend for CBC Radio Two in Toronto has been declining, while the trend for ABC Classical FM in Sydney has been increasing.


What’s wrong with those aussies? Don’t they know that classical music is dead? Don’t they know that they have to represent all musical genres in Australia, to showcase music performed by Australian musicians? Don’t they know that their role, as a public broadcaster, is not to feature music that will not normally be programmed by commercial radio stations and that will enlighten and educate their listeners, but is instead to try to appeal to the widest possible audience by featuring a mish-mash of genres spread out over various times of the day?

Apparently they don’t – and thank God for that.

CBC Radio Two: for the Geography-challenged.

From the Letters to the Editor section of the Globe and Mail, Tuesday, Jan. 6 2009:

Tune in to geography?

MAX TITBORK

January 6, 2009

Ottawa -- So CBC Radio 2 has a scheme to send 49 songs from above the 49th parallel to Barack Obama to make him more aware of Canada (Naming Those Tunes That Define Canada - Review, Dec. 30).

Mr. Obama probably knows this, but it appears the CBC does not: Most Canadians live south of the 49th parallel; music that originated in Toronto, Montreal, Ottawa, Moncton, Halifax, St. John's or anywhere in PEI wouldn't qualify. Even places like Sault St. Marie, Sudbury and Chicoutimi lie south of the 49th.

The CBC management should realize that when ordinary Canadians feel compelled to ridicule their programming choices in the national newspapers, something is seriously wrong. And it's not something wrong with the ordinary Canadians.

Have we no pride? Apparently the CBC doesn't.

From the "Letters to the Editor" section of the Friday, Jan. 2 2009 Globe and Mail. Even the Americans are outraged at the CBC Radio Two restructuring, not to mention puzzled by the idiocy of CBC management in implementing these changes:

Have we no pride?

ROBERT J. MULVANEY

January 2, 2009

Columbia, S.C. -- Will CBC Radio 2's current tsunami of idiocy never cease (Naming Those Tunes That Define Canada - Dec. 30)? Having just heard the dazzling Canadian soprano Measha Brueggergosman sing in Beethoven's 9th Symphony on U.S. National Public Radio, and having recently seen the brilliant Michael Schade on the stage of New York's Metropolitan Opera House, I find myself exasperated and embarrassed by the CBC's offer to send the next American president 49 songs - and this to let Americans know about Canadian culture.

Canadians, please note: Your high art is known everywhere on Earth. Its virtual abandonment by CBC Radio is shameful and ridiculous. Forget the 49 and this silly contest, and remember the dozens of world-class performers from one sea to the other, take pride in them and bring them back to the airwaves, at least for the sake of Canadians getting to know their own artistic glory.