March 5, 2009 / 2:42 PM / 10 years ago

Radio seeks to clear signal in trying times

NEW YORK (Reuters) - Radio may lack the glamour of Hollywood or the cool of the Internet, but the oldest broadcast media business is banking on its ubiquity to increase its fans and advertising revenue during the economic downturn.

A traditional microphone is displayed in a window at Broadcasting House, the traditional headquarters of radio broadcasting for the British Broadcasting Corporation (BBC) in central London October 31, 2008. REUTERS/Toby Melville

More and more people are listening to radio, industry leaders say, and the century-old technology hopes to offer consumers new ways to experience it, including advances such as High-Definition broadcasts and portable devices like Apple’s iPods.

The medium has some 235 million listeners, who check into talk shows, music and news on everything from bedside clock radios to cars and websites. According to the National Association of Broadcasters (NAB), 64 percent of Americans listen to the radio at least once a day.

But the industry sees a future where FM radio chips are embedded in most portable media devices, such as personal navigation systems or mobile phones.

“We need to be ubiquitous. We have to be in all of these gadgets,” NAB President David Rehr said in an interview. “We need to remind people about radio being adaptable and forward looking, so people don’t think about the big radio by the fireplace.”

That’s no easy task. The global economic crisis has found consumers buying fewer cars and spending less on electronics. Even the alarms on mobile phones are gradually displacing home clock radios, particularly among younger users.

The Radio Advertising Bureau said industry revenue fell 10 percent in 2008 to $16.5 billion. It was the third consecutive annual drop as companies cut back on spending.

Last month, Standard & Poor’s downgraded top radio broadcaster Clear Channel Communications, citing extremely weak recent results among its peers. S&P said in a report: “We are concerned that negative secular trends facing the radio industry could limit a rebound in 2010.”


Those gloomy figures do not tell the whole story, insists Jeff Haley, president of RAB, a trade group. In these times, radio has an economic advantage over TV and other forms of advertising: clients can get more bang for their buck.

It costs less to create a radio commercial than it does to make a TV commercial and local radio stations can hit more targeted demographics. Also, radio’s audience grew by 3 percent last year, albeit as a result of overall population growth, he said.

“One knock against radio in recent years is the lack of revenue growth — but there is listenership growth,” Haley said. “The economy hurts every business in America (but) our listenership will not be affected. Therefore, we are an efficient media for advertisers to use.”

Innovations could bring listeners to radio, including attachments for iPods that grab a radio signal, or websites like Pandora, which the RAB embraces as “sponsored audio content.”

Still finding its way is HD Radio, which receives over-the-air terrestrial stations with CD-quality sound and multiple new-program formats, and devices like the Nokia 1662 phone — sold in the United States as T-Mobile’s Vairy Touch, which has an FM radio built in.

And despite the auto sales slump, millions of cars are on the roads with traditional radios in their dashboards.

“We don’t think we are going to have to reinvent the medium, we just want to expand and energize it in these new channels,” Haley said.

Reporting by Franklin Paul; editing by Leslie Gevirtz

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below