Here's an interesting bit from Jacob's Media
, regarding some analysis by Katz Radio Group showing that, wait for it, satellite radio is insignificant to terrestrial radio's listener penetration. I'm not going to fault Fred Jacobs for giving props to Katz (it's his M.O. afterall), but rather let's take a look at the report itself.
The December 2006 issue of Katz Radio Group's newsletter "Radiowaves"
(PDF) focuses on trying to debunk "myths" about Old Media vs New Media (are we really still having this argument?). So of course as a key feature they show a neato chart that illustrates satellite radio's penetration versus terrestrial radio's penetration in the Top 25 U.S. markets.
Now, let's ignore the genius editorial copy in this newsletter (which proclaims that while XM and Sirius will have "disappointing" Christmas sales, HD Radio will have "very robust" sales). Let's just examine the data itself, afterall it's data that Jacob's feels should go out "to the advertising community, as well as media outlets like The New York Times."
First off, the Total U.S. Penetration number. This is probably the most relevant since XM and Sirius have no localization capabilities. See, the data that Katz is showcasing is meant to prove to the world that advertising with terrestrial radio is a smarter choice than advertising with satellite radio. But any advertiser who signs with Sirius or XM would be advertising on a national basis, so examining the penetration in each individual market makes little sense. If "Bobby's Used Car Sales" in Minneapolis wants to talk up this Saturday's midnight bonanza, why would he advertise on a national scale?
But I digress, back to Total U.S. Penetration.
The data, which is provided by Simmons
, shows that Satellite Radio penetration is at 4.1% for Sirius and XM combined. Hmm, interesting... 4.1% of what? The Katz feature doesn't say. But since the words "total U.S. penetration" are being used, let's assume they mean the entire U.S. population of 300 million. Ah, so that's 12.3 million people. Sort of close to the combined number of subscribers between XM and Sirius (not counting Q4 subs I assume). That ignores the fact that there's more listeners than subscribers. (Simmons, by the way, is partnered with Sirius
Next to the 4.1% number, Katz shows where satellite radio would be "ranked" among local
terrestrial radio stations. This is an average of the local rankings, based on - Arbitron numbers. Not based on the 4.1% figure. So we have two different figures, from two different research firms, on the same line item. Nice.
But how is that possible since Arbitron has postponed the listing of satellite radio
in their books? Ah, that's because Katz used individual market penetration data from Scarborough Research
, to determine the rankings among local terrestrial radio. So it's really just an "assumption" more than an actual ranking.
So let's break it down. This "eye opening" data is the combination of data from three different research firms
, with different methodologies, and different audience measurements - yet they're combined on associated line items. Brilliant.
Yet again, none of this really matters. Not because satellite radio is a national media - and so comparing local marketshare is just plain silly. And not because a majority of the channels on satellite radio don't even have commercials, so this information serves useless to the advertising community. It's because the satellite radio business model isn't dependent on advertising dollars, like terrestrial radio's is.
Do yourself a favor Katz, and leave the apples and oranges alone. Everybody knows that terrestrial radio has more listeners than satellite does. The real question is, if satellite radio is so insignificant... why do you care?