BusinessWeek on HD Radio

Monday, January 29, 2007 at 12:15 PM

Polk I-Sonic
BusinessWeek has a good article today on the state of HD Radio and hurdles that terrestrial radio face in spurring adoption.

One interesting section of note:

The problem for the broadcasters, who continue to see their audience become fragmented and struggle to boost ad revenues, is that HD radio "is not a new offering. It's a defensive move," says Ted Schadler, an analyst with Forrester Research (FORR). "It's better radio, but it's not a whole lot better radio." He calls it a replacement product and likens it to the transition from black-and-white to color TVs.

"People still got a picture and their shows on black-and-white so they waited until their sets went on the fritz. Then they bought a color TV." For 2007, the industry will sell a few HD receivers, but 10 years from now, everyone will have one. "It's that kind of thing. It will happen without a ripple," says Schadler. 

The only difference with this analogy is that color TV was "cool" - HD Radio, in this rapidly evolving technological environment - is being challenged by a heck of lot of other "cooler" things.

Now let's flip it around (because I can't bring up HD Radio without talking about Satellite Radio)... what about satellite radio isn't "cool" enough to the consumer?




Having been an XM subscriber for over two years, I can say most of my conversations with terrestrial radio listeners inevitably come back to the price of activation and monthly service, whereas their in-dash car radio "just works".

I was more than happy to ditch terrestrial radio for commercial-free, genre-focused music that worked regardless of where I was; even though everyone who gets a chance to experience satellite radio loved it, no one wanted to pony up the money for the radio and associated costs.

Although factory-installed satellite radios are a step in the right direction, I have heard too many stories of people who took advantage of the free trial period but then switched back to terrestrial as soon as they had to pay. This is hard to understand myself, but I suppose not for the consumer base as a whole.

I love satellite radio so much, it's hard to find a negative. For the average consumer I would have said money but I see people spending for subscriptions to games like War of Warcraft and having both Netflix and Blockbuster Total Access just because they can, that I can't blame satellite radio's monthy charges.

I would have to say it could be buying the hardware that might scare some people off.

As far as what is not cool about satellite radio, I guess some feel it is difficult to set up or install and would rather have an I-Pod and if they had a problem with there I-Pod's they know that have alot of oulets (Like family and friends) that can help them.

"As far as what is not cool about satellite radio, I guess some feel it is difficult to set up or install and would rather have an I-Pod and if they had a problem with there I-Pod's they know that have alot of oulets (Like family and friends) that can help them."

SO, The iPod / Satrad argument is comparable to the old "Boombox/cassette" , Walkman/CD player vs FM.
(today to listen to "iPod/mP3" in the car, you still have an installation process) As kids, we would carry the "boombox or walkman with the cassette/cd pouch yet how many people (parents) were listening to FM while driving. Right now Satrad is direct competition to the big money of "FREE FM" as well the "Jukebox" effect with the iPods. The old Walkmans never threatened FM as Satrad does today. FM never threatened the "juke box" effect as Satrad does today.

The Bridge report just came out with Crystal Ball predictions out to 2020........ They have the Satrad industry from 2010 to 2020 only gaining 10mm subs. 10 years of equally gaining .50 mm (500K) subs per year. Why is that? "No more Stern after e.o.y. 2011"? Nothing to base statistics on? Satrad is one of the cheapest bills one may "chose to pay monthly" with the largest satisfaction.(I suggest the full initial investment/ subscription-yearly) "Low Bridge" I say and thats based on watching their statistics over the past couple of yrs. ( also on the mentality of any stupid m.f. that wants to openly publish stats for 13 yrs out these days) Maybe they called Sylvia Brown on the Montel show and she told them that Satrad is as dead as what she told the parents of the kid that was just found alive? Kudos to miss Oprah also............ Do some digging on and the free FM studies concluding that Content is king!! On an investment front, if you can not afford/handle the wait to profits or to a class action. Stay away from an investment in Satrad!

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