The pending death of AM broadcasting is a common refrain these days.
Claims based on highly publicized station closings (e.g., author Stephen King), over-generalized personal experiences, the uncertainty of AM’s presence in automobiles, sentiment surrounding the medium and miscellaneous random events have fed this narrative.
But as in the infamous obituary for Mark Twain, this corpse can still fog a mirror. Here is why I say that.
Based on the number of AM and FM station licenses over time, measured radio audience levels by Nielsen, advertising trends and other factors, my analysis shows no signs of AM broadcasting being in a nationwide death spiral. Instead, there are local media markets exhibiting difficult conditions in which to remain profitable.
Key findings include:
- The loss in the number of AM station licenses in the United States is small in historical terms. Depending on the source you use, AM station licenses have declined by about 400 from their peak in 1990, some 8.4% over 35 years. Radio World cites data giving the drop as 630 stations and 13% over that time. But these are not “falling sky” numbers.
By my calculations the annualized percent change for AM and FM station licenses has been less than 1 percent for each and is largely flat since 1991. Yet, there is no clamor over FM station loss, which momentarily surpassed that of AM stations around 2020.
- Nielsen has recently published AM reach data by DMA. My analysis using GIS with spatial statistics shows which local media markets have more AM stations failing as well as those where FM station loss is significant. The Bangor, Maine, DMA, where King’s stations were located, is one of those poorly performing markets in the U.S. Yet news coverage suggested it signaled the death of AM radio.
- A surprise is that radio reach among the 18–49 age segment is some 12% higher than TV, not a sign of mortality in the offing. Podcasts? Radio dominates them in ad revenue! Combined with the high level of trust in the radio medium, AM/FM radio is doing quite well. Public data do not separate AM from FM. But these combined data points would have to be lopsided in favor of FM to produce a different conclusion.
- It is in the larger media markets where more station loss has occurred, perhaps a sign of over-built markets? FM stations also fail in many local markets, especially in larger ones. In fact, in my analysis I show that it is the size of the market that better predicts AM and FM station loss over market geographic area or audience reach. Regardless of audience size or the market area, more AM or FM stations begat more closures.
- These results lean heavily toward a local media market “shakeout” rather than a national death of AM radio. Smaller markets tend to rely more on radio, particularly AM, where some areas just do not receive FM signals well due to terrain blockage. Larger markets tend to have many more outlets for news, information and entertainment. Hence, a shakeout is the most likely culprit rather than the death of AM radio.
- Nielsen does not release DMA ad revenue separately for AM stations. If it did, we would have a more definitive answer to the most underlying ailment leading to AM (and FM) station closures. Should the company decide to do so, I will readily include them in a new study.
I have explored these arguments in detail in the August issue of The Spectrum Monitor magazine. I encourage readers to review them. Subscribers can find it here or here.
Read more about the author Frank M. Howell, Ph.D., K4FMH on his blog.
