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Maintain the Core, Explore the Fringe

And Monitor the Transition: Watchwords for Providing Relevant Service

Last year an editorial in this publication asked, “When do we stop calling it ‘new media’?”

Well, the answer is, we probably never will — but how the term is defined will keep changing. Today’s meaning of “new media” is pretty different than that of five years ago, although the term was similarly and no less frequently used as a catchall for non-traditional distribution methods of the day.

For example, streaming media to the PC and burning your own mix CDs have now become largely mainstream, while streaming to handheld devices and vast libraries of music in one’s pocket — all on the same device you use to make phone calls, handle messaging and sync personal data — are today’s emergent edge.

The paradigms keep shifting as they replace each another through a revolving door of formats du jour. Meanwhile, “old media” is getting even older, being squeezed ever further toward the back of the bus by the growing number of “middle-aged” digital systems.

Radio survives, for the moment at least,

although the writing on the wall is starting to become legible, and a slow downward trajectory has begun. Numerous analyses agree that today radio broadcasting finds itself at a pivotal moment, and it’s one in which many possible missteps can be taken.

Worse yet, the results of these missteps won’t appear immediately, but when they do, it will be even harder, if not impossible, to correct them.

Glidepath over troubled waters

Radio finds itself in a place that other traditional media have already encountered, or will in the near future. In fact, traditional media are passing through the gauntlet of transition to new media in roughly the same order that they were born — first print, now radio and next television — although they may not all suffer the same fates when they emerge on the other side.

Some of the variables that affect this outcome are predetermined by circumstance, while others rely on how the incumbents handle themselves as it proceeds. Given the opportunity provided by the latter, let’s look at how such behavior can help or hurt radio’s prospects as it passes through its new-media transition.

Radio now holds the potentially deceptive posture of having a still fairly solid core business, with a fast-growing fringe marketplace. This tenuous position provides decision-makers with a number of dangerous options, which include denial (ignoring the fringe), infatuation (ignoring the core) or misjudgment (using core methods to assess fringe behavior).

The first two are fairly obvious extremes that are becoming easier to avoid, but the last is a more nuanced obstacle worthy of further exploration.

First, because the online media environment essentially removes the element of forced scarcity, almost every business metric and tool traditionally used in assessing the broadcast business model no longer applies. So the primary challenge to broadcasters is determining what new methods to apply in the fringe business, while continuing to optimize traditional approaches in the core.

Next, if establishing this dual methodology weren’t tough enough, it’s also important constantly to monitor and manage the balance between the two components from a single vantage point, so that resources can be allocated effectively across the enterprise.

Complicating this yet further are the very different rates of change that the two sectors experience. As noted at the start, “new media” is constantly evolving while traditional broadcasting is fairly stable and mature. Thus proper management of the two processes requires quite separate temporal granularities in their respective analyses — akin to the skills required in piloting a kayak vs. a supertanker.

Apocalypse now and then

It’s also important to face the problem with as much clarity and veracity as possible.

This begins with an unvarnished acknowledgement of the circumstances, along with the realization that assessment alone is not enough — it must be followed by proper corrective action.

So we begin with fully understanding how brutal and deep is the Internet’s impact on all traditional media businesses, along with a candid admission of how difficult it is for traditional media to adequately react. (In fact, we’ve learned that traditional media may be hardwired to react poorly to such challenges, even when they do accurately perceive the approaching threat.)

A good example appears in a recent blog by the popular new media writer and NYU professor Clay Shirky, where he considers the newspaper business’s current travails.

Shirky quotes Gordy Thompson, a manager of Internet services at the New York Times, who said, “When a 14-year-old kid can blow up your business in his spare time, not because he hates you but because he loves you, then you got a problem.” And Shirky remembers Thompson saying this in about 1993.

Other bloggers, like Advertising Age columnist and NPR host Bob Garfield, have referred to the Internet’s impact on traditional media as “apocalyptic.” Even for radio — with its opportunistic and flexible nature that has staunchly weathered previous challenges — this implies an unprecedented trial ahead.

Here’s why I think these dire predictions may not overstate the case.

First, the Internet’s well known, intrinsic disposition toward free access to content makes it difficult for traditionally paid media to survive there.

This might lead one to believe that advertiser-supported media like radio should fare better — except the concurrent lack of scarcity that the Internet also brings simultaneously thwarts this advantage. Traditional media is thus attacked by the Internet on multiple fronts, and the most vulnerable — the daily newspapers — are already falling. Yet the process is far from over.

Perhaps the most dispiriting element, and the most seemingly difficult to address, is the dilutive effect that this transition may have on content creation. Consider that even under the most optimistic projections, no single successful online media offering will ever likely aggregate the revenues that an equivalent traditional (i.e., scarce) media service could.

Thus it is arguable that the critical mass required to produce high-value content will never be reached, unless the means of production also enjoy substantial cost reductions in the transition (possible, but probably not enough to make up the difference), or sufficient consolidation among service providers allow such resources to be re-concentrated (sounds painfully familiar).

Closer to home

To some, this presents the conclusion that online media is a monster that eats its own tail, and that the only positive endgame scenario is one in which some sort of artificial scarcity is reapplied.

But this is particularly unlikely in radio, where the “aggregation-produces-quality” argument is already hard to make. To wit, many Internet-only radio services, while only marginally funded, currently are providing service of higher perceived value to many users than is terrestrial radio. Unlike newspapers, the demise of which is almost universally lamented, the loss of services provided by many commercial radio stations would likely not elicit similar public outcry.

It’s critical to acknowledge that Internet radio is already a professional environment. This is not an apples-to-oranges comparison like YouTube competing with the TV networks. Many Internet-only radio services are beating broadcasters at their own game on content, presenting a large and growing number of online services that are highly valued by their listeners, against a few, largely similar and lower-valued (due to limited choice and excessive commercialization) on-air channels.

Broadcasters still hold the upper hand in platform penetration, of course, and therefore maintain a corresponding monetization advantage. But as this metric changes (and if nothing else does), so goes the fate of what we call radio. That change is already in progress, and is almost certain to naturally continue and accelerate, as we’re all coming to understand. If broadcasters do not adapt, their future — like newspapers before them — is sealed.

Sure, broadcasters can claim that Internet-only radio has no localism, no EAS or Amber alerts, little or no news, and no other infrastructure of immediacy or connectedness that radio has worked so hard to build over the years.

Unfortunately this argument rings a bit hollow today for two reasons: 1) Many over-the-air broadcast services don’t do much of this anymore either; and 2) Many listeners don’t put much value on these attributes anyway. What those listeners are looking for most of the time is a well-selected, -produced and -presented entertainment service tailored to their tastes, with little or no commercial intrusion.

If broadcasters can’t figure out how to provide such relevant service, they will become the Amtrak of Audio, ultimately relegated to providing a little short-haul service only when and where a lot of people want to go to the same place at the same time. Meanwhile, most of the traffic will choose alternate routes.

Skip Pizzi is contributing editor of Radio World.