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HD Radio Licensing Fees Are Reduced

IBiquity also offers more flexible payment options

HD Radio developer iBiquity Digital hopes to get more U.S. radio stations to adopt its technology.

The company is lowering radio station licensing fees and expanding payment options; it says the 2010 pricing plan will simplify broadcasters’ migration.

The pricing model offers a broadcaster three payment options to air HD Radio on a main channel. A station can pay $10,500 when it signs its contract; it can be billed $11,000 net 30; or it can pay $12,500 spread over a year (that’s $1,042 per month).

That’s down from 2009’s rate of $25,000 for a one-time license fee, which with various discounts brought the price for the average station down to $15,000, a company official told Radio World.

Uptake of HD Radio among stations has appeared to plateau in the past year or so, a trend that has worried some of its proponents, including the FCC, which commented specifically on that while approving the recent digital FM power hike.

But iBiquity cites recent “major successes” for HD Radio, including receiver sales, auto adoption and consumer product rollout, as well as the recently approved FM power hike. There are about 2,000 HD Radio stations on the air, the majority of them FMs, with some 1,100 multicast channels. IBiquity says 15 automakers have announced plans to integrate HD Radio into their vehicles and that this year 80 vehicle lines will incorporate HD Radio receivers, 36 as standard equipment.

In making its pricing announcement, the company also described “heightened broadcaster enthusiasm” for HD Radio and “growing momentum.” Director of U.S. Broadcast Sales Rick Greenhut stated in the announcement: “Approximately one new HD Radio station goes on the air every three days.”

The company says 85 percent of Americans are now within reach of an HD Radio station, and more than half of U.S. radio listening takes place on stations that have upgraded.

“The multicast channel pricing policy remains unchanged,” Greenhut also told Radio World. “Stations pay either 3% of incremental net revenue derived through any means (data or over-the-air advertising sales) for each multicast channel, or $1,000/year (whichever is greater) for each multicast channel broadcast in addition to their main channel.”