The NAB has filed comments with the FCC regarding competition in the audio programming marketplace. It is part of the commission’s preparation of a congressionally-required communications marketplace report.
The NAB describes the audio marketplace, from its perspective, as “dynamic” rather than challenging.
The comments state, “While today AM and FM radio still account for 50% of daily time spent listening to audio sources for those ages 13+, well ahead of any other single audio platform, total time spent listening to AM/FM radio on a weekly basis has been heading downward.”
Several additional statistics pointed to paint a less-than-bright picture: “Teens ages 12–17 spend much less total time than adults listening to AM/FM radio and their listening also fell from 2014–2017. Consumers under age 35 also are considerably less likely than older ones to own radios in their homes.”
Much of the commentary involves laying out the current audio marketplace, of which the NAB notes that “digital technologies have significantly expanded the number of audio content providers and the marketplace choices available to listeners.”
This expansion within the marketplace has led to changes in the marketplace for both listenership and advertising. The comments likewise note that the ad market has seen similar seismic shifts with advertisers taking advantage of an explosion in digital advertising options that did not exist a decade ago. This has come at the expense of radio and, especially, print media.
It says, “The digital revolution has disrupted both the local and national advertising markets, as advertisers increasingly spend their dollars with online and mobile outlets rather than with traditional media outlets.”
And it adds, “AM stations face special challenges in attracting listeners and advertisers in markets of all sizes.”
A sobering takeaway is this statistic on scale: “… the local advertising revenues of a single digital company that just celebrated its 20th anniversary — Alphabet/Google — now exceeds the total local advertising generated by all commercial radio stations in the U.S. (and rivals the amount generated by all full-power commercial TV stations in the country).” Illustrating that weight, “Google alone earns close to 40% of all local digital ad revenues across all markets in the U.S., and Facebook and Google combined account for nearly 48% of all local digital advertising”
Concerning demographics, the comments say, “Local radio stations are facing real and growing challenges in attracting audiences in a fragmented listening market, especially among younger demographic groups.”
There is also an emphasis on streaming technology — both as a threat and an opportunity for individual radio stations and corporate groups. “Last year, Nielsen Music declared that streaming is ‘becoming a new norm.’ The numbers bear that claim out. An Edison Research survey conducted in early 2018 found that 57% of those ages 12+ (or 160 million people) listen weekly to online audio, up from only 2% in 2000. Weekly online listeners spend an average of 13 hours and 40 minutes per week listening to online audio, up from six hours and 13 minutes in 2008.”
It adds that the streaming trend is particularly strong with younger demographics. In addition, “While many more consumers still stream for free, the number of those willing to pay for music and other audio content from on-demand streaming or satellite services has grown quickly.” Plus, “SiriusXM is set to become a much more formidable competitor among streaming services with its proposed merger with Pandora … With the advent and expansion of streaming and satellite services, the audio marketplace has become more competitive and more fragmented.”
Though it shies away from making large-scale policy suggestions, there are some areas wherein the association urges that something be done. It points to traditional radio’s (and TV’s) community attachment: “Given the importance of OTA radio service in rural areas and small communities often lacking other media outlets, including locally-licensed TV stations, NAB and the radio industry are particularly concerned about the continuing competitive viability of small market radio stations.”
The full comments can be read here.