Commercial Radio Considers Combining Efforts on Multiple Digital Channels
The ability to air several digital streams of programming is an alluring one to broadcasters accustomed to thinking of one radio station as one channel.
How stations might use the additional channels – to make back their money on the cost of converting to digital, and beyond – is being discussed by commercial radio groups among themselves and with suppliers.
While public radio has long had the lead on the concept, commercial radio is starting to pay attention.
Business models for auxiliary data uses of HD Radio are not firm, for a variety of reasons, according to industry experts.
Radio World reported from the Consumer Electronics Show in January that several commercial radio groups with investments in Ibiquity Digital are looking at the data services possibilities enabled by HD Radio technology, including multi-channel audio, and that the groups might at some point combine their efforts (Feb. 16, page 1).
At the time, Jeff Littlejohn, executive vice president of distribution development for Clear Channel Radio, said all the groups are looking at supplemental audio, including his company. “We’re all trying to figure out how to make this work.”
Radio One Chief Financial Officer Scott Royster predicted collaboration in the industry, “because it does not make sense for every radio company to go out and do its own thing. We’d end up just beating each other up.”
‘Free’ vs. ”pay’ radio
The potential value of multi-channel radio is making an impression at the management and finance level.
Executives began dropping mentions of multi-channel audio during their quarterly conference calls with financial analysts in February. A common theme is that airing specialized formats might be an attractive way for “free” radio to combat “pay” or satellite radio for audience.
Entercom CEO David Field, releasing company financials, said it’s too early to speak about specific ways to use auxiliary data capabilities of HD Radio. But he said a “consortium” that could roll out programming for new channels at an attractive incremental cost “opens up some interesting opportunities for either a subscription-based or advertising supported vehicle” to deflect the appeal of other radio services.
NPR already plans to give affiliates four programming streams by June. These would be free to its affiliates for their second-channel use. The formats are jazz, news/talk, classical and a fourth, with format yet to be announced.
Experts say one 96 kbps FM channel could be divided into up to eight streams of digital programming, including a main channel and seven others.
Harris broadcast executives say that, in discussions with customers and others, they are hearing these ideas being discussed, as well as others such as on-demand functionality or a TiVo-like service for radio.
“One of the more interesting ones we’ve heard about is the ability to push a button on your radio when you hear a song that you like, know it’s going back to a central location where they send you an MP3 of that song to your home PC and then charge you for it,” said Tom Jones, director of radio transmission products for Harris Broadcast.
Another possible use for the new channels is on-demand traffic and weather services, which would allow stations to compete directly with the satcasters. Sirius and XM offer on-demand traffic and weather in some markets; the channels are available to all subscribers.
“Rather than waiting for a certain time, such as 10 minutes after the hour, you can get it instantaneously the minute you want it,” said Jones.
Ibiquity Digital offered such a display at CES, showing how a station broadcasting a digital signal could send information to a vehicle’s navigation system. Several sources pointed to on-demand traffic and weather as an example of a possible subscription service.
Such a service also would allow a station to “re-purpose” content, lowering costs to produce the channel, said Rich Redmond, director of broadcast systems for Harris.
“The station already owns the intellectual property; they’ve done the local weather in the newscast,” he said.
Multi-channel in TV
Al Kenyon, formerly an engineering executive at Clear Channel Radio and now a senior technical consultant with Denny and Associates, offered what he called a rough comparison of what radio could do. Some commercial television stations, he noted, are using a portion of their digital bandwidth to provide weather.
Using the NBC television affiliate in Washington as an example, he said, “NBC thinks (the concept) has some legs because they’re trying to compete with The Weather Channel by delivering directly to their affiliates to the digitally-equipped home.”
He cautioned that acceptance of this concept or of multi-channel services for radio is to be determined, as there are few digital receivers in the hands of consumers.
Radio ownership groups are mindful of using their multiple digital channels to deliver services that make good business sense. Royster noted that publicly held groups must be accountable to shareholders in whatever they decide to do.
CPB also is thinking about the cost, having asked public station executives for ideas to develop the multi-channels last fall (Sept. 8, 2004, page 14).
While several public radio station managers are eager to put on Supplemental Audio Channel formats that would be unique to their markets, Luis Guardia, senior director of media technologies for CPB, said that after discussions with colleagues and station personnel over the past few months, public radio must be mindful of expenditures.
“In the near term, I think our aspirations for SAC may need to be tempered with practicality. Therefore, SAC applications may have to be low cost as you consider that the digital radio audience is just starting to grow, and will need to get a sense of how SAC services will affect public radio’s current business and operational model.”
He said, “As more stations adopt news/talk formats in lieu of music, SAC also presents the ability for stations who abandoned one format to bring it back on SAC. Also, re-purposed materials and formatted music streams may provide cost-effective solutions that are not music-based.”
That is important because the more the digital signal is divided, the fewer available bits are available to carry data for each channel.
NPR, Harris and Kenwood initially divided the stream into a 64 and a 32 kbps channel for the so-called Tomorrow Radio concept. This summer, codec tests showed it was possible to achieve two high-quality channels, plus up to four additional voice-grade channels with minimal interference to existing analog radios, according to NPR.
Ibiquity prefers to see the bit rate maintained at a certain level, so if music is played on the supplemental channel, it has high audio quality, experts said.
In general, commercial radio groups and public stations are cautious when speaking about their supplemental audio channel plans and what they intend for HD Radio data services. Competitive issues are involved; and how IBOC data services might shake out remains undetermined in many areas.
Receivers must be available to decode multiple digital channels. Boston Acoustic plans to ship a tabletop HD Radio that can decode a second channel this spring; Kenwood has said it would be ready with product when the FCC approves supplemental channels.
IBOC proponents hope the commission approves supplemental audio as well as other outstanding digital radio issues by mid-year, though there is no guarantee of that. In early March the agency clarified that stations can seek experimental authorization to split their digital signals and then submit test results to the FCC.
Also undetermined is whether the agency would place any restrictions on the use of additional channels such as a base channel size and/or other radio rules such as programming or ownership restrictions.