In headlining his online column, Bob Struble used a phrase that often has been used by HD Radio’s critics.
The nation’s top HD Radio proponent (as head of iBiquity Digital, its developer), Struble topped his remarks with the words “HD Radio Technology: Show Me the Money.”
Struble says broadcasters are in fact starting to see that money now, thanks to sponsorships on HD2/3/4 channels from companies like Budweiser and Harley Davidson; music purchases through iTunes Tagging; the leasing out of spectrum; traffic info; and “capitalizing on the sports angle.”
“Stations that have begun monetizing HD Radio Technology often have line item budget objectives for HD Radio sales,” he continued. “We’ve seen bonus commission plans and sales contests to incentivize sellers at the station. Stations are bundling all of their digital assets by packaging their HD2 or HD3 with an online streaming sale and traditional over the air spots. These packages are sold to advertisers as a total digital sales solution.”
He says iBiquity has done “really, really well” at getting receiver sales going. And he went on to offer some “best practices” to HD Radio broadcasters.
“Make sure to encode HD Radio channels for PPM to capture listening. Sell the HD Radio channels, don’t just throw them in. You’ll set low value expectations which will be difficult to overcome. Limit spot loads. We have seen shortage and exclusivity drive attractiveness. And finally, let your creative and energetic people have fun with the effort.”
He also commented on his conversations with industry leaders during the NAB Show. “There is an interesting industry debate going on about when (and if) we will get back to the industry’s prior revenue levels,” he wrote. “2007’s $21.6 billion is often cited as the benchmark. Predictions ranged from as early as 2012 to as late as never.
“My view is it will take quite a while, because this downturn was the result of not only cyclical economic decline, but also secular erosion driven by radio’s new digital competition. I see that competition getting stiffer, so recovery will be tougher.”