While he can’t say much yet, Emmis Chairman/CEO Jeff Smulyan says the company is close to an official announcement about the initiative to embed FM chips in Sprint smartphones. When it does happen, he predicts it will be a “watershed moment” for the radio industry.
Smulyan’s personally talked with some 60 to 65 radio groups about the deal, he said. He didn’t discuss specifics of the agreement today, however we’ve reported it involves the industry providing some $15 million worth of ad inventory for each of the three years. Radio broadcasts would be delivered through apps like the one Emmis has built and calls NextRadio.
Asked for an update during today’s earnings call, the Emmis executive said there’s been “a remarkable outpouring of support” from the industry for the project, and he could only think of one broadcaster who turned him down. Apparently the contractual talks with Sprint continue and he can say more when those are concluded.
He did say when the effort is launched, expected to be later this summer, it would be important to have the industry united behind the effort. That’s why Emmis is including a way for even nonparticipating stations to have their logo appear in their market on the app.
Embedding an FM chip in a smartphone has the potential to change the industry “forever,” according to Smulyan, discussing what has become a more than five-year effort. When launched, if consumers love it, ultimately FM chips could be in 300 million cellphones, he predicts.
On the financial side, Emmis had the best quarter it’s had in a long time, said Smulyan, with radio net revenues up 6%, from $34.9 million to $36.9 million in its fiscal first quarter that ended May 31.
National and local ad revenue is up as advertisers rediscover radio, a trend that bodes well for the industry, he said. “Radio reaches about 275 million Americans a week. Radio works.” Advertisers realized they threw radio out of their buying plans because of a bad perception, but now they don’t want to buy newspapers or directories, so they’re coming back, he believes.