Clear Channel Plans to Participate as a Program Vendor to New Motorola Service
Move over, iPod; Motorola plans to ship its second “iRadio” device to stores by the end of the quarter.
Radio World reported on the first such product under development in 2000. At that time the company was to combine an in-dash head unit with an Internet connection including text displays. But actually maintaining such a connection in a moving vehicle at that point in time “was a stretch,” admits David Ulmer, senior director of marketing for Digital Media Services at Motorola; and that product never actually shipped to stores.
Now Motorola believes its new iRadio will grab consumer’s attention better than both satellite or HD Radio – and iPods – alone. The device combines music with cell phones in a mobile environment. It features hundreds of commercial-free Internet radio stations that can be downloaded onto listeners’ cell phones, along with their own personal content – songs or spoken word content from MP3 files.
After downloading the content to their home computer, the listener loads their cell phone with music so they can listen to it using their cell phone or a car stereo via Bluetooth. When listeners charge their phone at night, preset Internet streams are updated automatically.
Motorola faces competition in the audio download space.
Verizon Wireless introduced mobile music download services recently to compete with the iPod. Sprint Nextel launched music download and streaming services last fall and Sprint and Sirius Satellite Radio customers who sign up can get 20 Sirius channels over their Sprint Nextel phones.
Motorola already has a relationship with Apple Computer, running Apple’s iTunes music distribution service on the first generation of its Rokr cell phone.
Clear Channel, too
Warner Music Group, Music Choice and Universal Music Group signed on to provide content for the iRadio service, which launches with 435 commercial-free channels; so did Clear Channel Radio. Clear Channel and Motorola announced the plans at CES and said they expected to sign a deal shortly, according to Jeff Littlejohn, executive vice president for distribution development at Clear Channel Radio.
The broadcaster plans to provide talk content and create custom music channels, so listeners can hear their Clear Channel Radio content “whether they’re underground in a subway tunnel or traveling outside their local radio market,” said Littlejohn.
Motorola learned from its early development efforts, Ulmer said, about using the Internet as an entertainment medium. “Internet radio is coming back,” he said; it’s growing and is a commercially viable alternative to terrestrial radio.
“We can’t maintain an Internet connection on the car while it’s moving, but we’ve devised a method to use the Internet on the cell phone using Bluetooth technology.”
Motorola has adapted Bluetooth wireless connectivity to make it work with digital audio and a car stereo, he said, rather than FM modulation or over-the-air streaming. Bluetooth technology doesn’t drain the phone battery and its range of 35 feet or so is well within the distance between the driver and the car radio, he said.
A transmission rate of 128 kilobits per second is in trials, he said.
The idea of iRadio is to make the cell phone a portable music player. A minimum of 10 hours of material can be buffered on the phone, or the user may buy an additional storage card.
The iRadio service is a software application individuals may purchase from their cell phone carrier; the application is “activated” on the user’s PC and cell phone, he said. Initially, the service will be available on Motorola cell phones; Motorola is introducing iRadio in its second edition of the Rokr cell phone, called Rokr E2. Eventually, the company believes other wireless carriers will make their phones compatible with iRadio.
The carrier will charge a fee, which will range from $7 to $10 a month, he said.
The car version of iRadio is a Bluetooth adapter for existing car stereos. “It allows your phone to take over the stereo selection,” said Ulmer. The adapter plugs in to the CD changer or the satellite radio port in the back of the in-dash head unit; it detects the phone if the phone is on in the car.
“If you listen to your cell phone as you turn on your car, you will hear iRadio content through your car speakers. Song title and artist information will now appear on the car radio display.”
If the user holds down the pre-set button, that particular content is tagged on the phone and PC. The Wish List feature, which Motorola says goes beyond satellite radio’s offerings, provides a way for listeners to buy the content later over the Internet or at a bricks-and-mortar retailer.
The device gives buyers more content choice than HD Radio or satellite, Motorola believes. “Radio has been spiraling downhill, with stations playing the same 12 songs,” said Ulmer, and the advent of multicast channels won’t change that, he feels. While new channels will remain commercial-free for a while, eventually advertisers will determine those program choices to some extent.
“Advertisers on radio are not supporting big genres like classic rock. Imagine what it’s like for unknown artists,” he said, referring to the number of new artists on the iRadio service.
HD Radio will be a hard sell “if it’s message to the public is, ‘Buy this $500 radio because it’s digital,'” he said. “The Achilles heel for traditional radio is they didn’t look over their shoulder and pay attention to the growth of Internet radio. You can’t just ignore technology because it hasn’t hit you yet.”
Also, satellite radio has a long climb to drive adoption rates, Motorola believes, saying the company sold more than 10 million cell phones in a recent month, with a total of about 800 million sales in one year, compared to about 9 million subscribers for both satellite radio companies combined.
One of the services that distinguishes traditional radio is local traffic; satellite radio offers new traffic services as well. Motorola is working on it, with plans to offer it on-demand for several cities.
Clear Channel has expanded the number of navigation system manufacturers and markets involved with its Total Traffic Network, for example. Littlejohn says the broadcaster supports the iRadio concept because it’s “an important addition” to the choices available to consumers.
One analyst believes Motorola is backing off its iTunes relationship in favor of this new offering. Nitin Gupta of the Yankee Group told Yahoo News it will be interesting to see how the phone company markets iRadio “given that it competes with existing music services offered by Sprint, Verizon and other carriers.”
Gupta inferred that iRadio might be more cost-effective because bandwidth is less expensive on the PC than it is on the wireless carriers’ networks.