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Radio Exec Says "Suckers Invest in Pandora"

February 14, 2011

Not everyone took a liking to our headline yesterday "How Pandora Plans to Bury Radio." Mary Beth Garber is the President of the Southern California Broadcasters Association. She called us out on the story and here, in full, we have printed her objection. Your comments are also welcome below her letter.

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Ed, even though your headline ("How Pandora Plans to Bury Radio") was somewhat facetious, you and Pandora (and the suckers they get to invest in them -- like the ones who declared that Sirius or XM would replace radio within 3 years.  Except for Howard Stern and his agent, who sold their shares the day after they got them, very few people made money on the shares.  Any long term investors lost most of their investments.) haven't considered two important things:
 
1.  The math.  They aren't invading the dash board anytime soon. There are about 240 million cars on the road.  In the average year, we sell about 13 million vehicles (the top was 17 million just before this last financial meltdown).  Very few of those vehicles are in-dash internet capable.  Even if half of them were (and they aren't), it would take nearly 20 years for the technology to attain 50% penetration.
 
2.  The localized human connection.  There are many reasons ipods and pure-play internet radio haven't replaced (or even much hurt) radio [at least, if Arbitron's over 100,000 PPM panelists are to be believed).  Chief among them is that radio provides a unique entertainment experience that goes beyond a music mix.  It's an experience that includes on air personalities and localized references and information (at least in most cases).  Even the JACK-FM "dj-less" format in LA has fresh, localized dialogue from JACK, locally selected music and promotions and on air references and comments by local listeners.  These are virtual neighborhoods that most listeners come back to day after day.  The neighborhoods are populated with personalities whose endorsements have turned local entrepreneurs into multi-millionaires.  These are things Pandora can't replicate.  And these are the primary reasons 93% of the population invites local radio into their lives every week.
 
I'm not saying Pandora and Sirius/XM don't have a place in the realm of audio entertainment.  It's fine for times when one wants a musical background with no interaction required.  Fortunately for radio and our advertisers, that is not as often as when one seeks the unique entertainment experience that local radio offers.  I'm also not saying radio doesn't have to find more and more ways to listen to and connect with its core listeners.  I am saying that that local, personal connection is one of the defining elements of what makes and keeps local radio's entertainment experience unique.  I trust that our radio stations won't ever lose sight of that.
 
Radio Ink has been very good about not publishing headlines that inexperienced, narrow-minded media planners and clients can grab onto as proof that "radio is dying".  Please don't start now.  Let's keep the perception and perspective straight.
 
Thanks for all you do for radio, it is appreciated.
 
Best regards,
Mary Beth Garber
President
Southern California Broadcasters Assn             
1849 Sawtelle Blvd Suite 543
Los Angeles CA 90025




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