NAB Tells FCC Radio Losing Money to Digital

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The NAB has filed comments with the FCC regarding the Commission’s upcoming Communications Marketplace Report to Congress. In those comments, the NAB says the report “should reflect the proliferation of audio content providers and the vast options now available for consumers and advertisers in today’s audio marketplace.” An example the NAB uses to describe a fragmented advertising marketplace is one company it says lost accounts totaling over $100,000.

The NAB says that money formerly spent with radio and other traditional media are now being split with – or diverted to – multiple additional platforms. And the NAB says that money is moving to digital and that includes small markets. “Midwest Communications reported the loss of local advertising accounts worth over $100,000 each in several markets (including Duluth, MN, Fargo, ND, Wausau-Stevens Point, WI and Hibbing, MN) to digital services such as Pandora and Google AdWords. Through interviews with advertisers and ad agencies, Townsquare Media found that most advertisers across a range of markets now have, on average, three times the number of companies calling on them wanting to sell advertising time/space as they did a decade ago.”

The NAB says given the emergence and rapid growth of competing advertising platforms over the past decade, it is unsurprising that the radio industry has struggled to regain the total level of advertising revenue it achieved prior to the Great Recession.

Many radio companies have been using the argument that Google, Facebook and other online companies are taking away their ad dollars to push for more deregulation. In fact, the NAB is pushing a proposal to lift all ownership caps in smaller markets. However, the industry is not united on the deregultion issue and that may be a problem with a very radio friendly FCC, especially if Republicans do poorly in the mid-term elections and lose either The House or The Senate.

The NAB is asking that Commission’s Report to Congress on the communications marketplace should focus on how differently audio content is delivered and consumed today compared to the analog past. “This Report must make clear that local radio stations now operate in a vastly expanded and highly competitive audio market providing unprecedented choices for consumers and advertisers and that continuing technological change will create still more options for audiences in the future.”

Read the NAB’s filing HERE

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