That’s the name of automotive and analytics expert Roger Lanctot’s latest column on LinkedIn. Lanctot was reacting to Tesla’s latest optional software update on 2018 models that removes AM/FM Radio. He says Tesla’s decision “highlights the strangely tortured relationship between the broadcast radio industry and Silicon Valley.”
To this day radio still has a huge advantage in the dashboard of a vehicle. It’s free, easy to use and, in many cases, still local. However, as technology improves and that dashboard transforms into a computer, the radio has become just a piece of an infotainment system, and that worries some in our industry.
Lanctot says, “Google, Apple, and Tesla have all turned their backs on the broadcast radio industry in spite of the wide reach of radio – a reach that exceeds that of television – and the fact that it is free, localized content ideally suited to consumption in a mobile environment.” The radio industry hasn’t done itself any favors by overloading consumers with commercials in an era where consumers can simply change what their listening to with their voice. Lanctot wonders if Tesla is testing consumers, to see if they care if radio is gone and they’ll pay $2,500 for Netflix, Hulu, YouTube and Twitch.
Lanctot goes on to lay out the important questions: “Is this approach sustainable? Is it tolerable? Where can an outraged consumer turn to protest? Will there be consumer outrage? Should there be? Is it time for an in-vehicle radio mandate to ensure that emergency communications – at least – can be broadcast into cars?”
And he ends his piece with the words every radio executive wants to hear from an outsider: “I will say that the radio industry offers contextually relevant and reliable content delivery with a broad reach across a wide range of devices and listening environments. Deleting radio from cars – terrestrial or satellite-based – tears at the fabric of our social connectedness.”
Check our Lanctot’s article on LinkedIn HERE
While radio listening may be only slightly dropping, the ownership of radios in the home seems a bigger problem for the industry.
https://www.edisonresearch.com/radios-hardware-problem/
I listen to radio now more than ever, but haven’t owned a ‘radio’ in years. I stream it over my mobile, Google Assistant and Amazon Alexa. As mobile phones expand their bandwidth and voice assistant capabilities, consumers will have a seamless audio experience available to anyone with a smartphone, anywhere they are.
Between the decline in car ownership, self-driving vehicles, and 3rd party decisions like Tesla’s, it seems the future opportunity for the radio industry has to be in expanding the content experience to people throughout the day, and not just in their cars.
I would imagine in a few years, when 5G is everywhere, tuning in local station in cars using their streams will become incredibly easier than it is now. We’re now sort in the “FM Converter” stage as far as ease is concerned. Of course, when that happens, listeners will be able to access thousands of stations, along with lots of other streams. If you’re WBZ/Boston, how are you going to monetize the listeners you have in West Palm Beach? You probably can’t. Even when WBZ reached 38 states with their terrestrial signal (they probably still do), they couldn’t sell ads based upon their listeners in far away places.
The only way we can survive at KCAA is to deliver every audio service, every video service and every social media service that comes along.
What began as a little day time only AM station has evolved into a full service audio and video production company with three terrestrial frequencies.
Each time another pimple faced 16 year old “genius” has an idea for a new delivery system, we adopt it.
Let’s face it. Radio has lost it’s exclusivity and much of it’s influence and nothing we can say or do will change it. The barriers to entry have been reduced to the cost of a smart phone. Nothing we learned about radio or even imagined about the future of radio can help us chart a course into the future. All of us are in a new world.
Someone asked me, Fred, what are you guys doing to stay relevant in this age of the internet”… I instantly answered “everything”…
Hopefully, “everything” will be enough.
During the first 60 years of radio’s existence, radio manufacturers owned radio stations. They included RCA, GE, Crosley and a few others. The companies that owned radio stations had a vested interest in the technology and the devices that carried those radio stations, and vice versa.
That is not the case any more. Radio stations are owned by a bunch of companies that primarily own towers & transmitters, and create content. There is no connection or vested interest between those companies and devices or device makers. So for the last 25 years, we’ve seen the decline in radio device manufacturing and marketing. Until the smart speaker came along, there had been no new radios for over 25 years. But smart speakers are INTERNET radios. They don’t have antennas, and they don’t receive AM & FM signals from the air. So AM & FM radio companies are basically at the mercy of electronics manufacturers and auto makers, mostly from outside the US, to include the devices that allow the public to hear those radio stations.
As far as I know, the radio companies, the NAB, and the FCC have no real plan for addressing things like this. Radio stations don’t own their frequencies. They’re licensed from the FCC. So it seems to me that the FCC has a vested interest in keeping radios made and included in cars and other devices. Not sure if the FCC understands that or shares that view.
Overlooked is the economics radio brings to the table. Theoretically, one New York City Class C FM could have kept 8 million New Yorkers informed, safe, and proactive during the Sandy Hook hurricane disaster. One station — let that sink in.
Roughly speaking, it would take hundreds of cell sites to provide equivalent coverage. Superior coverage, high reliability, and distribution costs = radio.Sudden demand on a cell site brings it down. Follow on bulletins are impossible.
Why is radio getting the Tesla treatment? Industry demographics are one reason.. Many owners/managers are not far from retirement, with little desire to manage disruption and adapt.
These are great people, who have achieved much. But retirement is around the corner — not a time to rock the boat.
The CRITICAL lesson of Sandy Hook is that where content is compelling, millions of ears will tune to radio — (cell goes out if just one cell gets pulled down through demand in a given area). Radio is free, and a reliable emergency information provider.
Conclusions: Radio is everywhere. Radio is reliable coverage at low cost, with big reach. No other medium offers this ubiquity.
But overall radio CONTENT ain’t what it used to be. And radio doesn’t promote itself through industry nationwide periodic campaigns.
Radio can thrive with fresh ideas, new leadership, (including the long-timers) and managers. Until folks wake up and roll up their sleeves, radio is in the process of throwing away its incredible advantages. Radio sorely needs a kind of Manhattan Project.
I speak only for myself ; not for any company with which I am associated, and for which I have great pride. Just one person’s views, mixed with humility, and they might be wrong. But I am old enough to remember how great radio was and can be.
I’m not the most creative person out there, but even if I was 30 something owner/manager, what could I do with a traditional radio signal to compete with entertainment providers that are capable of providing on demand and tailored playlists?
I rode down the elevator with a young lady the other day with earbuds in her ears. I asked what she was listening to. She said christian music from Apple. I asked if she ever listened to regular radio. She said seldom. She doesn’t like the commercials. She just wants music. She did say she does sometimes listen to XM radio.
Another young lady who rides the bus in the evening with me is about the same age. For the entire ride, she listens to music via you tube. While listening to a song she’s searching and flipping through you tube results to find the next song or she has a playlist she chooses from. Never listens to over the air radio.
Our local university just purchased a nearby college station to make part of their network. The selling gm noted that radio is not something students are interested in. He also noted that his daughters never listen to over the air radio.
Is the above the norm or just antidotal evidence?
Hurricane Sandy Hook? Hurricane Sandy and Sandy Hook were two totally different things.
This is something we all should be watching. Here is another thought to ponder. The automaker now finds themselves at a leverage point. What happens if the automaker starts taking bids on who and what can be in their infotainment system? What happens if Google purchases exclusive rights to Ford for 100M a year or more? Would the consumer be outraged or accept their fate? Some will say it will never happen. However cord cutting did. Technology is the game changer. We need to look at what is happening to tv, and think about staying relevant and using new distribution systems that the consumer wants. The listener is the golden goose. Unless we deliver ears, we have nothing to sell. We need to pay attention to this.
Actually you may be on to something. Exclusive rights for the indash entertainment functions of the car.
This happened with satellite radio. XM and Sirius each had exclusive rights to the dashboard in certain cars. When the merger happened, the exclusivity remained. I have access to XM, not Sirius, in my Toyota, even though the companies are merged.
The difference with AM & FM is they’re not exclusive. They can be installed for free with no royalty or licensing agreement. That’s an advantage to AM & FM. HD Radio on the other hand requires licensing and a royalty.
No surprise here. Between electric motors and all the associated electronics, a Tesla is a (radio) jammer on wheels. Eliminate the radio and no complaints about all the noise on the new car owner’s favorite station.
More disturbing–on many levels–is placing “infotainment centers” in the dash. Tesla’s autopilot system has already killed several drivers, we don’t need more excuses for drivers to take their concentration off driving.
Radio is still a great choice for the auto or anywhere. The radio industry is not. The recent overhaul or demolition by iHeart is just one more example of an industry that is no longer focused on the listener. Its time to quit singing the praises of the “Radio Industry” because in total this group is making big mistakes and cutting their way to the bottomline every month. While Radio remains a great tool on so many levels, be careful confusing the Radio with Good Radio! It’s time to compete again and stop retreating or the competition is going to claim a major victory!