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Facebook Live Audio – So What?


Cue the panic in the radio streets. Facebook is moving into the audio space by making available a publishing tool called “Live Audio.”

“Should you be worried?” asks Radio Ink (which should be in a position to answer that question rather than ask it).

First, let’s acknowledge the utter inevitability of this announcement. Facebook’s job is to extract dollars from potential advertisers who value the platform’s virtually infinite and addressable audience and want to reach them in every possible channel. To ignore audio would be leaving money on the table. And that’s not Facebook’s style.

Second, “live” is a matter of definition. If you are repurposing an existing show, there’s nothing “live” about it. If you are listening to a show previously recorded, it’s not “live.” My guess is that once this platform matures, little of what’s on it that matters will actually be experienced “live.”

Third, it’s pretty clear to me that music radio stations would enjoy licensing issues aplenty if they use this service since, like Live Video, it records the “broadcast” so it can be later heard on-demand. That would make Live Audio more analogous to what we now call “podcasts.”

Fourth, Live Audio has the potential to dramatically improve consumer access to on-demand content. Part of the reason why podcast usage is still relatively low is that the technological hoops discourage consumption. But Facebook is a familiar platform where the audio would become a “speed bump” in the newsfeed just as video is today (and just as satellite radio is for anyone buying a new car). And that speed bump will be crossed by every Facebook user at one time or another. In other words, on-demand will become less about “seek and find” and more about “accidental collisions.” And those happy accidents will increase listener exposure to and interaction with on-demand audio. These “happy accidents” are how every successful radio show is built, I might add. On-demand audio will become less about 'seek and find' and more about 'accidental collisions.' Click To Tweet

Fifth, Live Audio will become an important complement to traditional forms of podcasting. For example, what if most consumption to your show comes via Live Audio rather than the RSS feed which drives your podcast? What if Live Audio becomes more important than iTunes? Then you no longer have a “podcast” per se, you have a Live Audio show, right? Indeed, this echoes a theme I have long argued: “Podcasts” are a form of audio rather than a platform all their own. The SHOW is the unit of focus, not the distribution channel.

Sixth, how would this possibly impact traditional radio advertising? Unless you have a viral hit on your hands, the only way this audio will be widely heard is by your brand paying Facebook to distribute it. In effect, Facebook becomes the new radio station and you are the client. Why would your advertisers choose to spend their money on Live Audio shows whose producers need to pay to promote their own shows to achieve the scale you get for free?

Here is a very peculiar argument on how Live Audio would be “bad” for radio advertising:

Facebook [Live Audio] could kill radio’s key financial advantage: how much it charges for ads. If digital audio advertisers are buying ads in Facebook Live Audio broadcasts, this can only hurt radio’s bottom line. As Recode reported in November, only Facebook and Google experienced growth in digital advertising in the first half of 2016. Every other digital advertiser combined experienced a collective 3% decline. Let that sink in. Meanwhile, audio advertising rates have skyrocketed. The Columbia Journalism Review noted that, “Podcast ads are selling for $20-$45 per thousand listeners — a number known, in ad-sales parlance as CPM. That’s far more than either radio, network tv, or web ads, which tend to have CPMs in the $1-$20 range.” So please, if you think migrating to Facebook Live could kill your advertising niche, don’t start using it.

I don’t know where to begin.

First off, Facebook’s and Google’s ad growth have helped stall traditional radio advertising but have hardly killed it.

Second, advertisers will pay Facebook for broadcasts, not for spots. In other words, this is more of a content marketing play for major advertisers (who largely lack audio content marketing anyway). Thus, the real market for Live Audio is not Coca-Cola and Ford, it’s vanity publishers and folks with a stake in podcasting who want greater distribution for their shows and are willing to pay for it.

Third, show me the local radio advertiser who would rather place their spot on a Live Audio broadcast than on a local station. Go ahead, I’ll wait. On the other hand, if I’m This American Life and I can be heard via Live Audio in addition to the radio and my podcast, now advertisers are interested. Because the brand and the audience they care about have just gotten a lot larger and is worth a lot more. That’s a great strategy if you’re TAL, but not so great if you’re a lesser show that doesn’t have scale already in your favor. For those shows, the publisher will be the advertiser and Facebook will be only too happy to take their money.

Fourth, it’s absurd to compare the CPM for podcasters with specialized audiences and unique programs with the CPM for network radio and web ads where audiences are commodities and ad inventory is limitless.

Bottom line: Live Audio has the potential to change the future of on-demand audio and create a lot more listening to “podcasts” without people even knowing they are listening to “podcasts” (it’s about time). But it has little potential to disrupt the audio advertising pool that drives local radio.

Will Live Audio further disrupt the amount of listening dedicated to local radio? Of course, but every radio alternative disrupts radio listening at the edges. So what else is new?

Live Audio is much more interesting for America’s most popular podcasts and any publisher with the urge and the resources to promote their audio show. For the rest of us, not so much.

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