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Is this Big Radio’s Digital Radio plan revealed?

An anonymous email landed in my in-box attached to a PDF file which, if authentic, seems to be authored by a major Radio group and outline high level options for Digital Radio.

Again, I can’t confirm the authenticity of the document and, as a result, I’m not going to share it with you or point you to it. But believe me, there’s lots of content here that will have industry tongues wagging.

The presentation, titled “Digital Radio Discussion of Options,” is dated August 29, 2005. It’s very thorough and thought-provoking and includes the following highlights:

1. A review of the current landscape of terrestrial broadcasting, including a projection that AQH persons will fall 3% annually between now and 2015. Meanwhile mp3 devices will explode to nearly 30% penetration over that same period and combination Satellite Radio/mp3 devices will be used by 10% of the population, 12-54.

2. An overview of a PR plan which includes actions and dates

3. A discussion of “delivery issues” for digital radio – that is, difficulties in coverage in some of the large markets. For example, coverage in the top ten markets is estimated to range from 96% in Houston to only 66% in New York. The document also illustrates this problem with a vivid no-reception crater in the LA market which covers the majority of Burbank.

4. A discussion and dismissal of the idea of a digital radio subscription model

5. An evaluation of several “partnership alternatives” as business model alternatives. For these, I’ll quote verbatim from the presentation:

1. Market Forces (Let it Run Wild) 2. National Partnership (Run by [two major groups specified]) 3. National Partnership (Run by New Entity) 4. Local Partnerships

Each option is considered at length – both pros and cons.

There are a few things clear from this document overall:

1. The authors are aware of the difficulties of having a different set of digital stations in every market grown organically according to “market forces.” They seem to recognize inherently that for our industry to use digital radio to knock more shares off each other only perpetuates a downward spiral.

2. The authors understand that radio must work together as an industry – and within the laws enforced by the Department of Justice.

3. The authors imply that some radio groups might collaborate to lead the rest.

4. The authors seem to jump to the conclusion that because erosion in terrestrial listenership is anticipated, the obvious solution is digital radio – a conclusion that does not necessarily follow from the premise.

5. The authors seem to indicate a degree of signal coverage in some of the major markets considerably worse than what I expected (although maybe I’m just ignorant on the matter). To be sure, anyone unloading a few hundred bucks for a brand new radio does not expect reception to go analog every time they drive into Burbank.

All in all, this document (if genuine) is a tremendously revealing glimpse at the thought process in the rarefied air of Big Radio boardrooms. It shows the hopes and fears of our industry in unblinking detail.

My advice to the creators of digital radio strategy is this:

1. Factor in feedback from the audience, especially the problems that this technology would presumably solve (if any) 2. Devise a content strategy that’s not just broad, but unique

Neither of those items are in this document.

Without those legs the chair will never stand.

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