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The Radio Gypsy’s Predictions for 2007

A No-Nonsense Marketing Smart Tip January 17, 2007

I don’t know how I ended up here, sitting at a small round table across from “Bella, the Gypsy Fortune Teller.” I had lost my way and stopped at this ramshackle storefront to ask for directions. I was taken aback when she said “Ah, I was expecting you.”

And so it was that I was having my fortune told. But, uncomfortable as I am with such things I thought I would cleverly shift Bella’s focus from my personal future to the future of the industry in which I work. She wanted too much money for that – “I charge Wall Street thousands for those readings,” she told me. So we settled on what’s ahead for radio in the next twelve months.

Maybe Bella the Gypsy’s predictions will come true, or maybe she was just working me for a $20 bill. Maybe she was in a demented haze, thanks to that half-empty bottle of gin by her side. We’ll see. In January of 2008.

The Radio Gypsy’s Predictions for 2007

1. After an on-air promotional campaign valued over $400 million, there will be between 1.5 and 2 million HD radios in the U.S. by the end of 2007. There will be nine times as many satellite radio subscribers and many times more listeners of Internet and terrestrial radio (“See Bridge Ratings for the latest projections,” Bella added).

2. The Internet will continue to penetrate the mobile phone market and will finally enter the automobile. And with it will come the potential for an all new – and potent – threat and/or opportunity for radio.

3. XM and Sirius will announce a merger. And they’ll include a spoonful of sugar to make the medicine go down with federal regulators.

4. More broadcast groups will go private. Because the only thing Wall Street likes more than double-digit profit growth is a wholesale change of ownership and all the commissions that ensue.

5. Radio stations will awaken to the value and the power of online listener communities. The “social” aspect of the Internet has largely been lost on radio stations which tend to limit their social integration to a MySpace page. More stations will turn their “databases” into community vehicles, where listeners register and interact with each other. The dialogue will go in all directions rather than one way: From station to listener. Listeners will join in order to link to other listeners and revel in the joy of their favorite station, not strictly to enter a contest and collect email “blasts.”

6. Radio advertising works and radio stations know it. Look for stations to experiment with accountability techniques designed to vividly measure and demonstrate the success of advertising and marketing efforts on behalf of clients.

7. The market for programming talent outside of radio will spark. Suddenly companies not in radio will be competing with radio for the ears of an audience – and those companies will need talent behind and in front of the mic. Stringing together songs is easy. Knowing what to put between them is a skill.

8. Despite plenty of kicking and screaming, PPM will become the obvious future of radio station audience measurement.

9. Audiences will choose smaller and smaller “hives” with which they have much more in common. And they may not be on the radio. These hives will have social interrelationships that go well beyond anything radio is currently experimenting with. The internet will facilitate “stations” for book clubs and high school classes and bowling leagues, all of which will compete with conventional radio for “ear-share.” It will not be about a narrow slice of music, but rather about a deep slice of listener culture.

10. As specialized as these hives are, they will not be able to provide top drawer talent any more than a local TV show can out-talent Jay Leno and David Letterman. Radio will increasingly look to stars to set themselves apart. With this will come greater risk and greater reward. When all the music sounds the same, that which isn’t music will burst through the noise.

11. Radio stations will hit their emotional bottoms and determine that making more money in the future will require spending more money in the present. They will wake up to the reality that investing in their brands will make the difference between long-term health and long-term obsolescence.

12. Apple has already announced an iPhone that features WiFi capability and full wireless access to iTunes. Before the year is out Apple will announce new models of their runaway bestselling iPods with the same WiFi capabilities. The good news is that listeners can stream your station anywhere in the world. The bad news is that listeners can stream any station in the world from your market. This will add considerable frictional competition to local radio stations on a platform that will be fairly ubiquitious, familiar, and completely portable. Much like radio itself.

13. Streaming will become mandatory for all radio stations. Stations will actively market and promote their streams. Stations will produce multiple streams – even if they siphon audience away from the “mothership.” Stations – and agencies – will increasingly see that ratings – of any flavor – will become less important while the the depth of a station’s reach and its ability to achieve results for its clients becomes more important.

“Are you sure about all this stuff,” I asked the Gypsy?

“Well,” said Bella, drinking deep from that bottle of gin and wiping her sleeve clear across her wet face, “some of it is just conventional wisdom, but the rest of it has the ectoplasmic ring of truth.”

“Then again,” she added before teetering off her stool, “maybe my spirit guide took a wrong turn.”

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