Radio is the tried and true work horse of the media industry. We have always turned to it for company, helping us to get through our commutes, workdays and, of course power outages. We’ve relied on it for its stability and consistency. There have been what seemed at the time to be game changers before, like HD Radio and Satellite radio, but they haven’t, as it turns out, really done much to shift the core of the industry. But change really is coming, and as the internet and Wi-Fi have evolved most every industry, it appears likely they will help to fundamentally alter radio as we know it today.
We’ve been seeing steady growth and momentum in internet radio listening. According to the Pew Research Center for Excellence in Journalism, in 2011, one-third of all Americans (34%), or 89 million people, said they listened to either streaming of AM/FM stations, Internet-only services, such as Pandora, or both in the previous month. While impressive, the Radio Advertising Bureau says that 73% (adults 18+) of radio listening still occurs in cars, where internet radio has not yet penetrated meaningfully. Folks are connecting their smartphones through the speakers, but that number is still relatively small. What about Satellite radio? While XM/Sirius now has about twenty-four million subscribers, growth has been slow, perhaps because consumers are accustomed to “free” radio.
Change appears to be imminent as we are beginning to hear more and more about the “connected Wi-Fi enabled” car market. Not unlike the way we are seeing Wi-Fi on planes and trains, we’ll soon see it as a standard option in automobiles. Wi-Fi will mean listeners will be able to access radio stations on the web and across the country and the number of options available will be unprecedented. Tuning into local radio as we know it today will no longer exist – there won’t be any geographic limitations. What will this mean to stations who define themselves by their local markets? To stay in business they’ll need to figure out how to make sure they have solidified their value to local consumers or they’ll be replaced by other options that will.
And once wired and working, the “connected” car will set off an “app revolution” – listeners will be offered music, news, weather and traffic, celebrity gossip apps and more. Listeners have gotten accustomed to personalization with the rise of such services Pandora and Spotify. It seems quite certain now that this democratization of assembling playlists will spread more universally to all radio listening platforms and locations. The programmers will be the listeners themselves and an era of limitless choices will begin. Will “Traffic and weather on the 8s” be a thing of the past? Not if a listener chooses to listen that way. And what content providers will survive? Likely the ones who are savvy enough to offer more of the content listeners want.