Broadcast Radio "Stale and Stupid" (August 24, 2004)

With the dinosaur corporate radio conglomerates controlling what you hear come out of the local broadcast sticks, music creativity has been stifled and is running some ten years behind the natural curve, sticking to soft modern rock, hot AC love songs, and hip hop sounds from circa 1994 while older listeners fed-up with stagnant classic rock and unrelatable gen-Y music, have migrated to satellite and Internet radio where they can enjoy the programming ideas local radio has been lacking and continues to lack.

XM and Sirius radio, though combined to form a paltry selection of 220 channels when compared to the infinite number of stations on the Internet, are giving the music afficiando outcasts a reason to turn on the radio for music once again, in their car, home, or anywhere they go.

Though satellite radio enjoys the advantage of being free from the shackeled mentality of the dinosaur broadcasters, it is far from being in the clear as long as the big broadcasters continue to wield several advantages for the poorer (those who can't afford satellite radio) music fans such as free use of the airwaves (though they are licensed by the government and must abide by the obscenity restrictions), the AM and FM bands on every radio manufactured, the ability to market themselves to get and keep listeners, and the ability to provide local public service news and information. Satellite radio, as of now, cannot do such as thing, but with XM's foray into local traffic reports, broadcast radio is crying foul and is trying to get them off the air by taking them to federal court.

From Forbes: "In a fair fight, XM Satellite Radio would capture a good share of the U.S. audience. Unfortunately, competition in the broadcast industry is anything but fair...

"XM's chief executive, Hugh Panero, proudly ticks off the new technology's advantages over traditional radio, which dates back 90 years: greater variety, clearer sound, better coverage, lower cost. And no advertising to interrupt the music -- none of the blaring and banal spots that fill almost 20 minutes of every hour on radio; freedom from homogenized formats or cookie-cutter playlists.

"Yet XM's geriatric competitors dominate the market in listeners, revenue and profits, nine years after the federal government first cleared satellite radio to compete. In fact, in that same period the old guard -- Clear Channel, Viacom's Infinity Broadcasting and other AM/FM giants -- has enjoyed a boom...

"For decades the radio industry has crushed incipient competitors by wielding raw political muscle and arguments that are at once apocalyptic and apocryphal. Radio station owners, who formed the National Association of Broadcasters in 1923, have won laws and regulations that have banned, crippled or massively delayed every major new competitive technology since the first threat emerged in 1934: FM radio...

"Radio's old guard has been as effective at thwarting the digital threat. Existing stations thrive on an array of perks won by radio operators, including free use of the airwaves (XM and Sirius, by contrast, had to pay almost $200 million combined for their spectrum) and an exclusive exemption from paying royalties to performers.

"But the NAB's real forte has been in the modes of attack and delay, persuading regulators and Congress to impose daunting restraints on the satellite rivals and stalling their debut for the better part of a decade.

"Meanwhile, earthbound radio is pushing its own digital service, a long-gestating and tepid alternative aimed at neutralizing the satellite threat: 'high-definition' radio, first proposed 14 years ago. It does nothing to expand reach or reduce operating costs, but it will add CD-quality sound to the same playlists and station lineups now on the air, for those listeners who buy the new HD radios that debuted in January."

Read this entire Forbes piece online here.