Sample and Hold
As the HD Radio roll-out progresses, many broadcasters and consumers question the business model that makes converting to HD Radio a worthwhile investment. The common argument is that just because it's digital doesn't mean that a station will be able to charge more for advertising.
While this basic idea is true, there are other elements to HD Radio that could bring additional revenue to a station. In January, Kagan Research announced its projections for HD Radio station revenue in the year 2008. These figures are based on four additional services that stations could offer.
Multicasting. The added HD2, HD3 and other program streams can generate revenue in the same way that existing analog streams have through traditional advertising sales.
Advertising-supported "now" channels. These would also be placed on multicast streams but would use niche and highly formatted local information such as all-the-time weather reports, all sports, all traffic or all local news.
Datacasting. Revenue is expected to come mostly from leasing the space to a third party.
Fee-based radio. This follows a model like that for satellite radio and other subscription services.
|2008 Revenue Source||Forecast Revenue ($million)|
|Sponsored "Now" station||152.02|
|Total HD Radio Revenue||805.19|
|Total Radio Revenue||22,269.22|
One hypothetical model for a station to allocate its 150kb/s spectrum for the multiple services is as follows: 55kb/s for an HD1 channel, 55kb/s for an HD2 channel, 12kb/s for a “now” channel, 8kb/s for datacasting and 2kb/s for a subscription-based local traffic report channel. This allows an additional 18kb/s for another use or to be reallocated into the example list.
By 2008, Kagan Research forecasts that terrestrial radio broadcasters will earn $805.2 million (4 percent) of their total revenue from HD Radio. The table shows the projected revenues from these services.
Source: Kagan Broadcast Investor: Deals and Finance, January 2006
Acceptable Use Policy blog comments powered by Disqus
[an error occurred while processing this directive]
Today in Radio History
The history of radio broadcasting extends beyond the work of a few famous inventors.
EAS Information More on EAS
The feed provides feeds for all US states and territories.
Need a calendar for your computer desktop? Use one of ours.
Information from manufacturers and associations about industry news, products, technology and business announcements.
Staying on-air is priority #1, but 100 percent redundancy comes at a cost.
Browse Back Issues[an error occurred while processing this directive]
Also in the November Issue
- Music is Everywhere at WTMD
- FCC Looks to Update RF Exposure Rules
- Government Shutdown Causes FCC Delays
- Applied Technology: Wheatstone baseband192
- Side by Side: Video Cameras
- Exploring More from Google Earth
- The History of W9BSP