COMPETITIVE MEDIA

Digital Audio / Satellite Radio



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AM/FM radio was the original portable electronic medium as technology migrated out of homes and into cars and onto transistor radios through the mid-20th century. Now online audio services and satellite radio have stolen some of traditional radio’s mobility thunder with delivery on multiple devices and capacity for each user to customize content or to receive unique content based on algorithms

Although it’s all sound, consumers and the respective industry segments differentiate among traditional AM/FM radio, digital audio/Internet radio services, and satellite radio services. The newer audio options have established a place in the media spectrum relatively quickly, appealing to younger consumers, early adapters, upscale adults – and advertisers, who are attracted to the expanded options afforded by satellite and digital/online audio marketing.

Digital Audio (Internet Radio, Streaming Audio)

  • Streaming media is multimedia that is constantly received by and presented to an end-user while being delivered by a provider. The verb “to stream” refers to the process of delivering media in this manner; the term refers to the delivery method of the medium rather than the medium itself.

(Source: IAB – Internet Advertising Bureau)

  • Streamed music (or other audio) may be played on a downloaded player on a compatible device or on a player embedded in the website from which it is streamed. Audio music streaming sources include Google Play, Grooveshark, iHeartRadio, iTunes Radio, Pandora, Rdio, Rhapsody, Slacker, Spotify, TuneIn.

  • Digital music technology records, stores, and reproduces sound by encoding an audio signal in digital form rather than analog form.

(Source: Media Review: Music Streaming Services Market Profile – Clearvoiceresearch, May 2014)

  • Pureplay radio services are webcasters that transmit only on the Internet; they don’t transmit simulcasts of AM/FM radio broadcasts. These may not be interactive (“on demand”) based on a ruling on royalty payments. (Arista)

  • Online radio’s monthly audience (pureplay/AM/FM streamed combined) is estimated at 180 million, representing 64% penetration of the U.S. 12+ population
    • Listening by P12+ over the past years have been substantial
      • 2011 @ 22%
      • 2012 @ 29%
      • 2013 @ 33%
      • 2014 @ 36%
      • 2015 @ 44%
      • 2016 @ 50%
      • 2017 @ 53%
      • 2018 @ 57%
    • 88% of America’s 12-24 year-olds listen online monthly
    • 73% of 25-54’s are online listeners
    • The 55+ audience is slower to adopt, with just under 1/3 (33%) penetration

(Source: THe Infinite Dial 2018 - Edison Research/Triton Digital)

  • An estimated 59% of persons 12+ (estimated 160 million) tune in to online radio weekly

(Source: The Infinite Dial 2018 – Edison Research/Triton Digital)

  • Digital radio continues to grow, partially as result of starting from a low base number, but also owing to adaptation among younger consumers and innovations in technology. Among pure-plays, growth is measured in sessions, not listeners like AM/FM radio.

  • On-demand streaming audio of music grew 59% from 252.38 in 2016 to a record 400.48 billion streams in 2017

(Source: Nielsen, 2017 Year-End Music Report, U.S.)

  • Among Americans who stream music online, aproximately half create their own playlists, while 35% use public playlists based on genres or moods

(Source: Nielsen 2017 Year-End Music Report, U.S.)

  • While music is a popular content type on digital or online audio, but spoken word programming, especially in podcasts continues to see growth.

  • The Internet audio pie is continually growing with increasing completion across platforms and contexts
    • Leading services are flourishing
    • Pandora continues to gain traction over Spotify based upon trends in The Infinite Dial 2018
    • AM/FM radio streams comprise an important element of online radio usage

  • 18% of Americans 12+ (an estimated 51 million people), live in households that have at least one Smart Speaker.
    • Smart Speaker ownership has more than doubled from 7% from 2017
    • Adoption is at a faster rate than the early days of the smartphone, which showed only 4% growth in a comparable timeframe.
    • 72% of adults own an Amazon Alexa but not a Google Home, 17% own Google Home but not Amazon Alexa and 11% of adults own both.
    • (Source: The Infinite Dial 2018 – Edison Research/Triton Digital – Podcasting)

      Audio Podcasting

      • A podcast is an audio program formatted to be played on the iPod and made available for free or for purchase over the Internet. The name derives from the combination of broadcast and iPod.

      • Podcasts are shows similar to a radio show that is produced by professionals or amateurs and posted to the Internet for download and listening or viewing.

      (Source: About.com)

      • In 2018 44% of persons 12+ had ever listened to an audio podcast, an all-time high – increasing from 40% in 2017, 36% in 2016 and 33% in 2015
      • A year ago, 18% of podcast listeners described the car as the place they most often listened to podcasts; this year, that number is 22%.

      (Source: The Infinite Dial 2018 - Edison Research/Triton Digital)

      • Approximately 73 million (26%) of Americans reported listening to a podcast in the past month in 2018 – nearly double from 12% in 2013

      (Source: The Infinite Dial 2018 - Edison Research/Triton Digital)

      • The majority of podcast listeners listen to multiple podcasts each week,with an average of 5 podcasts listened to weekly
        • Listen to 1 podcast per week - 18%
        • Listen to 2 podcasts weekly – 17%
        • Listen to 3 podcasts weekly – 13%
        • Listen to 4-5 podcasts weekly – 21%
        • Listen to 6-10 podcasts weekly – 17%
        • Listen to 11 podcasts weekly – 14%

      (Source: The Infinite Dial 2018 - Edison Research/Triton Digital)

      • Podcast tune-in source shifted significantly from computers to mobile devices in just one year (2013 vs. 2014). The shift continued, albeit more slowly, 2014-2015:
        • Access podcasts via computer/laptop
          • 2015 – 42%
          • 2016 – 34%
          • 2017 - 33%
          • 2018 - 29%
        • Access podcasts via smartphone/tablet/portable audio player
          • 2015 – 55%
          • 2016 – 64%
          • 2017 - 65%
          • 2018 - 69%

      (Source: The Infinite Dial 2018 – Edison Research/Triton Digital)

      • Streamed or online audio not seen as replacing AM/FM radio in the car. AM/FM Radio continues as the most used audio source in car over other audio options including owned digital music.

      (Source: The Infinite Dial 2018 - Edison Research/Triton Digital)


      Satellite Radio

      • Satellite radio arrived on the American scene with the September 2001 debut of XM Satellite Radio, followed by Sirius Satellite Radio in July 2002. The two competitors merged in July 2008 after it became apparent the sector couldn’t support two distinct entitites – now known as SiriusXM Radio.
      • Satellite radio services broadcast from satellites, with programming delivered primarily to vehicles or other dedicated devices. Programming is available only to those who subscribe to the service.

      • Satellite radio subscriber categories:
        • Self-Pay – individuals pay their own monthly fee
        • Promotional – Depending on how initial deal with an auto partner is structured, promotional subscriptions may or may or may not be “paid” by the manufacturer or a third party

    • Satellite service claimed 32.17 million subscribers as of Q3 2017
      • Self-pay subscribers were 26.986 million
      • Total subscriber growth of 119,000 was the smallest increase since Q4 2103.

    (Source: SiriusXM Q3 2017 Investor Report)