Even though the music wafting from the offices of SmartMedia LLC is standard-issue American pop, a disc jockey is rapping above the lyrics in a language far different than the Korean and Spanish normally heard in this building.
“It’s from Tel Aviv,” explains company president Eran Pick, after noticing his guest’s quizzical look.
“I’m from Israel, and sometimes I have a need to listen to sports, news and talk shows from back home — live — rather than wait for CNN.”
Roll over, Marconi, and tell Tchaikovsky the news.
Internet radio (the technology used in the Tel Aviv broadcast) isn’t exactly a fresh concept, even though only a small percentage of Web surfers actually bother to take advantage of the audio services available. Neither is cable or satellite radio, although it generally is part of a package that includes digital cable TV or a satellite dish.
What’s got people in the industry buzzing these days really could be the next great leap forward in broadcasting. Within months, radio audiences around the world will be able to install appliances — whether for Internet radio or for satellite radio — in their homes and automobiles that will dissolve borders and allow listeners to tune out commercials, silence, moronic talk-show callers and processed music for good.
True, the technology won’t be free. But for many listeners, a few bucks a month is a small price to pay for real choice.
“We’re going to flip people’s concept of radio on its head,” said Joe Capobianco, a senior vice president for New York-based Sirius Satellite Radio at last month’s Consumer Electronics Show. “Radio hasn’t changed in the last 40 years. It exists to deliver a certain demographic of consumers to advertisers, within a specific market.
“That’s why although there are some 10,000 stations in the U.S., there only are about four or five types of music played on the stations that aren’t all-talk, all-news and all-sports. … It doesn’t matter if you’re in Chicago, New York, Boise or Portland. People aren’t used to the same degree of choice now on the radio that has been available on cable TV for years.”
Capobianco was at the Electronics Show in Las Vegas to give buyers and media their first taste of satellite-delivered music on radio. Cars with specially equipped radios and antennas were picking up the musings of deejays that originated in a studio just above the heads of conventioneers, then were transmitted to Sirius’ New York headquarters and bounced off a satellite back to Las Vegas.
The same thing was happening next door in an exhibit sponsored by Sirius’ primary competitor, Washington-based XM Satellite Radio.
“Our whole mission is to bring radio back to the listeners,” explained Lee Abrams, XM’s senior vice president of content and programming. “We’re hiring people who have been in creative prisons, and now they’ve been let out. These people are smart and knowledgeable, and they wouldn’t know how to make bad radio.”
Programming executives for both satellite services appear to have been heavily influenced by the “underground radio” revolution of the late ’60s, when hippie-dippy broadcasters took advantage of low overhead and high fidelity at underutilized FM stations to play the kind of music conservative stations wouldn’t touch. The programmers also want to return to the days when disc jockeys actually spun records, spoke as if their thoughts mattered, and didn’t rely on jokes for their appeal.
“Most of our staff got into radio when it was great, and then research took over. And then Wall Street took over from that,” Abrams said. “The good programmers were still there, but no one wanted to hear what we had to say.”
When XM and Sirius launch their well-financed marketing campaigns early this summer, savvy consumers probably will roll their eyes in anticipation of yet another suicidal format war. After all, both companies offer about 50 channels of commercial-free digital music — in various genres and niches — and another 50 channels dedicated to news, sports, comedy and other entertainment.
No one wants to invest in another costly war of attrition, waged by high-tech geniuses too stubborn to agree on a single digital standard. By contrast, Internet radio already offers access to thousands of commercial, public and government-sanctioned radio stations from around the world, via home computers, laptops and component devices from Kerbango, RCA and iM Networks (formerly Sonicbox). All that’s needed is streaming software, easily downloaded from such services as Real Player or Microsoft Network, and an ability to sniff out the Web sites of interesting broadcasters.
“The benefits of Internet radio over traditional radio, and satellite radio, are that the number of stations is practically unlimited, and many companies already are investing in the broadband infrastructure,” said Pick, whose company also had a booth at the show, but one that wasn’t nearly as noisy or conspicuous. “Radio providers have a worldwide delivery channel they can piggyback on — the Internet. And unlike XM and Sirius, which have to build their own infrastructure, including putting those satellites into orbit, they’re not limited to 100-150 channels.
“In Japan, they’ve had great advances with 3G wireless technology, which provides the band width to deliver Internet audio over wireless networks. Once the infrastructure is established, wireless Internet radio will follow, but it’s about two to four years away in the U.S.”
Starting late next month, SmartMedia will begin marketing its DDL (Dynamic Digital Link) Player, which simply plugs into a phone line, connects to an amplifier and takes up about as much space as a DVD machine.
Customers with access to broadband or DSL lines only will have to pay a one-time fee of $200 for the ability to receive radio stations from around the world, providing each outlet has a Web site. Anyone who doesn’t have DSL can use the DDL console as an Internet service provider and pay a one-time fee of about $100, and $15 a month for the service.
The console hooks up easily to an existing stereo system, and digital organizers on the box help surfers locate stations based on country, genre and other categories. Once a favorite Web site is identified, listeners can bookmark the stations.
Because the technology is interactive, consumers also will be offered pay-per-listen options and other special presentations. Eventually, the technology will be integrated into other appliances, just like VCR Plus.
Internet radio would appear to be far less fearsome to traditional broadcasters than satellite services. As long as a local station maintains a Web site and access to a streaming infrastructure, its audience can remain intact. Satellite providers hope that consumers are so sick of today’s uninspired programming that they’ll immediately embrace their services.
Indeed, no one is more long-suffering — and stands to gain the most from Internet and satellite radio — than fans of country music. XM and Sirius plan to offer country audiences everything from Steve Earle and Gillian Welsh to Billy Ray Cyrus and the Dixie Chicks — just not on the same channel. Internet listeners can tune in to outstanding Americana stations, such as KOTR and KPIG, based on the central coast of California.
“We have nine rock channels, we have five country channels, four or five jazz channels and three classical channels … if it’s good, it will get on our air,” said Capobianco. “And it’s being presented by people who live and breathe the music. After Emmylou Harris performed a concert for our alt-country channel, as she did a few weeks ago, she went down and did a half-hour on MLBradio.com, which is produced for Major League Baseball in our studios, and talked about the Braves.
“The week before, Alice Cooper did the same thing, except he talked about the Diamondbacks. Among the channels that have advertising are CNBC, Discovery, A&E, Sci-Fi, SpeedVision and Outdoor Life, BBC World Service.”
Local broadcasters, sensing things could get ugly, fast, already are promoting such traditional services as local news and weather reports and traffic updates. Fact is, though, radio receivers likely will continue to offer access to the AM-FM bands, along with tuners that can pick up satellite or broadband services.
In the car radio of the future, listeners won’t have to guess who’s singing a particular song or its title, as informative digital readouts will appear automatically on a screen.
With Internet radio, “the same technology that’s used for cell phones and high-speed data can provide radio, so motorists can listen to stations from all over the world, or one station all the way across the country,” said Pick. “People love the fact that they can pick the games of their favorite team, no matter where they’re at. We also tested our product in the Russian community here, and it was very popular, because they could get all the news from back home.”
SmartMedia hopes to persuade traditional broadcasters that its technology ultimately will save them money, and help them find new customers.
“A radio station in Israel may have 1,000 listeners in the U.S., but that doesn’t help a store or gas station in Tel Aviv,” Pick said. “But the technology will allow us to substitute an ad for, say, El Al airlines into that space, for American audiences … or even target specific ads to different listeners, so two neighbors could be listening to the same station, but hear different ads.”
Over on the satellite side, at Sirius, Capobianco countered, “We’re focusing on subscribers, not advertisers.” At the Electronics Show, XM announced that 24 models of radio receivers would be manufactured by companies such as Alpine, Sony, Pioneer, Blaupunkt and Clarion (expect an added cost of $100-$150). Later this year, XM will be introduced in Cadillacs and roll out in other GM, Toyota and Honda models soon thereafter. Sirius has already signed agreements with BMW, DaimlerChrysler and Ford.
With its iRadio telematics system, Motorola already is anticipating the day when passengers in automobiles will have the same access to data and information as they do at home.
The system, likely to find its way first into Mercedes-Benz models, also facilitates capturing music on demand, downloading audio books, accessing e-mail and receiving real-time traffic reports.
Four or five years after the first units hit the streets, consumers will be able to buy radios that receive both companies’ services. Perhaps the most versatile receiver unit displayed at the show was Sony’s attractive XM-ready product. The tuner is expected to cost about $300.
“Sony’s plug-and-play device slips into a sleeve that’s attached to the top of the dashboard,” said Hugh Panero, president and CEO of XM, which is co-owned by General Motors, Clear Channel Communications, DirecTV and Honda. “It connects into the existing stereo system through the cassette slot. Once at home, you can remove the unit from its sleeve, bring it inside and insert it into a similar sleeve, which is connected to your component stereo system.
“That way, you can have XM at home and on the road.”
Or you can have the world at your fingertips wherever you are.
