A Brief History Of Broadcast And Satellite Radio
History and Summary of the Radio
Since the invention of the radio in 1906, radio-sound communication quickly developed into the first electronic mass media. Radio created unprecedented access to news and entertainment for a mass audience. Originally, radios were not accessible to the public as they were exclusively homemade, using a small piece of lead sulfide to detect signals. Coined “Crystal Sets,” these radios were simple and inexpensive, yet made tuning into a specific station challenging. During World War I, the radio was used for exclusively military communication. However, radios became mass produced after the war, inspiring in mass communication and becoming a staple in American households for entertainment and news. As radio transitioned, notable radio personalities and programming became pop culture references. Certain programs garnered a huge following. Individuals arranged their schedules to not miss their favorite programs. Radio gave space for specialized acts such as music, comedy, and vaudeville to reach a larger audience. According to Marina Koestler Ruben, “During World War II, nine in ten families owned a radio, and they listened to an average of three to four hours of programming a day, using it as their main source of news. ” Radio paved the way for television to take over by creating popular content and genres that television came to eventually claim. Quite quickly, “listeners became viewers” (Koestler Ruben), and by the 21st century, broadcast radio was no longer the quintessential American household staple. Recently, broadcast radio has extended into satellite radio programming. These programs are transmitted via satellite, thus allowing for national broadcasting. These programs are available on a subscription-basis and offer more stations that are commercial-free and tailored to listeners’ interests. The invention of satellite radio has ultimately led to the inception of music streaming services, which could be detrimental to the radio industry.
Where is Broadcast & Satellite Radio Today
Though the broadcast and satellite radio industry arguably remains robust today — with 271 million Americans tuning in weekly — the streaming industry has caused a setback in the radio industry. As digital streaming services such as Spotify and Apple Music attract a loyal subscription base, the radio industry loses out on viable audiences. Most notably, the radio industry is suffering among younger generations. According to Edison Research, “only 50% of the people in the age group of 18-34, (who were surveyed in 2018) reported to owning a home radio, which was a fall from 94% (2008)”. Despite continuously pulling in large audiences, leading media experts argue that the radio has to appropriately respond to the convenience of the digital era. One of the most significant challenges facing the broadcast and satellite radio industries today is the generational gap of those listening to daily broadcasts. According to facts drawn from Nielsen ratings, the largest amount of radio listeners come from Generation X (people born from 1965-1979), with approximately 80. 5 million Generation X listeners tuning in each month. However, that number lowers with millennials and Generation Z. These audiences generally favor popular streaming services, such as Spotify and Apple Music. Media researcher Gordon Borrell claims that the younger generations’ interest in digital streaming services are due to “relatively cheap pricing and high targetability”. Borrell argues that if the radio industry accepted rapid digitalization they would be able to adapt. However, he believes that the radio won’t be patronized long term, due to the fact that radio stations target their older listeners while consistently ignoring younger audiences. Digital streaming services are stealing these audiences — especially college students by marketing affordable deals such as Spotify’s college discount program.
Through lack of response to the digital era, radio industries do not guarantee premium content to its consumers. However, the radio industry still holds a significant amount of power in the United States — out of the 11,185 registered radio stations, radio advertising revenue was still at $17. 6 billion as of 2017. Despite a decade-long decrease in revenue, the radio industry is still a dominant force for advertising. Though still economically successful, the radio industry is primarily suffering because the media world has transitioned from measuring reach to measuring “engagement”. Younger users are more interested in engaging directly with the content they consume. Digital services such as Spotify and Apple Music provide direct engagement through curated playlists and interactive features. While radio may be reaching over 200 million people a month, the industry has not found a way to actively engage its consumers. Newer streaming services that cater to younger audiences are increasing their market share by offering convenience. Much like the television industry is suffering from digital platforms such as Netflix and Hulu, it is hard for the radio industry to compete with the original content of these new music platforms. And though radio executives argue that “radio has strengths that streaming cannot replicate,” streaming services are certainly trying — with Spotify acquiring two new podcast companies for their service. Automobile makers are now including Spotify and Apple Music on dashboards, thus eliminating the need to listen to radio in the car. These small changes have affected the present-day radio industry in terms of influence. Ultimately, the broadcast and satellite radio industry remains successful in terms of reach, but will need to adapt in order to fulfill the needs for content engagement. The streaming industry presents a formidable competitor to the radio industry; however, broadcast and satellite radio remains among the most consumed media in America. An appropriate-industry wide response that appeals to younger generations would facilitate more success.
How Radio is Used & Consumed
Radio waves carry information from a transmitter to a receiver. Information is typically applied to the wave through a process called “modulation”, which causes the wave to vary depending on the information it holds. The most common forms of modulation in radio are frequent modulation (FM) and amplitude modulation (AM). The carrier wave in FM transmission has a constant amplitude but varies in frequency, while the carrier wave in AM transmission has a constant frequency but varies in amplitude. Therefore, FM has less interruptions in its communication process, making it more reliable and trusted. FM and AM are both analog transmission systems, meaning that they both process sounds into stable patterns of electric signals that resemble sound waves. On the other hand, digital radio utilizes a system where analog signals (either FM or AM) are converted to digital signals, taking the form of numerical patterns. Satellite radio adapted from the AM and FM technology by creating a transmitter that orbits the Earth. These transmitter allow for satellite programming to reach audiences globally. Due to this advanced technology, this service is only subscription based and is predominantly intended for motor vehicles. Based on the technology, the differences between broadcast and satellite radio consumption lies in the transmission’s clarity and accessibility.
General Use and Audience
Radio audiences have changed as the platform has evolved. Starting with exclusively extremely specific and tailed programming such as live theater recordings, programs have transformed into many genres. These new programs cover topics ranging from education, comedy, sports, politics, and music. This allowed the platform to extend and relate to a broader audience. Relating to the shift from military use to mass audience programming, Americans listened to the radio for more than four hours a day during the 1930s. As popular radio programming emerged, broadcast began creating content that specifically targeted certain demographics. Broadcasters took advantage of certain time slots that would appeal to the demographic listening at the time. For example, broadcasters targeted housewives by creating soap operas during the day while they were doing house chores. Furthermore, evening programming was dedicated to news, live music, or vaudeville so families could listen together. Ultimately, the radio built communities and brought people together. Radio was also used as a political tool. Franklin D. Roosevelt delivered his “fireside chats” in which he would discuss his policies to deal with national crises during the Great Depression. This is the first example of a politician using radio to connect to its constituents. Radio gave Americans peace of mind during the Great Depression and paved the way for for televised political campaigns. A key distinction between radio and other forms of media is that you can multitask while consuming content, allowing audio to seamlessly fit into Americans’ busy lives, thus keeping broadcast and satellite radio relevant.
Main Companies That Use Broadcast & Satellite Radio
There are several types of broadcast radio including the most common commercial, noncommercial, and public radio. All of these varying types of radio broadcasting are either AM or FM radio stations. For major broadcasting, FM is more commonly used as it is less prone to interference. There are three major companies that dominate the broadcast radio industry: Entercom, iHeartRadio, Inc, and Cumulus Media, Inc. iHeartRadio is the largest radio station operator in the United States with 850 stations that brings in 270 million monthly listeners. Cumulus Media is the second largest radio station operator with 441 radio stations, and Entercom Communications Corporation is the third largest radio station operator with 235 stations that bring in 170 million monthly listeners. The satellite radio industry is an extension of broadcast radio industry, as the only differences between satellite and broadcast radio is the technology required. The use of satellites for radio was introduced to the United States as the clearer and static-free alternative to regular AM or FM radio. The satellite radio industry is dominated by two major services, XM Satellite Radio and Sirius Satellite radio. In 2008, these two companies merged to become Sirius XM Radio. Together, this merger made it the second largest radio business in the United States, with 18. 5 million subscribers. With a high barrier of entry for other companies to compete, Sirius XM Radio has formed a monopoly within the industry. The merger faced opposition from lawmakers and broadcasters, but eventually passed due to the argument that the industry is different due to Internet radio and other music streaming services. The merger allowed for Sirius XM to create a better subscription-based system for consumers.
Possibilities and Limitations of Broadcast & Satellite Radio
The future of broadcast and satellite radio hangs in the balance of avid radio listeners and the monopolization of the streaming industry. At the current moment, the majority of transportation vehicles “don’t have stereo systems that will accomodate a Smartphone or bluetooth connection,” which limits the amount of people who can stream from their cars. Broadcast radio benefits from this limitation, as stations often struggle to gain listeners as a result of streaming news podcasts. In addition, there is currently a legal discrepancy surrounding the rights to “royalties for music aired on digital audio and satellite radio channels”. The discrepancy forces listeners to either pay at a higher price point, or continue listening to broadcast and satellite stations. The high price point is an advantage for free broadcasting networks that generate the majority of their income based on advertisements and subscription models through a vocal media. Similarly to how Disney and FOX purchased ESPN, this could result in broadcasting networks to purchase streaming rights to music — which would cause opportunity for monopolization of the streaming industry. An alternative perspective asserts that the growing popularity of digital music and online podcasts could result in the collapse of broadcasting networks and satellite radio. There is a decrease of “in car usage” that concerns many broadcasting networks due to the lack of advertising exposure and lower subscription models. The main issue is demonstrated by Apple, whose software, CarPlay, “presents a challenge to satellite radio as it allows iPhone connectivity to the vehicle’s dashboard for easier access to apps, and music”. There is no solution for individual technology companies who find a way around paying broadcasting networks and satellite radio hosts for content. It could only spell the end of a platform that was unable to transition between the electronic and digital eras.
