Music2: The Future of Radio (media futurist Gerd Leonhard)

Gerd Leonhard
Presentation at RadioDays 2007

Music 2.0 and the Future of Radio?
www.mediafuturist.com

Gerd Leonhard www.mediafuturist.com

Monday, January 21, 2008 1

Radio used to have a

Monopoly in
Attention!

Gerd Leonhard Music & Media Futurist www.mediafuturist.com

The problem is not the new
ideas - but how to get rid of
the old ones.

So let’s start there.

Radio today: competition coming from all sides

Social Networks and Blogs

Car Audio Systems

Wimax Music
Ipod
Podcasts
iphone
Satellite Radio
Mobile Music

What’s good about all this: Choice
What’s bad about all this: The Paradox of Choice

Me, September 2007

Friction is Fiction


SMS +41 79 79 353 84

Across the world, 1.1 Billion
People use the Internet, 1.4
Billion watch TV, and 2.2 Billion
use Mobile Phones

So HOW will RADIO be consumed in the Future,
and what is its value proposition (both for music and for audio)



The Net Generation:

I program my media
- it does not program
me!


The key drivers of Change
• Broadband
• Mobility
• Social Networks
• Blogs and User Generated Content (UGC)
• Total Fragmentation of the Audiences
• Globalization (and localization)
• Convergence


W e a r e h ea d i ng int o a a cc el e ra t i ng
c o nverg enc e o f A ud i o a nd V i d eo .


And in advertising

By 2008, online advertising
spending in the US is
expected to surpass radio
advertising spending


A few shocking facts from the U.S.


In the US: tuning
out of Radio is
guaranteed


Radio ad
revenues
are not
going
away -
they just
won’t be
growing.


and then comes...


‘How’ will matter less and less. ‘What’ will matter more and more


Remember when Radio had a

Monopoly in
Attention?


Consumers inevitably use the best
innovations that are available - legal
or not


three


Imagine a page, a button, a Canvas where
you simply put all the stations that you
want to listen to.
A canvas that you can always have with
you (see Netvibes, iGoogle), no matter
how you receive the content.

Radio fills the need
to filter Choice.

Consumers are, now more than ever before,
seeking consolidated, trustworthy content,
recognition and community - even more when it
comes to mobile and Internet entertainment

This is still the biggest
opportunity in Radio.

New technologies often disrupt ecosystems
but always make the market bigger


The De-Walling:
• Music formats will be either open or 100% compatible -
DRM is the past
• Music as a service will become a default setting, and
the ‘sell units’ paradigm is ending
• Creation of new revenue flows will be more important
than controlling distribution
• The People formerly known as Consumers are gaining
more power by the minute
• Music licensing will be drastically simplified

Isn’t Radio the definition
of Music as a Service?


Thanks to the Net Generation & the
Digital Natives,
Social Networks on the
Internet are the
Next Radio


Global Social Networking is already bigger than Radio in the U.S.


The People formerly
known as Listeners
(aka Consumers)


The Medium formerly
known as Radio


Soon, most of them will
get most of their ‘Radio’
via any digital network
- the Internet dominates

Why is your station not broadcasting on
Facebook, Lunarstorm, Sulekha.net or Orkut?


Because

In all Media, Push is
becoming Pull


Just different words for the same thing...

Broadcasting
Streaming Tubesocking
Public Playlisting
Performance Download
Listening Streamripping
PodcatchingCopy
Buffering
Caching Digital
Renting Phonographic
Delivery (DPD)

The most important development in the
Context of Radio Licensing is The
Flat Rate for Digital Music


And for Public Radio

The Net Generation will not
continue to pay a public
Radio or TV License without
archiving, time-shifting,
place-shifting and device
shifting - i.e. with build-in
DELIVERY options

The Reality is:

• The Internet is a Giant Copy Machine
• Digital Radio IS Distribution
• From the listeners standpoint, Digital Radio
MUST offer time / place / device shifting

which is... Distribution
• Case in point: RSS and the Google Reader


The bottom line:
In media, Friction is now

Fiction

Very soon -
listening IS receiving


A Logic Challenge

Radio is Free
Records / CDs are not

If the Internet is the New
Radio -
are Copies are ‘free’ ?


EU Radio in 3-5 years

• 100% digital (in all its variations), and 50%
converged with the Net
• All stations everywhere,anytime, any way
• Video and Audio converge
• Community features are a standard
• Geography fades, borders become soft
• License is both questioned and then expanded
(based on a Flat Rate for Digital Music)
• Advertising2.0 emerges
• Public Radio offers full archives on-demand


EU Radio in 10 years
• The term “Radio” simply refers to
‘curated programming’
• Public radio is the #1 curator of a huge
digital library
• The ‘Copy versus Performance’ (listen
versus own) distinction is over
• Everything is on demand - few or
nothing remains scheduled


The trigger factors:

• Highspeed Wireless Internet everywhere
• WiBro in the car
• 4G Wireless cell phone networks fully
deployed How
long?
• Radios with WLAN chips
• Cell phones with DAB receivers (and WLAN)
• Mobile computing devices that talk
effortlessly to each other
• Web5.0 as easy as a TV remote control

What is good about Radio?
What is good about Audio on the Internet?

***
*** **
• Free or feels like free
• Ubiquitous

*
• Easy to use for anyone

**
• Does not require engagement

***
• Trusted, professional curators

***
• Known brands

*
• Local context
• Strong tradition
• Great way to discover music

Radio’s Future is on the
Internet, with the Net
Generation, and with fully
integrated Content Delivery


The 5 Inevitables

1.Radio must support time-shifting

2.Radio must support space-shifting

3.Radio must support sharing

4.Radio must support interactivity

5.Radio must support community


Radio is a perfect fit for the experience economy


This is where the growth is


The new currencies in Media

• Getting (and keeping) attention
• Trust
• Influence
• Reputation


And advertising follows the trends of
mass-personalization
Souce: Booz Hamilton Report


From
Impression to
Relevance


Integrate the audience! Provide a
platform!

The NYT went ‘open access’ 3 days ago - after
maintaining a wall for the past 5 years (incl. RSS)


You must take Radio’s walls down,
too:
• Archive Access
• Web-based access on all platforms
• Radio as social medium
Don’t hide behind any wall.


Changes in the content industries

Content 1.0 Content 2.0
Distribution Attention

Shelf Space Mind-share
Mass Marketing Niche Marketing
Monolog Dialog
Influence &
Control
Reputation
Control Attention & Trust
Gerd Leonhard, Music & Media Futurist

So if I ran the circus, I would...
• Widgetize my radio stations (syndicate radio shows
via embedded players), turn them into channels on
social networks
• Turn my listeners into active network members, roll
out Engagement programs
• Offer archives of everything, no matter what
• Mobilize my radio station
• Demand extended licensing grants, and one-stop
licensing
• Lobby for a digital music flat rate
• Push converged service: audio, video, text
• Build my brand and become an EXPERIENCE

Music2: The Future of Radio (media futurist Gerd Leonhard)

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