MediaBuyerPlanner: Radio is still a “superb business,” despite falling ad revenues and a fierce competitor in the form of satellite, according to a new report from Credit Suisse analyst John Klim.
Klim claims the radio business is solid because there isn’t a lot of capital investment necessary to run it and it provides a steady stream of income, writes MediaPost. Klim believes that HD radio will not give a substantial boost to the terrestrial radio industry as a whole, however. He warns that the profusion of new formats and niche channels may simply slice the existing pie into ever-smaller pieces, which could disrupt the price structure.
Currently, at least, HD radio has failed to motivate consumers to actively participate in terrestrial radio to any great degree. In fact, according to a recent survey of 1,009 American adults by American Media Services, Klim points out that only 9 percent of respondents had heard “a lot” about HD radio. Thirty-six percent had heard “only a little,” and 55 percent hadn’t heard about it at all.
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