By Martha Sharan and Kelsey Pospisil
The airways are experiencing some wind gusts. A portion of advertising dollars once flowing into television and radio stations are beginning to change direction, and as that money shifts, it is creating some new prospects for the dissemination of news and information.
As of January 1, 2015, two key financial radio networks owned by Dow Jones & Company, Wall Street Journal Radio and MarketWatch, ceased operations. These radio networks provided business-news programming to hundreds of affiliates and millions of listeners nation-wide. But as trusted as these networks were to provide financial news and analysis, Dow Jones was seeing flat or falling revenue and sensing that as consumers shift some of their attention to digital media, ad dollars are going to flow there too.
With a 12% drop in revenue for the last quarter of 2014, the company decided to follow ad dollars to focus on digital media and product expansions in surrounding areas. Staff members received an e-mail on November 12, 2014, which media blogger Jim Romensko obtained. Dow Jones CEO William Lewis sent a memo that read in part:
The Wall Street Journal Radio Network, which includes MarketWatch Radio and provides content to affiliate stations in the U.S, will cease operations at the end of the calendar year. As we move away from the terrestrial radio business, we will continue to build out our digital audio capabilities and offerings.
In the U.S., Sunday Journal from The Wall Street Journal, which provides content to partner newspapers each weekend, will come to a close over the coming months. We have an extremely strong offering in the very successful WSJ Weekend and will continue to work to grow that audience.
“These divestitures and closures are part of a larger strategic realignment dating back to a management shakeup earlier this year,” according to Media Post’s Media Daily News. The product expansions Lewis refers to in his memo mainly take place in the digital space and include a new WSJ iPad app, a new WSJ+ subscriber program, a partnership with Evernote for the Journal and Factiva, digital expansion for Barron’s in Asia, expansion of WSJ. Magazine into Latin America, and a new WSJD Live tech conference.
Last summer, eMarketer predicted that mobile ad spending would see its largest increase in ten years and that by the end of 2014, mobile would represent nearly 10% of all media ad spending, surpassing newspapers, magazines and radio for the first time to become the third-largest individual advertising venue, only trailing TV and desktops/laptops.
This mobile trend will most likely give rise to the popularity of internet radio. Pandora, iHeartRadio, Tunein, and Live 365 are some of the sites attracting the most listeners. A year ago, Edison Research and Triton Digital published a study which found that the weekly audience for all forms of online radio is now 36% of all Americans age 12 and older, or 94 million nationally. The average amount of time spent listening increased from 11 hours, 56 minutes per week in 2013, to 13 hours 19 minutes in 2014. Overall, 66% of online radio listeners say they tune in via their smartphone.
But despite the growth in digital radio, the study revealed that traditional broadcast radio still dominates overall audio consumption, with 75% of consumers saying they turn to traditional stations to discover new music, versus just 48% for Pandora. Broadcast also prevails in in-car listening, with 58% of respondents saying they listen to AM/FM “almost all of the time” or “most of the time” versus just 6% for online radio.
So, it is categorically critical to note that terrestrial radio is 100% still alive and well. People will always drive to and from work. They will always have an interest in hearing about what will impact their purse strings and their heart strings. They will always want to know what’s going on with important issues locally in their city and state. Just because one mammoth company, with many other business interests, shut the door on radio does not inherently signify a nationwide movement.
Media blogger Tyler Moody echoes by saying, “I’m not here to say ‘radio is going away’ because I don’t believe that at all. But for businesses where radio is only a small part of a portfolio, I can understand why they would say ‘this now concludes our broadcast.’”
“I think part of the answer is to acknowledge that broadcast radio is a mature business, and isn’t going to grow at a double digit clip. Owners and investors need to understand that and be happy with what they have,” Moody states in a later blog post. “Produce better programming than the competition. Deliver some kind of value to your audience and they will seek you out whether it’s AM or FM or digital.”
What is, and always will be paramount, is having a powerful message. No matter the medium, if your message is strong, people will hear it.