Why digital radio?     Patrick Hannon15th March 2012, Barcelona
Contents           1 Radio today           2 Benefits of digital radio           3 Keys to success 2
The world in which radio competes is changing     Digital music services with power to disrupt                            ...
Across Europe, the footprint of digital radio is expanding       Norway: DSO                                    Sweden: pl...
Newer territories can benefit from the experiences of othermarkets                                     Benefits of experie...
Contents           1 Radio today           2 Benefits of digital radio           3 Keys to success 6
Listener benefits can be classed in three areas                                    Consumer                               ...
Digital radio offers listeners significantly greater choice      Sydney analogue services            Sydney digital servic...
Providing a range of new speech-based services…              Germany                     Australia               Hong Kong...
… and music services designed for the tastes of specificaudiences          UK                  Australia             Germa...
Existing radio groups can retain share on digital radio    Share of listening by platform, %          AM / FM services (si...
How can digital radio build value for commercial broadcasters?                                   Strategic options     1  ...
First, digital radio can enable broadcasters to extend theirgeographic coverage – potential to create national brands     ...
Second, broadcasters can use digital to extend their brandportfolio     Analogue and digital               Digital-only se...
New digital-only services have increased Absolute’s listeninghours by 60% in two years Absolute Radio, weekly listening ho...
Third, broadcasters can enhance the user experience – forexample through colour screens                        Revo Axis  ...
Stations in UK, Germany and Australia use colour images toprovide information and cross-promote services17
Looking ahead, smart radio (broadcast and IP) will provide newlistener benefits - and create new revenue opportunities    ...
New song – no longer a passive relationship                                              • Hear new song on radio         ...
Listen later – on any connected device                                         • Listening to programme                   ...
Hybrid radio gives access to online and mobile marketing budgets                                          • Hear ad on rad...
Contents           1 Radio today           2 Benefits of digital radio           3 Keys to success22
Collaboration between various industry groups, government andregulators is essential                        Policy and    ...
Thank you                  Patrick Hannon     VP Corporate Development Frontier Silicon        patrick.hannon@frontier-sil...
The BBC has also seen significant benefits from co-branding,cross-promotion & smart scheduling    Radio 7 / Radio 4 Extra ...
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03 15-1200 patrick hannon - going for a digital future

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  • For RX makers it is a key to have a worldwide marketThis is the only way to offer radios for a solid price and to continue the evolution of radiosWe are still having too much hesitations, it would be beneficial for the industry to have a common European approach, DAB/DAB+ implementation everywhere, consolidated definition of radio types (e.g. WorldDMB profiles) and similarity on the transmitted information and data
  • 03 15-1200 patrick hannon - going for a digital future

    1. 1. Why digital radio? Patrick Hannon15th March 2012, Barcelona
    2. 2. Contents 1 Radio today 2 Benefits of digital radio 3 Keys to success 2
    3. 3. The world in which radio competes is changing Digital music services with power to disrupt •Media consumption habits are shifting -especially younger listeners •Greater competition for advertising revenues •Analogue radio has limited ability to innovate 3
    4. 4. Across Europe, the footprint of digital radio is expanding Norway: DSO Sweden: planning planned for 2017 for DAB+ UK: 40% have Denmark: 34% digital radio have digital radio NL: planned migration to DAB+ Germany: DAB+ launch 2011 Belgium1: creating DAB+ strategy Switzerland: 25% France: by end 2012, have digital radio 10 cities DAB+ 4 Note: (1) French-speaking part
    5. 5. Newer territories can benefit from the experiences of othermarkets Benefits of experience Consumer Automotive • Device prices falling • Over 20% of listening is in-vehicle - Chip prices falling • New cars: in UK, digital as standard - Economies of scale - Q4 2011, 21% of all new cars - by 2015, 75-85% - Jan 2013, DAB royalty ends • Other countries following, e.g. Toyota Lexus in Australia • Aftermarket solutions being developed and refined 5
    6. 6. Contents 1 Radio today 2 Benefits of digital radio 3 Keys to success 6
    7. 7. Listener benefits can be classed in three areas Consumer benefits Sound & Additional Choice ease of use functionality • Lack of interference • Extra stations • Scrolling text / info • Clear, consistent • Specialist stations • Visuals sound (e.g. live sport) • Pause / rewind / record • Easy tuning • Pop-up / event stations • Detailed traffic info • EPG • Interactivity (smart radio) 7
    8. 8. Digital radio offers listeners significantly greater choice Sydney analogue services Sydney digital services 17 services on AM and FM 40+ on DAB+ 8
    9. 9. Providing a range of new speech-based services… Germany Australia Hong Kong • Exclusive live rights to • Comedy radio station • Digital Money German football - business news / stock • Up to 5 matches market reports simultaneously - horse racing 9
    10. 10. … and music services designed for the tastes of specificaudiences UK Australia Germany Classic Rock Unsigned bands Electronic music Jazz Country Classical10
    11. 11. Existing radio groups can retain share on digital radio Share of listening by platform, % AM / FM services (simulcasts) Incumbent digital-only1 New entrants and others 2% 3% 15% 14% 19% 98% 83% 66% UK AM / FM UK DAB UK online Note: (1) includes analogue services broadcast on digital-only outside their analogue licence area 11 Source: RAJAR, PH analysis
    12. 12. How can digital radio build value for commercial broadcasters? Strategic options 1 2 3 Geographic Deepen user Develop portfolio coverage experience • Extend beyond • Analogue stations in • Value add through analogue licence area digital quality - Text • Niche and temporary stations - Visuals • Cross-promotion - Interactivity12
    13. 13. First, digital radio can enable broadcasters to extend theirgeographic coverage – potential to create national brands XFM – UK coverage • XFM on FM in London and Manchester FM and DAB -14m population DAB-only • XFM on DAB in many regions -40m population • Listening up by 22% 13
    14. 14. Second, broadcasters can use digital to extend their brandportfolio Analogue and digital Digital-only services14
    15. 15. New digital-only services have increased Absolute’s listeninghours by 60% in two years Absolute Radio, weekly listening hours, m Absolute Radio (core service) Absolute digital-only services Launch of 00s 20.3 +60% Launch of 90s 19.0 Classic Rock 80s replaces and Extreme Extreme 15.5 7.4 8.7 12.6 13.3 4.4 1.2 2.0 11.4 11.3 11.1 11.6 11.6 Q4 09 Q2 10 Q4 10 Q2 11 Q4 1115 Source: RAJAR; four quarter moving average
    16. 16. Third, broadcasters can enhance the user experience – forexample through colour screens Revo Axis (launched 2009) • Top-end devices typically over €150 • This year, in Germany, new colour screen devices will be available Pure Sensia(launched 2009) - expected prices from ~€100 16
    17. 17. Stations in UK, Germany and Australia use colour images toprovide information and cross-promote services17
    18. 18. Looking ahead, smart radio (broadcast and IP) will provide newlistener benefits - and create new revenue opportunities 1 New song 2 Smart radio Listen later (connected) 3 Advertising 18
    19. 19. New song – no longer a passive relationship • Hear new song on radio • Use IP to -access info -add to playlist -share with friends19
    20. 20. Listen later – on any connected device • Listening to programme is interrupted • Tag and listen later -same or different device20
    21. 21. Hybrid radio gives access to online and mobile marketing budgets • Hear ad on radio / see visual display • Use IP to -access more information -register interest21
    22. 22. Contents 1 Radio today 2 Benefits of digital radio 3 Keys to success22
    23. 23. Collaboration between various industry groups, government andregulators is essential Policy and regulation Network Broad- Consumer Cars Retail Consumers operators casters devices Broadcasters & stakeholder body23
    24. 24. Thank you Patrick Hannon VP Corporate Development Frontier Silicon patrick.hannon@frontier-silicon.com24
    25. 25. The BBC has also seen significant benefits from co-branding,cross-promotion & smart scheduling Radio 7 / Radio 4 Extra weekly listening hours, m Service rebranded1 April 2011 Radio 4 Radio 7 Extra 9.2 8.6 37% increase 5.8 5.7 6.7 6.7 5.6 5.4 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Note: rebranding coincided with increase in cross-promotion and greater emphasis on complementary scheduling 25 Source: RAJAR

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