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Music 4.5 Smart Radio: Mark Mulligan, Analyst, Midia Consulting

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Radio – a mental concept in transition
The term ‘radio’ has been repurposed for streaming music – are the streaming music services the natural progression of ‘radio’, transcending the traditional infrastructures while delivering similar content?

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Music 4.5 Smart Radio: Mark Mulligan, Analyst, Midia Consulting

  1. 1. Music 4.5 is organised by #m4pt5 #SmartRadio Radio – a mental concept in transition Mark Mulligan, Analyst, Midia Consulting
  2. 2. Mark Mulligan September 24th 2013 Tuning In To Radio’s Future
  3. 3. • What constitutes radio in the digital era? • How are the UK and global radio markets faring? • What factors are driving today’s radio trends? • What can we learn from the US market? • What is the outlook for radio? www.midiaconsulting.com – Mark Mulligan – September 2013
  4. 4. What Is Radio Anyway? www.midiaconsulting.com – September 2013 Interactive Radio? Subscription Services? Web streaming? Vevo/YouTube? Traditional & DAB Radio? Podcasts? Emerging digital entertainment services are blurring consumers’ perceptions of what constitutes radio
  5. 5. Global radio ad spend down 0.4% in 2012 (Zenith) UK radio ad spend up 4% in 2012 (RAB) UK radio ad spend down 4% Q2 2013 (RAB) 3.4m more people listening to radio than 2008 Listener hours are down 4% from 2011
  6. 6. App and web competition Consumers expect on-demand experiences Shift of Advertising Spend Smartphone & Tablet Listening Solid Listening Trends Robust DAB Market UK Radio Market UK Radio Market Drivers and Inhibitors www.midiaconsulting.com – September 2013
  7. 7. 45.1 45.7 46.8 47.1 46.6 48.4 1,003 1,008 1,055 1,076 1,023 1,028 0 500 1,000 1,500 0 20 40 60 80 100 2008 2009 2010 2011 2012 2013 Audience Totalradioaudience TotalListeningHours (millions) (millions) UK Radio Listening Has Remained Steady Source: Rajar www.midiaconsulting.com – May 2013
  8. 8. Radio Has Fared Far Better Than the Hi-Fi www.midiaconsulting.com – Mark Mulligan - September 2013 71% 56% 50% 46% 44% 40% 18% 25% 39% 28% 34% 77% 69% 73% 69% 74% 70% 0% 20% 40% 60% 80% 100% 2007 2008 2009 2010 2011 2012 Listen on Hifi Listen on MP3 Device Radio %ofconsumers Penetration of Music Listening by Device Source: Ofcom / MIDiA Consulting
  9. 9. DAB Underpins UK Digital Listening Growth But Internet is Underperforming www.midiaconsulting.com – Mark Mulligan - September 2013 16% 21% 25% 28% 32% 37% 11% 13% 15% 18% 20% 24% 2% 2% 3% 4% 4% 6% 0% 10% 20% 30% 40% 50% Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 All Digital DAB Internet %totallistening Share of Total UK Radio Listening Source: Rajar
  10. 10. Mobile May Be Radio’s Best Route Into Youth www.midiaconsulting.com – Mark Mulligan - September 2013
  11. 11. A Quick Look at the US Market www.midiaconsulting.com – Mark Mulligan - September 2013 • Robust Interactive Radio sector (Pandora = 6.8% radio listening) • Strong satellite radio sector (25 million Sirius Subscribers) • 58% of ad agencies are more interested in streaming radio than a year ago • 86% ad agencies same – or lower – levels of interest in traditional radio • Spot advertising down 2% • Digital radio ad spend up 9% • Total radio ad spend flat
  12. 12. What Will Radio Be 5 Years From Now? www.midiaconsulting.com – Mark Mulligan - September 2013 • Radio, and radio-like programming, will become a central tenet of on-demand music services (paid and free) • More radio content will be consumed in a non-linear fashion • Radio will become a key tool for addressing the tyranny of choice • More media consumption time will shift to multi-media devices (tablets, smartphones, laptops) leaving DAB devices vulnerable to obsolescence • Interactive car dashboards will be a threat, but also a great opportunity (lean back experiences are safer in the car) • The importance of DJs and spoken word content will still be key, but contexts will have changed
  13. 13. Conclusions www.midiaconsulting.com – Mark Mulligan - September 2013 • Media consumption is rapidly shifting online and onto mobile devices • DAB is a great digital ‘lock-in’ for the home • New emerging digital entertainment services are blurring consumers’ perceptions of what constitutes radio • Tablets and smartphones help break down the distinctions between different media formats • Radio has a big future ahead of it, but that doesn’t necessarily mean a big future for broadcasters • However the big change will be generational rather than immediate
  14. 14. Contact: Mark Mulligan Phone: +44 (0) 780 11 66 712 Email: mark@midiaconsulting.com Web: http://www.midiaconsulting.com Blog: http://musicindustryblog.wordpress.com Twitter: @mark_mulligan www.midiaconsulting.com – Mark Mulligan - May 2013

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