OPINION: Get ready for a digital TV and radio disaster
This may sound like a somewhat pessimistic way to start the year, but here goes anyway.
2009 is supposed to be Australia’s year of digital TV and radio. Instead it’s going to be a massive money-loser for the networks providing the service, yet it will provide only negligible benefit for consumers.
Let’s start with why digital radio isn’t going to work.
First, the cost. New transmitters have to be installed for the digital signal, while for the foreseeable future, radio stations will still have to maintain FM and AM transmitters too. That means that there will be significant extra cost on launch day, with only a small audience, and therefore little hope of serious revenues.
I think Australians have an inherent disposition taking up anything with the word digital in it!
The sad thing is that these new media technologies could make a real difference to many people with the right strategies behind them and some overarching vision.
People have come round to digital television in the last 12 months but sadly, at least for the moment, these new media channels appear to be simply old media in sheep’s clothing.
I posted about this when the CRA’s digital radio roadshow came to Bris in November. I agree with you in that the medium itself is not exciting or delivers enough benefits for consumers to change handsets straight away. What it does do is open the platform for stations and advertisers to broaden the way they can use radio and offerings. It will be a slow process but once stations are offering programming that is only available digitally the fear of missing out will convert users. But stations have to convince listeners that they are missing out first.
The question was asked why internet streaming was not available on digital radio and it was to do with bandwidth. I can’t remember the numbers but there was a substatial difference between the bandwidth available and what was required to stream to digital radio devices. We’ve been told this will widen for years now – who knows how long it will be before it is enough to threaten digital radio.
I’ve got a detailed rundown of my thoughts on the launch of digital radio here http://anotheradvertisingwanke.....to-us.html
In regards to TV and net merging check out this post by Om Malik where he interviews Reed Hastings, CEO of Netflix. Nothing happening immediately but things are clearly moving in that direction:
http://tinyurl.com/7prwf6