The Digital Generation: Radio's Friend or Foe?

I attended the event today, organised by the Radio Academy, called 'The Digital Generation: Radio's Friend or Foe?'. Held at the Apple Store on London's Regent's Street, a bunch of radio industry professionals gathered to discuss whether the iPod (and other portable MP3 players) are a threat to the radio industry. These are my notes and comments on the interesting session. I've tried to be as accurate as possible, but if I've made any mistakes please let me know.

On the panel were:

The talk was kicked off by Paul Bennun, who suggested that young people (15-24 year olds) are being "turned off" traditional radio. This isn't idle speculation, he warned, these are the facts as presented by research conducted by RAJAR and Ofcom. The Ofcom research suggests that these young people are fed up with the hackneyed formats and "crap ads" of traditional radio, and are instead turning to new technologies such as the iPod. The question to the panel is, then, what radio can do about this.

Daryl Denham introduced podcasts as something that kicked off in the USA, with thousands of specialist shows now on offer. Podshows launched a few weeks ago (BBC report) as the first commercial podcast broadcaster, in an attempt to produce shows of a "high quality" which listeners would pay for. The site currently has shows from a number of DJs, (most of which have recently been fired from or have quit traditional radio networks), including the Official Top 40 with ex-Radio 1 DJ Wes Butters and the Classic Countdown with Paul Gambaccini, which is a direct copy of a show he used to do on Classic FM. Daryl Denham himself does a daily show.

The Podshows site hasn't really received a great reaction from the web. Matthew Revell suggests that they're "hoping to appeal to too many different people" and Northwest Noise points out that they've picked a name far too similar to the rival Podshow. Mostly though, people have just been indifferent. One of the major problems for the site is that there isn't currently any way to license music content for downloadable podcasts. This means that only the site's speech-only content can currently be offered as downloadable MP3s, the music shows are instead offered as Windows Media Streams, which cannot be played on iPods, or even in iTunes. Podcasts and internet streams are completely different things, and mixing up the terms is only going to confuse people. What's more, the site incorrectly claims in the FAQ that iPods can't play MP3s (a bit of an embarrassing error for a podcasting site).

Daryl does claim, however, that a deal with the record industry is just around the corner, with them having confirmed deals with some labels already, and only needing to "dot the Ts and cross the Is" with the others. The terms of the deal weren't disclosed however. The shows will likely use Microsoft and Apple DRM though, and it seems that they can only play 60% of any song (which would be ironic as Daryl kept making digs at Radio 1's new Top 40 show not playing all the tracks). I guess that compared to the 99p or so per track charged on iTunes, 99p for an hour's show wouldn't be too bad a deal though. The music industry has been really slow to develop a license fee structure for downloadable music, so I guess any developments in this field are welcome.

Over to Chris Berthoud next, who introduced the BBC's podcasting projects, which started with the Reith Lectures and In Our Time last year, and is being rolled out to 20 more shows. The trial last year was a great success, with 20,000 downloads of In Our Time per week and 50,000 downloads of the Reith lectures over the five weeks. The shows are offered as simple DRM-free MP3 files, which can be downloaded straight from the site as well as via RSS-reading podcast applications.

Chris commented that he didn't see the BBC's podcasts as a replacement for live radio, which he described as "the mothership", instead it's a way of timeshifting the shows and making the more accessible, so that you can listen, say, "whilst jogging in Hyde Park".

Ian James then introduced Chrysalis as a company which runs radio station (Heart, LBC and Galaxy), publishes music as an indie label (artists include Bowie and The Beta Band) and provides mobile services, such as ringtones and SMS services, to radio stations and other networks. Ian sees Chrysalis as wanting to "guard and manage intellectual property rights" at the same time as wanting to create profitable services for mobile content. He says that podcasts can enable commercial stations to deliver more specialist content to complement their more constrained live output.

Paul Bennun asks Ian whether he sees the mobile phone as being a portable music device. Ian suggests that this will increasingly happen, with Chrysalis set to offer music downloads to mobiles over the next 18 months. He comments that the 1GB memory sticks for mobile phones are already available, with even bigger ones on the way. The big question in the industry, he says, is whether the mobile phone will be a device for downloading music (over 3G or 2.5G), or for simply playing back music transferred from a computer.

At this point, Paul comments on the rumours that Apple is set to release an "iTunes Mobile" service in conjunction with Motorola. The service has been announced an unannounced by both parties, he comments, asking Ian whether he thinks it will have a big impact. Ian responds that it's looking like Sony will beat iTunes to it, perhaps gaining back some of the market share it's lost out on since the demise of the Walkman, he comments.

Paul asks the panel what podcasts can do to make up for the lack of interactivity which can be had with live shows. Daryl responds that there's no way of doing phone ins, although they can read out e-mails sent in from listeners, and make phone calls out. Chris comments that with the huge range of people posting their thoughts onto the internet as high-quality podcasts, there's the possibility of directly including audio content which has been blogged by listeners in response to past shows. This would work especially well for the Radio 4 kind of programmes which are intellectual and require carefully considered responses. I thought this was a fascinating idea which could be really interesting. For me, this is the kind of thing podcasting should be doing, adopting the blogging model of individuals responding to content by posting their own thoughts back into the blogosphere over a more extended period of time. It's great to see the BBC thinking on such wavelengths.

Tackling the big subject of DRM, Paul asked the panel whether the incompatibility of various formats and restricted usage would prove destructive. Daryl responded that they were currently using WMP and were generally reliant upon the industries to supply the technology. Chris responded that it was a huge issue, and having to deal with rights holders was difficult, comedy especially so. There is a huge cost issue, either with employing the DRM technology or with buying the rights, and so the BBC wasn't yet in a position to waste license fee money on this without first making sure that it was what people wanted. Ian commented that over the next 12 months we would see the emergence of mobile phone "realtones" using the OMA2 format, which has DRM built in, and so the future wasn't so bleak.

Paul then asked the panel whether, in light of the statistics mentioned at the start, the radio industry was doing okay with adapting to the iPod revolution. Daryl responded that they weren't, but he liked it this way as it feeds into their new service. Chris commented that the BBC was doing its bit, and pointed to some new podcast directory sites which have been described as a "post-broadcast EPG".

There was then time for questions from the floor. I've picked out some of the most interesting responses.

Someone suggested that podcasts only work if they have a Unique Selling Point, such as either a leftfield take on the mainstream or specialist programming, and hinted that Podshows isn't really offering this. Daryl naturally responded by saying that he thought all of their shows had a USP, which I think highly debateable.

I asked Daryl why they had adopted the business model of trying to sell the speech-based shows, hoping that listeners don't pass them on to their friends, rather than letting their content run free, using the distributive power of P2P networks and earning money through sponsorship and advertising. Daryl responded by commenting that swapping shows was again their T&C but suggested that they might offer free, sponsored shows in the future (no adverts because listeners don't want it). Whilst this seems promising, I would have thought that adopting the free model from the start would be more successful, as the audience would increase faster, and people wouldn't have to fork out money to try listening to a show they'd never heard of before. Even if they can't get any sponsors at the start, giving the programmes out for free and hoping to build an audience big enough to attract sponsors is surely the better long-term solution ('build and they will come', remember?) At the very least, they need to offer a free trial to entice listeners in.

In a similar vein, someone suggested that as radio was free, but podcasting wasn't, wasn't the user stuffed? Chris correctly pointed out that most podcasts were free (these guys have obviously done their research). Daryl commented that there was free stuff out there, but it wasn't at the same quality of the BBC stuff or the stuff Podshows was doing - there couldn't be a huge number of people wanting to listen to "American college students relaying their daily events", he commented somewhat provocatively (this guy obviously hasn't seen how popular obscure weblogs can become).

Other responses to question included Chris commenting that the listen-again figures for In Our Time doubled when the podcast was launched, rather than falling as expected and that, from what they can tell, the typical podcast listener was young and male, hardly surprisingly.

Finally, someone asked for 10 year predictions. Chris suggested that In Our Time would get 1 million podcast listeners, which would in turn boost the general listening figures for Radio 4. Ian made noises about home 'media centres' and suggested that all content would be accessed live over internet networks. And Daryl hoped that Podshows would still be around, having a considerable share of the commercial podcast market.

One issue that no-one mentioned, which I thought of on the way home, is the idea that Digital Radio receivers might get small enough to be integrated into MP3 players and mobile phones. With consumers then being able to switch between listening to their MP3s (for music they know they like) or live radio (when they get bored of their collection and want to hear something new, or want chat or news), surely this would be ultimately the best long-term way for traditional radio to compete with the iPod? And as MP3 players have a hard disk built in, these devices could also be radio time-shifting devices, what more could you want?