"Knowing theScore: Classical music can't live in the past if it hopes to have a future"
by Andrew Druckenbrod, Pittsburgh Post-Gazette

The New Convergence: Broadcast + Telco

Future Receivers May Incorporate Broadband Wireless, Broadcast Services in a Single Device

by Skip Pizzi

Last time we discussed how the radio industry must cope with both incremental and disruptive change simultaneously. Part of the latter includes the potential for dramatically changing business models engendered by the ongoing transition to digital broadcasting. 

The biggest challenge for broadcasters is adapting to any business that does not maintain the fundamental premise of zero marginal cost per additional end-user, which the broadcast model has always observed. In other words, once a broadcasting transmission system is built, there is no incremental cost to the service provider as audience grows. Listeners buy their own radios and can tune to a station with no impact on that station's facilities or operational costs. 

While this approach offers very low cost per listener, its inherently unidirectional, point-to-multipoint service structure implies that little or no personalization or interactivity can be offered. Those features are the primary appeal of online services, of course, but with them come an incremental cost per user that runs contrary to the broadcast business model.

Such is the conundrum that broadcasters face when contemplating addition of online services to their operations. 
 

Converged devices

For radio broadcasting, online services have been strictly differentiated from on-air services for consumers because they each use different receivers. Most online listening is done on a personal computer, and few of these have AM/FM reception capabilities. 

The near future may change this, as new portable devices debut with both digital broadcast and wireless broadband capabilities. Think of these as cell phones with digital radio and/or TV - the so-called "converged device."

This is not altogether new; a few cell phones have already included FM receivers, but these have not been widely deployed. The reason for their lack of success is fairly simple: Wireless service operators don't like these phones because they get nothing out of the additional FM tuner capability, and in fact may lose something since whenever users are listening to the radio they aren't making calls.

For the converged device to gain traction, both broadcasters and wireless telcos must mutually benefit. Such a process should play toward optimization of both industries' divergent business models. For example, if a listener likes a song he hears on the radio, while he's still listening to the radio, he can order the song for download to the converged device's memory via the wireless broadband link. The cellular operator makes a sale, and the broadcaster gets a piece of the action, all while the user is engaged with the broadcast side of the device. 

The station could also invite listeners to send in requests via SMS, again stimulating use of the wireless operator's network; and so on. The two technologies and businesses could work together in synergistic ways: Broadcast reception capability motivates the user to "take the phone out of the pocket," which is the wireless operator's greatest obstacle to increased revenue. The interactive capability of the wireless phone adds new functionality to the broadcaster's service, which provides significant and timely value to an otherwise increasingly old-school medium. 

The two services could also interact in deeper ways. Consider that the wireless broadband device might serve as a radio-like receiver for a broadcaster's online streaming offerings, placing them at near parity with on-air channels. Or the converged device could also gather content via ancillary data carried in digital radio broadcasts.

Finally, any such downloaded content to the portable device can be synched to a PC or to an entire home media network when the phone is next re-connected (via USB dock, WiFi, Bluetooth, etc.), reversing the more traditional flow of content from the PC or network to the portable device. In this way, the user no longer needs to be sitting at a computer to purchase digital media content for a home media ecosystem, thereby increasing revenue opportunities for online content providers.

The converged device therefore allows broadcasters and wireless operators to both move forward while still doing what they each do best, and not trying to force-fit their services into one other's business models.
 

Challenges

While the scenarios above may sound quite appealing, they depend heavily on harmonious cooperation of all players involved - broadcasters, wireless network operators and converged-device manufacturers. Such an arrangement is unprecedented, but not inconceivable. 

Perhaps the biggest question in this context is, "Who will control the device?" Broadcasters, wireless operators and consumers will all have to feel adequately empowered in this respect for the converged-device scenario to be successful. Terrestrial broadcasters have already had a taste of this, in sharing space on a dial they once unilaterally controlled with satellite radio service providers on today's AM/FM/satellite-radio receivers. Meanwhile, consumers are becoming familiar with such processes as they adapt to devices that combine portable media players with cell phones. 

So it may be wireless network operators who have the toughest time coping with this new reality. They are used to having unilateral control of the device, particularly in the U.S. market, where most cell phones only work within the network of a single service provider.

Consider also that as services continue to proliferate, no single platform will enjoy the aggregation that existed in earlier times. This could mean that the critical mass that enabled a given medium's success may evaporate as time goes on. Even though clever silicon can make the user believe that he or she is connected to a unified whole, the service networks seemingly connected in transparent fashion must all still operate as separate businesses, and each must remain viable in its own right.

Put another way, what made broadcasting great was compelling content, which takes substantial revenues to produce. The aggregation of audiences to a single or small number of platforms (e.g., AM and FM radio) made this a workable proposition. Will any new platform be able to amass the same commercial engine that can drive production of equally desirable content? Additionally, as technologies and audiences diverge, will incumbent operators retain the requisite agility to adapt, or will they be replaced by new (and less satisfying) services? 

Only time will tell if audiences of tomorrow look back on the current day as the last golden age of radio, or a hopelessly antiquated predecessor.

Skip Pizzi is contributing editor of Radio World. 

The Big Picture   06.08.05

Under Construction: Radio Rules

Now That NRSC-5 Is in the FCC's Hands, What Happens Next for Digital Radio Regulation?

by Skip Pizzi

The FCC has been in receipt of NRSC-5, the IBOC standard, for a while now, so focus of the industry has shifted the commission's way, awaiting the next steps on digital radio regulations. One of the key external elements the FCC was anticipating prior to moving forward on IBOC rules was NRSC-5. Now that this has been delivered, will final IBOC rules be forthcoming, or will further interim steps be required?

First let's consider what NRSC-5 contains, or more importantly, what it doesn't contain. 

Several important items are not included in the standard. First, there is no audio codec specified for IBOC, and no method delineated by which a transmission can specify any particular codec(s) in use on the channel. Second, there are no specifications for IBOC datacasting in the standard - although the NRSC is continuing work in this area, and a datacasting update to the standard might be forthcoming at some point in the future. 

What NRSC-5 does specify with substantial completeness is the IBOC AM and FM transmission systems, without saying much about the content transmitted therein.

Thus, the first major regulatory question is: Does NRSC-5 provide enough detail for the FCC to move forward with development of final IBOC rules based solely upon the standard; or will the commission have to do additional work of its own before reaching an adequate level of specification for such work? 

Specifically, how will the FCC handle the codec issue? Certainly the standard provides plenty to work from, but its omissions are not negligible, and these gaps may require substantial staff effort from the FCC to fill. 

Process-wise, a number of options are possible, from soliciting comment on NRSC-5 via Public Notice, to issuing another FNPRM, to moving straight to R&O. It will be interesting to see how the FCC chooses to proceed under these unusual circumstances.
 

Content protection, anyone?

Another open question regards what if any next action the FCC will take in the area of digital radio content protection. You may recall that along with its last FNPRM on digital radio, the commission issued an NOI on content protection. The RIAA filed voluminous comments to this inquiry, advocating the establishment of a system akin to the "Broadcast Flag" (the content-protection system proposed for use in ATSC digital television). 

Most other commenters disagreed; and meanwhile the courts have invalidated the DTV Broadcast Flag rules on the grounds that the FCC has no jurisdiction over how receivers handle broadcast content once the signal is demodulated, unless explicitly given such authority by Congress. Moves are underway to have Congress grant the FCC this authority for content protection rules, but the outcome here is also decidedly uncertain at press time.

On the other hand, if a new content protection solution is devised in the DTV environment, this approach might find its way into IBOC as well. So again, the commission may be forced to wait for external developments before closing a key digital radio topic.
 

Wait, there's more

The list of unsettled second-tier issues for IBOC regulation is also lengthy. It includes AM nighttime operation, dual-antenna transmission for FM, Supplemental Audio Services rules, an emission designator for IBOC, FM-IBOC translator rules and more. Some of these items certainly will be addressed in the FCC's next regulatory step for IBOC, but some may remain open.

A few other interesting issues in this area have been raised recently, one in this publication's April 27 issue. In a Guest Commentary, broadcast attorney John Garziglia calls for rules requiring all satellite radio receivers to include IBOC AM and FM capabilities. This is not unprecedented; the FCC's rules for new digital cable-ready receivers include a phase-in requirement for inclusion of ATSC terrestrial broadcast DTV tuners, for example.

To date, the satellite radio industry has voluntarily included analog AM/FM tuners in all their receivers, of course. This simply made good sense for the primary automotive market, where the idea of multiple radios was impractical and unwelcome. It also is good business during any transitional phase to combine support for both legacy and emergent formats in any new products. But this voluntary integration may not last forever, and there is likely to be significant push-back from the satellite radio industry to any move that would mandate inclusion of terrestrial receivers, even analog, but especially IBOC.

This would not be purely an issue of cost. Consider that the audio quality of satellite radio is fairly similar to that of analog radio. In fact, on a good reproduction system, FM analog terrestrial audio sounds noticeably better than satellite radio services, especially for voice-only channels. (Voice services on satellite radio are more akin to AM radio quality.) Nevertheless, satellite radio does not suffer from the impulse noise of terrestrial AM, nor the multipath distortion of FM, so on balance, quality issues are probably a wash between satellite and terrestrial analog radio. Add IBOC to this equation, however, and the balance could shift substantially in terrestrial radio's favor, with both music and voice services sounding substantially better on terrestrial than on satellite radio. Thus an attempt to require IBOC reception capability in satellite radios is likely to face a pitched battle.

Any discussion of new radio regulations might also include the issue of "podjacking," as well. There is a growing number of reports from automotive listeners that when they pull up to a traffic light at a multilane intersection, the FM station they were listening to is momentarily interfered with, if not overtaken by the adjacent car's iPod FM modulator accessory. Consider that in some cases, the iPod modultor's antenna may actually be closer to the adjacent car's receive antenna than it is to its own (e.g., iPod on the passenger seat, radio antenna on the rear deck, adjacent car one lane to the right with its radio antenna on the left side). Further, some of these devices only offer frequencies at the lower end of the FM band, meaning that NCE stations bear the brunt of the problem.

On the other hand, other users report that they cannot maintain a consistent signal from their iPod as they drive around town, due to the inability to find an FM frequency that is consistently vacant enough to not interfere with their iPod signal. So there is pressure to increase the output power of these modulator accessories. Thus the FCC may be forced to react to the podjacking issue in upcoming rulemakings, as well.

Whatever happens, radio will be squarely on the FCC's agenda in the near future. The new population of the commission makes this an even more interesting scenario for commission watchers. Stay tuned.

Skip Pizzi is contributing editor of Radio World.

© 1999-2005 Association of Music Personnel in Public Radio

Updated 7/18/05

Web Pages by Delbridge Text & Design