By Steve Faguy
IS TERRESTRIAL RADIO dead?
Well, no. The Canadian commercial radio industry brought in $1.45 billion in total revenues in 2018-19, according to CRTC data. But that’s a steady decline from $1.6 billion in 2014-15, and even without the effects of Covid-19, it looks like the only way forward is down as both advertisers and audience increasingly migrate toward digital services.
Faced with this decline, broadcasters are taking various strategic approaches to the future. Some are embracing new platforms, launching podcasts
and streaming services of their own.
“I think there’s still a place for terrestrial radio,” says Troy Reeb (right), executive vice president broadcast networks at Corus Entertainment, which owns 39 radio stations. “The big challenge of terrestrial radio, of course, is that unlike satellite or streaming services, there’s no option to charge a subscription fee. In your revenue modelling, you have one option and one option only, that’s to put advertising on — or to be like the CBC and get subsidized.”
One way Corus has been fighting the trend is to launch its own podcast network. Curiouscast, launched in 2018, includes such podcasts as Super Awesome Science Show, The Ongoing History of New Music, History of the 90s, and a bunch of podcasts tied to Global News Radio shows and other Corus radio programming.
“Many radio broadcasters are still in the space where they’re repurposing their radio shows as podcasts, and that’ll get you some listeners obviously, but the most successful podcasts we have are generally shows that are made specifically for the platform,” Reeb says. “In fact, we’re now using some of those shows back as radio programming.”
It was a bit of a surprising result that podcasts would work on the radio. The conventional wisdom, Reeb says, is that “it had to be a live engagement of the host or a fake live engagement of the host with the audience.” Instead, podcasts on the radio — which usually air on the weekends when people’s schedules aren’t so rigid and news is perhaps of less importance — seem to be doing well.
“Our podcast business has been growing very nicely. It’s a very small business, but it continues to grow 30-50 per cent a year,” – Troy Reeb, Corus
“You kind of provide this bingeable experience in podcasting, and back on the radio it seems to be working as well. … Our podcast business has been growing very nicely. It’s a very small business, but it continues to grow 30-50 percent a year.”
Other broadcasters have also dipped their feet into podcasting. Bell Media has original podcasts on its iHeartRadio app, including ones hosted by Jann Arden and Amanda Lang that get used on talk radio stations. Stingray has a smaller network of four podcasts but is planning to expand. Rogers has its Frequency Podcast Network, with podcasts like The Hopeful, Canadian Politics is Boring, and The Big Story, plus the Pacific Content branded podcasting division.
Rogers’s use of podcasts on radio has been more limited. “Sometimes we just put snippets on the air — we may put a 60-second version that airs in the commercial set that ends up being a mini version of a podcast, and then we have the opportunity to sponsor and monetize it, so that works really well for us,” says Julie Adam (right), senior vice-president of news and entertainment for Rogers Sports and Media.
“But we also have the opportunity to just go out and sign shows and not worry about whether they’re going live on broadcast radio or not, because the way the network works is advertisers can come in and buy Frequency with live radio or any combination of the two.”
Regional owners are also looking at the medium, but with a bit more skepticism.
“There’s so much news right now about podcasting and we’re very interested in the podcasting space,” says Rod Schween, president of the Jim Pattison Broadcast Group. “But when you look at the share of ear of podcasting in Canada, there’s a disproportionate amount of news going on about all the digital platforms.”
The truth is radio still reaches a lot of Canadians — more than 80% on a weekly basis, according to Numeris data — and more than 80% of radio listening is still done on traditional AM/FM receivers, with the rest split between streaming services and people listening to radio stations on their TVs (though more younger Canadians are using streaming to listen to the radio).
“We’re a little taken for granted because we’ve been around forever.” – Rod Schween, Pattison Broadcast
“We’re a little taken for granted because we’ve been around forever,” Schween (left) says.
Nevertheless, Pattison is moving in that direction.
“
We’re getting ready to announce some pretty significant changes within our own organization in the digital world,” Schween said. “So, I don’t slight any of those areas, but I’m just as excited about things happening on the broadcasting end.
“We’re still very interested in buying radio stations because that’s our core business and is going to be our core business for a period of time to come – well after I am the president of the company.”
Other executives agreed that while terrestrial radio may be in decline, they have no intention of abandoning it. “People still like free radio in their cars, and I don’t think that’s going to get to zero anytime soon,” Adam said.
“I think we have to be less fussed about it being just a radio station… that’s where our industry needs to really innovate.” – Julie Adam, Rogers
“I think we have to be less fussed about it being just a radio station… that’s where our industry needs to really innovate. I don’t even think it’s just audio. If we think about what we’re good at, which is connecting humans with other humans, whether that be to make them laugh and entertain them or give them the news or just to tell them what’s going on in sports or deliver a sports play-by-play to them, I don’t think those things are going away… So we can build a strategy around that.”
Social media is a big part of the plan going forward, too.
Adam points to the Roz and Mocha show that airs on Kiss stations in Ontario. “It started as a radio show and it’s expanded. They’re on social, they have video with cameras in the studios, everything that they do is recorded onto video. We use it on social. They have a podcast.”
Even Toronto’s 680News is on TikTok.
“And all these (social media) platforms want to work with us because they’re not content creators,” Adam continued. “They have an amazing platform and a big audience and we have the ability to find and curate talent and use their platforms to get it to an even bigger audience. So I think as long as we don’t get stuck in the ‘we only have one way to deliver the content,’ I think we’re going to be OK.”
What about Spotify, though? If Canadian broadcasters argue American music streaming services get an unfair disadvantage by being unregulated (which they have done as the federal government studies Bill C-10, which will modernize the Broadcasting Act), why not start up their own Canadian unregulated streaming service?
Some are. Stingray has a music app tied to its pay audio channels. Bell piggybacks on iHeartMedia’s app. And Quebecor recently launched its QUB Musique service, focused on francophone music.
“We have looked at it,” says Rogers’s Adam. “There are some media companies that are doing variations of it.”
But one look at the graveyard of streaming services — Rdio, Rara Yahoo! Music and Grooveshark among them — can scare even a Canadian giant away from trying, Adam says. “I think it’s difficult to prove-out building a Spotify-like competitor that would only live in Canada,” Adam says. “If someone can do it, that’s awesome. Never say never. And maybe we’ll figure out the secret sauce, but it’s definitely a challenging business model with the cost of copyright for on-demand music services.”
Corus’s Reeb agrees. “Music tariffs are very different for streaming than they are for terrestrial radio,” he says. “It’s a challenge to do it on a smaller scale for the Canadian market only. You really need to be a global player to make that work.”
Regardless of the platform, Canadian radio company executives say their job is creating content, and they’ll use that on as many media as necessary.
“AM and FM, even streaming — in the end, I don’t care if it’s two tin cans and a piece of string that somebody wants to consume content on,” Schween says. “We’re not a broadcasting company anymore. We are a media company that focuses on local content, and we will be on whatever platform our audience gathers and where we can build an audience, and monetize it by inviting that audience to consume products from advertisers.”
