Podcasting and MP3 players are stealing radio's audience, according to the latest figures from Bridge Ratings. According to Dave Van Dyke, President of Bridge Ratings, "By 2010, today's 94% penetration for terrestrial radio will have sunk to 85%."
27% of people 12-24 attribute their reduced use of radio to MP3 use; 22% attributed it to tired radio programming; 3% attributed it to podcast listening.
"The days of top market - top station margins in the 40% range are numbered. Expect those hot stations to fall into the 30% range and the entire industry on average to fall lower," adds Van Dyke. "Wall Street and corner offices will be readjusting their expectations on performance and having to swallow that pill happily knowing it is the only real operational option left."
According to the firm's latest research:
Terrestrial audience erosion to alternative audio entertainment continues to occur in young demographics.
Podcasting is beginning to siphon listening.
MP3 device usage can consume as much as 80% of a radio user's audio entertainment during initial ownership weeks and months. This number tends to be generally lower among 30+ women and 35+ men.
MP3 player fatigue is slowing overall as the market continues to expand due to consumer interest in these devices. Fatigue with MP3 players remains high among those consumers who have owned the devices longer than 6-8 months.
Competition for traditional radio time-spent-listening is more severe. Time spent listening to terrestrial radio is fighting for its share of time with a multitude of digital devices. Even television has regained viewership based on this quarter's data. The most often given reason for this by our sample: better programming and new shows. Meanwhile, music-specific radio stations are vying for the attention of their constituencies as MP3 players continue to be more pervasive than ever (75 million sold). Podcasting is beginning to show evidence of cannibalizing radio's time-spent-listening.
Satellite radio also suffers from attrition! For the first time, we are seeing satelite radio consumers who have been subscribers for longer than 6 months are actually spending less time than they were six months ago with their satellite service of choice. According to our panel, during the second quarter of 2005 average time spent listening to satellite radio was 16 hours per week. During this most recent study during the period of January 1 through March 31, 2006, weekly TSL for satellite radio among subscribers of 6 months or longer was down to 12.6 weekly hours.