RBR+TVBR INFOCUS – Jan. 9, 2017
By Adam R Jacobson
RBR + TVBR
News organizations across the globe on Friday reported on a Scandanavian situation two years in the making, which is now set to cause considerable disruption to all radio listeners in Norway.
This is the week that the Norwegian government approved the shutdown, en masse, of its FM signals; its MW (or AM) signals are already gone, as is the case in numerous countries across Europe.
It’s a controversial move, and one that has proven somewhat unpopular with Norwegians. Other nations are eyeing Norway, and asking themselves if a wholesale abandonment of broadcasts between 88 and 109 MHz, in favor of DAB broadcasts designed to expand listener choices — in the eyes of Norwegian leaders — is a wise idea.
Could such a scenario happen in the U.S.? It’s highly unlikely, thanks to a fight waged two decades ago by now-retired radio industry visionaries. But what if all FM signals — and AM signals — were to suddenly shift permanently to a digital environment? How would brokers react?
Meanwhile, what is HD Radio’s future, nearly 20 years after multicast channels were given the official go-ahead by the FCC?
NERVE-WRACKING MIGRATION
At 4:54 p.m. on Friday (1/6), wide-ranging rock station “Rox 90.1” was, ironically, playing the Everclear song “AM Radio.”
The Oslo-based station is one of a handful in the Norwegian city that are not directly controlled by NRK, and the Norwegian government.
In cities outside Oslo, such as Bergen, private operators are nearly nonexistent: Top 40 network NRJ is the only one on the dial.
Thus, Norway is a very different marketplace than the U.S., or Canada. In fact, it is a rarity in that its radio landscape mirrors that of Great Britain and Spain in the 1980s, before privatization led to an explosion of radio station operators on the local and national level.
That’s a key differentiation point between a nation like the U.S. and Norway, with respect to a shutdown of the FM band.
“It is a very tiny country doing this,” said one media broker who requested anonymity. “We are the nation with the mass identification of radio.”
There is also one key difference between FM radio in the U.S., and what is seen across Europe: The shift from analog to digital broadcasting was done with an in-band, on-channel system, as opposed to a DAB development that sees Norway’s radio stations all sandwiched between 222 MHz and 239 MHz.
With such a shift, listeners in Kristiansand, Norway now have access to 26 radio stations; there are 10 available on the FM band.
The problem as of today is access.
Opposition to the end of FM broadcasts has been loud in recent days, with some chastising the Norwegian government for rushing the shift to DAB-only broadcasts. This could result in people missing emergency alerts.
Then there is in-car listening: Some 2 million vehicles in Norway do not have DAB receivers, Thomson Reuters reports. TNS Gallup data from 2015 puts the amount of Norwegians with DAB-less car audio receivers at 20%.
An opinion poll published in Norwegian daily Dagbladet in December showed that some 65% of Norwegians opposed the end of FM broadcasts. That did not have any bearing on parliament’s decision to move ahead with plans set forth two years ago.
In April 2015, the Norwegian government set in place a January 2017 shut-off of its FM radio stations, “having concluded that the criteria for the technology shift are now met.”
The decision followed up the radio digitization mandate issued by the Storting, Norway’s parliament, in 2011.
Thus, Norwegians have had six years to prepare.
Ole Joergen Torvmark, head of Digital Radio Norway, told Thompson Reuters that the average cost of a DAB-enabled car radio is $176, or 1500 Krone.
A DOOR THE U.S. CHOSE TO SKIP
In its April 2015 codification of this week’s shutdown of all FM signals in Norway, the country’s Minister of Culture, Thorhild Widvey, said, “Radio digitization will open the door to a far greater range of radio channels, benefiting listeners across the country. Listeners will have access to more diverse and pluralistic radio content, and enjoy better sound quality and new functionality. Digitization will also greatly improve the emergency preparedness system, facilitate increased competition and offer new opportunities for innovation and development.”
The Norwegian government also determined that the end of analog broadcasts on the FM band amounts to a cost savings of $23.47 million U.S., “releasing funds for investment in radio content.”
It also argued that digital broadcasters are “far less vulnerable to transmitter failure in extreme conditions and permits tunnel reception of all channels.” It also allows simultaneous transmission of emergency messages on all channels.
At issue is the following criteria: Affordable and technically satisfactory solutions must be available for radio reception in cars.
Had the Norwegian government said such “solutions” were not available in April 2015, the FM switch-off would have been scheduled for 2019.
Nearly two years after that decision, some government leaders are desperately fighting for a delay nevertheless.
“We are simply not ready for this yet,” Ib Thomsen, an MP from the Progress Party, a partner in the Conservative-led government, told Reuters. “There are two million cars on Norwegian roads that don’t have DAB receivers, and millions of radios in Norwegian homes will stop working when the FM net is switched off. So, there is definitely a safety concern.”
That’s why broadcasters in Switzerland, Denmark and the United Kingdom are looking closely at what transpires in the coming days across Norway.
According to the BBC, three national digital multiplexes — the platforms that hold stations — exist. Two are for commercial broadcasters, while one is for the BBC.
U.K. legislation holds that any switch-over from traditional FM frequencies to DAB-only occur only when digital listening has reached 50% of all radio listening and national digital coverage is comparable to that of FM. This puts a possible abandonment of Britain’s FM signals unlikely to occur in the next three years.
WHY THE U.S. IS DIFFERENT
The spectre of a mass nationwide shutdown of all FM signals in the U.S. sounds like the stuff of Science-Fiction. As RBR + TVBR reported on Friday (1/6), some 6,746 commercially licensed FM stations can be found in the U.S. and its territories on New Year’s Eve. This is an increase of nine stations since Sept. 30.
Meanwhile, some 4,669 AM radio stations continue to serve listeners across the U.S.
Thus, there’s no immediate danger of listeners losing access to emergency alerts, information and entertainment on the signals they’ve enjoyed tuning to for generations.
Randy Odeneal is one of the individuals to thank for this.
In May 1996, Odeneal — a principal at former radio station owner Sconnix Broadcasting — served as the DAB Task Force Chair of the National Association of Broadcasters (NAB). At the time, in-band on-channel systems were being tested, including Eureka 147, used in the U.K.; USA Digital Radio; AT&T; and Voice of America/JPL.
The concept of in-band on-channel, or IBOC, digitization of AM and FM radio allowed for the smooth transition of consumers from analog to digital receivers; today both analog and digital signals are transmitted to ensure no listeners are unable to tune in.
One year later, in the May 19, 1997 issue of Broadcasting & Cable, the focus was on USA Digital Radio, and a joint plan with Lucent Technologies to push IBOC development.
Along with Odeneal as a chief proponent of IBOC was Dick Ferguson, who retired in May 2006 as EVP of Cox Radio and in 1997 was President of the NAB Radio Committee. Speaking to B&C, Ferguson said, “The NAB is committed to developing and implementing IBOC systems for AM and FM radio stations.”
Cox’s Ferguson was instrumental in having HD multicast stations appear as “supplemental” offerings above the regular band, instead of as sub-channels next to the primary signal, on HD Radio receivers when displaying and scanning stations.
Commitment to HD Radio began in July 2004, when iHeart predecessor Clear Channel announced it would convert 1,000 stations to digital by 2008. Similar announcements from Entercom and Cox Radio came just a few months later.
HD Radio, now owned by Tessera Holding Company’s DTS, is the exclusive technology approved by the FCC for such IBOC transmissions in the U.S. Final rules authorizing HD Radio were published in the Federal Register in August 2007. This opened the door to HD multicast channels on the FM dial, effective Sept. 14, 2007.
WHAT HD RADIO MEANS TODAY
Absent a door to an alternate universe, where FCC Chairman Tom Wheeler and Congress are standing by an order to have all FM signals silenced per a move to DAB, U.S. radio consumers will continue to tune in to their favorite station as they do today for years to come.
But, the Norway scenario does present some interesting angles for brokers, and broadcasters, to consider.
“We didn’t take that path,” notes Robert Heymann, Chicago-based Director at Media Services Group. “We chose the one that we are currently on, and I don’t see it changing anytime soon, because I see no reason to.”
In his view, there is no motivation among radio broadcasters to shift all FM signals to the mid-200 MHz broadcast spectrum.
And, lest anyone try to compare radio’s transition to digital to that of television in the U.S., they’d be dealing with two wholly unique scenarios.
The ongoing broadcast incentive auction is designed to free up UHF broadcast spectrum used by television stations across the U.S. for use by the wireless services companies; UHF frequencies are of particular value to companies such as T-Mobile, Verizon, AT&T, Sprint and U.S. Cellular. Radio’s analog signals, however, are in the low end of the VHF band — and not desired by the wireless companies.
Meanwhile, Heymann points to another big differentiation point between TV and radio on digital migration.
“When the FCC mandated that all TV broadcasters give up their analog signals, the overwhelming majority — 85%-90% — of consumers viewed television stations via cable and DBS,” he says. “To them, the migration was completely transparent. They didn’t know anything had changed.”
With no more than 15% of U.S. consumers receiving TV via over-the-air signals, getting digital tuners and/or converters impacted a small segment of overall viewers.
“You weren’t hearing rallying cries in the streets saying, ‘Give us back our TV!'” Heymann says.
Of course, there is a whole delivery difference with respect to radio, versus TV. “You don’t watch television in your cars … and your cars aren’t attached to a coaxial cable.”
Yet, what if Odeneal and Ferguson had not been among the champions for IBOC? What if a DAB solution for HD Radio had indeed been selected?
Media broker Richard A. Foreman believes he and his peers would adopt to the shift, and life would go on for broadcasters and brokers.
“I think we will sell whatever the paradigm is, commercially,” he says. “Whatever is there, it is our stated task of selling and marketing it.”
For the foreseeable future, that’s squarely focused on the thousands of AM and FM stations from San Juan to Guam that aren’t going anywhere, except out of the earbuds and speakers of consumers’ listening devices of choice.
