Nancy Hill: DTV multicast channels and HD Radio

In part III of our AAAAs CEO Nancy Hill Interview, we asked her about what she thinks the future is in monetizing DTV and HD Radio multicast channels. What will it take for agencies and advertisers to add them to the mix?

So, what about the DTV multicast channels? How might they be relevant in the future and should they be mandated as must-carry?
I think the opportunity is akin to cable in terms of being able to have a broader offering, but you may find that each one of those offerings has a smaller audience.  The thing is that I don’t think that in the US we’ve gotten the broadband penetration that we’ve gotten outside of the country simply because of the infrastructure here.  Once you start to reach the penetration of say Korea or Denmark then you start to see this thing really max out. Broadband will provide the ability to get the multicast channels to more households.  Once you get DTV up and running then it becomes relevant immediately.  But it’s going to be relevant to different audiences.

Most people are not going to view DTV over the air.  They’re going to do it over cable or a broadband connection like FIOS or whatever.
That’s exactly right.

I suppose that would be the way to make it happen because over the air you’re going to have like one percent of people sitting there with their extra DTV channels.  What are your thoughts on HD Radio—is it going to help the industry? What sort of opportunity do you think radio has here and where should they take HD Radio, if anywhere, to revitalize the radio industry and monetize some of this extra bandwidth that they’ve been given?
Give me your definition of HD Radio because I hear a lot of people talk about it a lot of different ways.

And that’s part of the problem with HD Radio.  Do you realize if the AAAAs CEO isn’t completely understanding what HD Radio is, do you realize how confused the general population is?
Exactly, exactly.

And that’s one of the big issues in the radio industry is they have not given a proper message or proper education on HD Radio and that’s sort of what’s crippled it to some degree.  HD Radio is very simply, let’s use FM as an example because FM will give you the capability for multicast channels.  Let’s say your favorite station in New York City is 95.5 WPLJ.  I’m just going to guess—I bet you it’s not.
You know the funny thing is when you live in New York you don’t listen to the radio.

You should check out WFMU 91.1, WFUV 90.7 or maybe Columbia University’s WKCR.
Yeah, I actually know ‘FMU.

With HD Radio, stations are given an extra two frequencies.  So let’s say WPLJ is 95.5--that’s their analog frequency.  Well they have now been given 95.3 and 95.7 in which to inject digital signals.  If you have an HD Radio those digital signals will allow your radio to tune in to the main signal of 95.5 in digital, so you don’t have any hissing or static at some of the stoplights.  It will just be clear, but it doesn’t go quite as far out if you are driving towards say Philadelphia you’re going to lose that digital quicker and it will go right back to analog.  What it also gives them, and WPLJ is a good example, they have two extra music channels.  So those HD Radios whether they be in a car or be in your office they’re going to give you two more channels with different formats.  One of them might be all ‘80’s. One of them might be Indie Rock (which they should be doing but they aren’t).  Now those things when they fade out there is no analog backup, they just die.  When they pop on and they pop off and they go on and they go off. 
You know the thing about radio is--and this is a personal point of view more than Nancy Hill President and CEO of the AAAA’s--it’s only as good as the programming.  Yes, having more options is nice for each station but if they’re not programming things that people want to listen to it doesn’t do any good.  I think part of the issue that a lot of people have had with commercial radio is the fact that they don’t necessarily like the programming.  If they like the programming they stick with it.  If they don’t like the programming they’re pushing buttons.  That’s always going to be the bottom line.

Absolutely, so do you listen to Internet radio for the most part?
I do some, I also can’t use this word “satellite,” but yeah. XM was a client of mine at Lowe and I just fell in love with their programming.  Again, that’s what it’s all about for me.  I also use an IPod.  I love music but because in New York you’re not in your car and you don’t necessarily listen to radio at home.

What about your office—has anyone given you an HD Radio for free?
No one has given me and HD Radio for free but I do listen to some streaming. My favorite station ever is KLLC in San Francisco, Alice. I loved Alice because it was Indie Rock.  I quite frequently will put them on streaming.  At one time I-tunes had a KLLC playlist and I downloaded the whole playlist because I knew it would be fantastic.

by Carl Marcucci

See parts I and II of the interview here

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