dab+ business case and critical success factors patrick hannon poznan: 10 th april 2014
TRANSCRIPT
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DAB+ business case and critical success factors
Patrick Hannon
Poznan: 10th April 2014
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Contents
1. Introduction to WorldDMB
2. Radio today
3. Business case
4. Critical success factors
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• Not-for-profit membership organisation
• Developed DAB technical standards
• Promote digital radio (DAB / DAB+) around the world
WorldDMB – who we are
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Over 80 members from 22 countries
BroadcastersNetworks / regulators
Technology AutomotiveDevices /
equipment
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Policy makers and regulators
We work with players across the radio ecosystem
BroadcastersNetwork operators
Devices AutomotiveSilicon providers
Retailers
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Contents
1. Introduction to WorldDMB
2. Radio today
3. Business case
4. Critical success factors
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• Digital music services
• Smart devices
• Competition for FM radio
Online music services
For broadcasters, the competitive landscape is changing
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Changes in youth per capita listening hours, 2006-101
-27%
-17%-14% -13%
-9% -7% -7%
Sweden UK USA Italy Germany France Spain
Note: (1) Definition of youth varies by market; e.g. Sweden (9-19s), UK (15-24s); US data 2006-08 & 2009-11 (new methodology in 2009). Source: EBU (Europe), Arbitron (US).
Younger audiences are listening less
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In many markets, FM spectrum is full – difficult to innovate
• Overloaded airwaves
• No capacity for new services
• Difficult to innovate
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A digital radio wave is moving across Europe
UK
Norway
Sweden
Germany
France
Spain
Italy
Switzerland
NL
Bel
Denmark
Poland
Czech
Austria
Ireland
Portugal
Slovenia
Slovakia
Hungary
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Four core markets: UK, Norway, Denmark and Switzerland
UK
Norway
Sweden
Germany
France
Spain
Italy
Switzerland
NL
Bel
Denmark
Poland
Czech
Austria
Ireland
Portugal
Slovenia
Slovakia
Hungary
Established markets
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Followed by Germany (2011) and Netherlands (2013)
UK
Norway
Sweden
Germany
France
Spain
Italy
Switzerland
NL
Bel
Denmark
Poland
Czech
Austria
Ireland
Portugal
Slovenia
Slovakia
Hungary
Established markets
Newmarkets
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Several potential markets
UK
Norway
Sweden
Germany
France
Spain
Italy
Switzerland
NL
Bel
Denmark
Poland
Czech
Austria
Ireland
Portugal
Slovenia
Slovakia
Hungary
Established markets
Newmarkets
Potentialmarkets
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Poland: first services on air
UK
Norway
Sweden
Germany
France
Spain
Italy
Switzerland
NL
Bel
Denmark
Poland
Czech
Austria
Ireland
Portugal
Slovenia
Slovakia
Hungary
Established markets
Newmarkets
Potentialmarkets
Poland?
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Annual cost of transmission1, $k
385
925
1645
68 98 128
Owned site Regional site Metro site
FM DAB+
Source: Harris BroadcastNote: (1) Opex costs; on DAB+, assumes 18 services on multiplex
DAB+ distribution costs about 10% of FM for a single service
-92%
-89%
-82%
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DAB / DAB+ radios now mass market
Prices from $29
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Power consumption of in-use devices, W
Source: DCMS / Intertek Technical Report, March 2013
Digital radios now consume 20% less power than FM devices
4.69
3.75
FM radio DAB radio
20% lower
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Automotive brands offering DAB – increasingly as standard
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Contents
1. Introduction to WorldDMB
2. Radio today
3. Business case
4. Critical success factors
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Increase audiences
Increaserevenues
Innovation
How can digital radio build value for broadcasters?
1 2
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Increase audiences
Increaserevenues
Innovation
How can digital radio build value for broadcasters?
1 2
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Sound quality ChoiceAdditionalfeatures
Benefits of DAB / DAB+
Benefits for listeners
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UK, % benefits of digital radio
65%59%
35%
24% 23%
Sound quality Wider choice Easy tuning Textinformation
Extra features
Source: Ofcom
Sound quality and choice are top two benefits
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UK Australia Germany
Electronic music
ClassicalDecade Country
Unsigned bandsClassic Rock
Specialist music services – for niche audiences
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Sport Drama & comedyScience
Specialist speech services – e.g. sports or archive
• Germany: live football
• Up to 5 matches simultaneously
• UK: archive from the BBC
• Germany: higher education for younger audiences
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Strong brands – key to success
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Energy on FM
Hamburg
Berlin
Nuremberg
Stuttgart Munich
Rhein-Main
Potential to extend geographic reach
Energy on DAB+
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Analogue and digital Digital-only services
Extend the brand portfolio
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Weekly listening hours, m
11.3 9.5 11.2 12.6 12.3
1.7 6.47.613.0
15.818.8
22.825.3
13.010.2
Q4 09 Q4 10 Q4 11 Q4 12 Q4 13
Absolute Radio (core service) Absolute digital-only services
Source: RAJAR
+95%
Absolute’s listening hours - up 95%
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5.86.7 6.7
9.2
9.2
Q1 10 Q3 10 Q1 11 Q3 11
Source: RAJAR
+37%
Rebranding as “Radio 4 Extra” added 37% listening
Weekly listening hours, m• Radio 7 (DAB), sister station to Radio 4 (FM)• Rebranded as 4 Extra in 2011
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Increase audiences
Increaserevenues
Innovation
How can digital radio build value for broadcasters?
1 2
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Sponsorship opportunities – youth audiences
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Branded stations take sponsorship to new level
• Branded channels – aimed at housewives target audience
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Pop up stations – for range of events
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Sponsorship opportunities – music tour & digital radio station
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Sponsorship opportunities – music tour & digital radio station
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Colour screen devices create new opportunities
Revo Pixis
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Colour images for additional information
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Hybrid radios with Bluetooth connectivity – from €59
John Lewis Spectrum Duo
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• Hear new song on radio
• Hit button
- for info
- add to playlist
- share with friends
New song
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• Hear ad on radio / see visual display
• Tag to interact
- access more information
- register interest
Advertising
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Contents
1. Introduction to WorldDMB
2. Radio today
3. Business case
4. Critical success factors
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Policy and regulation
Critical success factors
Coverage Content Retailers CarsConsumer devices
Consumers
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Policy and regulatory framework
Policy• Clear vision and commitment to a digital future from
Government / regulators
Public radio
• Success of digital radio depends on active support of major broadcasters – needs to be funded
Private radio
• Link between commitment to DAB+ and renewal of FM licences
• For digital services, reduce regulation (fewer restrictions)
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Government
Network providers
Regulator
Commercial broadcasters
Public broadcasters
Coverage – work together to create cost-effective plan
• Start on major population centres
• Define strategy for major roads
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17 services on AM and FM Over 40 on DAB+
Digital content proposition must be stronger than FM
Sydney analogue services Sydney digital services
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Devices available from wide range of suppliers
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Retail activityConsumer marketing
• Consumer advertising encourages footfall and inspires confidence in retailers
• Retail (with the right product, point of sale and trained sales people) delivers sales
Marketing activities must be co-ordinated and sustained
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TV ads, heavy FM promotion and device give-aways
Source: BBC and Bayerische Rundfunk
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Devices available in-store
MediaMarkt, Berlin, March 2013
• Must have strong retail support for DAB+ radio
• Devices on shelves
• Training for staff
• Post-code checker
• Repeaters
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• Educate local importers and dealers
- consumer benefits
- coverage plans
- long term commitment to DAB+
• Work with international partners
Automotive – work with manufacturers to fit DAB+ as standard
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Policy makers and regulators
Industry stakeholder
body
Key to success is collaboration
BroadcastersNetwork operators
Devices Retailers Automotive Consumers
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Thank you
For further information, please contact:
www.worlddab.org
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54Source: CAP/SMMT
0%
10%
20%
30%
40%
50% Standard Cost Option
Q1 10 Q4 10 Q1 12 Q1 13 Q1 14
4%
10%
22%
35%
45%
In UK, 45% of new cars have DAB as standard