Audio: By the Numbers
By Laura Houston Santhanam, Amy Mitchell and Tom Rosenstiel of PEJ
“By the Numbers” houses a comprehensive set of charts and tables telling the story of each media sector. For a narrative summary, visit the corresponding essay.
The vast majority of Americans still report listening to AM/FM radio weekly. But, as many as 40% percent of Americans now listen to audio on digital devices, and that is projected to double by 2015, while interest in traditional radio—even the HD option—is on the decline. One of the prime arenas for digital listening was the car, once the domain of AM/FM radio.
By the most basic measure, traditional AM/FM radio’s has retained a place in people’s lives. The vast majority of Americans use or own an AM/FM radio, and at a level that has remained largely unchanged over the last 10 years.
The growth and momentum, however, lies in digital-only listening.
More people are listening to online audio services. In 2011, one-third of all Americans (34%), or 89 million people, said they listened to either streaming of AM/FM stations, Internet-only services, such as Pandora, or both in the previous month.
Among those who listen to both AM/FM streaming and Internet-only services, 9% of Americans in all, a growing number of people say they listen to Internet-only services the most.
Since 2009, the amount of time people spend listening to online audio has climbed. From 6 minutes, 13 seconds on average in 2008, it grew to 9 minutes, 47 seconds in 2011.
There is also clear affection for these newer forms of audio listening. Three out of four people say they like or love satellite audio, the same number of people who said that they like or love Pandora. Meanwhile, 69% of people said they like or love AM/FM broadcast radio. Still, online audio in general received less enthusiasm (53% liking or loving it generally). Portable devices such as the iPhone, iPod and iPad inspired the greatest affection.
One of the more interesting trends evident in 2011 is the use of smartphones to bring online audio into cars. Use nearly doubled in 2011, and with smartphone ownership projected to eclipse that of personal computers in 2012, online audio may stand the chance of competing even more with AM/FM broadcast radio.
In addition to streaming their broadcasts over the internet, broadcasters have also developed HD digital radio, which allows stations to add new channels aimed at niche audiences with higher-quality sound. According to the latest data, though, the evidence is growing that HD is failing to take hold. Most people are aware that HD radio exists, but very few adults express interest in it. From 2006 to 2010, the number of people who said they were interested in HD radio never rose above 8%.
The number of stations that added HD declined in 2011, continuing the trend first seen in 2006. According to BIA Financial Network data and analysis from the Project for Excellence in Journalism, only 17 stations added HD signals in 2011, for a total of 2,103 stations.
The economics of audio, by contrast, still tilt heavily in the direction of traditional radio broadcasting. As in other media sectors, this has been the innovator’s problem of trying to invest in new technology when the old continues to generate the most revenue.
Over all, radio revenues increased by about 1 percentage point to $17.4 billion in 2011, according to data from the Radio Advertising Bureau. This was far less than the 6% revenue growth in 2010. That, however, was when radio revenues had more ground to regain after the recession took its toll.
In 2011, total radio revenue grew, but to a lesser degree than the year before. And spot advertising, which dominates radio broadcast revenue, was flat. In contrast, digital platform spending, the smallest piece of the pie, is projected to have the steepest upward growth trend. Just as we see in audience trends, then, the challenge will be who will capture that digital market share.
A Big Year for Internet Audio Services
Internet audio services, such as Pandora, SlackerRadio and Spotify, saw important developments in 2011. Along with more people tuning in to internet audio, Pandora Media made an initial public offering of its stock and a new competitor, Spotify, made its debut in the U.S. While Pandora and Spotify are not the sole competitors in online-only audio, they have an established presence and brands that makes them increasingly recognizable. For all the growth in audience, however, a sustainable business model has yet to fully emerge.
Nearly half of all Americans have heard of Pandora.
The first of the major challengers to AM/FM, satellite radio saw audience and revenue grow in 2011. The U.S. satellite radio industry is now a single company, SiriusXM. The company reported attracting new subscribers in 2011, but some are not happy with the company’s recent announcement of higher subscription charges.
The use of podcasting hit a plateau in 2007, and has largely stayed there since. As of 2011, 45% of Americans report knowing what a podcast is, about on par with awareness levels since 2007.
Just one-quarter of Americans, though, reported listening to podcasts in 2011, compared to 23% during the previous year. Only 9% of people reported that they “love” podcasts, according to Arbitron’s data.1
The volume of podcasts was also fairly steady at more than 91,000 in 2011, compared to nearly 90,000 the year before, according to PodcastAlley.com.
Where does news fit into the audio landscape? News/Talk/Information (most of which is syndicated talk shows) remains one of the most popular broadcast radio formats among Americans, second only to country music. Nearly 59 million listeners tuned into news/talk/information stations in Fall 2010, according to Arbitron.
Older listeners make up the biggest cohort of news/talk/information’s audience of more than 58 million people.
Listening to a radio broadcast or logging onto a radio website is the way 51% of Americans say they get their local news, according to a survey from Pew Research Center’s Internet and American Life Project and the John S. and James L. Knight Foundation. The medium falls behind local television news (74%) and word-of-mouth (55%). Most often, adults between ages 30-65 turn to local radio.
Although people generally are not spending as much time listening to news/talk/information as they once did, the number of news/talk/information stations grew in 2010, the last year for which data are available. With the 2012 presidential election under way, station growth is expected to continue, and listening may increase.
Public news/talk radio dominates traditional public (noncommercial) radio. It attracts 47% of all public radio listeners, far outpacing classical, jazz and other public radio formats. Overall, 2% of the population tunes in to public radio every week. Across all age groups, these listeners are more likely to be men than women.
In 2011, NPR underwent a year of upheaval. Key members of its upper management left or were fired. NPR was the focus of threats from Republicans in Congress about federal funding, although the cuts were not passed in the Senate. In the end, fewer people listened each week to NPR in 2011, though the number of member stations increased, as did NPR’s total operating budget.
Furthermore, NPR is making headway in reaching audiences on other platforms and devices, including Facebook and apps for iPads, iPods and Android.
Talk Radio Hosts
Michael Savage and Glenn Beck swapped standings in the broadcast talk radio world in 2011. Beck lost listeners on radio during the year in which he also lost his program on Fox News and started his own online cable outlet, Glenn Beck TV. The No. 1 spot continued to belong to Rush Limbaugh, whose audience is an estimated 15 million weekly listeners, a number unchanged from the year before. Sean Hannity maintained his spot as the second most listened-to talk radio host in the U.S., with 14 million weekly listeners.
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- Arbitron. "The Infinite Dial 2011." April 5, 2011. ↩