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radio technology

Google exits radio – is that good or bad?

What's Google Doing With Radio? (cc) James Cridland @ flickr

Google’s exit from the radio arena this week wasn’t necessarily a huge surprise. It was a bold move to try and port their successful advertising business from the Internet to radio, and to do so without primary control over the inventory they were selling and the environment they were selling into. But it didn’t seem to be getting the prominence in the marketplace to make it successful.

Google created a relatively rich technology ecosystem in order to support the on-line trading of  radio airtime. They acquired dMarc, and set about re-branding and reworking that company’s playout system, to relaunch it as Google Automation, with integral support for Google’s APIs for advert insertion. They worked with the vendors of other major playout systems to extend the number of playout products supporting Google ad insertion. They created a pretty good, simple, on-line interface to allow people to book airtime campaigns, and monitor the performance of them. And the Google Creative Marketplace allowed advertisers to find creatives to make their radio adverts.

There are some things that I don’t think we’ll really miss. I was really disappointed with the Google Automation product, which I didn’t think was worthy of having the Google brand applied to it. When I think of Google, I think of innovative UI design, clever APIs, and rich-meta data. Google Automation didn’t live up to those expectations, and I think there are much more capable and exciting playout products in the market.

Google tried to sell radio advertising as a commodity; buyers didn’t know what stations their ads were going to run on, and they only had vague controls over formats, demographics and geographic area. That Google was unable to commoditise radio is probably good news. It means that brand values, production values and market prominence are still important, and that advertisers want to be heard in the right environments.

But there are some things that I hope radio can hold onto after Google has left. The principle of on-line trading of airtime is really interesting, and could mark a change in the way that radio is sold, in the same way that airline shifted their business from selling through travel agents to selling through websites. The cost of processing those orders and transactions could fall, which means more money going to programme making, and maybe even more money going to make better radio adverts. It might even open up radio to new advertisers, particularly in the small non-metro markets that find life particularly hard.

I thought the Creative Marketplace was a very cool idea. I wonder if it will live on in another guise? I like the idea of many individual, freelancing creatives being able to connect with so many prospective customers – a trading floor for creativity. Great idea, and a shame for it to get lost.

The technology behind the project was good, as you’d expect from Google. Radio airtime scheduling is still somewhat archaic, often involving the nightly transfer of flat text files, and it’s difficult to really deliver on radio’s ability to be immediate. Google created a set of APIs to schedule and insert adverts in near real-time, and get the reconciliation back almost as quickly. Ad breaks were filled just minutes before they were played out, which is the way it should be. We should keep that as the benchmark for airtime scheduling, giving us an almost unique position in mass-media.

Google have said that, whilst they’re withdrawing from radio, they will keep this technology and develop it for personalised advert insertion in on-line streaming. I’m not sure that will give them any more success. If the radio industry is smart, it will create formats which will deliver targeted demographics with low wastage, meaning that the efficiency gap between broadcast advertising and personalised advertising will be fairly narrow, reducing the financial incentive for advertisers to get into the altogether smaller, more complex and more opaque world of streaming advert insertion. (Let’s see how Spotify does with that one).

One thing I was surprised about. Google did some clever technology, but didn’t really introduce any innovation into radio advertising. They didn’t seem to offer a service that encompassed advertising on-air and on-line or on the radio station’s website, something that is more routine in radio companies own sales forces. Why didn’t Google see the opportunity for synchronising visuals, audio and interactivity and offer radio stations a streaming “tuner” that did all that for them? That kind of differentiation might have given them the edge they needed.

Maybe it’s unrealistic to expect Google to have a vision for innovating with radio advertising. That responsibility seems to rest with us.

Photo: What’s Google Doing With Radio by James Cridland @ flickramusingly taken at NAB in 2006 in Rome, IIRC.

Categories
dab digital radio radio technology

The Internet is not a risk to Radio

Participation Levels in Online Services by EduBlogger @ flickr

I was at the Media Guardian Radio Reborn conference last week, and Claire Enders showed us one of those scary “share of display advertising” graphs. True to form, every sector was either in decline or clearly looking a bit feeble (radio in the latter group). The share of spend was on the vertical axis, and the sectors (TV, National Press, Regional Press, Radio…) along the horizontal access, although “Outdoor” was inexplicably absent.

The only set of bars in growth was the set labelled “Internet”.

But this strikes me as being wrong; it’s an invalid comparison. “The Internet” is just a set of interconnecting networks, using an agreed communication protocol. There’s no business called “The Internet Ltd/plc” (although doubtless Google are working on that right now).

A more accurate set of labels would have been: “ITV & other commercial TV operators”, “Guardian & other national newspaper publishers”, “GCap Media plc & other commercial radio operators”, and… “Google & other search engines”. That would be a far more accurate indication of where the money is going. Money doesn’t go “to the Internet” – it goes to companies who have used “The Internet” as a platform to access consumers that they were previously unable to.

What a more accurately labelled graph would show us is that advertisers are moving their money to where they feel it is more effective, a feeling that’s re-enforced by apparently magical accountability for every display and click. (Can you tell that I’m sceptical?). The problem isn’t “The Internet”; the problem is that traditional media owners have failed to keep up with their clients’ demands, or (and probably more realistically), educated their clients to have more reasonable demands.

Google & Co. have a substantial audience. OFCOM tells us that 65% of the UK have “The Internet” (of which 86% apparently have “Broadband”, whatever that means). Here’s what’s interesting – whilst the content consumption on the Internet is fragmented beyond belief (and this blog contributes yet another consumption pin-prick on the map), the commercialisation and aggregration of that audience is in the hands of a much smaller number of media sellers. So actually, what Claire was really trying to tell us is that advertisers trust Google to deliver better results on a “per click” model or multimedia display model, than they do with incumbent TV, Radio or Newspaper companies.

The challenge for incumbent media owners is to change the perception of advertisers about “The Internet”. Some of that needs to be through real, demonstrable, product development, and clawing back some of people’s media consumption time that is now spent with Google, Facebook, et al. Incumbents allowed competitors to steal audience from right under their noses because they didn’t think “The Internet” would ever be a platform of significant reach. Now it’s up at 65% coverage, compared with ~90% for TV and Radio, and 50%-60% for Newspapers (national readership survey).

But the second challenge is to offer a commercial proposition that is attractive to those starry-eyed about “Internet” advertising. That’s a mix of really good, effective, communication with consumers, and believable and trustworthy measurement.

I think it’s amazing how much trouble Kelvin Mackenzie caused the radio industry by selfishly trying to derail RAJAR by claiming it was inaccurate. One person created an environment of anxiety about the reliability of RAJAR’s measurements, but everyone apparently finds Google utterly trustworthy and really truly believes that they measure every click and every ad delivery. Maybe they should look at some of the Javascript that delivers the ads, or work how many splogs there are out there? Or survey how many people have ad-blockers? I’m not trying to undermine the on-line advertising ecosystem, but there needs to be some reality about the fallibility of any system.

The radio platform is used by 90% of the population, and commercial radio used by 62% of adults. Commercial radio is about at parity with “The Internet” in terms of reach, but ahead on time spent consuming. With Digital Radio we have a platform that’s capable of delivering a similar digital advertising environment as “The Internet” platform, but is still far more ubiquitous in every part of life. I believe we’re still a long way off, in behaviour terms, people using “The Internet” in the kitchen, bathroom, bedroom; and thankfully economics will continue to make using “The Internet” in mobile environments a great deal more expensive than receiving digital radio. So if we can use Digital Radio to deliver advertising propositions that are the same as the ones delivered on “The Internet”, that can be measured as reliably, and are demonstrably as effective, we stand a chance of revitalising interest in what radio companies can offer advertisers.