The digitisation of radio will bring better sound quality. It will also increase the number of channels and allow existing content to be complemented with text and images. But radio will have to contend with the internet and the popular podcasts, file exchange platforms, satellite providers and mobile telephony.
Many of these options are already available and competing for customers. These customers, however ,only represent a small minority of radio listeners. Whilst providers have been working on digital signal and content for a few years now, consumers are still far from being digitised.
Manufacturers have been slow to respond to the digital shift, partly due to the lack of convergence amongst providers with regards to which platform will work best. The high fragmentation of the content across platforms also poses cost challenges for broadcasters.
Industry regulation and the development of more collaborative business models could overcome some of these challenges. They could allow broadcasters to send programmes to PDAs and cell phones for instance.
It's hard to say who and which platform will commend audiences as large as that of the incumbent analogue system. But what is sure is that digital radio will need to leave its old business model (broadcaster-advertiser-listener) behind in favour of new, more fluid models.
Source: A new golden age of radio
Lluiss Renart, Nicolas Munoz
IESE Insight Feb 2007
Review by Emilie Filou