DIGITAL AUDIO'S FUTURE LOUD, CLEAR Paul Bond – Reuters Satellite radio subscriptions are likely to climb to more than 20 million in the next five years, driven by early adopters of the technology with above-average incomes, according to a study released on Tuesday.
After that, however, the industry will have to consider price reductions or other measures to sustain rapid growth, the study concluded.
Sirius Satellite Radio and XM Satellite Radio might consider a two-tier system, whereby some subscribers pay $12.95 per month to receive commercial-free music channels while others pay just $8 or so for channels carrying limited commercials, said principal analyst Ted Schadler, who authored "The Future of Digital Audio" report for Forrester Research.
The study's main finding is that digital audio offerings in all its forms will continue to invade more and more U.S. homes over the coming years.
Competing with celestial and terrestrial radio in more meaningful ways by decade's end are iPod and MP3 players, online radio and "podcasting," in which consumers download to their portable digital players spoken-word files for on-demand listening.
Already, entities such as NPR and BBC are courting podcasters, as are small start-up firms.
In the future, predicts Schadler, popular talent like Rush Limbaugh might allow fans to download previous shows — or capture them with their podcatchers, for listening at their convenience — while the show prospers the old-fashioned way: delivering commercials to a larger audience.
"There are pieces missing from the business model," Schadler acknowledged, "but if you can measure ad impressions, you can make more money."
Podcasting, which has just begun to catch on with the savviest of Internet users, has huge potential, Schadler said.
According to the study, about 100,000 people experienced podcasting last year, though that number will grow to 12.3 million in 2010, when 34.5 million U.S. households will sport at least one portable digital content player, be it an MP3 player or iPod. |