For Immediate Release:

Friday, March 4, 2005

Where Are My Listeners Going?

In November, 2004, Bridge Ratings & Research released initial results from a multi-year-long Audience Attrition project. The results in that report reflected audience erosion from terrestrial radio due to generally less time spent with AM/FM radio and more time spent with a variety of digital media, including MP3 players (including iPods), Internet radio, satellite radio and Compact Disc.

As part of Bridge Ratings’ on-going studies of radio listening behavior, this month the company is releasing the 2004 full-year trending from its Audience Attrition project as well as initial findings from January/February, 2005.

This study, which has been tracking such behavior since January, 2004, once again reveals behaviors we have assumed are taking place, but heretofore have not had clinical results to confirm. While this project is intended to be a two year study, initial results show:

1. Audience erosion to alternative audio entertainment occurs through all demographics.

2. Erosion rate is most significant in younger demographics and is pronounced in the 12-17 year old age group although we are seeing momentum now in the 18+ market.This is evident when one considers the October thru February period trends.

3. On-going interest in alternative media has been building through each of the months thus far studied (January – December, 2004 and January-February, 2005).

4. Audience migration to digital playback devices (iPod, MP3), satellite radio, Internet Radio and Compact Disc is equally significant among male and female 12-17 year olds. And more recent survey trends show this parity among sexes as age increases to 18-49 year olds.

5. Audience erosion is now evident in older demographics (35-64), where a 16% increase in alternative media use is reflected from January to December 2004.

Methodology. Bridge Ratings measures CUME SHARE and FAVORITENESS rather than CUME and Average Quarter Hours.  AQH is a fabricated mathematical measurement of cume x an average quarter hour number composed of 'best guesses' by diary keepers.  Thus, the AQH number tells a station or its client nothing about the capability of the station to deliver listeners.

FAVORITENESS is a better measurement of loyalty especially when combined with the Cume number. The cume number divided by the favoriteness number yields a conversion number which more accurately measures station loyalty.  In Bridge Ratings studies, stations that convert their cume audience to favoriteness at the rate of 40% or more are powerful instruments in their communities. This is powerful information for both station and advertisers alike.

For the “Erosion Studies”, as an add-on to our usual questionnaire, Bridge Ratings selected 1000 persons over six national markets to be interviewed on an every other day basis regarding the listener’s use of AM/FM radio and, where applicable, their use of digital media players, Internet Radio, CD’s, or satellite radio. Questionnaires were structured to seek overall daily use of the aforementioned media with short recall requirements.

The results represent the multi-market sample’s behavior and reflects quarter hours of usage per week.

Traditional Radio Audience Erosion to New Media    

Number of quarter hours listened or used     

How to read: In the above chart, 12-24 year olds surveyed were spending 68 quarter hours per week with traditional radio (AM/FM) and 50 quarter hours per week with alternative media. During quarter 2, 2004, traditional radio usage among this group dropped to 66 quarter hours per week while their use of alternative media increased slightly to 51 quarter hours.

Over the course of the year, the 12-24 year olds surveyed used traditional radio 20 percent less (68 QH in Q1 to 54 QH) in December.

According to our sample, by the end of 2004 Adults 25-49 were spending 10% less time with traditional radio and 33% more time with alternative media. This age group is spending 16.25 hours a week or 2.3 hours a day with traditional radio and 1.5 hours a day with alternative media.

Where Does the Time Come From?

When additional media or activities are added to the mix, time spent with digital media by working adults 25-49 is having a profound impact on time spent with other lifestyle pastimes such as television, newspapers, the Internet and books & magazines.

Additional time for digital entertainment for Adults 25-49 is sourced at primarily television viewing with a half-hour a day. Time spent with non-media alternatives such as household activities (housework, food preparation, garden care), shopping, sports and socializing has also been affected.

Bottom Line

Since initially publishing the 2004 preview to this study, the radio press has been focused primarily on improvements in the first-quarter advertising environment, censorship and the industry's obsession with reducing commercial loads through strategies such as Clear Channel's "Less is More". It is interesting to note that along with Bridge Ratings findings many industry managers, consultants and owners are publicly 'soapboxing' for renewed investment in radio product, content and, most importantly, talent.

Radio's charge now is this reinvestment. No doubt times are changing and it seems that every week there is another digital alternative to broad-casting. Bridge Ratings will continue to monitor the behavior of the industry's lifeblood - it's audience. And if the radio industry continues to invest in its content and develop talent, these trends of migration to new media can perhaps be slowed.

For additional information, contact Dave Van Dyke at 818.291.6420.

Markets measured: Los Angeles, Phoenix, Chicago, Nashville, Boston, West Palm Beach

Bridge Ratings is a ratings and research company based in Glendale, California. We are dedicated to providing on-going, immediate, reliable, useable and affordable audience measurement services for the radio industry. Our methodolgy is based on sound consumer research principles. We are in the business of tracking listeners - not listening. Because we are a true research company we offer flexibility