Broadcast conference focused on NextGen TV, radio's future

Introduction

The evolution of ATSC 3.0 — also known as NextGen TV — and its capabilities were on full display at the National Association of Broadcasters' NAB Show in Las Vegas, held April 24-27. Additionally, a heightened interest in radio panel sessions and audio streaming gave attendees some insight into what is next for radio.

* TV broadcasters, consumers and technology manufacturers are excited to see the real-world implementation of NextGen TV and new business models, following delays brought about by the COVID-19 pandemic.

* While television is a core strength of NextGen TV, there are other use cases that may be a more significant driver of revenue. Datacasting and enhanced GPS services are useful business cases for the new standard and are viable immediately.

* Radio continues to have a strong listener base but is finding it difficult to maintain its hold on listenership, particularly with regard to those between the ages of 13 and 34, who now often prefer streaming alternatives and are willing to pay for ad-free services.

Top takeaways from the 2022 NAB Show:

NextGen TV

Days before the NAB Show, Sinclair Broadcast Group Inc. announced a partnership with USSI Global to provide datacasting services to USSI's electric vehicle charging stations. The pilot program calls for the delivery of local content, advertising and data files to EV chargers, and it is a good example of just how broadcasters can license ATSC 3.0 technology and bolster their bottom line with new revenue streams.

Anne Schelle, managing director of Pearl TV Consortium, estimates that ATSC 3.0 will be available in 80% of U.S. TV households by the end of 2023. It is currently at 50%, according to Schelle.

Schelle also said that by 2025, 10 million TV sets will be sold in the U.S. with NextGen TV capabilities.

Broadcast multicast stations and networks are growing, with NextGen TV unlocking the potential of these stations through its added capacity.

Television manufacturers are also pushing to have more 4K content available through NextGen TV, with major events such as the Beijing Olympics already being made available in that resolution. Expect more events to be broadcast in 4K.

The broadcast ecosystem is likely going to change with NextGen TV becoming widespread. It will be easier to get national distribution for advertising because it can be incorporated using technology. Shawn Makhijani, senior vice president of NBCUniversal LLC Television and Streaming, said 2025 will be a "flipping point," when broadcasters will see a significant acceleration in advanced advertising due to NextGen TV.

Integration with multichannel video programming distributors will come in time as some will integrate NextGen TV into their systems, while others will not. "It will be a business decision," Makhijani said during a session panel called "What's Now and What's Next with NextGen TV."

Despite ATSC 3.0's popularity, there will be a certain number of TV stations that will not be able to change over to the technology because of cost. Financial support from the Federal Communications Commission is needed for those stations, but the likelihood of the government body funding upgraded station signals is highly doubtful.

Broadcast radio

While radio remains an important part of consumer audio, radio consumption is on the decline. According to a study conducted by Edison Media Research Inc. and commissioned by WorldDAB, 90% of all in-car radio listeners say a broadcast radio tuner should be standard in every car. Furthermore, 82% of the more than 6,000 respondents said they are less likely to buy or lease a car that does not have a radio. WorldDAB is a global industry nonprofit aimed at defining standards for digital audio broadcasting.

According to the latest Share of Ear study by Edison Research, radio in 2021 had a 38% share of time spent listening to audio sources for those aged 13 and above. Laura Ivey, director of research at Edison Research, presented the data during a panel session called "Audio Megatrends: What the Biggest Shifts in Listening Mean for Broadcasters' Future." That share has shrunk from 53% of all time spent listening to audio in 2014, due to the surge of digital and streaming audio platforms.

Growth in digital audio has been significant since 2014, with Spotify growing from 2% in 2014 to 8% in 2021. Podcast growth went from 2% in 2014 to 5% in 2021, and YouTube grew from 5% in 2014 to 13% in 2021, according to Ivey.

In addition, 47% of all AM/FM radio listening is done by individuals aged 55 and above. Younger listeners are turning elsewhere for audio, Ivey said. In 2014, 24% of all AM/FM radio listening was done by 13- to 34-year-olds, but that share shrank to 20% in 2021.

When it comes to the source of audio, listeners were spending as much time with mobile devices (32%) as with AM/FM radio receivers (33%) in 2021.

Interestingly, younger audio consumers are increasingly buying their way out of ads, with the share of ad-free audio among 13- to 34-year-olds going from 35% in 2014 to 51% in 2021.

Radio's daily reach remains strong. While declining from 74% of the daily cume of AM/FM radio in 2014, it remained at 63% of all daily cume in 2020 and 2021.

^{Broadcast Investor is a regular feature from Kagan, a media research group within S&P Global Market Intelligence's TMT offering, providing exclusive research and commentary.}