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FOR RADIO NETWORKS, CONSUMER CONTROL COMES WITH A PRICE

Subscription-Based Models Offer Exclusive Content and No Ads

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NEW YORK (AdAge.com) -- TV isn’t the only medium that knows consumers crave control.
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Radio networks, which syndicate top-rated talk personalities, also offer their content on demand. But unlike the free, ad-supported video-on-demand cable TV companies envision, radio networks have adopted subscription-based models that allow listeners to pull up radio shows on demand -- as well as access behind-the-scenes show prep, exclusive blogs and other premium content.

Branding on-air personalities
“The branding of our high-profile personalities is our No. 1 objective,” said Marc Horine, senior director for new media group at ABC/ESPN Radio Networks, which offers on-demand services for ESPN Radio shows, conservative talker Sean Hannity and “MoneyTalk” host Bob Brinker. ABC/ESPN offers free audio streaming, so the subscription model is really about on-demand and insider access.

“You can’t get close to Dan Patrick on SportsCenter, but through ESPN.com you can,” Mr. Horine said. “And if you pay, you get more access.”

ABC is looking to expand it on-demand feature to all ABC/ESPN Radio Network products this summer, with podcasting services close behind. Podcasting allows listeners turn audio content into MP3 files, which are easily downloadable on iPods or other MP3 players.

Growth of on-demand
On-demand programming is the hot buzzword in TV these days. VOD revenue and use is on the rise: By the end of 2006, 97% of the country's 34 million-plus digital cable subscribers will have VOD, and the revenue is projected to grow at a compound annual rate of 30% to $2.7 billion by 2009. One of the big question marks is whether consumers will continue to pay for on-demand content or opt for ad-supported versions. Additionally, many marketers are exploring ways to use the concept so that consumers interested in their products can opt into a longer-form ad message.

In 2001 Premiere Radio Networks launched subscription-based on-demand access to several of its popular personalities, including Rush Limbaugh, who sometimes broadcasts a “fourth hour” of additional content for subscribers, and Glenn Beck, who talks exclusively to subscribers during commercial breaks.

“They get this peek behind the curtain, to see what the motivation is, what the process is,” said Brian Glicklich, Premiere Radio Networks’s vice president and president for interactive services. “There’s this whole level of advanced access for people who are so interested in the show that they become subscribers.”

An advantage over TV
Radio networks have been offering on-demand services for the past four years -- perhaps because, as Mr. Glicklich says, “we have an advantage [over TV] because radio has a reduced bandwidth.”

Premiere doesn’t offer free streaming, but subscribers can listen online, time shift shows, download MP3s of a broadcast to transfer to a portable device or store on a CD, and in some cases watch video of the host. It has also recently created proprietary RSS-style software that automatically delivers podcasts of a few of its more popular personalities to a subscriber’s computer or portable MP3 player.

Neither Premiere nor ABC/ESPN sells advertising to support their on-demand services.

“It’s a serious strategy for our group going forward and a nice business for us,” Mr. Horine said. “But it’s not our bread and butter. ... We are a terrestrial radio company but looking to enhance offerings with consumers so, while they have choices, they’re still sticking within our brand, our products.”

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