This is an updated
version of a column originally posted February 2, 2015.
About 18 months ago
I reported on the problematic situation regarding HD Radio at CPB-funded stations
and CPB’s role is this situation. I am not blaming CPB. CPB’s plan to add
hundreds of HD channels was hatched at a time in the early 2000s when future
adaptation of HD technology was unknown. Now the dismal state of HD Radio
is known and CPB should become part of the solution.
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| Source: Jacobs Media |
As we now know, consumers have rejected HD Radio. Aside from cheery
company-sponsored news releases in Radio
World, there is little conversation now about HD. Many stations accepted
CPB’S offer to help finance HD channels. Now they are required to keep their HD
channels going regardless of the cost and lack of interest by listeners.
 |
| Source: Jacobs Media |
To the best of my knowledge, every HD channel that appears in Nielsen Audio’s
ratings uses an FM translator to repeat the HD channel. Fact of Life: When
someone is listening to HD on FM, they are really listening to FM. Feeding FM
translators is one thing HD does really, really well. CPB should help stations
on the hook for HD create more FM stations via translators
RUNNING THE NUMBERS ON CPB’S INVESTMENT IN HD RADIO
To understand what
is going on with HD radio and CPB, follow the money. Even CPB doesn’t know how
much money they and stations have invested in HD.
About a decade ago,
CPB made it easy for stations to get into HD. A highly respected station
manager, who asked me to keep his name confidential, put it this way:
CPB's HD grants were the
fastest and easiest $75,000 anyone in public radio ever came by.
[CPB’s] HD
radio campaign was a stimulus for spending money on hardware. CPB temporarily
assumed PTFP's role of subsidizing equipment replacement. Many stations justify
HD adoption because they replaced aging analog transmitters.
There have been enormous opportunity costs
for HD. CPB's millions might have been better sunk into stimulating journalism.
Untold staff hours were wasted on HD - logistics, installation, promotion, and programming.
My guesstimate of
the investment in HD Radio by CPB is somewhere north of $23 million. This does
not include the ongoing cost to stations. I base my guesstimate on information
that is available in public documents:
• A CPB press
release said approximately 300 stations participated in CPB’s HD Radio digital
conversion.
• The average cost
to establish HD Radio capability was around $130,000 per station.
• CPB paid $75,000,
or 70% of the project cost to entice stations to build HD channels. Minority
service stations and hardship cases got more even more money and/or a higher
percentage of funding from CPB.
• Lets say CPB
spent $75,000 for 200 stations to move into HD Radio; and $85,000 for 100
stations to the same purpose. Assuming these figures are correct, CPB’s
investment to stations into the HD Radio business is at least $23,500,000.
To date, the
Corporation for Public Broadcasting has given member-stations approximately $50
million in HD Radio “upgrade” grants (some of them of the matching variety). [link]
These estimates do
not include station investments, licensing fees paid to iBiquity, programming
or operating expenses.
STATIONS ARE ON THE
HOOK FOR THEIR HD CHANNELS
As part of the
agreement with CPB for stations to build HD capacity, the stations made a
long-term promise to continue operating their HD channels or they had pay back
the money.
One station manager
described the situation this way:
Pity the poor stations that
are still touting their HD service that no one listens to.
To this day, NPR
still exploits station's HD innocence by charging $3,000 / year to run NPR on
HD. How many stations flush $3,000 down that rat hole?
Nothing has changed in the
year since February 2015. Stations continue to subsidize HD channels that reach
virtually no listeners. This is a waste of valuable public service funding.
BEST CASE SCENARIO: “MOVE”
HD CHANNELS TO FM VIA TRANSLATORS
One of the few
benefits of station investment in HD Radio is that it provides a cost-effective
way to feed FM translators. We reported on one example in January 2016 [link].
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| THE MIGHTY 90.9 • The Rock of Duluth |
American Public
Media’s (APM) 89.3 The Current is expanding its reach with a new Instant FM
Station covering the Duluth/Superior metro area. It debuted
on February 1, 2016. FM translator W215CG 90.9 repeats The Current from Classical WSCN HD-2 channel.
Now The Current is serving thousands of "music discovery" listeners in the Twin Ports. They are adding additional local programming.
Hello CPB: This is the kind of "HD Recovery" plan CPB should support for frustrated HD station owners across the nation.
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