Millennials abandoning AM/FM for streaming

Cars and kids used to be commercial radio's best friends. Driving around with "no particular place to go," finding the sound tracks of their lives with five push buttons on a car radio was the stuff that made for huge ratings at boomer-era radio stations.

But today's bulge of 83.1 million 18-to-34-year-old millennials, now the biggest chunk of the population, are steering their ardor for music elsewhere.

Instead of broadcast radio, they're wallowing in cool, "all request" tech and software alternatives: on-demand streaming and satellite music services, internet radio outlets, and podcasts galore. Ventures that were unimaginable in the eras of WFIL and WIBG, or underground rock and disco.

In its latest "Share of Ear" study, Edison Research discovered that one-third of today's millennials don't even own an old-school radio. And across the board, 21 percent of the U.S. population now gets by without one. That's up from 4 percent in 2008.

For many, streaming music and podcast app-laden smartphones have become the new transistor radios. And internet-connected cars are their new jukeboxes.

Take web designer Liz Pinney, 27, of Germantown. Her twice-daily, 40-minute car commute flies by, she says, on a nutritious, cellphone-tuned diet of out-of-market stations "like WWOZ New Orleans and podcasts like Radio Lab, Another Round, and The Many Moods of Ben Vaughn."

Here's another Edison finding: Among 18- to 24-year-olds, and teens 13 to 17, streaming audio actually beat out AM/FM radio as the top source for listening.

Like the poor kid who couldn't get a date for the prom, broadcast radio is trying to put a positive spin on the situation.

"The reach of radio has remained rock solid," said iHeart Media CEO Bob Pitman from his perch atop the nation's largest, 861-station radio group, formerly known as Clear Channel. The company was renamed a couple of years ago after its iHeart Radio streaming service. If you can't beat 'em, become 'em?

Complicating Pitman's job is a walloping $20.6 billion debt load and a public perception of radio's fading signal. That has cut iHeart's share price to about a buck, down from $6 last year, while the second-biggest radio group, Cumulus Media, which owns 454 stations, was trading last week around $0.35 a share. Another biggie, CBS Corp., is trying to unload its 117-station radio division.

Yes, broadcasters such as Pitman can cite Nielsen Audio "cume" ratings that 93 percent of the population - including 91 percent of millennials - still get their heads in front of a radio speaker every week. But industry cynics note that the portable people meter device that Nielsen raters wear in such markets as Philly counts radios playing in an elevator or clothing store.

Radio execs are more muted about "time spent listening" stats. Today that's about 14 hours a week, per listener, according to the Radio Advertising Bureau. In 2007 it was nearly 20. And when listeners do drop by for a station visit, it isn't for long. The average millennial's time spent listening to a channel has dropped to a mere 11.26 minutes.

Gen Xers (what Nielsen calls the 35- to 49-year-old coterie) and boomers (ages 50 to 67) are a bit more patient - or maybe less technically adept at finding alternatives, lingering 20 percent and 40 percent longer, respectively.

When Villanova-based Maddie Jones, 16, and sister Nell Jones, 18, go cruising in the family Subaru SUV, they may start out with a taste of 104.5 or Q102 pumping through the cabin. "But when the first" (of four, five, or even six) "commercial comes on, we are so out of there!" said Maddie. Just hopping down the FM dial won't do, "because other stations have their commercial breaks at the same time" (typically slotted at 20 and 40 minutes past the hour, for "quarter-hour" rating maximization). And the Jones girls seldom feel desperation to go back "because those stations play the same songs over and over," Nell said with a groan.

A touchscreen display and hidden computer behind the dashboard of today's modern rides make the skedaddling easy. AM and FM are now just two of several options you're offered on the screen menu, weighted equally with Sirius/XM satellite radio (the leading paid audio service, now in 30.1 million U.S. subscribers' cars), streaming radio options such as Pandora and Stitcher, and content/service aggregators such as Apple's CarPlay, Google's Android Auto, and Harman's Aha that can take over the car display when you bring a connected smartphone into the vehicle or pay a monthly fee for in-car internet service delivered mostly by AT&T.

Artificial intelligence-powered voice activation also is helping level the field for new radio alternatives. Popping up in cars, smartphones, and home speakers such as the Amazon Echo, this cloud-based tech can search for and deliver channels, podcasts, and tunes, almost as fast as you can say them!

The Jones sisters share a passion with their mother and father for Sirius/XM "throwback" channels. But when cruising with contemporaries, they are more likely to "call up a new album or Beats One radio on Apple Music or a Pandora station, which is great for discovering more artists like the ones you've already favorited," Maddie said.

Or else they'll plug in a phone preloaded with favorite tunes and pass it around, letting fellow passengers pick songs they want to hear, "though we rarely ever finish one," Nell said.

How is commercial radio responding? Most stations now offer online streaming versions of their broadcast feed, some post podcasts of the morning shows.

Former Y-100 Philadelphia program director Jim McGuinn, now running a Minneapolis public radio channel called "The Current," told me that the streaming version of his station "blew up worldwide, with 450,000 new listeners when Prince died and his fans wanted to grieve with us."

Havertown-based radio consultant Tom Kelly of Kelly Research counsels station clients that "the key to market survival is be hyper-localized."

And he tells them to chill out about perceived rivals such as Spotify and Pandora, which he believes "can't survive forever" on two commercials an hour. "Eventually they'll demand monthly subscription fees from all customers. Our research has found most people will no longer listen if they have to pay."

The National Association of Broadcasters has been pushing the Federal Communications Commission to mandate inclusion and activation of an FM radio chip in every smartphone for the sake of emergency communications, low power consumption, and zero demand on a user's monthly data allowance.

The Emmis Communications station group has been trying to build a fire under "NextRadio" - a hybrid smartphone app combining that onboard FM tuner with web-streamed visual enhancements/interactivity. But such big players as Apple and Verizon have balked and T-Mobile touts how it is already giving customers unmetered streaming of audio services.

HD Radio - which inserts extra and often commercial-free digital stations into an FM broadcaster's authorized frequency space - "is a nice idea that's been going nowhere," said Tom DeVesto.

A seasoned electronics-maker whose resumé includes the Advent, Cambridge SoundWorks, and Tivoli Audio brands, DeVesto is launching user-friendly, push-button preset Como Audio table radios that tune in FM and internet radio channels, Spotify Connect and Deezer streaming music, and also have accommodations for Chromecast Audio and voice-activated Amazon Dot devices. But no HD tuning.

"In Europe, broadcasters really got behind the [HD] equivalent - DAB - by putting exclusive content on it - a Rolling Stones concert, important soccer matches," he said. "If U.S. broadcasters really want to make HD fly, they'll have to show the same kind of commitment."

takiffj@phillynews.com

215-854-5960@JTakiff