When WHUR launched "high definition" digital radio this year, it advertised the move several times an hour on air. It slapped the "HD Radio" logo on its letterhead and employee jackets. It drove around town in a specially outfitted van inviting people to listen to the crisp, no-static sound. And it tutored consumer electronics retailers about the technology.
The marketing blitz at WHUR (96.3 FM), owned by Howard University, is not just about introducing listeners to compact disc-quality sound on FM stations and FM-quality sound on AM -- a feat described by some as radio's most dramatic technological leap since FM broadcasting debuted more than 50 years ago.
It's about educating advertisers and consumers. The digital signal can deliver not just music but text, voice and pictures. One day it might be possible to press a button to order a CD as it plays on the radio. Or hear customized traffic reports. Or pause or rewind your favorite song. These uses may become possible in just a couple of years, transforming radio from a passive medium to an interactive one.
But first, radio stations must buy equipment that transmits digital signals, and consumers must spend big bucks on radios built to receive them. After-market FM/AM digital car stereos hit stores this year. At today's prices, about $500 or more, they appeal mostly to technophiles. But if prices tumble as expected, sales should pick up. And if automakers start offering them, as some plan to do next year in higher-end cars, sales could surge to 4 million units in 2007 from 35,000 this year, research firm In-Stat/MDR said.
"If these radios go into a big-ticket item like a car, consumers are more likely to add them," because the cost doesn't seem so high relative to the price of the auto, said Michelle Abraham, a senior analyst at In-Stat/MDR.
But consumers are a quirky bunch, and unless they get excited about digital radio, manufacturers and automakers may shy away from mass-producing those radios.
"The average person on the street doesn't know it exists," said Stephen Jacobs, an assistant professor at the Rochester Institute of Technology. "There's a real consumer education piece that needs to be addressed before people gain an interest in it."
Broadcasters are taking their chances. Twenty-five percent of the nation's 13,000 radio stations have committed to going digital in the next several years. About 150 -- including WETA (90.9 FM) and WAMU (88.5 FM) in this area -- already broadcast digitally. Another 250 are preparing to install the technology within months. This summer, Clear Channel Communications said it would roll out digital equipment at 1,000 of its 1,200 stations, and Cox Radio Inc. said 80 percent of the 78 stations it operates or provides sales services to would make the change in the next four years.
In many ways, the migration is old-fashioned radio's way of staying relevant now that music is beamed digitally via satellite and downloaded from the Internet. Radio broadcasters fear these ways of bringing music to audiences will erode their ability to woo advertisers and the recording studios that supply them with free music. Radio generates about $20 billion in advertising revenue annually.
"Radio has been a well-oiled machine, but the parts are starting to grind no matter how much oil is poured in, " said Laura Behrens, senior media analyst at GartnerG2, a technology research firm. "So the machine really has to change."
The change is being helped along by Ibiquity Digital Corp. in Columbia, which engineered the technology that makes digital radio feasible. Ibiquity's technology, developed during the past 15 years, allows stations to send digital and traditional analog signals simultaneously on existing airwaves.
That means listeners who buy digital radios should receive the improved sound without having to search for a familiar station at a new dial position.
It also could mean more programming options. Eventually, stations could broadcast more than one program on the same channel and listeners could toggle between 93.9 FM, for instance, and 93.9A FM.
"The question for radio guys is, what will we do with all this additional capacity," said Scott R. Royster, executive vice president and chief financial officer of Lanham-based Radio One, which plans to convert its 69 urban music stations to digital within five years. Half a dozen of its stations have already switched.
"Maybe we can charge for these additional channels," Royster said. But "it will be a couple of years before we can start talking to the public in earnest about digital radio."
Whether consumers will pay for it is another question. And if these radios proliferate, with interactive features attached, will they prompt laws that restrict their use, the way cell phones have?
These questions may crop up in a few years. Robert J. Struble, president and chief executive of Ibiquity, said it will take three to four years before digital radio goes mainstream. It will take even longer for consumers to replace all 800 million radios in their homes and cars -- a phenomenon he thinks will unfold during the next 12 years.
Helping pave the way for that acceptance is the Federal Commission Commission's decision in October 2002 to approve Ibiquity's technology as the national standard for digital radio.
Ibiquity calls its technology HD Radio, a name it coined to piggyback on consumer recognition of HDTV. It has managed to avoid some of the setbacks suffered by its television cousin. Among them was controversy surrounding the government's decision to grant HDTV broadcasters a new chunk of airwaves for their digital signals. In exchange, the government wanted television broadcasters to give back their old, and valuable, analog airwaves. Opponents decried the transfer to broadcasters as an unfair giveaway.
HD Radio avoided similar squabbles by using existing airwaves. But because it holds every patent (103 to be exact) for digital FM/AM radio, the FCC requires it to grant the same terms and conditions to companies of similar sizes that want to license its technology.
Ibiquity licenses those patents and collects a small fee from anyone who uses them. A fee from broadcasters that use their software. Another from the company that sold broadcasters the equipment. Another from companies that make digital radios and more from firms that build chips for those radios, Struble said.
Many of these firms are Ibiquity investors, including the nation's top 12 radio broadcasters. Other stakeholders are Texas Instruments Inc., Ford Motor Co. and Visteon Corp. But the largest chunk of money comes from financial institutions, Struble said. He points to Grotech Capital Group, J.P. Morgan Partners and Pequot Capital Management Inc.
Struble figures that every one of the 70 million radios sold in this country each year eventually will use an Ibiquity patent.
"And we'll get a small check for each one of those radios," Struble said. "Small check, big volume, hopefully equals big business."
Jim Watkins, general manager of WHUR, hopes his radio station will benefit from adopting the technology early. In January, WHUR invested $75,000 to $100,000 to install a transmitter that sends digital signals on its antenna.
"When this digital market matures, we'll be seeing a return on the investment we put in because we have taken the time to experiment with it," Watkins said. "Right now we're just trying to educate and enlighten people about it."