Radio Claims 76% Would “Pay Extra” for Cellphone FM Tuner

National Association of Broadcasters (NAB) release results of nationwide poll claiming sizeable majority of cell phone users would like the ability to listen to local radio stations through a built-in radio receiver on their mobile phone. Effort is to bolster attempts by the NAB and RIAA to get Congress to require all portable electronic devices to include an FM tuner in exchange for radio paying a reported $100 million in royalties to artists and record labels.

The RIAA always manages to surprise us by consistently reaching new levels of insanity, but what is becoming increasingly clear is that this insanity has a way of rubbing off on the company it keeps.

Last month I mentioned how the RIAA had partnered with the National Association of Broadcasters (NAB) to lobby Congress to require that all portable electronic devices include an FM radio tuner. In exchange for the RIAA’s help, the NAB would help support amending the Performance Rights Act which would amend copyright law to “grant performers of sound recordings equal rights to compensation from terrestrial broadcaster.

Radio enjoys a longstanding exemption from having to pay performance fees under US copyright law. Unlike webcasters and satellite radio which have to pay royalties to songwriters, artists and record labels, radio has only had to pay royalties to songwriters. It has been exempted from the rest in the name of artist promotion. Removing the exemption would mean radio would pay upwards of a reported $100 million per year in royalties; so the RIAA gets cash and radio gets an expanded audience.

Criticism of the plan was immediate with Consumer Electronics Association president Gary Shapiro referring to it as “buggy-whipping” by the NAB and RIAA which have refused to “innovate” and adapt to the digital marketplace and have decided to try and “impose penalties on those that do.”

A coalition of six technology industry associations even sent a letter to the Chairmen and Ranking Members of the U.S. House and Senate Judiciary Committees asking them not to include an FM tuner mandate as part of what is ostensibly unrelated conflict between the broadcast and recording industries over royalties.

Now the NAB has released the results of a new nationwide poll claiming that americans do in fact want an FM tuner in their cellphones.

Among the poll findings:

• 76% of cellphone owners would consider paying a one-time fee of 30 cents to access local radio stations through a built-in radio chip.
• Local weather and music are the top reasons they would listen to their local stations on their cell phones.
• 73% of cell phone owners indicated that having a radio built into their cell phone capable of providing local weather and emergency alerts in real-time would be “very” or “somewhat” important.
• While 66% of adults would use a built-in radio, 71% of 18-34 year olds and 35-44 year olds as well as 73% of single and never married adults indicated they would use a built-in radio to listen to local stations if their phone was equipped to receive local radio stations without using mobile apps or their cell phone provider’s data plan
• Parents are also more likely to want to listen to local radio stations on their cell phone. 70% of parents indicated they would use this function.

The poll was conducted online between August 31 and September 2, 2010 among 2,587 U.S. adults 18 and over.

“Today’s survey results demonstrate convincingly that there is significant demand for radio-capable cell phones in the United States,” said NAB Executive Vice President of Communications Dennis Wharton. “Unfortunately, most U.S. mobile phone users have been denied over-the-air access to their favorite free and local stations. With much of the U.S. cell phone market built upon exclusive contracts between carriers and manufacturers, most consumers are left paying for fee-based data-intensive streaming apps with no free, broadcast alternative.”

Now I’m surer Harris Interactive is good at what it does, but the poll, in my opinion, is completely bogus. Who the heck wants to listen to the drone of stale, ad-filled radio when they have FREE (cellphone data package aside) music streaming services like Slacker, Last.fm, Pandora – the list goes on and on. Better still is that the sites are customized to your particular taste and aren’t some bland playlist spit out by Clear Channel corporate HQ.

I doubt the researchers asked which they prefer: streaming radio or terrestrial radio?

Again the CTIA has the appropriate response to the dubious scheme, questioning the sense of replacing private sector innovation with govt design requirements.

“A chip mandate is the wrong answer. Government-dictated design would reduce innovation and limit consumer choice,” says CTIA Vice President Jot Carpenter. “In reality, FM capability is available today for consumers who want to access over-the-air radio on their mobile devices. Contrary to NAB’s self-interested assertions, a majority of consumers do not want that capability, and the notion that they want to pay more for a functionality they do not want is ridiculous.”

If the worst part is that consumers aren’t asking for the feature, then how about the fact that the costs of the mandate will be passed along to cellphone customers?

The whole plan wouldn’t even exist it weren’t for the RIAA and its attempts to extract more money from radio broadcasters, proving that the real heart of the debate is once again an inability on the part of the music industry to innovate and its desperate attempts to drag down everybody else as it tries to save itself.

Stay tuned.

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