According to this Business Week story, Standard & Poor’s sees a bumpy road ahead for media companies:

S&P expects radio advertising to grow only in the low-single-digit percentages in 2006. Radio ad demand is under pressure from competing media such as the iPod and satellite radio, as well as from excess commercial loads. … Even with lethargic revenue growth, radio broadcasters generate significant free cash flow.

S&P expects that online ad growth in 2006 will exceed 20%, reflecting the continued strength of both search and brand advertising. Marketers appear to be gaining confidence in the Internet’s ability to reach consumers. For example, Yahoo! indicated that its brand-marketing revenue from the top 200 U.S. brand advertisers grew more than 45% in second-quarter 2005, and Ford Motor has allocated about 15% of its marketing budget to online initiatives. Furthermore, some marketers have begun to incorporate search advertising as part of their overall branding campaigns, which could spur more online-ad spending.

Even assuming that growth decelerates somewhat, Internet advertising is likely to exceed magazine advertising in 2006. Spending on Internet ads could potentially surpass spending on radio in 2008, assuming 1% to 2% growth in radio ad spending and a minimal contribution from satellite radio.

Hmmm.

Russ Schell says don’t dismiss the JACK radio format just because I haven’t heard it:

“I launched the 3rd JACK station in the U.S. and found it, among the very few I’ve programmed, one I actually enjoyed listening to for extended periods. (It was also a ratings smash before I quit.) Most people don’t realize that every incarnation of JACK is different from another. There’s a very loose guideline, of course, in terms of presentation and production values but you won’t find all of the same songs on JACK stations in different parts of the country. There IS localization. There are collaborations with local values and local tastes when it’s done well. There are “air talents” on some JACK stations and none on others. It’s not satellite, it’s not syndication… it’s a concept, and one left open to wide interpretation. That’s the part that the naysayers don’t get.”

“Your Nano is good. Fine. Excellent for a road trip through Kansas… but Nano is a cocoon. Your own music, your way, without any outside intervention or appeal. It’s limiting in that sense and has nothing more “local” than your own brain and own “mix.” I can talk to myself all day… but that doesn’t make me interesting, challenging, compelling, or unique. Hopefully, somehow, that’s what radio can be.”

Russ tried to post this as a comment to an earlier post that linked to a post by Chris Anderson. (I can’t seem to get comments working properly here at Typepad) As far as I know, the Jack format is great radio. I just have not heard it. So I’m certainly not ready to dismiss it. There must be a place where I can stream it and take a listen.

As for the iPod nano: “nothing more local than your own brain and own mix” sounds pretty good to me, Russ. The good news (or bad, depending on your perspective) is, listeners will decide the fate of radio. If it’s good and entertaining and informative…we will listen. The new factor in the equation is all the choices we now have that didn’t exist a few years ago (Internet, iPods, satellite). Radio had a captive audience… and now it doesn’t.

I forgot about the Mothboard on this topic. The perfect place for Russ to have shared his comments. I’ll have to provide a more prominent link.