David Gibbs: what shape will radio take in the future?

The last radio survey for 2017 radio has just been released and overall, it’s another good year with the medium continuing to attract a large audience. Radio’s starting to look like an almost non-disruptable medium and has thrived in the disruption and modern media chaos. However, will it remain sustainable in the medium and long term and what form will it take? 

What we can predict is that radio does have a future and can continue as a mass media with the fundamentals in place, but it won’t sound quite the same as it does today. There are plenty of challenges ahead to face predominantly but not exclusively brought about through technology either directly impacting radio or through how audience engage and the how advertising base partner.


Increasingly listening will move digitally whether that’s apps or through other online consumption. Already roughly 15 percent of measured radio consumption is done this way. Both circumvent the need to have expensive transmission costs and allows networks to deliver additional formats and products this way. As much of this is currently younger audiences, I suspect some of the younger niche stations will move to this format rather than take up expensive and prime spectrum (for example, George FM). Additionally, podcasts, video and additional information can be handled easily digitally. Digital radio will enable new players to enter the market especially at the local level, the challenge for owners is how audiences find digital stations. 

Alongside content, radio’s strength is its localism and mobility. It’s a generalisation and also a truism today as other mass media pull away from local products produced locally both radio companies have resisted pulling entirely into networking and run at least one local show daily. There will always be the attraction of efficiency of networking and I think New Zealand has gone about as far as possible on that front before it impacts audiences and advertisers.

Radio is local

Radio’s localism has been a critical lifeline to audiences. Radio informs and tells stories and enables sharing of stories. You see it during key events where audiences spike. Christchurch fires, the election and Americas Cup for New Zealand were examples this year.

Music and talk are the drivers of radio. Younger audiences access the latest music and older audiences appreciate being exposed to new and different ideas and points of view. The music position is being challenged, however, as did the ‘first for news.” The weekly listening of someone 18-34 is 25 percent less than someone 45-64 and teens are only 50 percent. This is where music is the significant driver of listening. Streaming and video music services now strongly compete with radio for a share of their time. If radio isn’t relevant to the younger audience and doesn’t become a habit and that listening trend moves into the 35+ market over time then radio as a compelling and viable platform may be called into question. Radio has so far seen off most of the initial streaming services but they will return.

Radio is the go anywhere medium

Mobility is the other driving force along with radio’s ability to be consumed passively, whether you’re driving, working or exercising. Technology has enhanced this and will only continue to do that. Investment is being pumped into this through online and digital listening. The in-car listening will be a new battleground. Three years ago, driverless cars were a futuristic vision; now they are becoming reality faster than we can imagine. Traditionally, radio consumption was hardwired into the car ecosystem and radio owns the car. As we spend more time stuck in traffic radio listenership has benefited.

The New Zealand car fleet is one of the oldest in the developed world. The average age of a car is 14 years. Given the first iPhone is only 10 years old, there’s still a significant captive market for radio until that average age significantly diminishes. Meanwhile, driverless cars will turn a driver into a passenger who potentially may wish to engage with alternative media (any media) or no media. No guarantees that audio won’t continue to be the medium of choice – but there will be plenty of other competing options.


Go back 20 years and most towns (outside the major metros) had two to three commercial stations to choose from. Now those same markets have upward of 18 commercial choices. At the same time the number of hours broadcast ‘locally’ has significantly declined along with the local staff that supported the on-air product.

The New Zealand radio scene has a very small personality pool with which to draw on: think Mike Hosking, Jono and Ben, Polly and Grant. Historically, this would come out of the regions into metro markets and from there into the networks. With 20 hours a week broadcast locally, the amount of on-air time locally reduces and more networking takes its place. And this in turn also reduces the opportunity for talent to develop. Talent fatigue becomes a real possibility in this environment. 

The role of Public Broadcasting

Our two largest commercial radio operators (NZME and MediaWorks) are locally owned. Intrinsically, they understand the local landscape despite the dire financial pressures (not from radio) both companies have found themselves in, but in five years it’s unlikely they will still be under the same ownership and no guarantee that a new owner will have the same desire to serve New Zealand audiences at the expense of maximising profits in the short term, especially if that was a US owner where radio performs poorly across most indices. Perhaps, one of the reasons is that the PBS in the US is extremely weak due to poor funding and political manipulation. Radio New Zealand is a very strong public broadcaster with good funding and a strong charter to guide it. Interestingly, whenever you have strong public broadcasting, the commercial operators deliver higher quality and more innovative radio with stronger audiences. As long as RNZ remains that way and continues to deliver quality programmes that are easily accessible, I suspect we will be well served commercially.    

The Future

As the cost of entry continues to decline, especially digital stations, the number of stations will rise and increasingly become niche with only the mega brands available on all platforms. Radio has historically been ‘live’ with the major stations attracting the big audiences the most revenue. Technology is driving changes with how radio is consumed and the way advertising is transacted is also beginning to shift. Negotiated 30-second commercials in groups of six to eight with station trailers book-ending the break could well become a thing of the past in the near future.

We might also see the end of the relationship between brands and specific media. As audiences consume various forms of radio, being able to take a brand on that journey with multiple executions of a brand story will be critical and require a much better understanding of who the audience is, where they are, how they consume and how brands can influence them. This means that brands might become less monogamous with their spend, sharing it across a variety of radio brands that customers listen to.   

Also, radio will be even more mobile and have more competition and a more competitive environment to deal with. There will be new owners who will need to seriously invest in infrastructure to support a modern multi-platform industry and sales teams that truly can help advertisers compete rather than negotiate spots and sell packs. 

We still love our favourite radio brands and personalities and radio’s strengths have remained true. There is no reason why radio cannot continue to thrive but there are a lot more challenges in the future to deal with than there have been in the past. There are no guarantees. 

David Gibbs was a radio executive with decades of experience across both Australia and New Zealand. His most recent radio role saw him serve as the acting head of radio at MediaWorks.  

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