The Alternate Side, a younger targeted project launched by WFUV in 2008 will take over six hours a day on city-owned 91.5 WNYE/New York starting June 1.

The program will replace a simulcast from KEXP, Seattle partially hosted by John Richards (John in the Morning).

WNYE, an also-ran with a strong signal, has operated for years as essentially a time-brokered station, serving ethnic communities home-grown as well as syndicated programming.

KEXP bought time on WNYE at an extremely favorable rate months before the creation of The Alternate Side, in hopes of building an East Coast outpost for its alternative programming.

It never really panned out. While creating buzz in the ultra hip zip codes, there wasn’t much else. It was a tough putt — a checkerboard, multi-lingual station, and little ad budget to break through in a market of 16 million people.

WNYE never gained much cume, and never rated above a .1 share. The cume today stands at 139,000 people.

The Alternate Side, which takes its name from New York’s daily alternate side parking regulations, has been residing on 90.7 WFUV from 10 p.m. to midnight, and streaming online and HD3. This will remain the case in addition to the 30 new hours (6 a.m. to noon) on WNYE.

Check it out here.

Newer HD Radio models feature artist imagery.

To hear Ibiquity’s Rick Greenhut tell it, “It’s getting fun again.”

That’s because he’s selling a product that, in spite of a collapse in station values and a near-depression economy, continues to slowly but surely gain converts.

We’ve been fans of HD Radio for almost a decade now, and have been more than frustrated with a myopic view of many radio companies and doubters, as well as a fumbled rollout and marketing strategy.

But rather than concentrating on that, let’s look into where the technology stands today.

Our position is that great content has to come first, and as long as broadcasters throw up automated jukeboxes, there will be very little incentive for the consumer to get excited.

Thankfully, there is some movement on that front, and in an opportunity suggested before, ethnic broadcasters are stepping up — serving East Asian, Desi, Caribbean, Spanish-speaking, and Vietnamese communities.

Another very interesting innovation is the use of analog translators to broadcast HD2 or HD3 content. A prime example of this is the old 99x in Atlanta. Pushed off the air due to low ratings, it found a home on HD2. Then, exploiting a loophole in FCC regulations, 99x returned to the air on a 250-watt translator. Not perfect, but good enough for a .7 in the Arb (ranked 24th overall).

Greenhut told us that there are more than 4 million HD Radios in the hands of consumers, 2 million more will enter the market in cars this year, and there will be more than 8 million radios in the market by this time next year.

Check out our interview with Rick Greenhut from the NAB 2011 in Las Vegas…

On the heels of launching free, over-the-air, digital multicasts, television stations are not done yet. In April they’ll launch ATSC Mobile DTV, a second free over-the-air digital service aimed at automobiles and digital devices.

Unlike Digital Television, which can only be viewed on stationary sets, ATSC (Advanced Television Systems Committee) Mobile DTV can be viewed on the go — in cars and in your hand.

Now just to be clear, this is not streaming television on your phone or iPod. This is a piece of the broadcast spectrum and it will be available free of charge — no data plans needed. Perfect for the those who just can’t add another subscription plan.

For television, the Holy Grail has always been the car, and now it’s within reach. Just a small antenna on the roof and the kids are quiet in the back seat.

The gear is already on the way — phones from LG, TV-DVD players, and yes, a cradle for your iPhone from a company called Cydle for about $150.

And yes, like the main digital multicasts, spectrum can be split for niche channels.

And here’s a unique plus: ATSC Mobile DTV can communicate. Applications might include getting more information from advertisers, voting, or other direct response initiatives.

So far more than two dozen stations in five markets have installed the gear, spending 75-150k to get it done. The pilot cities are Los Angeles and Seattle on the West Coast, and Atlanta, Chicago, and DC.

As television plays offense, most of radio still plays defense, rejecting an almost identical business model with HD Radio.

No one knows how it will all turn out, but as they say in sports, if you wanna win, start by fielding a team.

I first started adding it up when radio cohorts started dumping on HD Radio.

The argument was, with broadband’s inevitable march to the dashboard, why bother? With thousands of radio stations available in the dashboard, a couple of radio station side channels wouldn’t matter, right?

It’s a good argument, but perhaps not a winning argument. After all smart-phones and miniplugs already offer thousands of stations in the dashboard. Does that mean radio should throw in the towel?

The internet-in-the-dashboard proponents tend to skip over a few big hurdles. First is the near-term issue of infrastructure. Anyone with an iPhone knows that the infrastructure isn’t up to the task. According to AT&T, data downloads have increased by 7000% in the past three years.

The second is that, best as I can tell, it’s not likely to be free.

So how much are you willing to pay for a web package in the car, in addition for the package you’re paying for your mobile phones, high-speed internet, and cable?

My quick review of what I’m paying to keep my family connected adds up to $429/month — more than $5000 a year — and that doesn’t include any of my subscriptions, or additional media entertainment such as movie rentals, music purchases, and the like. That’s just staying connected.

Something had to give.

I love satellite radio, but I let that go when Major League Baseball created an iPhone app. I knocked off premium cable channels in favor of cherry-picking series on-demand. We’re killing cable altogether next for a fiber-optic phone/high-speed internet/TV combo package with FIOS.

Add another data package for an iPad? Not anytime soon. A data package for the car? Not a chance.

At some point, enough is enough. Most of us are well beyond that point, and that fact will be somewhat of a boat anchor on many pie-in-the-sky digital business plans. At least in the near-term. Will it be enough to crack and opening for HD Radio?

With regard to skyrocketing costs for “free” content, I felt like I was reading about my own family in this story on this same subject by Jenna Wortham in The New York Times.

Digital broadcast television, just like HD Radio, allows broadcasters to split their signals into multicasts.

There are two primary differences: 1) Unlike radio, TV consumers are replacing their old sets en masse, and 2) Unlike radio, TV broadcasters are off to the races, embracing the technology.

In some major markets such as Los Angeles, with a digital television and a 99 cent antenna, you can pick up some 70 different digital channels. For free.

While radio largely fumbles over itself with digital, their television counterparts are smartly exploiting the technology by catering largely to ethnic audiences — a strategy we’ve repeatedly endorsed for HD Radio. A strategy that might actually spur the purchase of HD Radio receivers.

It could be the tip of the iceberg for new television content distribution, and radio would be wise to take note.

Check out this excellent article in The Los Angeles Times.

And this related video clip:

A few months back I predicted that an HD Radio station would make the Arbitron Ratings book. And while that hasn’t exactly happened, WAMU’s HD Channel, Bluegrass Country, has shown a weekly cume of 5,500 in an Arb topline for the DC and Baltimore markets.

HD haters, and there are many in the industry, may point to the paltry number. But the point is, at least this is proof of concept. 5,500 people is a group that is larger than the population of Aspen, Colorado. To look at it another way, 5,500 people is about a 10-share in Casper, Wyoming.

Arguably what we have here is a small market radio station. Two reasons to be encouraged: It’s Bluegrass, and it’s early. Millions of HD radios will hit the market in 2010 model year vehicles.

Here at TheTop22.com, we’re more bullish on HD Radio than most, given a few caveats. For example, we initially think it’s a solution for hyper-targeted market segments– especially the many ethnic opportunities. Also, we think many radio operators, with the exception of the HD-positive CBS, need to get out of the way and broker the bandwidth to entrepreneurs and third parties.

Check out our previous article and reasoning here.

And for further reading, check out the piece contributed to Current (the public broadcasting trade paper) by WAMU General Manager Caryn Mathes, who puts forth her very reasonable argument supporting HD Radio.

Further, I’ll wager that the first HD Radio station to appear in an Arbitron Report will do so as early as this Fall – probably in New York or LA.

For the most part, I’ve been putting off writing this because I didn’t want to get another deluge of cranky, whiny, emails from the scores of guys out there who want to tell me how wrong I am about thinking that HD Radio presents opportunity.

HD Radio bashing is extremely fashionable and has been for some time. Note, however, that bashing HD Radio is about as easy as shorting General Motors stock. When the going gets tough, it’s just easier to bet against something than to find possible opportunity in the rubble. Sometimes it’s just about the quick money, sometimes it’s a lack of vision, sometimes it’s just laziness.

You do have to give it to the negative thinkers, though. In today’s economic climate, it’s hard to imagine that the same guys struggling to save their current businesses could possibly launch a new one. The odds indeed seem long.

So against those acknowledged odds, here’s a general update on HD Radio, as well as six suggestions on how to keep this thing in play.

Status

There were plenty of good things to report from the well-trafficked HD Radio floor space at CES. Unfortunately, sales figures weren’t among them. Asking anyone in a blue iBiquity/HD Radio shirt “So how many units have been sold?” was met with various dodging, including three who independently said, “I should know that.”

At best guess, it’s about a million.

But let’s talk about the good stuff.

In brief, 12 auto manufacturers, 30 radio manufacturers, and the first of the real-time traffic and GPS navigation receivers are hitting the market. And the price barrier has been broken, with tabletops about $80. Better news comes in the strong belief that the FCC will grant HD Radio operators a requested power increase.

So where do we go from here? Even with those 12 auto manufacturers on board, most HD install deals don’t really kick in until the 2010 models arrive this Fall. In the meantime, auto companies are expecting a brutal 2009 – forecasting as few as 9.5 million total cars sold. How many of those will have HD Radios? One percent?

Hyundai said in August of 2008 that it could sell 50,000 Genesis in 2009 (HD Radio standard). Let’s assume fewer. All the Volvos sold this year will have HD standard. They might sell 75,000 cars. So throw in half the BMW and Mini Coopers, plus a couple of Fords and maybe a couple hundred thousand cars will be delivered with HD Radio in 2009.

It won’t make much of a dent in the numbers game, but it might help in the consumer education game, just as early Cadillac installs helped satellite radio. At least now you might know someone in your neighborhood fiddling around with an HD Radio.

But 2010 will be different. With the introduction of the new Zune player plus the auto deals kicking in, there could be as many as 4 million HD radios in the market. Yep, still a drop in the bucket, but keep in mind these can be considered household numbers, so the potential audience is that much larger.

Six Steps to Create HD Radio Momentum

I believe that, while the problems of HD Radio are many, the most crippling obstacle is the lack of vision. Virtually all of the HD Radio bashers have one thing in common: an inability to see HD Radio as anything but more of what already dominates AM and FM.

These folks need to get out of the way. They’re not only hurting HD Radio, they’re killing radio period. For those that remain, six points and suggestions:

1) Paradigm Shift: Bandwidth is Bandwidth

Many HD Radio critics mistakenly pit HD against WiFi. The argument goes, “if WiFi is going to be available in cars, you can get thousands of stations – so why bother with HD?”

This “either/or” argument, which by the way is rarely put forth by people who actually make content, is flawed. If this is indeed the case, then you might as well just shut down your station today because the radio cause is hopeless.

Second, it assumes that all this digital bandwidth is free. It is not. As consumers, my family has hundreds of “free” radio stations available to us now via our DSL, my iPhone, and her Blackberry. Last I checked, I was paying between $30 and $40 a month for each of those digital delivery systems. That’s about $1200 a year for all those “free” radio stations.

And on the content provider side, I’ll guarantee that proponents of the “free” argument have never had to cut a check to a streaming provider or SoundExchange.

It isn’t, and is unlikely to ever be, free.

The correct approach is to take the view that bandwidth is bandwidth, whether it be AM, FM, Television, HD Radio, in-home broadband, any of the various mobile telephony technologies, two tin cans and string, or carrier pigeon.

Content creators know that the objective is to create great programming, then get it out to the consumer on any and every platform available. In the past, we could count on the consumer to come to radio. That’s over. We now chase the consumer – on their terms, on all platforms available.

HD Radio and streaming are excellent compliments to one another.

CBS Radio’s Dan Mason nails it when he says that his company makes the donuts, and doesn’t really care where people buy the donuts.

2) It’s Not a Chicken or Egg Question

By studying the digital rollout overseas we learned that two things presaged the sale of digital radios on a large scale. One was the price barrier, which we’ve overcome. The other was strongly desirable content, which we haven’t.

In short, like so many new media technologies before it, content will drive the adoption of HD Radio. Waiting for more radios to be in the market before creating strongly desirable content is a false choice.

On a recent Saturday, while listening to a Mets game, The Fan (WFAN/New York) promoted the Bulls/Celtics playoff game that was airing on an HD Radio channel. Brilliant. For the first time, I perked up and paid attention to an HD Radio promotion. As a lifelong Bulls fan, I was reminded of a benefit (not feature) of HD Radio.
Public Radio continues to lead with some of the most innovative HD Radio projects, such as WFUV’s excellent TheAlternateSide.org (full disclosure – I helped).

Similarly, look how iPhone Apps (content = benefits) are driving that phone forward, while Blackberry plays catch-up. And by the way, who’s behind the development of all those apps? More on that in a moment.

3) Strongly Desirable Content May Not Be What You Think Is

Sadly, on the content side, programmers of HD Radio fail to see much beyond more of what already exists on the band. Yet there are significant business opportunities beyond more radio for white people by white people.

Even in these very difficult times, we could likely move millions of HD Radios into the marketplace if we just looked a little harder.

Since there is currently no real pressure on the channel inventory, hyper niche opportunities could be explored. First, there are data applications such as the aforementioned traffic services. But audio still has legs.

Foreign language programming is an obvious place to start. How about Tagalog? There are 78,000 Tagalog speakers in Los Angeles, for example. Do you even know what country Tagalog is the native language of? (I used the Google.)

LA also has 81,000 Korean speakers and 58,000 Armenian speakers.

New York is a foreign language bonanza, with 263,000 speaking Mandarin, 200,000 Russian, 83,000 Yiddish, 100,000 French, and so on.

There are foreign language opportunities well into the Top 20 markets, including 70,000 Vietnamese speakers in San Jose and some 65,000 Bosnians in St. Louis.

A huge opportunity exists in the 65+ crowd. Commercial radio has been kicking this demo to the curb almost as fast as it has been barring the door for the under 24 crowd. The BBC launched a national service (BBC 7) on digital to cater to the upper, upper demo.

And hey, if you really want to talk crazy, how about using a little bandwidth to service the 1.3 million legally blind in this country?

4) If You Don’t Want to Deal With It, Get Out of The Way

It’s tough for GMs and owners to justify the money and the time on innovative programming these days. And coming up with Tagalog programming is hardly a slam-dunk.

Unless you get out of the way – just as Apple has largely done with its App Store.

Who makes all those apps? Apple doesn’t. Entrepreneurs do.

No sane GM would turn down money today for his or her sub-carriers. Why should your HD channels be treated any differently?

Strongly consider brokering the channels to entrepreneurs at rates that are extremely favorable and then get out of the way.

5) Realize That the Promotion of HD Must be Localized

Currently, HD Radio has no national programming. That means, unlike satellite radio, you can’t promote any content on a national level. And, as we’ve discussed, content is the only way HD Radio will ever break into the marketplace.

This means that the generic national campaigns put forth by the HD Alliance need to go away. They may have initially worked in terms of raising awareness that there was some new kind of radio out there, but that’s about all these campaigns will ever accomplish.

The new campaign, touted as a second phase, is really just a repeat of the first. It won’t work. Every time I read that the HD Alliance was the number one or number two national advertiser, I squirm when I consider the results the campaigns have accomplished.

Campaigns instead need to be localized, focusing on the absolute best and most unique products available in the market. Further, the marketing needs to go to the street level and store level to not only demonstrate the product, but promote the unique content that is available.

In my neighborhood, Verizon Fios and Cablevision are in a pitched battle for my business. It’s hand-to-hand combat. For a while, we were getting weekly personal visits from Verizon. We still get weekly phone calls.

Does your street team even take an HD Radio out to events to let consumers play with it? Do you still have a street team?

6) The HD Alliance Needs Some Fresh Thinking and Perhaps Fresh Blood
We all know that there were a lot of missteps along the way with the launch of HD Radio.

The biggest, perhaps, was the decision to position HD Radio as the answer to satellite and declare it commercial free for two years. The result of this decision was that no GM in her right mind would invest in the content.

The technology may never overcome this initial blunder.

Yet today, the HD Alliance still touts “less advertising clutter” as a benefit. There’s nothing quite like talking down the lifeblood of the radio business. It’s absolutely baffling.

Of most concern is, when I mention the HD Alliance to just about anyone, I am met with groans and rolling eyes.

This is unfortunately a vote of no confidence that needs to be immediately addressed.

Paul Marszalek is Managing Partner of Media Mechanics, a multiplatform consulting and production company with offices in New York, Denver, and San Francisco.

Contact Paul at pmarszalek@media-mechanics.com or 917-533-4578.

www.media-mechanics.com