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News Archive: February 2013

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2/28/13 - Sprint's Radio Deal: Some Context [link to this story]

More details have emerged about Sprint's deal with broadcasters to include FM receiver functionality in some of its mobile devices. In simple terms, broadcasters have cobbled together a package of subsidies to the nation's #3 wireless carrier in order to buy access to that market.

Sprint will enable FM radio reception capability in at least 30 million phones over the next three years, using Emmis Communication's NextRadio app as the interface.

In exchange, broadcasters will pay Sprint 30% of any "interactive" advertising revenue generated via the app on those phones. Emmis sweetened the deal by pledging Sprint $45 million in advertising inventory over three years ($15 million per year, allocated quarterly).

What, exactly, are broadcasters paying for? There are about 50 million customers on Sprint's network. Taking into consideration that many customers have multiple devices, and an average smartphone "upgrade" cycle of two years, radio's actual penetration into Sprint's customer base will be marginal.

From a broader perspective, Sprint claims less than a quarter of the U.S. wireless market. When you factor in the projected growth of smartphones over the life of the deal, Sprint's commitment to 30 million devices is relative peanuts.

Emmis negotiated the deal directly with Sprint over the course of 2012, though Radio World reports that Emmis "is busy rounding up commitments" from other broadcasters to help shoulder its costs. CEO Jeff Smulyan casually suggested that "[i]f every broadcaster gives up $10,000 worth of inventory per year per station, [the Sprint deal] will easily take care of itself." He also says Emmis is attempting to strike similar deals with the larger carriers (like AT&T and Verizon), which may carry larger commitments.

Note that the Sprint deal requires no upfront cash outlay and promises the sharing of unquantifiable future revenue. It's the same template the broadcast industry used to promote HD Radio over the last decade. In that case, a coalition of broadcast conglomerates pledged more than a billion dollars' worth of advertising inventory to promote the technology; the fruits of that effort are a broadcaster adoption rate of ~15% and listener uptake in the single digits.

Emmis will also administer the NextRadio app and collect Sprint's revenue share. As its developer, Emmis plans to license the app to other broadcasters, who will also pay the company "a small management fee" for its back-end systems management.

The quality of NextRadio will determine its success– and there's not a lot of firm info on just what the app brings to the table beyond interactive advertising opportunities. Content and actual utility drive the use of apps, and sketchy details on that front leave one to wonder. Yet Emmis' Chief Technology Officer Paul Brenner sees dollar signs: "Mobile ad spending is the growth business for technology right now," he told Radio World.

iBiquity Digital Corporation President/CEO Bob Struble is similarly "thrilled" with the Sprint deal, because analog FM smartphone penetration lays the groundwork for an eventual "upgrade" to HD Radio, advancing one aspect of the four-pronged strategy the technology's proponents have to resuscitate interest in it.

Emmis and NAB Labs have already developed a prototype smartphone with FM-HD reception capability, but it's likely to be a while before they actually exist. It's another function of money: iBiquity estimates that adding HD to a phone will cost between $2-4 per device. As a rule, device-makers don't like to spend more than 40 cents to add a feature; in comparison, the analog FM chipset and firmware costs just pennies per unit.

Radio's migration into other devices is part of the medium's future, but the Sprint deal has more value as a symbolic commitment than in its potential for transformative return. All paths of transition must start somewhere...but is this deal meaningful or sustainable enough?

2/21/13 - VOA's Radiogram Brings New Utility to Shortwave [link to this story]

The Voice of America is set to launch a new communication service on shortwave radio with interesting implications for information flow in crisis situations or under repressive regimes.

Called Radiogram, the service uses digital encoding to transmit text and images via analog shortwave broadcasts. The transmissions themselves sound much like old dial-up modems (at root the technologies are identical, in that both involve the conversion of data to audio), but when decoded on an equipped receiver or computer the text and images appear.

Not a new concept, but it's the first instance of its deployment on shortwave. Amateur and pirate broadcasters use it regularly; for example, many shortwave pirates end their transmissions with slow-scan TV images.

The idea behind Radiogram is to facilitate the spread of vital information in areas of the world where communications are restricted. Shortwave provides massive range – and the technology works remarkably well even in conditions where reception of regular programs are degraded, including jamming.

The software needed to decode the transmissions remains to be consolidated and simplified for mass use, but that work is underway.

The Voice of America is currently producing a lengthy program to further explain and promote Radiogram, which will include sample transmissions. They hope to recruit shortwave listeners from around the world to decode the broadcast and report the results – a crowdsourced listening test of the new system.

This program will originate from the VOA's Edward R. Murrow Transmitting Station in Greenville, North Carolina with an airdate TBA. At present, test Radiogram broadcasts are taking place on Bulgarian shortwave station KBC, though they will be moving to a facility in Nauen, Germany next month.

2/12/13 - Broadcasters Get Wake-Up Call on Cybersecurity [link to this story]

On Monday, viewers of two television stations in Montana were treated to an Emergency Alert System prank. During a daytime schlock talk show, the EAS system went off at the stations and a message was heard that "the bodies of the dead are rising from their graves and attacking the living." The zombie apocalypse warning prompted a handful of quizzical calls to public safety officials, but no mass panic.

Today, we learned that this EAS hack was not a localized event. Public and commercial television stations in Michigan apparently broadcast the same warning; Radio World reported that other television and radio stations around the country also discovered the message in their EAS systems and some were able to prevent it from airing.

The National Association of Broadcasters, in passing along an advisory from the FCC about the EAS hack, suggests the event played out in "several states." The FCC and FBI are reportedly investigating.

The Emergency Alert System is a complicated network with many parts. Originally just a daisy-chain of broadcast stations throughout the country, the system now interfaces with internet servers, which makes station-level EAS systems accessible outside the station. The system is designed to promulgate such messages far beyond radio and television, to smartphones, tablets, road signs, and other info-outlets.

From what we know presently, hackers penetrated the EAS systems at the individual station-level and inserted the bogus zombie alert there. The fact that stations across the country were affected suggests that they were systematically probed. Those vulnerable hadn't changed the passwords on their EAS interfaces from the factory default. Thus, as far as hacks go, this one was pretty simple and straightforward.

Even so, it demonstrates that information-security vulnerabilities exist within the U.S. broadcasting system. A zombie-warning is infinitely less disruptive than, say, an Emergency Action Notification message, which would be carried by every single broadcast, cable, and phone provider nationwide. (It would also require hackers to penetrate much further up the EAS network chain.) While the potential of this might be disturbing, it'd be transitory – EAS messages give a hacker mere seconds of control over a radio or television station.

But radio and television stations are automated and networked in many different ways. Those who now operate and program broadcast outlets can be hundreds of miles away from the actual station. Regular maintenance of our broadcast infrastructure occurs almost wholly via remote control. Engineers have been using such systems to monitor and regulate transmitter operation for decades (first via touch-tone phone, now via internet connection).

On the programming front in radio alone, Clear Channel employs regional and format-specific program directors who each maintain the playlists of several stations from wherever they may be based, including the corporate HQ in San Antonio, Texas. For more than a decade now, program hosts have used voicetracking – uploading pre-recorded breaks into station computers, which makes the station sound live and local when it's not. And some stations have outsourced their advertising traffic management responsibilities to freelancers.

Long gone are the days when the folks you hear and see on your local broadcast outlets actually have to be there. These also present many other possible remote access vulnerabilities, and they suggest a variety of potential outcomes: fake commercials, news/weather reports, and public service announcements; the replacement or deletion of programming on a wholesale scale; and, yes, even the possible hijacking of a station's actual transmitter.

The scale of these potential vulnerabilities is wholly unknown. Broadcasters admittedly are not keen to talk about it, and there's been no formal audit of network security in the industry as a whole. The chance of a nationwide broadcast hijacking is infinitesimal, but nothing's impossible.

That said, there's also been a growing dilemma within broadcasting over the aging of its engineering workforce, many of whom are better-qualified to mess with RF than IT. Some broadcast engineers predict that the future of the profession will more resemble a network manager than a transmitter-caretaker. Today, the job already calls for maintaining multiple station facilities. Does the personnel and expertise exist to promote best practices of network security in broadcasting?

The FCC itself is not exactly a poster-child for this: in 2011 it discovered that its own computer systems had been heavily breached...and a $10 million project to harden them didn't fix all the problems.

The EAS hacks should be a wake-up call not only about the fundamental security of our system of broadcasting, but also about the deleterious structural changes in the industry which have exacerbated the likelihood of these problems actually manifesting themselves.

2/6/13 - FCC Grossly Overstates Anti-Pirate Activity [link to this story]

A paragraph in the FCC's annual performance report for fiscal year 2012 suggests the agency is on the warpath against unlicensed broadcasters:

The FCC shut down hundreds of pirate broadcast operations, which threaten the integrity of the nation’s communications infrastructure and caused interference to licensed broadcasters, air traffic control frequencies, and other public safety communications. There were $289,000 in penalties and 583 warnings issued during FY 2012.

Specious claims of the pirate threat aside, these numbers were quickly parroted by the Clear Channel-owned trade publication Inside Radio as evidence of a "pirate crackdown confirmed." But there's no data to back up these claims.

I've carefully collected all the FCC-released data on unlicensed broadcast enforcement over the last 15 years. Chairman Julius Genachowski claims the agency handed out 583 warnings in 2012. Trouble is, there's only documentation for 103.

In fact, the agency's never done 583 of anything against pirates in any given year: the Enforcement Bureau maxed out at just 447 enforcement actions of all kinds in 2009 and 2010, and activity has dropped off sharply since then.

Interestingly, the performance report understates the dollar figure of proposed fiscal penalties against pirates: the FCC says it handed out "$289,000 in penalties" during 2012 when it rightfully could've claimed nearly $500,000 – $205,700 in actual forfeitures and $294,000 in Notices of Apparent Liability (pre-fines). Collecting these penalties is a different matter – the FCC positively sucks at follow-through.

The actual state of FCC enforcement against pirate radio in 2012 is one of tenuousness. A thinly-distributed staff at regional and district field offices, overwhelmed with many, many other enforcement duties, only gets the chance to hunt pirates when complaints arise (with the exception of Miami and Brooklyn, where agents apparently conduct semi-regular "band scans" – appropriate for the two hottest pirate spots in the entire country). This hardly scratches the surface of unlicensed broadcasting in the United States.

This is not the first time Inside Radio has taken unsubstantiated claims from the FCC on pirate enforcement activity and run with them. Don't believe the hype: the agency's still a paper tiger.