NextRadio Folded Because Too Few in Radio Willing to Fund It, Says Emmis CEO
NextRadio’s lack of a “data attribution” component and the radio industry’s inability or unwillingness to help pay to build one was the biggest factor that doomed the smartphone FM-listening app, said Jeff Smulyan, CEO of NextRadio developer Emmis Communications, on an earnings call Thursday. Smulyan said Emmis no longer is willing or able to shoulder the costs of running the NextRadio business, which Chief Financial Officer Ryan Hornaday said incurred a $7 million operating loss in the 12 months ended Aug. 31.
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Emmis failed to build a radio industry “consortium” that would fund NextRadio and help it develop a data attribution capability, said Smulyan. “To make this business what it needed to be, it needed to do data attribution,” he said. “We really needed much deeper involvement” financially from other radio broadcasters, he said. “We tried. We couldn’t get the industry to come together. Everybody unanimously said we have to have this, but when it came time to sort of pitching in, and helping fund it, we just couldn’t get enough support.” NextRadio's failure for years to persuade Apple to unlock the chips in its iPhones was another hurdle, not mentioned Thursday as a factor in the decision to fold the business.
NextRadio’s demise is “very heartbreaking,” said Smulyan. “I put many years of my life into this.” He praised the work of the NextRadio team under CEO Paul Brenner, saying he doesn’t know what the future holds for them. “We can’t do it ourselves,” he said. “As one of our board members said, ‘We just can’t fund R&D for the entire radio industry.'” Only a quarter ago, Smulyan said Emmis was “far along in discussions in changing the focus of NextRadio” toward data attribution, “with significant input and partnership from major radio broadcasters” (see 1807120048 or 1807120009). NAB declined comment Thursday.
The “big takeaway” of the recent NAB Radio Show was “the value of data,” said Smulyan. “Our call to action” has “fueled” the radio industry for 100 years, he said. “In spite of the remarkable power of our call to action, we’ve been eclipsed by people who could provide to-the-minute information based on advertising characteristics -- the attribution ascribed to customers. The foremost example of that, obviously, is Google and Facebook.”
Emmis learned through its NextRadio experience at least three or four years ago “that if our industry could provide quality attribution data, the power of broadcasting married with that really had a chance to revitalize an industry,” said Smulyan. For the industry to compete, “it must provide that data to advertisers,” he said. If not, advertisers “continue to say they’re going forward with people who can provide that,” he said. There were “a thousand lessons learned” in the NextRadio project, he said. “It’s really tough to really get people to come together, understand what their own interest is, understand what the interest of the industry is, and allocate their resources to something.”