Multicasting
In early 2006, HD Radio’s momentum accelerated. First, major station groups launched aggressive HD Radio promotions to increase HD Radio awareness, teaming up with major retailers in cross promotions. Second, the fledgling HD Digital Radio Alliance, representing eight major radio groups, began coordinating an aggressive rollout of HD Radio multicasting over FM stations. The multicasting stations are broadcasting two or more digital programs simultaneously on their assigned frequency to give listeners more station-format choices. Stations are making their multicast programs available commercial-free for up to two years to get people listening. The additional channels are designated HD2 and HD3 on HD Radio tuners.

Multicasting is not an option for digital AM stations because of the stations’ narrower bandwidths.

During early 2006, the number of multicasting FM stations was expected to exceed 250, largely in 28 of the largest radio markets, from year-end 2005’s 70 stations. The alliance called it “the first wide-scale launch of [radio station] multicast channels in the country.”

Competitive Response
The stations’ efforts reflect growing awareness that competition for “ear time” has grown intense with the proliferation of new music sources offering a greater diversity of content. There are thousands of Internet radio stations, millions of headphone MP3 portables in use, and hundreds of satellite-radio channels available through a greater selection of headphone stereos, home audio systems and car audio systems.

By coordinating the roll-out of multicasting within major markets, radio stations hope to give consumers a subscription-free alternative to satellite-radio’s diversity. Within a given multicast market, the alliance promises “new and unique content,” and in the first wave of coordinated multicast launches, stations introduced such “new” formats in those markets  as opera, classical alternative, traditional jazz and blues, coffee house, female talk, future country, extreme hip-hop and in-depth news. New rock formats also were launched, including deep cuts classic rock, live rock, new alternative, fusion Hispanic-Anglo rock and chick rock.

Such developments led market-research company Strategy Analytics to conclude in late 2005 that “the emergence of terrestrial broadcasters using HD Radio/iBiquity in 2006 will...impact satellite growth rates.”

The 28 markets in the first multicast wave included the top 10 radio markets: Boston, Chicago, Dallas-Fort Worth, Detroit, Houston, New York, Los Angeles, Philadelphia, San Francisco and Washington, D.C. The other markets were all in the top 100. Some stations in these markets delivered not two but three simulcast channels. A station in Memphis, Tenn., for example, delivered blues on its main channel, comedy on a second, and news on a third. The music channel continues to deliver high-quality music despite sharing bandwidth with the HD2 and HD3 channels, which are spoken-word comedy and news channels that require less bandwidth than a music channel to deliver quality audio.

Consumers can hear the multicast channels on any currently available HD Radio home tuners and on select HD Radio car tuners.

CD-Like FM Sound
Digital AM and FM broadcasters also plan to compete on the basis of sound quality. Digital broadcasting minimizes adjacent-channel interference and virtually eliminates multipath, noise and interference that reveals itself as static, hiss, popping sounds and fading.

Just as important, iBiquity’s compression-decompression (codec) technology, called the HD Codec, promises digital FM that sounds “statistically indistinguishable” from CDs and digital AM stations that sound as good or better than today’s analog FM stations.

In fact, many HD Radio proponents contend that digital FM stations will sound better than satellite radio even when broadcasting two digital music channels. If an FM station splits its bandwidth equally between two channels, each will deliver near-CD quality that exceeds the sound quality of satellite-radio music channels, they contend.

FM multicast options abound. For example, instead of broadcasting a single 96-kilobits-per-second (kbps), CD-quality signal, an FM station could broadcast two near-CD-quality 48-kbps music channels. Alternately, a station could broadcast a high-quality 64-kbps program and a supplementary 32-kbps program. The 32-kbps data rate is satisfactory for a mixed speech and music service, and it would still be interference-free. Then there’s the 48-24-24 option, allowing for a near-CD-quality music channel and two spoken word channels for programming such as news or comedy.

A proposal to free up another 50 kbps of FM-station bandwidth for content delivery would give FM stations even more options, including the delivery of more programs on their assigned frequencies.

Hybrid Broadcasts
Because it’s an IBOC technology, HD Radio makes it possible for digital stations to simultaneously serve analog-radio. IBOC technology lets broadcasters deliver simultaneous analog and digital versions of the same program without interfering with a digital FM station’s ability to simultaneously multicast additional digital programs.

The dual analog-digital approach serves another purpose: a station’s analog signal will back up a dropped digital signal to ensure uninterrupted listening. The dual approach is needed because, with digital broadcasting, there’s no such thing as receiving a degraded signal. You get a pristine signal or no signal at all. That’s called the “cliff effect.” To prevent cliff-effect digital dropouts, a digital radio gradually switches over to analog reception in digital-drop-out locations. Digital dropouts aren’t expected to happen often, however, because digital stations broadcast a second digital signal as a back-up.

When digital signals are received, listeners will not hear the familiar static, hiss, pops and fades associated with analog radio. The noises will return, however, in areas where the digital signal gives way to its analog counterpart.

Broad Support
Because of advantages like these, iBiquity’s technology has won broad industry support. Its owners include major radio station groups as well as automakers Ford and BMW, which became the first automaker to offer HD Radio with the launch of 2006-model-year BMW 6- and 7-series cars. HD Radio is an option in those BMW vehicles.

iBiquity’s technology also has been endorsed by the National Radio Systems Committee (NRSC), which is jointly sponsored by CEA and the National Association of Broadcasters (NAB). The endorsement was based on field, lab and listening tests conducted by independent test labs and monitored by NRSC representatives. From the tests, the NRSC concluded that the digital FM technology delivers “greatly reduced impact of multipath interference (for mobile, portable and fixed receivers alike), superior resistance to co-channel and adjacent-channel interference, support for enhanced data services, [and] improved audio quality.”

The advantages overcame many top broadcasters’ concerns over the cost of installation. The cost of converting higher power major-market FM stations has run between $100,000 and more than $200,000. For broadcast groups operating tens or hundreds of stations, the conversion costs add up quickly. Nonetheless, radio stations “realize they can’t be analog in a digital world,” said a National Association of Broadcasters (NAB) spokesman.

Radio Station Roll-outs
By early 2005, that reasoning led 21 major radio station groups to accelerate their digital conversions. All told, the committed groups account for nine of the top ten groups, 17 of the top 20 groups, and 21 of the top 27 groups. Each planned to convert anywhere from 50 percent to 100 percent of their stations.

Combined with plans by public radio stations and others, the commitments were expected to increase the number of digital stations to more than 3,200 during the next several years.

The 3,200 represent about 24 percent of the 13,500 radio stations in the U.S., but these numbers don’t tell the whole story. During the early years, the number of digital stations in major markets will be more important to HD Radio’s success than the number of digital stations nationwide, and most of the committed stations are located strategically in the top 100 population centers. Commitments by the top radio groups also will spur other stations to convert to stay competitive, iBiquity contends.

Within a given market, not every station needs to broadcast digitally for HD Radio to be successful, proponents add. Research company In-Stat/MDR notes that most consumers listen to between two and six radio stations regularly. If several of their regular stations offer digital broadcasting, consumers would be willing to buy new HD radios, the company contends.

Product Availability
Should consumers choose to buy, their choices are growing and becoming more affordable. About 15 home and car tuners were available in early 2006, and iBiquity expected that number to hit 25 by the end of the year.

In the car audio aftermarket, at least seven companies planned to offer car products in 2006, up from three in 2004. Four of them planned to offer a single CD-receiver with built-in HD Radio, while the other three planned “black-box” tuners that mount under a seat or behind the dash and are controlled by many of their latest in-dash CD-receivers. The black-box tuners were expected to cost as little as $250 in 2006. CD-receivers with integrated HD Radio were expected to start at about $299, down from $999 in 2004.

 In the meantime, iBiquity has engineered an adapter system to add HD Radio to any existing satellite-radio-ready car stereo – aftermarket or OEM – and control the HD Radio tuner from the existing radio’s controls. If a supplier manufactures and markets the system, it would retail for anywhere from $249-$299, excluding installation charges.

On the home front, as many as seven suppliers are expected to offer home HD Radio products in 2006. One product already available is a one-piece tabletop AM/FM stereo radio available in February 2006 at around $299. Another example is an optional slide-in module for a four-zone component tuner whose price starts at $2,800. It’s designed to distribute as many as four radio programs (including satellite-radio programs) simultaneously to different rooms of a house through custom-installed in-wall and in-ceiling speakers.

All current and announced home HD Radio tuners are multicast-capable, as are select car audio tuners, including a $299 CD-receiver.

Surround Sound Radio
In the future, new HD Radio products might deliver surround-sound music into the home or car, if digital AM and FM stations opt to broadcast some of their music programming in one or more stereo-compatible surround-sound formats.

Four separate surround-sound technologies are competing for adoption by radio stations converting to digital broadcasting. Although the surround solutions aren’t likely to be compatible with one another, they all will be compatible with two-channel HD Radio tuners, which will play the surround broadcasts in two-channel form.

iBiquity already has endorsed the installation of Circle Surround II encoders at AM and FM stations. Stations would use Circle Surround encoders to transmit matrix 5.1-channel music from such sources as multi-channel DVD-Audio discs and Super Audio CDs. Many home and car audio systems already are equipped with Circle Surround II decoders , and they would reproduce the multi-channel version of a song the way it was mixed. Home and car systems using other surround decoders also would reproduce the music in surround sound, but not necessarily in the way that the music was originally mixed.  iBiquity has also endorsed Pro Logic II Surround Sound and Neural Audio’s Surround Sound. 

 The other competing technologies are said to be backward-compatible with two-channel HD Radio receivers and audio systems. One of the technologies, developed by Neural, already has been adopted by XM Satellite Radio. Although Neural’s technology is said to require Neural decoders to produce the best surround sound, Neural points out that Neural-encoded broadcasts can be decoded by 5.1-channel matrix-surround Dolby Pro Logic II and Circle Surround II decoders, which are available in home and car systems. Neural, however, claimed its decoder will deliver better channel separation and stability. The location of a voice, for example, won’t be pulled toward the channel with the dominant music passage.

 At least four major suppliers of home audio products plan to offer Neural-equipped audio/video receivers in 2006.