Radio Industry: Business Aspects Before and After Satellite Radio

Radio Industry: Business Aspects Before and After Satellite Radio

Contents
1. Introduction
2. Radio industry before satellite radio
3. Radio industry after satellite radio
4. The contemporary radio industry and its future
5. Conclusion
6. Bibliography


Introduction
Radio is considered to be one of the greatest inventions of the mankind throughout its history. Despite the fact that it was invented in the late 19th century, radio still remains popular and new technologies implemented in the radio industry make its perspectives really great. At the same time, it is worthy to note that many contemporary means of telecommunication to a significant extent are the result of the development of radio industry and it is hardly possible to imagine the 20th century and even the contemporary technologies if radio have never been invented.
It is quite natural that since early stages of its development till the present moment radio possessing such a variety of perfect characteristics is widely spread and often, being unnoticed, radio constitutes an essential part of human life. On the other hand, the wide spread of radio naturally resulted in its growing commercial use and if initially it was created in order to improve human life, communication, navigation, etc. than later its commercial use started to grow rapidly. For a long period of time radio remained one of the most profitable industries, at least in the sphere of telecommunications, especially until the introduction of television and more recently IT and Internet. Nonetheless, even nowadays, radio industry quite attractive industry for investments and new technologies open new horizons before the further use of radio.

Radio industry before satellite radio
Naturally, on analyzing the development of radio industry and business aspects of the use of radio, it is necessary to start with the early stages of its development that would naturally help better understand the further development of radio industry.
First of all, it should be said that the full potential of radio was not fully known until the Christmas Eve of 1906. Till this moment radio, which actually existed for about a decade, was basically used as a ‘wireless telegraphy’. To put it more precisely, radio was a means for sending Morse code through the air and as a rule it was used in navigation to help ships to communicate. However, on December, 26, 1906, instead of traditional dots and dashes a few wireless operators on ships in North Atlantic heard a voice reading from the St. Luke’s Gospel. Naturally, this was not a miracle but just a great achievement of Reginald Fessenden, an American who had devised a means for radio waves to carry signals for a range of sound. In fact, this was the first time in history when a term ‘wireless telephony’ became a reality and probably it was the first manifestation of radio as a potential means of mass communication which it became much later.
At the same time, it does not necessarily mean that until 1906 radio was not regarded at as a commercially attractive industry. In stark contrast, Guglielmo Marconi was the early radio experimenter and one of the first individuals who found the first commercial organization devoted to the development and use of radio. In this respect, it is worthy to note that in 1897 he established the world’s first radio station in the Isle of White, England that was one of the first attempts to develop a radio network and potentially its creator was in an advantages position if radio became a means of mass communication. It means that potentially he could first commercially use radio the only problem was to find commercial application of radio. Remarkably a year later he opened the world’s first ‘wireless’ factory in Chelmsford England, and employed about 50 people.
Naturally, it is hardly possible to speak about great benefits of the first radio station and Marconi’s factory since basically its facilities and radio properly were used to assist in navigation of ships but at the same time, it is worthy to note that in this respect, Marconi was in a monopolistic position but still he obviously lacked the further spread of radio as a mass product.
However, such a monopolistic position of Marconi did not last for a long time since in 1900, another radio experimenter Tesla opened the Wadernclyffe Tower facility and advertised services. Nonetheless, neither Marconi nor Tesla revealed the real potential of radio until Fessenden (Belrose 1995).
Obviously, since the moment when radio turned to be able to transmit voice and sounds other than just Morse’s dashes and dots and the full potential of radio was revealed, radio industry had started to grow dramatically. Initially, amateur radio operators in the United States and elsewhere were using this technology to chat with each other. After World War I, radio’s future seemed to be in transmitting long-distance telephone calls, and the American Telephone and Telegraph Company made sure it rounded up the key patents.
Some radio buffs set themselves up as broadcasters, playing music or reading newspapers to anyone who tuned in. But, “virtually no one in the scientific, amateur, military or corporate communities had expected broadcasting to become the main use of wireless technology” (Aitkin 1985, p.183).
Indeed, the word broadcasting, which meant scattering widely, had not yet been applied to radio. Then, in the fall of 1920, a Westinghouse Electric executive, Harry P. Davis, had an epiphany. The attention that a Westinghouse engineer had attracted with his amateur transmissions from his garage in East Pittsburgh, Mr. Davis later said, “caused the thought to come to me that the efforts that were then being made to develop radio-telephony as a confidential means of communication were wrong, and that instead its field was really one of wide publicity” (Aitkin 1985, p.204). Mr. Davis realized, in other words, that radio transmissions could be heard by the masses.
On Nov. 2, 1920, at Mr. Davis’s urging, Westinghouse introduced what is considered the first commercial radio station KDKA in Pittsburgh with a report on the Harding-Cox Presidential voting. By the end of 1922, 576 commercial radio stations were operating in the United States.
But a large question remained: How would these new stations make money? Mr. Davis’s financial goal for KDKA was simply to help Westinghouse sell more radios, and in 1922 about 100,000 radio receivers were purchased in the United States. But that same year, AT&T was already introducing a new way to profit by charging people who wanted to broadcast from AT&T’s transmitters a “toll” for access to the audience of its growing group of stations. The strategy rapidly evolved into the advertiser-supported model of broadcasting.
By 1925, 5.5 million radio sets were in use in the United States, and what was “the only means of instantaneous collective communication ever devised” (Sterling 2004, p.129) had begun to capture its mass audience. The following year AT&T recognizing that radio no longer seemed to have much to do with telephony sold its stations to the newly created National Broadcasting Company.
Practically at the same time, in 1922 the first regular entertainment broadcasts started from the Marconi Research Center at Writtle, England. This was a very important stage in the development of radio industry since it clearly indicated at the potential of radio as the means of mass entertainment that could be commercially used and it could be extremely profitable since radio transmitted messages directly to the audience that made it possible to use as the means of advertising. On the other hand, the popularity of radio and a profound interest of the audience to the fast developing radio stations made this industry quite attractive for investments. In fact, in that epoch radio was the only means of mass communication.
Naturally, the radio industry kept growing and new inventions made radio even more popular and commercially attractive. For instance, in the early 1930s, single sideband and frequency modulation were firstly invented by amateur radio operators but by the end of the decade this invention had already been commercially applied. In fact, in the years to follow, radio not simply entered every household but it became an essential part of practically all people.
The popularity of radio stimulated radio industry to invent new technologies in order to make radio more accessible and widely spread. As a result in 1954 Regency introduced a pocket transistor radio, the TR-1, powered by a standard 22,5 V battery (Sterling 2004).
Furthermore, it should be said that radio was used not only in sea navigation and entertainment where radio industry earned significant profits but it was also widely applied in the aircraft industry. For instance, one of the first developments in the early 20th century was that “aircraft used commercial AM radio stations for navigation” (Sterling 2004, p.166). This way of application of radio was widely spread until the early 1960s when VOR systems became finally widely spread and gradually replaced AM which though “are still marked in the US aviation charts” (Sterling 2004, p.217).
In such a way by the middle of the 20th century radio became the main means of mass communication which was commercially used and could be applied in different spheres from entertainment and advertising to navigation where it was vitally important and consequently its commercial potential was really significant.
Radio industry after satellite radio
However, the second half of the 20th century was marked by the rapid development of a new means of mass communication which later became dominating medium - television. On the other hand, it is worthy to note that radio also contributed dramatically to the development of television since radio “was used to transmit pictures visible as television as early as the 1920s” (Sterling 2004, p.240). In this respect, it is possible to view radio as a precursor of television another extremely profitable and commercially attractive means of mass telecommunication.
At the same time, the early 1960s marked not only the start of the new space age of the mankind but it also revealed new opportunities of radio industry to a significant extent due to satellite radio. It is evident that since the early stages of its development radio was an essential part of many vitally important processes. Its use in navigation implied that radio is a guarantee of safety and that was one of the reasons why radio companies were so significant and powerful in the industry as well as in economy at large. For instance, the use of commercial AM stations by aircrafts made the latter vitally important for normal functioning of aircraft industry at large and the crisis of radio companies would directly involve aircraft industry. The same may be said about sea navigation as well as telephone industry. What is more, radio companies were one of the major entertainers and entertainment industry would be affected dramatically by the potential crisis of some of the major radio companies. As a result, radio companies always hold firm position which was reinforced significantly after the implementation of satellite radio which had made other industries even more dependable on radio than ever before.
In fact, the beginning of the era of satellite radio dates back to the early 1960s, notably to 1963 when the first radio communication satellite, TELSTAR, was launched. Basically, it was used to provide radio services to rapidly growing television industry since in this period of time color television started to be commercially transmitted and the radio communication satellite was used in this process. In such a way, satellite radio overcame the borders of radio proper and became an essential part of the transmission of television and in the course of time the coverage of radio communication satellite signal grew dramatically. Thus, to put it in simple words, radio became a means of transmission of television that made radio industry highly profitable and its benefits grew proportionally to the success of television broadcasting though the popularity of radio stations was shattered by the television.
Nonetheless, television did not kill radio as some skeptics forecasted. In stark contrast radio companies kept growing and sustained its niche in the market of entertainment. Moreover, the number of radio stations and radio companies continued to grow that indicated at the commercial profitability of this industry.
Also, it is worthy to note that satellite radio was used not only for television but also for telephone networks as well. In this respect, it should be said that in the late 1960s the US long-distance telephone network “began to convert a digital network, employing digital radios for many of its links” (Lichtenstein 1999, p.105). Obviously, in such a way radio contributed to the progress of telephone networks and increased their profitability as well as the profitability of companies operating in the radio industry.
At the same time, navigation, being a traditional domain where radio was widely used, readily implemented the innovations and new technologies applied in the radio industry that only strengthened the position of radio companies. It should be said that since 1970s radio navigations systems had started to appear and the first one was LORAN and the researchers in this field continued. As a result, in 1980s, the US navy experimented with satellite navigation that eventually led to the invention and practical application of the GPS constellation.
Naturally, as technologies progressed so did the radio industry which commercial potential enlarged dramatically due to its wide use in a variety of telecommunication systems and in 1990s in addition to television, telephone networks and navigation, radio companies began to use personal computers with audio cards to process radio signals. In such a way, radio companies not only remained in a vanguard of telecommunication industry but also successfully applied latest technological achievements to enlarge the use of radio and make it more conventional and more accessible for the public.
Moreover, the age of satellite radio, especially 1990s were characterized by rapid progress in the quality of the product of the radio industry. It should be said that in 1994, the US army and DAPRA launched aggressive and commercially successful project to construct a software radio that could “become a different radio on the fly by changing software” (Lichtenstein 1999, p.137). Finally, it should be said that the late 1990swere characterized by wide application of digital transmissions to broadcasting that contributed to the further growth of radio companies and their numbers.
On the other hand, it would be a mistake to think that that radio companies faced no problems. In fact, one of the major problems was the problem of deregulation of radio industry and the Telecommunication Act actually was supposed to do it but, instead, specialists estimate that “most media ownership were thrown out by the Act, and independents were bought up” (Lichtenstein 1999, p.198).
The contemporary radio industry and its future
In fact, this problem still remains important for the contemporary radio industry since to a significant extent because of the Telecommunication Acts the number of independent radio companies decreased and gradually small radio companies are getting involved in the sphere of influence of large corporations operating in the radio industry.
Nonetheless, the radio industry is still progressing and at the present moment its commercial value and attractiveness for investments can be hardly underestimated. It should be pointed out that at the present moment, radio companies are getting to be more involved and integrated in the telecommunication industry at large that means that they are not simply forecast on broadcasting proper but are particularly concerned about the development of radio services supplied to other companies operating in the field of telecommunications, including television.
Not surprisingly that nowadays, radio still remains one of the leading mass media and the fact that it is closely cooperates with television, telephone networks, its integration to PCs indicate at its importance. Moreover, nowadays, radio is getting to be even more accessible due to the development of IT which made it accessible via Internet, for instance. At the same time, it is necessary to remember about such a traditional domain where radio companies successfully operated as navigation but nowadays the role of radio increases because unlike in the past, in the contemporary world radio is used not only in sea and aircraft navigation but also in automobile industry as well. For instance, GPS is widely used in navigation, including automobiles.
Naturally, the long history of the development of the radio industry and its current strong position in the market of mass media and telecommunication companies makes it possible to speak about positive perspectives of the future development of radio companies. To put it more precisely, the role of radio in its traditional domains is unquestionable but the fact that nowadays radio is integrated in new domains such as PCs, cell phones, etc. indicates that radio technologies will be further applied in different industries. Moreover, it is even possible to presuppose that the notion of radio would gradually change. For instance, traditional radio receivers would probably be substituted by new devices, such as contemporary PCs and phones and the radio industry would tend to the further integration with other industries.
Conclusion
Thus, taking into account all above mentioned, it is possible to conclude that the radio industry, initially created by amateurs attempting to find the ways to increase the ways of communication, gradually became a great business which potential was revealed at early stages of the industry’s development. Nowadays, the radio industry achieved really great results and the contemporary world is practically unimaginable without radio which entered every household and at the present moment it is in a hand reach of any individual. It is obvious that radio became a powerful means of communication and one of the major mass media that is not simply profitable but which can potentially influence human consciousness and create stereotypes and models of behavior as well as other media. This is why it is necessary to pay a particular attention to the development of the radio industry and provide equal opportunities for all companies operating in the market in order to make them really competitive and independent. In this respect, it should be said that legislative system should be very careful when implementing Telecommunications Acts and similar legislative documents.


Bibliography:
1. Aitkin, Hugh G. J. The Continuous Wave: Technology and the American Radio, 1900-1932. Princeton University Press, 1985.
2. Belrose, John S., “Fessenden and Marconi: Their Differing Technologies and Transatlantic Experiments During the First Decade of this Century”. International Conference on 100 Years of Radio, 5-7 September 1995.
3. Lichtenstein, Claude (ed.), Your Private Sky, Baden: Lars Muller Publishers, 1999.
4. Sterling, Christopher H. Electronic Media, A Guide to Trends in Broadcasting and Newer Technologies 1920-2003. New York: Praeger, 2004.