NPR Revenue Streams

I’ve been playing with this program Replay Radio which allows me to audio streams that are playing through my computer. There are a bunch of programs that do similar things. I’m going to be posting a larger piece about this soon enough, but for now I thought I’d talk a little about NPR and how the new technologies are affecting them and will continue to in the future.

NPR is a great source of news, at least as far as I’m concerned. I know some people find it too liberal, too snobby, or whatever, but I think there’s some quality reporting and as long as you keep an ears open for bias, which exists to some extent in all reporting no matter the source (based on the questions that are asked or what is decided as relevant to a given piece), you can glean a lot from the various programming on NPR.

NPR is a special case when it comes to broadcasting of course because it does not get its revenue from advertising, the way all other radio does. It gets its money from a combination of the taxpayer through government funding and through voluntary means. It’s a bit contradictory in that sense because on the one hand you have people who are giving to NPR whether they want to or not simply by their paying taxes, and another group who not only gives through their taxes but gives again through voluntary donations.

NPR then will also charge people again if they want to obtain tapes or transcripts of recordings, or if they want to download digital versions (through Audible.com). I can understand that tapes and the writing of transcripts may mean using extra resources. Even making digital recordings can do this as well. However, one can also listen to various NPR programs via streaming audio for absolutely nothing. True, they are often in somewhat lower-quality audio (I see often 20kbps, or slightly less than what AM radio is rated at), and it is less convenient than a downloadable file, but it’s still a disparity. Then if you consider these new computer applications like Replay Radio that take that stream and convert it into a downloadable file, the disparity becomes even more of an issue.

Podcasting, of course, has made this issue all the more relevant as home-grown (and a few more professional) broadcasters have started putting out audio files that are downloaded. NPR itself is experimenting with this with podcasts of On The Media. On The Media, of course, is ahead of the curve a bit because its raison d’etre is thinking about media, media trends, new technologies, etc. I wonder if NPR is thinking about these various delivery mechanisms and how they make sense?

When Satellite Radio came on the scene a few years ago I was excited about being able to get an all-NPR channel or channels and have access to it no matter where I was roaming. But after talking to someone at XM (Sirius does carry a couple of NPR shows, but none of the bread and butter stuff), I was told that NPR didn’t want to use them because it might deplete revenue of affiliate stations.

This is where things get a little more complicated. NPR isn’t just one monolithic entity, but rather it’s a public broadcasting network and in an of itself does not do any broadcasting except over the Internet, and even with that has only been doing it for a few years. Traditionally, it’s relied on affiliate stations that pay for its content. Some of these stations actually create content themselves which is then syndicated on other affiliates, although I have no idea how this works in terms of revenue – does NPR play the middle man? Do these stations talk directly to themselves and work out compensation plans? In any case, as you can see, it’s not a simple and clear situation. Affiliates need to be able to pay for these programs, for the general NPR programs, for their facilities, for staff, etc. This is what voluntary funds are for. I wonder, though, whether any of those donations go to NPR itself and if so how much? What about government funding? Does that go solely to NPR proper or to any of the affiliates?

In any case, the issue again comes down to content and paying for that content without resorting to advertising. Certainly advertising could be resorted to, but this is what makes NPR listenable in many ways – you aren’t bombarded by ridiculous amounts of offensive ads every time you want to hear the news or some interesting stories. And anyone who listens to NPR will tell you how annoying pledge drives can get.

So, the question basically is how does NPR and all the affiliate stations make money? One answer is more government funding, but there are a lot of people who would balk at this either because they think NPR is biased and biased in a way that contradicts their own political leanings. Alternately some believe simply that people should not be forced to pay for this if they don’t listen to it. These are certainly understandable arguments, so then what’s next? Perhaps NPR really needs to be thinking about setting up a subscription-based service for “premium” listeners or members. So, basically, you would become a member through your local affiliate the way you do now, and that affiliate would get a cut of your donation, but you could apply directly to NPR as well. Instead of getting a tote bag, an umbrella, a coffee mug, or a CD, you would simply get a membership to download content from NPR or any of its affiliates. You could have graduated levels of membership that would give you access to a greater number of these files. They could package the various shows produced by affiliates, charge differently based on the sound quality (and thus file size) of the content, etc.

As a fan of NPR, and member of local affiliates, even I have difficulty sometimes justifying the fact that I’m paying extra for something that I’m already paying for via taxes. I understand why this is, but it’s still doesn’t always sit well with me. Then the fact that I can’t get the content the way I want (via a downloadable file) unless I pay yet more money, and it’s a bit frustrating. However, I’ve paid subscription fees to various other providers of content (Satellite Radio and TV, Internet Radio, etc.) and not felt it to be onerous. Subscription, I feel, is the most fair because it is opt-in. If NPR continues to receive public funding, that’s fine by me, and so taxpayers should still get access to the programming in some form, but let those who are willing to pay extra receive the content exactly the way they want. That means being able to download this content as individual files, but perhaps also as premium channels on both Satellite Radio providers. That’s my idea, anyway. Then again, as it should be clear from this entry, I’m not an expert on the internal revenue workings within NPR and its affiliates, so take this for what its worth, but I think that as radio of all kinds make a transition from the current AM/FM model of local affiliates to a more global internet-based or satellite-based model, that NPR will have to adapt just as many other traditional broadcasters will if they don’t want to be made irrelevant by the scores of independent broadcasters coming out of the woodwork that provide their content for small fees (or absolutely nothing) via podcasts or audio streaming.

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