The Financial Post's Sean Silcoff has an interesting column looking at how Canada's private radio industry is thriving at a time when other media - newspapers, television, magazines - are struggling with the Internet's growing popularity. Silcoff points out radio listenership has remained steady at 532 million hours over the past six years, while sales have climbed by 5.6% a year over the past decade. Meanwhile, operating margins climbed to 21% - 3.5x the level in 1995.

So has commercial radio in Canada managed to thrive at a time when competition has increased from the Web, satellite-radio and the iPod? Maybe, it's the local nature of radio - the fact it provides people with local weather, traffic conditions and news; stuff that the Web and satellite-radio struggle to provide. While local search is all the rage these days as Google and others such as Ask.com look to expand, the job of providing local information has continued to effectively handled by local-based media.

This is something newspapers need to grasp as they look for a new recipe for success. Rather than trying to compete with Google.com or CNN, newspapers should put a lot more resources on local coverage in their print and digital publications. It's this kind of content that will keep them relevant to readers and advertisers. In Toronto, the Toronto Star's efforts to provide even more local coverage has been abundantly evident in recent months. This is a strategy more newspapers will have to embrace going forward.

Michael Urlocker, who writes the OnDisruption blog, has a column in today's National Post looking at whether satellite-radio can survive the growing popularity of the iPod in the mobile music battle. One fact that jumps out is that 70% of 2007's U.S. car models will have built-in iPod connectors, which will give the 67 million iPod owners another way to enjoy their devices. Urlocker, a former telecom analyst, suggests XM and Sirius must implement some "tough measures" to compete such as pursuing lower growth targets so they can become profitable, and "looking for marginalized customers who don't want or can't afford iPods". When it comes to the challenges facing satellite-radio, Mike and I are perfectly aligned.

So how's satellite-radio doing in Canada? Canadian Satellite Radio, which operates XM Canada, said yesterday it ended its 2006 fiscal year with 120,000 customers (90,000 paid, the rest falling into the promotional and discount category). That's the good news. The bad news is it lost $102.7-million, mostly on marketing and customer acquisition costs. In a research note, Genuity Capital analyst Andrea Horan said the paying subscriber numbers for CSR were below her forecast of 96,000 but 40% of XM's net adds will come during the holiday season. While I can see how satellite-radio can appeal to certain types of customers (taxi and truck drivers, serious commuters, cottage owners), I'm still not sold on its mainstream appeal. Sure, there is plenty of programming choice but it has never struck me as compelling even when you consider it costs about 50 cents a day. Both XM and Sirius Canada have serious ambitions (XM believes it can hit one million subscribers by 2010) but they seem far more bullish than realistic. Of course, XM is a publicly-traded company so they have to be optimistic otherwise they wouldn't be seen as serving the needs of shareholders properly. CSR shares by the way have dropped by more than 40% since the IPO earlier this year. Tags: XM Canada, satellite-radio

Not to suggest commercial radio is heading down the tubes but when it comes to audio (music, talk, etc.) in the car, the most exciting battle is being waged between the iPod and satellite radio. While the iPod has tremendous buzz and million of loyal followers, Apple isn't taking complete advantage of the opportunity to take control of the in-car experience. Why? As it now stands, if you want to listen to an iPod in your car it either requires some kind of gadget from a third-party such as Belkin or Griffin, or the custom installation ($$) of an input jack or special connector. (Disclaimer: I've been using the Griffin iTrip but the reception is terrible in downtown Toronto because there are so many radio stations, it is hard to find a channel without some kind of interference). If Apple was smart, it would start striking more deals with the auto makers (much like what Sirius and XM do) to make an iPod connection a standard or a simple, inexpensive option. This would easily extend the reach of the iPod into millions of vehicles - many of them owned by people with iPods but not using them was driving. Apple is already doing business with a handful of auto makers such as BMW, Honda, VW and Chrysler to integrate an iPod connection into cars such as the Mini Cooper and the VW Beetle, but given Apple's marketing muscle, it's puzzling why these kind of relationships haven't been extended to nearly every car maker. Apple should also be working with car stereo makers to make an input jack for the iPod a standard feature.
   As for satellite-radio, I remain far from convinced even though there are millions of XM and Sirius subscribers. From my own experience using a satellite radio, the lack of control was frustrating despite the fact there are more than 100 channels. When you boil it down, most people likely find 10 to 15 channels that meet their interests. But after awhile, the 10 or so music stations on your favorites list begin to sound repetitive because they must appeal to a large audience to be commercially viable. This is why the iPod could thrive as you drive because the user has the ultimate choice to listen to you what they want.