Astro Radio is a part of Malaysia’s Astro Group. It operates eight terrestrial FM networks: ERA fm, MY FM, hitz.fm, MIX fm, LiteFM, SINAR fm, Melody FM & THR (Raaga and Gegar).
Broadcasting in four languages, it boasts of 12.6 million weekly listeners, according to the latest Nielson RAM survey.
AsiaRadioToday spoke to its CEO Jake Abdullah about the network’s performance, its future plans and the radio industry in Malaysia.
1. You just had some impressive figures for your Radio Division. What are your views on the latest results?
We are pleased that our share of Radex has grown four points, from 59% (Q1FY15) to 63% (Q1FY16). This reflects the fact that our growth rates continue to outperform the Malaysian market by +17%.
Nonetheless, with the soft consumer sentiment, we expect the Radex market to be challenging going forward. We will counter this by leveraging on our growing radio listenership of 12.6 million, the depth and breadth of our local content and talent, and targeted advertising solutions for our clients to drive income growth and share of Radex.
2. How important is Radio to Astro’s business? What percentage of revenue does radio generate for the company?
The group looks at its radio, TV and digital assets in a holistic manner instead of solely based on its revenue contribution. Radio plays an important role in Astro’s positioning as a leading media and entertainment group.
Astro Radio reaches close to 12.6 million listeners weekly, which is impressive when you consider we only have a total population of 30 million. Four out of our nine FM stations are among the top stations in their respective language segments.
In the past, radio dealt solely with its clients for air time sales. Today, through our new online streaming radio and music service, Raku, we are engaging with individual customers and leading the way in customised content as well as ads.
3. What is your assessment of the commercial ‘health’ of radio in Malaysia?
Radio remains the most effective medium to reach our audience and grow our clients’ brands.
As suggested by the latest Nielsen RAM survey (Wave 1 – 2015), total radio listenership currently stands at 17.6 million, reaching 95% of the listening population. These figures support our argument that radio remains highly relevant among listeners, notwithstanding the escalation of digitalisation. Malaysians have and will always continue to be heavy listeners of radio in their car, which supports the continued success of Astro Radio’s brands.
Nevertheless, the media industry is changing more rapidly than ever. Success in this new and connected age means the ability to grasp social and mobile technologies to engage with our consumers. According to PricewaterhouseCoopers, there has been a 57% increase in digital versus non-digital consumer spending since 2012.
Instead of competing directly with the digital revolution, we choose to embrace the rise of the machines long before the development of Raku with the creation of our respective stations’ websites and apps, which have garnered strong following over the years.
Our positioning strategy for the future is to strengthen the leadership position of our #1 station such as ERA fm, MY FM, hitz fm and THR Raaga. At the same time, we will continue to grow Sinar FM, MIX fm, LiteFM and MELODY FM to be strong #2s in their respective languages.
In the digital space, Astro Radio’s average monthly traffic for unique visitors grew by 69% from 2.3 million users to 3.9 million users in 2014. In the same year, page views also increased by 32% from 6.6 million to 8.7 million page views.
Besides the traditional way of selling airtime to our clients, we are now able to provide targeted advertising in order to strengthen and deepen engagement with content partners – i.e. advertisers, record labels, DJs, local artists and establishments.
Targeted advertising is made possible by creating data-backed advertising inventory through user profiling, behavioural data and user activity. Raku, our music streaming service, helps us grab the most relevant data important to us and to our advertisers in exchange for free content.
4. From your big picture CEO viewpoint, what do you see as the big issues for media in Asia at present?
Media consumption has changed drastically in the last years. The key aspect is how consumers listening and viewing patterns have changed primarily because of the ready available content across an array of platforms at the convenience of the consumer. Digital is in the forefront of this change and rather than going against the grain, we need to embrace change, which is now more rapid and we also start to pay more attention to consumption trends.
In Asia, with readily available illegal torrent sites and a multitude of pirate options, listeners are getting their content faster than via legal sources. This, to me, is one of the biggest issues that Asia is facing. From a radio point of view, this has made us to dig deep and provide the most entertaining and cutting edge content with the best talent possible across a multitude of platform whether it’s real-time traditional radio listening, podcasts, website, social media, RAKU etc. Our agility to synergise with any platform makes us agile and also keeps us relevant.
5. One of the many challenges to radio in the last couple of years has been the invention of music streaming services such as Pandora, Spotify, Deezer, etc. some radio companies have aligned with the big streaming services and others have decided to set up their own services. Why did Astro choose the second path, to set up Raku?
Astro believes in delivering innovative solutions to our customers. Fortunately for us, we possess the resources and experience to develop our own music streaming app. What sets Raku apart from other music streaming services is the kind of content that we offer.
Raku is designed for Malaysian listeners, by Malaysians. It allows users to select their preferred language interface, and then create and customise their own personalised radio station, with a mix of music and other local content of their choice. Raku’s most distinctive feature is localised offerings like local radio hosts and talk show hosts, which Malaysians can relate to.
In order to develop Raku, we leveraged the digital expertise of our talent, in turn backed by our strong experience in producing in-house apps, mostly for our radio stations and other Astro channels.
6. In deciding to develop Raku, what were the strategic business factors you took into account?
The strategy for Raku is localisation, i.e. building a music and radio streaming service for Malaysians in terms of content aggregation, curation, creation, and from a user experience point of view.
Raku’s revenue stream is supported by advertisements, sponsorship and subscription from Premium users. The premium subscription is a valuable revenue stream and we believe that Malaysians are willing to pay for a service that provides them with a wide breadth of relevant content, available at their fingertips in an interactive and convenient fashion.
Raku users are able to create their own radio stations. This will give our users, advertisers and artists a more sustainable model as we are engaging with them more deeply than the other music services in terms of our content offering, audience reach and flexibility in advertising products. Through our deep-rooted network in the industry (music, radio, clients, agencies) ours is a service that truly stands out.
Aside from the premium subscriptions, Raku is also available free to all Malaysians, hence enabling advertisements on Raku to reach wider and deeper audience segments.
7. Tell us about Raku – how many songs, what languages, how it works, etc.
Raku has over a million songs, a number which we expect to double in the near future. More importantly for Raku is, it is not about the quantity but the quality. Our priority lies in ensuring that curation and localisation is exclusive, special and cannot be found elsewhere.
Raku allows users to pick and choose the best of local and international content and music, with the option of combining them with podcasts, including local news, traffic updates and sports news. Raku’s interface is localised and is available in English, Bahasa Melayu, Mandarin and Tamil.
Raku is available in two versions; Free and Premium. Both can be enjoyed via web on raku.my and available for download from Google Play and the Apple App Store.
8. Pandora’s annual report shows that it earned about $600 million last year. What are your revenue ambitions for Raku?
It is still too early to talk about numbers, as we are still in the initial rollout phase. Raku is supported by advertisements, sponsorship and subscription from Premium users.
While we’re optimistic of the potential of Raku, we need to take into consideration that Pandora is a global service and Raku is focused on Malaysia.
9. While Pandora had high earnings, it paid a huge percentage of that in paying artist rights. How do the rights payments work for Raku?
Here at Astro, we understand that for the media industry to thrive, we need to be fair to all the players involved. As such, when we developed Raku, we looked at satisfying not just listeners, but artistes, labels and brands among key stakeholders involved in the music industry.
Artistes with their music on Raku will be paid via the usual channels (their music label/ MACP) and we are looking forward to signing up more local talents that have their own indie labels. We hope that through Raku, we’re not only meeting the expectations of our listeners and customers, but also in bringing forth new talent to the local music industry.
10. From a business point of view, how important is it for companies such as yours to keep introducing new products such as Raku?
In this advanced and modern age of technology, it is not just about delivering content to the audience, we must work hard at engaging and meeting the shifting trends among our listeners too. We need to provide the content where and when they want it, or risk getting tuned out.
Listeners need to feel like Astro isfocused on building a genuine and sustainable one-on-one relationship with them. To keep introducing new products just for the sake of having what others have is merely not enough. The product must be relevant to current market demands.
We must continue to produce innovative solutions for the consumers, while at the same time providing a strategic platform for our advertisers too. Our products must be aligned with our business objectives while also meeting the demands of our stakeholders.
11. On AsiaRadioToday we have a job ads section and a lot of our readers are eager to get their next job with successful companies such as yours. What characteristics do you look for in Astro Radio employees?
The people who work at Astro Radio are as diverse as the 30 million Malaysians we aspire to serve. Our greatest asset remains our workforce, and we’re constantly looking for high-performing individuals from diverse backgrounds and interests. Our aim is to recruit these talented, high calibre individuals into our family and give them a stage to shine.
12. How many staff do you have working in Radio? How do you recruit them?
We currently have about 445 staff working in Astro Radio. Recruitment campaigns are run via radio, digital, and print as well as word of mouth referrals.
See AsiaRadioToday’s jobs section if you are looking for a new job.