A new study released by Arbitron and Edison Media Research called "The Infinite Dial: Radio's Digital Platforms" states that 61% of people 12 and older are aware of satellite radio. It says nearly one in five non-subscribers are "very" or "somewhat likely" to subscribe in the next 12 months. OK, no problem there, seems to pass the sniff test. But, the survey goes on to say this:

When read a description of HD Radio, 8% said they are “very” interested, and another 27% said they are “somewhat” interested. Those who subscribe to satellite radio are more likely to be “very” interested (10%) or “somewhat” interested (33%) in HD digital radio.

I would like to know the exact language of that description, but, no matter what it was, those are terrible numbers. The survery then states:

Most people who said they were interested in HD digital radio said they would be likely to purchase at a price between $50 and $100. Of the 35% of respondents who said they are interested in HD digital radio, nearly half (47%) said they would only be likely to purchase models that cost $100 or less.

What does this tell us? $50 to $100 is less than the cost of a nearly every satellite radio player (not including car kits), and is less than most MP3 players. Couple that with the low numbers of interest based on a description - one can assume that the description highlighted the key differentiating factors - it sounds like the market for HD Radio is still in the toilet and will be for some time. Certainly, the recent announcement that the HD Radio Alliance will rollout a $200 million advertising campaign for HD Radio is good news, but those interested in getting HD Radio to the masses must never lose sight of the fact that people will not care unless it offers something better than a) what they can get for free, or b) what they can get for an acceptable subscription fee. Free equals over the air radio, so paying for the same radio (i.e. the HD re-broadcast of a station) will never sell, ever. That implies that multicasting is the only way to differentiate. But, then you run into (b) - will the multicast stations be able to compete with satellite's offerings, enough to offset the cost of buying an HD Radio? I think the answer is No. What is the solution then? More on that soon.