Tuesday’s Topics . . .

LIBERTY THROWS A PITCH IN THE DIRT FOR IHEART:  By far the biggest news in radio yesterday was the disclosure that Liberty Media and it’s Sirius XM subsidiary has made an offer to buy 40% of iHeart for $1.16B in cash.  The one catch to the deal is that it requires iHeart to go through bankruptcy first to shed itself from $22B of debt.  That will be easier said than done, since a post-bankruptcy iHeart most likely won’t remain intact because many of its assets will be sold to pay creditors.  Another concern is valuation – $1.16B for 40% of iHeart prices their market cap at $2.9B, which is just over 10% of their $27B value when they went through their original leveraged buyout in 2008.  The third issue would be an antitrust concern.  Liberty owns (wholly or partially) a spider web of media companies including Charter Communications, Sirius XM, Pandora, Live Nation, Ticketmaster, etc..  Will regulators allow them to pick up a chunk of the nation’s largest radio broadcaster or would that be considered monopolistic?  I’ve attached two articles on this for different perspectives.  The first Inside Radio link (which is owned by iHeart) has a gleeful “someone likes me” feel like they were just asked to prom.  For a more adult perspective check out this WSJ link.  All in I think there’s very little chance of this happening. It feels like a cheap pitch in the dirt attempt to buy a stake in iHeart at a huge discount.  iHeart must decide what they’re going to do with this offer, or any other option, by this Friday’s debt default deadline.  Get ready for some fireworks.

VOICE-ACTIVATED AI IS COMING TO YOUR PASSENGER SEAT:  You knew it was just a matter of time before voice activated digital assistants came to your car.  According to the attached TechCrunch link, Ford is about to introduce the first “voice controlled co-driver”.  The technology is being enabled by a third party company called Sygic which will embed it’s driving AI in Ford’s next gen SYNC 3 platform.  Envision being able to have a live conversation with your car about traffic conditions, directions, parking options, gas prices and even where to find that one clean highway restroom.  That’s what you could be doing when you buy certain 2019 Ford vehicles (available this Fall) which are enabled with Sygic’s tech.  Right now the landscape for voice-controlled AI in connected cars is pretty sparse.  Siri works on your Apple device as normal when you’re connected through CarPlay, but it’s driving-related content is pretty weak.  And Alexa is currently just for home-bound Amazon devices unless you buy a piece of Garmin hardware to connect in-car to your Amazon account.  This leaves a gaping hole for Ford, and I’m guessing several other OEMs, to drive through over the next few years.

SOLVING THE FINAL MOMENT OF TRUTH:  In marketing the final moment of truth is the instant a shopper stares at a shelf and decides to pick up a particular brand and put it in their cart.  Can you imagine how much marketers would pay to influence the purchase decision in that nanosecond?  Over the last few years the field of Beacon technology has been developing to meet this demand.  Beacons are electronic sensors placed in stores (or even on shelves) which can ping customers’ mobile devices with an ad, coupon, etc., as they get near the shelf.  The concept seemed pretty solid, which led national retailers like Walgreen’s to set up chain-wide beacon systems that can feature selected brands in a location-triggered mobile coop program.  But according to the attached AdWeek link, over the last year growth of beaconing seems to have stalled.  The biggest concern about beacons is an oversaturation which can lead to customers being shouted at by several different brands as they walk the aisles.  Retailers have started to get negative feedback from shoppers on this point, which has led them to rethink beacons and look for alternatives.  The leading contender to replace the beacon is something called Scannable Shelf Tags (SSTs).  These devices fit on shelves and emit a brand’s message/offer, but are only activated when a customer enables the Near Field Communication (NFC) receiver on their smartphones.  By using SSTs brands can create shelf-level communication that’s optional and individualized.  This solves for beacons’ intrusiveness problem, while still giving marketers a chance to influence the final moment of truth.

Have a great Tuesday guys!

308 thoughts on “Tuesday’s Topics . . .

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