iBiquity Digital – Profile
HQ: Columbia, MD
Founded: 1996. The company was previously USA Digital Radio and was spun out of CBS.
Management: Robert Struble is President/CEO/Chairman. He has run the company since 1996. He was previously President of Westinghouse Communications and Westinghouse Wireless Solutions. He has the MIT/HBS/Baker Scholar/McKinsey pedigree.
Investors: The company has raised over $130M. Most recently in February 2005 it raised a Series C add-on round of $30M from Gannett, Grotech Capital Group, JPMorgan Partners, MidOcean Partners, New Venture Partners, Pequot Ventures, Waller-Sutton Media Partners, Whitney & Co. In addition, 14 of the 20 largest U.S. radio broadcasters, equipment and automobile manufacturers have made strategic investments.
Business Model: iBiquity lays claim to be the sole developer and licensor of HD radio technology in the US which digitizes traditional FM & AM content. The benefits are compression which allows more programming to be broadcast over the same frequency, as well as improved sound quality. Company has convinced traditional radio operators to begin broadcasting digitally, and is just now getting consumer electronics companies to create digital radio receivers. It is also working with car companies to get digital radio installed in cars.
Competitors: XM Satellite Radio, Sirius Satellite Radio.
Dirt: The company has successfully overcome a lot of big problems. The next ones on its plate are that the initial radios being sold by its manufacturing partners are expensive. Plus it has strong mind-share competition from Sirius and XM which are gaining strong momentum. iBiquity is a fix for the old way of doing business, whereas XM and Sirius represent a new way of doing business. The old business that iBiquity targets is still based on ad revenue and established radio programming, whereas Sirius and XM have commercial free radio and new types of premium programming. So it will be interesting to see which one consumers are drawn to.