• by Erik Sass  @eriksass1, June 8, 2009

While traditional radio is tanking, the digital business is going great guns, with a steady stream of new deals and services being announced. Some of the most ambitious initiatives come from Clear Channel Radio, including a raft of new features and services.

Today, Clear Channel announced the rollout of a new Flash-based digital player for all its online properties; a new structure to encourage navigation between these properties (increasing overall "stickiness"); improved ad-serving capabilities that allow advertisers to "follow" consumers; more preference-mapping to refine content offerings for individual consumers; and new mobile apps.

A central goal of the expansion is pushing the transformation of Clear Channel Radio from a traditional radio broadcaster to a multimedia company, creating and distributing content across a variety of platforms.

The introduction of a new Flash Media digital player will help Clear Channel profit from continuing growth in on-demand video consumption, according to Evan Harrison, the president of Clear Channel Radio's digital division. (A recent study predicts that 145 million Americans will view VOD content in 2009.)

The new digital player is standard across all of Clear Channel's Web sites, which include radio station Web sites and national sites like Iheartradio.com and erockster.com. Harrison said this makes it easier to create and distribute video content -- e.g., footage of live performances at a special, 200-seat theater built by Clear Channel for this purpose -- which local station sites can then customize and repackage with national or local advertisers.

Clear Channel has also created new conduits between its Web sites that invite users to visit other local station sites, as well as national sites like Iheartradio.com. Clear Channel Radio currently has about 350 station Web sites integrated with Iheartradio.com, all offering streaming, on-demand audio and video content.

Previously, most of these station sites were "dead ends." The new structure encourages users to surf other station sites by format and location. Furthermore, the user's content preferences are mapped to provide additional recommendations ("more stations" and "more stuff") that can lead to deeper engagement with the current station site, discovery of new station sites and consumption of other types of media, like music videos.

With its new player Clear Channel is also offering advertisers high-profile, premium placement, reaching users via several different channels. For example, on Iheartradio.com a national advertiser could buy a permanent banner ad placement on the right side of the page, along with a pre-roll video ad in the player "screen" on the left side. By the same token, a local advertiser can enjoy similar exclusivity on a local station site.

Also, Clear Channel is marshaling new mobile applications to extend its reach among smartphone users. These include a broader rollout of local traffic reports available on demand via mobile devices; the mobile on-demand traffic reports are currently live in 11 top markets. This builds on the company's success last year, when Iheartradio apps became the most popular free app on iPhone and the most popular app overall on BlackBerry within days of their launch. Since then, BlackBerry users have downloaded about 2 million apps; 80% of these subsequently returned to download several upgraded versions.

For Clear Channel, investing in digital has already paid off. While the company is typically secretive about revenue data for specific divisions (all the more so since it was bought out by private equity last year), an industry watcher familiar with the business estimated that the digital operation's revenues cleared $175 million in 2008.

That's still a relatively small proportion of total revenues (about 5%) but compares favorably with the industry average of 3%-4% -- as does a year-over-year growth rate of over 20% in 2008, versus an industry average of 7% for off-air revenues including digital, per the Radio Advertising Bureau.

With over 120,000 advertisers on its digital network, 2008 marked the first year that a majority of Clear Channel Radio's advertisers participated in the digital platform. The company expects the figure will top 73% in 2009, citing stats from a study showing ad recall of 27% for combined online and on-air placement (versus just 6% for online-only). On the consumer side, Clear Channel's 350+ digital destinations attracted 22 million unique visitors per month in '08, with 8 million of these consuming both audio and video content.