With “This American Life,” a Big Bet on Digital Pays Off for PRX

6/5/14Follow @xconomy

If you were making a Mount Rushmore of public radio, Ira Glass would definitely be carved in stone. So when the creator and host of the iconic program This American Life announced that he’d found a new company to distribute his show to radio stations nationwide, the media world took notice. 

Under the new deal, Glass and company were taking control of sponsorship sales and station marketing, rather than farming those expensive duties out to someone else. The technical work of delivering the show’s audio to more than 500 radio stations would go to Cambridge, MA-based Public Radio Exchange, commonly known as PRX.

Winning the contract for This American Life is unquestionably a big deal for PRX, a roughly 10-year-old organization that operates out of modest offices on a side street near Harvard University. But the deal also says a lot about how public radio, and the media business as a whole, is changing in the digital era.

PRX was built from the ground up as an online system, harnessing the Internet as a way to both find new programs and deliver those shows to radio stations. That’s a big shift in the public radio world, where most networks—like This American Life’s previous distributor, Public Radio International—rely on a legacy satellite system to distribute programs.

“There are not a lot of people,” PRX CEO Jake Shapiro said, “who live in this weird space between broadcast and the Web.”

Shapiro

Shapiro

PRX was launched in 2003 with the aim of helping independent radio producers get their work on the air more easily. With a Web-based system, producers would be able to easily upload audio files and offer them for sale to stations.

If it worked, such a system would dramatically simplify the established behind-the-scenes marketplace for public radio programs, which was not particularly easy to navigate for a solo producer, Shapiro said.

“You’d have to buy satellite time, not knowing if anyone wants to carry the show,” he said. “You’d have to send a CD to 20 local stations, call them up, see if the program director was interested, maybe get them to agree to carry it. And then send them an agreement and ask them for a check.”

To build an Internet-based alternative, PRX had to basically start from scratch, which meant long nights of former technical director Steve Schultze writing code and running a group of Russian software developers.

“We decided at the beginning that we actually needed to be a technology company. We looked around, there was nothing off the shelf—there were no existing platforms, none of the existing institutions or networks had anything like we wanted to build,” Shapiro said. “There was no podcasting, there was no social media, there were no mobile platforms for audio. No smartphones, no YouTube. I mean, none of that stuff existed.”

Though it was built out of necessity, owning the software has become a strong competitive advantage for PRX. As Glass said in his press release announcing the new partnership, “they’re mission-driven, they’re super-capable and apparently they’re pretty good with computers.”

This American Life had been with its traditional distribution network since 1997, just two years after the show got started. In the public radio world, those distributors often handle a wide range of business services for the content producers: they market shows to radio stations, sell sponsorship packages, collect fees that radio stations pay to carry the show, and oversee the technical side of sending out the audio files.

Despite handing over all of those functions to PRI, This American Life had retained the rights to handle its own digital distribution. That was something the traditional networks typically didn’t care about in the early days of digital audio, Shapiro said, but it’s become an increasingly valuable asset as podcasting and streaming audio services continue to grow.

That digital rights decision would also be key to PRX eventually landing This American Life’s larger business. After the introduction of the iPhone kicked off the smartphone revolution, PRX decided to experiment with developing mobile apps for programs and radio stations. One of its early clients was This American Life.

“Years later, when they reevaluated their overall distribution needs and decided to leave PRI, we of course were one of the first phone calls,” Shapiro said. “Not the only phone call. But we were definitely one of the first.”

In some ways, the switch to PRX is an upset in the public-radio world. … Next Page »

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