Category Archives: devices

The Key to iTunes’ Success

iTunes now has 500 million users worldwide who spend approximately $40 a year on content, according to analysis produced by Horace Dediu of Asymco. Apple users meanwhile spend about $1 a day per device on content, meaning that each time Apple sells a device they can count on 11% annually from that device/user.

Music download sales from the iTunes store are declining however, while other content – mainly apps, are taking a larger share of user dollars. The main reason for this is that 5 years ago, most folks were just getting their first smartphone, and were actively using a device called an iPod to carry around their music. Remember those days, when you bought music and updated your iPod all the time, plugged it in to your car, listened to it while exercising? Now, you use your smartphone and connect to Pandora instead, right? (Or Spotify, iHeart, or whatever). asymco itunes chart

Yep, no doubt the iPhone had an impact on iPod sales as well as song sales, and very soon iRadio will have further impact. Apple is not afraid to look into the crystal ball, see the future, and cannibalize one product with the next big one. And a few years back they saw the Pandora app take off like wildfire in their very own iTunes app store as every new user downloaded the app onto their phone, and they decided that they had better get into the streaming game. Are you as willing to cannibalize your comfort zone in the face of future trends?

Streaming Music On Smartphones Is Popular

Smartphone users like to use the devices to listen to music, and that’s a trend that is on the upswing, according to new information from NPD Group. 56% of smartphone users listen to music on their devices, with 39% of them doing that daily. Of those, they mostly listen to Internet radio (65%), but also stream on demand services like Spotify or Rhapsody (30%) and listen to their own music (it’s not clear whether it’s on the device or streamed from a cloud service) as well.

Music listening on mobile devices extends to tablets as well, with 40% of tablet users listening to music on those devices.

Ovi Music - on the go

Ovi Music – on the go (Photo credit: Nokia RSA)

The Audio Consumption study done by NPD Group also observes that hardware of products that enhance wireless local playback of streaming services on mobile devices, like wireless speakers and headphones, are growing as a result of this trend. “With both local music storage and the ability to connect to any number of online music services, tablets and smartphones are actually contributing to a net increase in their owner’s use of internet radio and personal music collections,” said Ben Arnold, director of industry analysis at NPD.  “As a result, we are seeing sales growth in products that compliment playback on mobile devices, particularly those that feature wireless local streaming.” Wireless streaming speaker sales more than tripled in 2012, and wireless headphones grew by 34 percent.

NPD Group’s Russ Crupnick is a featured speaker at the upcoming RAIN Summit West on Sunday April 7th at the Las Vegas Hotel. For more information and to register, click here.

Streaming Music On Smartphones Is Popular

Smartphone users like to use the devices to listen to music, and that’s a trend that is on the upswing, according to new information from NPD Group. 56% of smartphone users listen to music on their devices, with 39% of them doing that daily. Of those, they mostly listen to Internet radio (65%), but also stream on demand services like Spotify or Rhapsody (30%) and listen to their own music (it’s not clear whether it’s on the device or streamed from a cloud service) as well.

 

Music listening on mobile devices extends to tablets as well, with 40% of tablet users listening to music on those devices.

 

Ovi Music - on the go

Ovi Music – on the go (Photo credit: Nokia RSA)

 

The Audio Consumption study done by NPD Group also observes that hardware of products that enhance wireless local playback of streaming services on mobile devices, like wireless speakers and headphones, are growing as a result of this trend. “With both local music storage and the ability to connect to any number of online music services, tablets and smartphones are actually contributing to a net increase in their owner’s use of internet radio and personal music collections,” said Ben Arnold, director of industry analysis at NPD.  “As a result, we are seeing sales growth in products that compliment playback on mobile devices, particularly those that feature wireless local streaming.” Wireless streaming speaker sales more than tripled in 2012, and wireless headphones grew by 34 percent.

 

NPD Group’s Russ Crupnick is a featured speaker at the upcoming RAIN Summit West on Sunday April 7th at the Las Vegas Hotel. For more information and to register, click here.

 

Apple Sets Its Sights On Radio With New Patent

This week Apple was awarded a patent that appears to be a shot across the bow to streaming broadcasters. The patent enables switching from broadcastor streamed content to media stored on a device. By using information available from RDS data, broadcast listings or published programming schedules, the device would determine in advance what programming might not be of interest to the user and then switch to songs or podcasts stored on the device or streamed from a cloud based library. The system reportedly uses the device owner’s content consumption habits, as well as “like” and”dislike” interactive features to determine preferences.English: Target

Apple Insider presents this description from published patent information:

“For example, a user may not like a particular song broadcast by a radio station, or may not like a particular segment of a talk radio station (e.g., the user does not like the topic or guest of the segment). As another example, a user may not be interested in content originally generated by sources other than the media source (e.g., advertisement content). Because the user has no control over the media broadcast, the user can typically only tune to a different media broadcast, or listen to or consume the broadcast content that is not of interest.”

There are a couple of remarkable things about this, not the least of which is that Apple is certainly a formidable competitor. The fact that they have developed this new technology which focuses extensively on replacing radio content is noteworthy. Implications could be significant for broadcasters and others that offer single stream programming, not to mention ad-insertion companies and advertisers. In fact, there could be, would be significant impact for on-demand services as well, since it would make an individual’s music library more useful and relevant.

And the devil is in the details, which might be comforting if the patent holder were any other than Apple…

Samsung Is In the Streaming Business

Device manufacturers are buying up streaming services, creating an interesting angle in the formula for success in the online audio marketplace. In March HTC bought MOG, now Samsung has picked up mSpot and relaunched it as Music Hub, a music store, locker and streaming service for their Galaxy phone. The service launched in Germany, France, Spain, Italy and the UK, and is not yet available in the US.

The service will be offered in both free and premium versions to owners of the new Galaxy S3. By the looks of it, it will try to get users to replace iTunes, Spotify and other streaming services with a one stop “hub” that offers 19 million songs in its catalog. Users can preview, purchase and download songs, store them in their locker, and play them back from their device or other devices or PCs. They can also stream personalized radio channels, get recommendations, build playlists and listen on-demand if they pay the subscription price of 9.99 euros or pounds.

While there is no word on why the service is not yet available in the US, it’s easy to suspect that there are licensing negotiations going on. and on.

There’s definitely a marketplace out there among device manufacturers for comprehensive streaming services that might be struggling to monetize given their enormous “content acquisition” fees. Mobile device manufacturers know that their customers want to stream content, and they are eager to offer it in a proprietary fashion to enhance the attractiveness of their brand. Dedicated lockers with lots of songs in them create long term relationships with customers, so the cost of acquiring the content and offering the service becomes part of the expense of acquiring and retaining customers. Ads, if they decide to sell them, are gravy rather than bread and butter.

CBS RADIO Signs Up With Tunein

CBS RADIO has signed a non-exclusive deal with tunein, giving tunein listeners access to news, sports and talk content on more than 40 CBS RADIO stations. This news flies in the face of several exclusive deals recently leveraged by Clear Channel on its iHeartRadio platform, where some major broadcasters were signing away their rights to work with multiple online portals to engage listeners, and instead agreeing that the online online portal they would work with would be iHeartRadio.

“We have always believed in the value of great local content, and this agreement validates the demand we know exists for our original programming while at the same time creates a new revenue source for the company,” said Ezra Kucharz, President, CBS Local Digital Media. “By forging relationships with premiere distribution services such as tunein, CBS RADIO will significantly grow its audiences by exposing our content to new listeners.”

The CBS RADIO deal make a lot of sense, although it’s disappointing that only talk radio content is included. This may be due to tunein’s global appeal – CBS Radio restricts streaming of its music stations to the US. tunein has a suite of very popular mobile apps as well as deals with many devices and automakers, high rankings on iTunes for its popular app. According to Alexa, it’s one of the most popular websites in the US and world, ranking just above the top 1000. That’s a lot of potential listeners…

HTC Moves Into Streaming Music With MOG

Image representing HTC as depicted in CrunchBaseIt’s all but confirmed that mobile phone company HTC will purchase on-demand streaming service MOG via their Beats Electronics high end headphone brand. Which is a very interesting play for the folks at MOG. That service, while interesting, might have been dismissed not very long ago as one that was getting sidelined by other on-demand services like Spotify and even long timer Rhapsody, which recently reinvigorated itself with the purchase of the legal remainder of Napster.

Following in the footsteps of the mobile phone/streaming service pairing between Muve and Cricket, this deal looks like a good one for MOG, which was founded by David Hyman in 2005 and had raised $33 million. MOG reportedly has about half a million users.

HTC, the fifth largest smartphone maker in the world, took a controlling stake in Beats last year. That company is tied in tightly with Universal Music, the largest of the big record labels, which adds yet another interesting twist to this deal.

So MOG, or whatever it becomes, will become an on-demand music source built into a large number of smartphones. Sure – those folks can still subscribe to Spotify or Rhapsody, but if HTC comes with a free service that offers the same thing why would they?

Consumers That Stream Also Listen To FM In Cars

Nearly 40% of smartphone owners have used their device to listen to a streaming music service while in their car, according to new research by NPD Group on automotive connectivity. Devices and ways to connect them have become a serious focus for the auto industry. 79% of car owners are using a digital device in their cars.

It appears at this point that streaming in the car is used to supplement listening to traditional radio – according to NPD’s Ben Arnold, seventy three percent of drivers report still using their FM radio “always” or “most of the time” during car trips while more than half (57 percent) of vehicle owners say a CD player is vital in their decision to buy a car stereo or entertainment system.

The desire to consume connected content is a challenge for the auto industry as well – as they focus on best ways to integrate mobile connectivity into the car with minimal driver distraction. Apple’s voice controlled Siri  and Microsoft’s motion controlled product found in Kinect are technologies that automakers are looking to integrate into the equation.

Meanwhile, in place of smooth integration, consumers are finding ways to connect their mobile devices using auxillary inputs (18%), USB ports (11%), and Bluetooth technology (56%). This fact – that consumers are so interested in developing workaround ways to use their connected devices in their cars, is a huge indicator of the desirability for a more connected dashboard.

“The key is for auto makers and traditional audio manufacturers to facilitate consumer use of connected devices in the vehicle, allowing content from the smartphone, tablet, or digital media player to easily stream or be controlled through the deck mounted in the dashboard,” Arnold said.  “We’re only going to see greater consumer attachment to social media, streaming audio and video, and other services as content options grow.”

Slacker Adds Live Sports, Customizable Weather

English: Exterior CES sign outside the LVCC du...

It’s CES week in Vegas, and that means lots of Internet radio companies are announcing new deals and developments.

Slacker will now offer live streaming of major professional and collegiate sports events from ESPN. The new feature began last night with the live broadcast of the BCS Championship game — No. 1 LSU versus No. 2 Alabama — which was available to all Slacker listeners. Slacker also announced a partnership with The Weather Channel to offer customizable forecasts and updates to Slacker listeners.

Adding real-time updates from The Weather Channel to Slacker’s millions of songs and non-music content further highlights Slacker’s commitment to creating the best Personal Radio experience. “Every person is affected by weather; it’s an important part of our lives,” said Jonathan Sasse, senior vice president of marketing at Slacker. “Including weather on our stations is one more way that Slacker is offering the most relevant content to listeners, providing the best possible personal radio experience.”

Meanwhile, Targetspot and Livio Radio have announced that TargetSpot will be the exclusive third-party advertising provider for Livio Connect, which allows consumers to access digital radio content while in their vehicles. Through this partnership, TargetSpot’s advertisers will be able to reach an audience of listeners comprised of 65 percent of the automotive Bluetooth market as well as drivers of major auto brands.

“Digital radio in-car is a game changer: until now, morning drive time has been served by over- the-air radio, but as digital access becomes more readily available in auto, this will change,” said Eyal Goldwerger, CEO of TargetSpot. “We are thrilled to offer our advertisers the ability to reach digital audio consumers in their cars. With TargetSpot’s widening network of distribution partners, advertisers can reach their desired target audiences wherever they are listening and whatever their listening preferences may be.”

 

Internet Radios Selling Well In Auto Aftermarket

Six percent of automotive aftermarket car radios sold this year will be Internet radio capable, according to the Consumer Electronic Association. That number will increase to 14% by 2015 based on projections from the CEA.

In sync with that trend, Ford will no longer put cd players in the dash of their cars, opting instead for their connected dash approach, according to Digital Music News.  “In-car entertainment technology is moving digital more rapidly than almost any other element of the vehicle experience,” said Sheryl Connelly, global trends and futuring manager at Ford Motor Company.  “The in-car CD player – much like pay telephones – is destined to fade away in the face of exciting new technology.”

The automotive aftermarket is hot for Internet radio, and most notably, Pandora enabled devices. Seattle-based Car Toys’ Jim Warren said, “Pandora products are selling through quite well. Typically, the Pandora feature is packaged in with other step up features so it is difficult to isolate the impact of the feature by itself. Regardless, we love seeing our suppliers adding step up features that connect the smartphone to aftermarket car audio.”

This year has seen a lot of interest by automotive aftermarket companies in introducing Internet radios. Alpine says that 60% of their 2011 radios have Internet radio features. Pioneer, Kenwood, Livio Radio and other manufacturers have introduced devices as well. “When we first started selling Internet radio products in 2008, we were cold calling customers and the main question we had to answer was “What’s Internet Radio?” Now customers are calling our office and asking us what products we have that can add Internet Radio to their cars.” says Jake Sigal, Founder of Livio Radio.

No doubt Pandora’s big brand helps to create the kind of buzz that sells these radios. Functionality that leaves the listening choices to the listener will be important to the industry as a whole. I look at the way that Sirius and XM drove the success of satellite radio’s expansion into cars and wonder who – other than Pandora and to some degree Clear Channel – is driving online radio’s automotive future?

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