There’s been a lot of news about Rdio lately. Until recently, Rdio was a streaming platform that focused on providing an on-demand library of songs to suit users who like to choose what they want to hear, build playlists, etc.. Kind of like Spotify, except Rdio is a little more aggressive about their subscription model, giving users the chance to use the service free for only a limited time, with various subscriptions available after that.
In August, Rdio announced that they were adding personalized “radio” stations to their offerings, based on the user’s music selections, using “taste profiling” technology from The Echo Nest. This approach enabled Rdio to offer a more “Pandora” like experience to listeners. They began by offering that service, called You FM, free on the web, but just recently announced that it will be available free on mobile devices as well.
They’ve also just announced that their on-demand service is available at half off for college students. Are you confused yet? Wait, there’s more.
Big Radio Broadcaster Cumulus recently announced that they have taken a financial stake in Rdio and will sell all of their advertising. Which will run on the personalized station streams. Now, the actual terms of the deal were not announced, and I’ve heard that no money has changed hands, but apparently Cumulus will own the ad inventory on Rdio’s web based streams – plans are for mobile to remain ad-free. In exchange, Rdio will get access to Cumulus programming, and promotion on its broadcast stations, as well as a network of ad sellers. It’s an innovative deal for both Rdio and Cumulus – Rdio gets a partner that will boost its business prospects, and Cumulus gets a plug and play digital option for its customers, with very little risk.
May they thrive…
comScore has released updated smartphone usage information for August. Pandora is the 9th most trafficked web property among US smartphone users, reaching 43.2% of total US smartphone mobile users over 18. Pandora’s mobile app ranks 8th on the list reaching 43.3%.
145 million people owned smartphones, representing nearly 61% of the population. That’s a number that jumped 3% since the last report in May. Apple is the top smartphone manufacturer, followed by Samsung. Android is the top smartphone platform, with 51.6% of the marketplace, with Apple’s platform at 40.7%.
While some may question the veracity of Pandora’s ratings, there’s no doubt that their reach in the mobile marketplace is huge. Here they sit, on a list of the top 15 sites with the deepest reach among mobile users, along with Google, Facebook and Amazon, and above CBS Interactive and Twitter…
I’ve always known that my friend Sandy Smallens was smart and innovative, so it comes as no surprise that one of the most innovative ideas to come out of Spotify involves him. Smallens is co-producer of the new original content series Spotify Landmark, which is in-depth audio content that provides “the story behind some of the greatest moments in music, told by the people who made them.”
The first series went live in mid-September and tells the back story of the making of Nirvana’s “In Utero” album – to celebrate the 20th anniversary of the making of that album. The series is divided up into short segments, and “each show blends intimate interviews with artists, producers, industry figures and celebrities to create a listening history of legendary albums, concerts and events.”
This is the kind of innovative content that will set a streaming platform apart. Original content can expand that platform’s relationship with listeners as well as artists, benefiting the brand in many ways. It’s also the kind of programming that especially suits Smallens, Spotify’s head of artist marketing and original content and Spotify Landmark’s co-producer, who is both a musician and a natural born marketer with a passion for streaming. I worked with him years back when he was involved in early digital platforms at CBSRadio and then Entercom. It looks like he’s found a great way to spend his time at Spotify…
Amid all the iTunes Radio hype in September came an announcement from Songza that they have secured $4.7 million in funding. Among the investors was Amazon.com, which bought Amie Street, founded by Songza founder Elias Roman, in 2010.
Songza’s not the biggest streaming service, but they’ve been quietly innovative in the past few years, catching my attention a few times. Eric Davich, the other co-founder of Songza, recently joined the Streaming Music Trends panel at RAIN Summit Orlando and turned out to be a great addition, smart and spunky, with plenty of opinions.
Songza will use the new funding to develop its native advertising solution. “With this funding, we’re scaling our native advertising solution to make brand-to-customer interactions more engaging for customers and more successful for brands,” said Elias Roman, co-founder and CEO of Songza.
Songza’s approach to streaming music is to offer music based not on genre or artist, but on activity or mood instead. Going for a run, getting ready for a date, having a party, Songza’s got options for all of those and a lot more. The plan is to develop high impact 7 second ads that work well for both listeners and advertisers within the context of the programming.
Recent info says that Songza has 4.8 million active users. They have 24 million songs in their database, as well as a slick interface and a unique approach. And they’re concentrating on monetizing their audience in a way that benefits advertisers and listeners. All that makes Songza one to keep an eye on. For more, check out an interview that co-founder Elias Roman did on CNBC not too long ago..
Last week was a big news week for online music news and RAIN Summit Orlando was front and center. The speaker list and agenda for the event were spectacular, featuring smart people from online music services and digital savvy broadcasters, global agency executives, and forward thinking industry folks. The discussions were dynamic – professionals from Ford and Pioneer Electronics discussed dashboard strategies with guys from Pandora, Slacker and TuneIn; and top Triton exec Mike Agovino didn’t mince words while debating benefits of ad insertion with agency exec Natalie Swed Stone and Saga’s Steve Goldstein.
It was a breath taking day full of meaningful conversation that took place on the stage as well as in the audience, in the halls and during breaks. The absolutely best part of every RAIN Summit is the audience. It’s a group that’s always engaged, leaning forward, listening and asking questions, engaged with what is going on. It’s one of the biggest and brightest audiences at the entire Radio Show.
David Field’s keynote at RAIN Summit Orlando presented an interesting, if perhaps defensive perspective of the online audio marketplace. He did admit that audio consumption is expanding, presumably with the help of steaming services, but went on to imply that Pandora’s numbers are a hoax and question the value of targetability of audio ads. While I don’t really understand the wisdom of taking such a position, I also have no doubt that the people in the room are smart enough to figure that out for themselves as well. This is not a room full of lemmings.
RAIN Summits are places where the industry – and I mean the entire online audio marketplace – can come together and engage in dynamic dialogue, maybe even debate, on best ways to grow the space. We don’t set an agenda or require our speakers to take a certain point of view. Pushing forward means considering all the perspectives, forming opinions and then questioning them again. That’s the true value of an industry conference, and that’s what I think we witnessed in Orlando last week. It was, in my opinion, the best RAIN Summit yet. If you were there, thanks for coming. If you missed it, please join us next time.
Classic Rock tops the list of most popular genres in a survey of people who listen to online radio at work. Followed closely by Rock and Country music, Classic Rock songs are the ones that more than 1000 respondents said they listen to online and at work. The new info is part of an at work study done by Radionomy and Edison Research and released today. Based in Brussels, Belgium and San Francisco, Radionomy is one of the largest user-generated radio station platforms for producers, listeners and broadcasters around the world. This new study was designed to encourage producers of Internet radio stations on their platform by providing them with more information on what users want to hear.
The study finds that most people listen to Internet radio to hear songs they know – 86% tune in for that reason. But they also like to discover new music, as 72% pick that as a reason to listen as well. Fewer folks said they tuned in to hear DJs and local news online. More than half listen to 2 or 3 Internet radio stations a week, and more than three-quarters listen in other places outside of work as well.
“The desire on the part of listeners to simultaneously hear their favorite music and also be exposed to songs that they haven’t heard before but still appeal to their tastes creates an interesting opportunity for producers,” said Radionomy’s Thierry Ascarez. “We believe that those who can achieve a balance of giving people what they already want, and also new things that will appeal to them based on their established tastes, will more meaningfully connect with their audiences.”
You’ll be able to hear more about this survey at the Radio Show in Orlando next week. And you’ll be able to get a lot of very useful information about online radio and digital audio at RAIN Summit Orlando on Tuesday September 17th at the start of the show. For more info on RAIN Summit Orlando, or to register, click here. To save a few bucks use the promo code Audio4cast (you have to register before you get there to get the discount). Hope to see you there!
Driving is down in the US, according to an AP article that I read in my local paper over the weekend, causing folks that study that kind of behavior to conclude that our love affair with cars here in the US is coming to an end. The average number of miles drivers individually rack up peaked in July 2004 at just over 900 per month. Since then it’s been dropping, off 9% by last year at 820, and down again for the first half of this year.
Apparently, many factors are contributing to this trend, including the high cost of buying a car, the high price of gas, and the increased ability to purchase things online and even socialize online. Job losses due to the recent recession are a factor as well.
Which leaves me thinking about the impact that decreased driving is having on radio. Is the actual decline in driving one of the factors in radio’s declining AQH? The fact is that for the past decade, broadcast radio’s time cume has remained fairly steady at around 92% of the 12+ population, while it’s AQH keeps dropping. Some of this is due to younger generations preferring to listen on other platforms, like streaming.
But I’ve never heard anyone mention that the drop in time spent listening to AM/FM radio is tied to an overall drop in time spent driving in the car. And not only that, but this trend may be more closely tied to younger generations choosing other listening platforms over broadcast radio as well. Twenty years ago, two thirds of 18 year olds had their license. Today fewer than half of teenagers get their license in the first year they are eligible. That’s got to be having an impact on their time spent with radio.
Radio’s dominance over drive time has long been its mainstay. The waning of the time that folks spend in the cars is surely having a significant impact on the amount of time they are spending listening to their favorite drive time media…
How does this trend impact the future of radio and streaming? Don’t miss a great panel discussion on the topic at RAIN Summit Orlando featuring execs from Pandora, Ford, Pioneer Electronics, Slacker and others. You can see the full agenda and register here. Use the code Audio4cast to save a few bucks. See you there!
Pandora hosted a 2Q earnings call last week, giving investors news of increased listening and revenues, and continued disappointing profits. The highlight of the call was the news that mobile ad revenues are up 92% over last year, with Pandora now claiming to be the third largest generator of mobile ad revenues in the US, behind Google and Facebook.
Other big news included the fact that just months after a move to cap listening at 40 hours per month, Pandora is removing that cap. No doubt, this decision has to do with the impact that move had – Pandora’s numbers dipped about 10% this spring after the cap was instituted, and at least one competitor, Slacker, saw simultaneous growth. Meanwhile, it did appear that the cap spurred subscription sales as well – although whether those subscribers will stick now that the cap is lifted remains to be seen. Non-GAAP subscription and other revenue was $33.5 million for the quarter, a 153% year-over-year increase, including $4.7 million in revenue relating to our subscription return reserve which has to be held separately since they collect the fees upfront, but subscribers may cancel for a refund.
Advertising revenue was $128.5 million, a 44% year-over-year increase for the quarter.
Pandora also announced that they will for the first time be running back to back ads in listener’s streams, increasing the potential number of ads a listener can hear from about 4 per hour to 5. Since these are mainly 30 second ads, the ad minutes may climb to 3 minutes per hour.
My take on the listener hour cap and commercial units per hour tweaking is that Pandora is growing up and turning its attention more to profitability. They’re demonstrating a willingness to try different things in their attempt to make money per listener. The fact that they are connected to identified listeners gives them the ability to watch their tweaks closely, and they are obviously not afraid to change course if they don’t like what they see. And since they are a public company, these are experiments that the entire industry can watch and learn from..
Are you coming to RAIN Summit Orlando on Tuesday September 17th? Join attendees and speakers from Pandora, Slacker, iHeartRadio, TuneIn, Spotify, Univision, Greater Media and so many more for a great conference with excellent panels and networking. Click here to register, and use the code Audio4cast to save a bit.
- Pandora Shows That A Media Business Can Grow Around Mobile Ads (businessinsider.com)
- Pandora scraps 40-hour mobile limit ahead of iTunes Radio launch (digitaltrends.com)
Innovative technology for connective cars continues, this week Pioneer Electronics debuted a new line-up of in-dash receivers that offer bluetooth and usb connectivity for Androids and iPhones. These affordable, aftermarket products make it even easier for consumers to connect and listen to streaming audio in their car, featuring Siri technology for voice commands, simplified Bluetooth connectivity for hands-free calling and audio streaming, enhanced playback compatibility, and Pandora internet radio.
“The smartphone has become a part of most consumers’ lifestyles and a source of both entertainment and communication,” said Ted Cardenas, vice president of marketing for the Car Electronics Division of Pioneer Electronics (USA) Inc. “Pioneer’s new CD receivers provide various means for integrating a variety of smartphones into the vehicle.”
At prices starting at $90. That sounds like a pretty affordable price point to me.
Pandora continues to lead the pack of services that come integrated into the new offerings, they recently announced that they are now integrated with more than 100 car models and 23 manufacturers. That doesn’t mean other services are unavailable – just that Pandora is front and center as the featured service in the car. Mazda recently integrated Pandora into its 2014 Mazda6, incorporating voice commands that make listening while driving very easy and fun.
Pioneer Electronics Ted Cardenas and Pandora’s Director of Automotive Business Development Geoff Snyder will join a panel discussion at RAIN Summit Orlando on Dashboard Integration. Other panelists include Ford’s Global Lead, Business Development and Partner Management Scott Burnell, Slacker SVP Steve Cotter, and TuneIn VP Kevin Straley.
RAIN Summit Orlando takes place Tuesday September 17 starting at noon and finishing with a cocktail reception in the evening. Register here, and use the code Audio4cast to save a few bucks. I hope to see you there!
Digital revenue is the bright spot for radio according to the newest revenue data out late last Friday from the Radio Advertising Bureau. Digital revenues grew 16% over last year’s second quarter and are up 13% for the year. Serious attrition continues for network dollars which are down 4% for 2Q and the year. Digital is now poised to overtake network’s share of radio’s revenue pie.
The big elephant in the room is spot radio, which was only flat for the quarter but is still off 1% for the year. Of course this is not a good trend in the face of a modestly recovering economy. Ad revenues continue to shift to online and mobile media, as evidenced by the growth of radio’s digital revenues.
In a move that is likely a reaction to news like this, Clear Channel, which owns Katz Radio, the sales firm that controls the lion’s share of national spot revenues, has just signed on with IPG, one of the largest ad agencies, to build an automatic buying platform for radio inventory. According to Mediapost, “The initiative, which was developed by Interpublic’s Mediabrands unit, is dubbed the Magna Consortium, and is part of the agency holding company’s mission to automate 50% of its media-buying by 2016.”