Kurt Hanson, Publisher of RAIN: The Radio and Internet Newsletter, and Founder of AccuRadio, a successful multichannel online station, has launched a new Smoothjazz station for Chicago and beyond. Recently, stations in New York City, Philadelphia, San Francisco and Chicago have abandoned jazz lovers and switched formats to attract more listeners. That, according to Hanson, leaves hundreds of thousands of listeners who love Smoothjazz without a favorite station.
ChitownSmoothjazz.com offers nine channels of Smoothjazz, focused on different styles, instruments and moods, with fewer commercials than any broadcast station. Plus, ChitownSmoothjazz.com has interactive features that allow you to customize your stream and view info about the songs you’re listening to. Smoothpiano, Groovejazz, New Releases, SmoothSax…if Smoothjazz is your thing, this station is sure to suit you fine. It is, as the website describes, a perfect soundtrack for a romantic candlelit dinner.
Internet radio has grown increasing mobile over the past year, with apps on various smartphones and other wifi enabled devices, making it even more plausible that an online brand can fill a format void created by local broadcast stations’ format changes. Chicago and Jazz are two things that go together, seizing this opportunity makes a lot of sense for Kurt – especially in his hometown.
One in four Americans have downloaded and watched or listened to an audio or video podcast, according to a new study presented online last week by Tom Webster of Edison Research and the Association for Downloadable Media. Awareness of podcasting is up – from 37% to 43% – and Webster says that means it’s mainstream.
In this 4th annual study of Podcasts, Arbitron/Edison found that Internet and broadband access are widespread, a factor that’s contributing to increased consumption of podcasts. Defining podcasts as audio or video digital files, the study makes the distinction that podcasting refers to the download of program-oriented online audio/video such as talk shows or hosted music programs, usually as an automatic download that can be listened to at the user’s convenience. It does not refer to the download of songs or mp3 files.
Most people that listen or watch podcasts do so because it allows them to consume the content whenever they want. That timeshifting behavior is driving podcasting’s popularity. Other reasons for podcasting were the ability to listen wherever they wanted, to carry the content with them, and have more control over the content.
More men than women download podcasts – 59% are men. 53% are 25-54 years old. They are well educated, high income, and active social networkers. About two thirds of all podcasts are consumed on a desktop computer, although podcast consumers are likely to own a portable device. They also spend more time online and are more likely to listen to Internet radio as well.
Podcasting’s audience is growing – but at 5% in a year that growth is modest. Webster’s presentation ends with recommendations that content providers create more short form podcasts to grow consumption. He also points out that there aren’t enough podcast aggregators to encourage audience growth.
Podcasting’s revenue opportunity lies in the level of engagement of the listener. Rather than pricing and selling podcasts as a mainstream medium with mainstream cpms, podcasts can be sold with premium pricing – either alone or in tandem with other platforms such as Internet radio.
About a year ago, Yahoo shuttered its own paid music service, and then subsequently handed operations of its Launchcast free streaming music platform over to CBSRadio. Last month, Yahoo Music debuted a new, beta site that gives Yahoo users access to various paid and free music services available online.
Visitors to the Yahoo Music site can select from a variety of music destinations, including free, radio-like streaming audio services such as Pandora and last.fm, music videos from YouTube, and paid music downloads from iTunes and Amazon.com.
The main Yahoo Music page is all about Launchcast – powered by CBSRadio, and the videos that I saw there were Yahoo videos as well. But a click through to an artists page finds links to Yahoo content as well as branded links to Last.fm and Pandora, where you can listen to a channel with Beyonce and similar artists. There’s also branded links to Beyonce videos on YouTube, music downloads from iTunes, Flickr photos of the artist, lyrics to her songs, and more. This new version of Yahoo Music is a really great resource to all things Beyonce – or the 500,000 other artists that Yahoo says they offer music and information on. (That’s roughly twice as many artists as they had on the previous Yahoo Music site. )
According to Yahoo Music head Michael Spiegelman traffic is up to the new Yahoo Music. Spiegelman told paidContent that Yahoo Music as a whole grew a respectable 13 percent traffic wise in April, to 20.5 million uniques. He added that daily uniques doubled, with traffic from search engines up a healthy 108 percent. Page views per listener, a good indicator of how long visitos are spending with the site and how much they like it, were up by 40 percent. Yahoo Music was still the No. 2 online music site, according to research company ComScore. Time Warner Inc’s AOL Music was the top site with 28 million visitors.
The new site gives Yahoo Music the ability to offer access to a wide variety of content and services in a format that is in keeping with its core business as a portal or directory. It’s a very well developed, interactive site with deep content. The videos and music that I listened to had a gateway ad in front of them, indicating that they are monetizing the assets as well.
It’s been a big week for news about Pandora – they announced the launch of a new, ad free premium (read: freemium) service with lots of enhanced features, projected profitability for their company next year, and made news by working with Ford Sync to get into cars. All great stuff.
A few other digital music services have launched new platforms. Music streaming service Imeem has a new iPhone app. Imeem mobile, like other streaming service’s mobile apps, offers the ability to stream, create personalized channels, search for and purchase music from iPhone and iTouch devices.
With Artist Radio on Imeem, listeners can listen to stations featuring their favorite artists plus similar sounding ones. They can also create lists of favorite songs and artists, and that information will be used to create personalized stations based on that feedback. Like most online brands, Imeem also offers a selection of Featured Stations, preprogrammed streams for listeners who don’t care for the interactive options.
The most interesting feature is Imeem’s MYMUSIC which allows listeners to upload their music libraries to the site and then stream their music on demand from their mobile device. According to CNET, the Imeem app allows you to call up any song or album in your collection and play it without the restrictions associated with most services (i.e. limited skips, and the inability to play songs from the same artist back-to-back). It’s a concept called Cloud Storage, the idea being that music is stored on one main cloud server and pulled to various devices by the listener.
Grooveshark, an on demand streaming music service, is working with Ping.fm on an app that pulls music from the Grooveshark library, creates a small twitter-compatible url for it, and allows people to tweet songs to each other. It’s a similar concept – Grooveshark’s music library is the cloud storage for musical tweets on twitter.
Here’s how one might use it: Last week I tweeted that Rick Derringer was quoted saying Internet Radio is the future of radio. Someone wrote back about Derringer’s hit song RocknRoll Hoochie Coo. So I went to ping.fm and tweeted him back the song. It seems like just the kind of social app that could get traction. It also seems like an app that radio stations could use to interact with their audiences…
Speaking to Bloomberg.com this week, Pandora Founder Tim Westergren said he hopes 2010 will be his music service’s first profitable year. He projected that revenue will double this year to $40 million based on audience growth and increased demand for ad units. Based on an assumption that current music royalty negotiations will be finalized, Westergren says he’s optimistic that Pandora can make money next year.
Pandora has 27 million registered users and adds 50,000 to 60,000 a day. Mobile devices such as the IPhone and Blackberry have played a huge part in Pandora’s success – last year Pandora’s iPhone app was the most popular app in the iPhone app store. Westergren says 18000 to 20000 new users a day are coming from iPhone alone.
Add to this news that Westergren didn’t mention during this interview: Ford says the next version of Sync, their innovative connected car radio developed by Microsoft, will have Internet radio capabilities. Ford says they are working with Pandora on development for debut in 9 to 12 months.
Pandora’s ad revenue strategy focuses on selling targeted ads, delivered to users based on gender, age, or geographic attributes. This is valuable to the advertiser, says Westergren. “We’re not delivering an ad for a women’s clothing store to men, or a bar or alcohol-related event to minors,…everything is delivered based on the information of the listener.”
They’ve beefed up their ad sales staff and added audio sales specialists. Pandora plans to air 2 or 3 :15 second audio commercials per hour as the audience and demand increases. Currently, they air only one per hour. I suspect with the exponential audience growth, targetability, and positive buzz about the service, the challenge won’t be finding advertisers, but optimizing units and cpms.
Pandora is the premier brand in the Internet radio industry now – a great site with enormous popularity, functionality and cache. The positive buzz that Pandora generates benefits all of Internet radio. They led the way with Iphone, and now they’re leading the way by working with Ford. I’m looking forward to watching them march toward profitability as well.
Fox Television will be the exclusive sponsor of Clear Channel’s IHeartRadio iPhone and Blackberry platforms on May 18th and 19th. Fox will takeover these platforms to launch its new series Glee, after the American Idol finale on tuesday. According to information released by Clear Channel, as part of the sponsorship, a gateway ad will appear while the iheartradio application loads and on every third interaction, such as a station switch. There’s no specific information as to whether that gateway is strictly a visual gateway or if it includes an audio element as well.
“Clear Channel Radio is an innovative media partner that has consistently provided us with new ways to reach our key targets,” said Laurel Bernard, senior vice president of marketing at FOX Broadcasting Company, “They make it easy for us to reach an extended audience on-air, online and now on mobile. We are always interested in the new avenues of communication that Clear Channel offers.
IHeartRadio is Clear Channel’s mobile radio platform and hosts over 200 of their broadcast stations’ streams, specially created online brands such as eRockster, sports and talk personality channels and some special services such as traffic for 10 markets.
Clear Channel Radio Sales President Jeff Howard gets credit in the release and says “From on-air innovations like shorter-length spots and blinks, to Web site takeovers, and now to mobile innovations like this roadblock, we’ve been fortunate to work directly with this powerful brand (Fox TV) to help them connect with their target audiences.”
It’s great to see this announcement coming from the traditional broadcast rep side of Clear Channel, as it indicates that Howard and his team are actively working to sell mobile and online opportunities to their stable of national radio advertisers. That can only be good for them and the rest of the industry.
Vitaminwater is launching a new flavor this summer by giving away lots of music downloads from MySpace Music. Promoting the new flavor called Sync with the tagline “download of vitamins and antioxidants”, Vitaminwater will put MySpace Music on 24 million bottles and give away that many free downloads from MySpace Music and Amazon Music. Reportedly, they’ll also support the campaign with radio and magazine ads as well as in-store advertising.
Coke, which purchased Vitaminwater last year, seems to be creating a promotion similar to one that Pepsi did with ITunes a few years ago.
It sounds like a great deal for MySpace Music, which has had a difficult time monetizing its huge audience since launching last year. MySpace Music, which has partnerships with the major record labels, plans to build revenue in two ways: advertising sales on the site, and converting traffic to the site to online sales of music, concert tickets and other items.
The association with Vitaminwater has some nice cache, it promises to build awareness for the site, and emphasize online transactions – in this case music downloads. Sounds like a campaign for two brands that are in Sync, and a good blueprint for other large online music sites to set their sights on.
A new report by EMarketer this week discusses the revenue opportunity for podcasts as small. Citing Online Spending projections by Zenith Optimedia, they report that spending on podcasting will be $28million in 2009 and increase to $43million by 2011 – a mere 0.2% of predicted total online spending.
This year 21.9 million people (11.9% of US Internet Users) will download or stream at least one podcast per month. While advertising is increasing, says EMarketer, it’s increasing slowly from a low base and is not about to make anyone rich.
None of this information spells doom for podcasting. As I have emphasized before, podcasting is not a mass appeal medium like radio. It requires effort and engagement on the part of the listener, and therefore is well suited to premium, desirable content. The level of engagement of the audience merits premium pricing as well.
To optimize podcasting’s revenue opportunity, content producers must understand who the listener is and identify advertisers who can perceive the value of engaging with those consumers in a highly targeted format. Since advertising these days is all about targetability, this shouldn’t be a challenge.
In 2003 Acacia Media Technologies sent letters to numerous adult Internet sites and radio webcasters demanding a license fee for the utilization of streaming technology. At that time, the California-based holding company Acacia Research claimed to hold patents on streaming, downloading and just about every form of digital audio and video distribution out there–including pushing MP3s from peer-to-peer groups, streaming newscasts from Internet radio sites and delivering movies through cable networks. They attempted to secure license fees from streaming sites, including Internet radio stations such as Radioio and Radio Free Virgin. They did manage to get some of the stations to sign license agreements. The stations were all struggling at the time, some have since stopped streaming, and the issue quieted down.
Now Acacia, using the name Aldav LLC and based in Texas, has filed suit against Clear Channel, Cumulus, Citadel, CBS Radio, Entercom, Saga, Cox Radio, Univision, Regent, Gap, Radio One, and the Aloha Station Trust, claiming that, by replacing advertising and other content in their online streams, the broadcasters are infringing on a patent on which Aldav holds a license.
In an article in Streaming Media covering the first round of IP property based claims, Publisher Dan Rayburn wrote: “Acacia appears to have made a business of buying patents and then using the threat of massive legal action to force companies into paying them licensing fees. In September 2002, the company lost a patent lawsuit against Sony, Sharp, and Toshiba for the V-Chip, another patent that Acacia owns.” Someone else told me that another term for this is “patent trolling.” Indeed, this behavior does appear kind of predatory.
In an article he wrote on his blog last week, Jerry Del Colliano fueled this fire by saying this was big trouble. He also states that Ando Media sells the ad insertion technology, which is true for some, but not all of the broadcast groups. I know that at least Cox, Cumulus, Radio One and Univision, and possibly others use other ad insertion technologies, including StreamAudio and Abacast.
I can’t pretend to have any expertise that will help to figure this out, but I did want to lend some historical and factual perspective to the story. Broadcasters realize this is important turf for them, and this may well be a typical battle for new technology in a new media world.
During first quarter of this year, XM, as a subsidiary of Sirius, lost close to a million subscribers (895,628), but added 700,000 new ones, for a net loss of 200,000 subs this year, according to a Marketwatch story yesterday. This, on top of subscriber declines at the end of last year as well.
This sheds some light on a story I heard from a friend last week. Someone stole his satellite radio from his car, so he called the company to have them shut it off, and while they’re at it, cancel his subscription, he wasn’t interested in buying a new one, and he’s not all that thrilled with the new channels since the Sirius XM merger. Not so fast, said the person on the other end of the phone, we’ll send you a new radio at no charge. My friend couldn’t believe his luck. Clearly, they’re in survival mode, and giving away radios that they can’t sell to retain paying customers is what they’re willing to do.
Satellite radio has relied heavily on new car sales to sell their product, now with the car industry in its own freefall, Sirius XM is doing everything it can to survive. They’ve begun to quietly market a streaming option to subscribers, and they are launching a new iPhone app, which will provide mobile streaming options to listeners. This, according to WSJ’s Sarah McBride, is a tacit concession “that the satellite-delivery system that once was cutting edge now has competition far beyond what its founders imagined.”