Monthly Archives: September, 2012

Study: More Than One in Five Listen To Streams Daily

 

Triton Digital and Alan Burns and Associates recently released a new study Radio Tomorrow which focuses on listener attitudes and behavior with a focus on future prospects for the medium. It’s a dense study with a lot of interesting questions in it. For example,

25% of those asked stream music on a smartphone daily from AM/FM, Pandora and other sources, and the number climbs to almost 40% weekly. Pandora alone claims 11% daily and 15% weekly in terms of people using it, per the study.

Some of the news in the study is predictable: young people listen to radio less, want more control of their stations.

Some of it is less so – for example, the study found that 44% of listeners would be more likely to buy a phone if it had an FM chip in it. And of the nearly 20% who have internet access in their cars, many still listen to AM/FM (70%).

When asked if there is a medium that feels like a friend, 50% named RADIO. And they find radio ads more trustworthy and less annoying.

If you haven’t taken a look at this study you should. There’s meaningful takeaways for anyone programming a station, online or not…

Alan Burns and Associates Radio Tomorrow Study

 

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Here’s The Thing: Podcasting Lives at NPR

 

New York Public Radio is setting the standard for excellent online content creation these days with a slew of interesting, high quality new programs. Some, such as Radiolab, rank in the top ten most downloaded podcasts on iTunes, while others offer a remarkable host of guests and really great content that other broadcasters would do well to take a look at. 

While there’s often debate about the quality of broadcasters’ online content offerings, such is not the case at WNYC.org. Each week, Alec Baldwin hosts Here’s The Thing, a weekly talk show in which Baldwin interviews well known and interesting people such as Billy Joel, George Will, David Letterman, Peter Frampton, Herb Alpert, Kathleen Turner – the list is interesting and impressive, as is the show.

WNYC also produces and airs Radiolab – the podcast of that program ranks third in the iTunes list of most downloaded podcasts. The show is so popular they even charge $2.99 for their mobile app. All of the programming that WNYC creates also becomes part of the NPR portfolio of content, along with content created by other stations such as All Things Considered, This American Life and Morning Edition.

It’s not news that NPR does an excellent job offering excellent news and talk programming to its audience. It’s an impressive online offering that would challenge anyone’s idea that podcasting is dead. As NPR could tell you, it’s alive and well on their platform…

 

Internet Radio Fairness Act

The Internet radio world is buzzing with talk of new legislation just proposed that would change the standard for determining performance royalties. If it passes, it would likely set the stage for lower rates, which would create a far more attractive playing field for Pandora and others. The services that would be affected are those that qualify as webcasters – services that play a programmed stream of music, but not those which play any specific song or artist on demand.

I’m not going to dissect the proposed bill here – there are places where you can read the technical nuances. But I do think that a general understanding of the issue is important to industry watchers and business folks. So here are the basics, at least as I see them..

  • The Copyright Act is the law of the land for setting rates for most royalties. In it, section 801(b) uses a “fair market value” assessment to evaluate and determine rates paid for the use of copyrighted works, such as an artist’s song.
  • 801(b) is the law of the land for satellite music, which is similar to webcast services in many ways but different in the technological delivery of the audio because it is delivered via satellite rather than stream.
  • Webcasting services were specifically excepted from using the “fair market value” standard for their rate setting negotiations with license holders (recording services). Instead, they must use a “willing buyer, willing seller” standard.
  • This has resulted in enormous royalty obligations for webcasting services where Pandora has in recent history paid about 70% of its revenue in royalties, while Sirius XM pays 8%.

My colleague Kurt Hanson, Publisher of RAIN: Radio and Internet Newsletter, gave an excellent example of the reason why “willing buyer/willing seller” is a bad standard during his State of the Industry talk at RAIN Summit Dallas. Kurt’s cat is old and tired, and not very pretty. But he loves that cat and wouldn’t sell it for any price. For the purpose of the example, let’s say he would sell it for $2000. But, after seeing the pathetic picture of the cat that Kurt put up on the screen, there’s not a sane person in the world that would pay even $5 bucks for that cat. It’s an excellent example! Artists can’t be objective about their art – of course each song is just like Kurt’s cat. Forcing webcasters to keep offering $5 bucks when they think they’re worth $2000 is like continually rubbing salt in the wound…

Over the weekend, Pandora Founder Tim Westergren sent out an email to Pandora listeners. “This bipartisan bill will correct the incredible inequity in how different digital radio formats are treated under the law when it comes to setting royalties…In 2011, Pandora paid over 50% of our revenues in performance royalties, while SiriusXM paid less than 10%.”

It seems simple, right? MusicFirst Coalition, which represents artists, is already against the bill, preferring the existing standard. Record labels will oppose it as well. But the proposed legislation has some strong support as well – the Consumer Electronics Association, and the National Association of Broadcasters have already come out in support of the bill.

TuneIn, Livio Score With Chevy

Chevy Spark - CIAS 2012

One of the best universal portals to Internet radio on the planet is TuneIn. Formerly called RadioTime, TuneIn has been in the business of enabling listeners to search, find and listen to Internet radio for a long time. They’ve been through several rounds of funding and a management shift, not to mention some serious competition, and they’re still holding their own.

One of the things that TuneIn has done well is create partnerships with the auto industry to bring their technology into cars. This week, General Motors announced it will use Livio Connect technology to integrate the popular TuneIn music smartphone app with the Chevrolet Spark’s MyLink Radio dashboards manufactured globally.

This is good news for TuneIn and Livio, as well as all of Internet radio. TuneIn is the most sophisticated universal platform for online radio that is independent. They will play with everyone, regardless of the size of your station. No exclusive contracts necessary. Their success in creating relationships with car companies means that listeners will have more choices and stations will have more options. When Pandora and iHeartRadio announce integration with car companies, that’s good for them. When TuneIn announces the same, that’s good for the industry…

Politically Correct Pandora

It’s high season for political advertising, and Pandora is a new favorite for lots of candidates, according to US News. It turns out that Pandora’s highly targetable advertising model, which allows advertisers to micro-target by zipcode, not to mention age, gender, and even musical tastes, is very appealing to the folks that decide where all the money behind political campaigns will go this season.

Vote

“On Pandora we know exactly who our audience is, so if you’re trying to reach moms, the D.C. area, or young people in Ohio, we can do that,” says Francisca Fanucchi, a spokeswoman for Pandora. When users sign up for Pandora, they give their ZIP code, gender, date of birth, and E-mail address, all of which are used for targeting purposes, Fanucchi says. Political research firms also buy lots of consumer behavior data to refine their targeted ads.

It turns out that your musical preferences also say a lot about your political views. Recently, music data firm The Echo Nest noticed some distinct profiles among listeners of certain types of music. Turns out Kenny Chesney or George Strait fans are reliably Republican while, Rihanna, Jay Z, Madonna and Lady Gaga fans are Democrats. Fans of The Beatles, Stones and Johnny Cash are hardest to predict.

Politicians advertising on Pandora can also use their new email sign-up feature. That asks the listener to let Pandora provide his email address to the politician so they can contact them directly.

All of this is not foolproof however – on a recent longish drive with my husband we listened to Pandora on my husbands phone, and heard repeated ads for Linda McMahon, the GOP candidate running for Senate in Connecticut. Problem is, he’s a pretty liberal democrat who just happens to like Pink Floyd

Apple’s Internet Radio Play

Details of Apple’s entry into the Internet radio space appeared last week, and because it’s Apple, they got lots of attention. Apple has been interested in the space for a while, so this does not come as a big surprise. As WSJ.com puts it – Apple pioneered the online music business with iTunes, and drove it with hardware sales. Now that streaming services have begun to cut into song download sales, it’s time for iTunes to step it up.

Image representing Apple as depicted in CrunchBase

Image via CrunchBase

Reportedly, Apple is in private talks with the record labels to negotiate royalty deals. Everyone knows that the performance royalty issues related to streaming are prohibitively expensive – content acquisition is the pricey challenge in the space. Indeed, Pandora shells out 50 – 60% of its revenue to labels and artists. The question is, does Apple have the kind of clout with the labels that can leverage an improved royalty landscape? And if so, is it possible this would benefit the streaming marketplace overall?

As far as what the service will be – it does sound a lot like Pandora. The NY Times says “Apple’s service would probably take the form of a preinstalled app on devices like iPhones and iPads and might be able to connect to users’ iTunes accounts to judge their tastes.”

First responders to the news about a streaming service from Apple proclaimed doom and gloom for Pandora. And the truth is, Pandora is so big and so reliant on Apple at this point that they probably will lose listeners if Apple opens up a service of their own. But that doesn’t mean it would be the worst thing for the streaming marketplace. In fact, given Apple’s golden touch, the fact that they are looking so closely at streaming and radio in general these days, could bode well for the space…

European Streaming Service Enters US Market

Radionomy, a French-Belgian service that enables users to set up their own online radio station and share it with others, is opening an office in San Francisco. The service, which has 6,000 user programmed stations, is similar to Live365 in its business model, taking care of the actual broadcasting and promotion of the stations, rights management, scheduling and audience monitoring and reporting.

They also have an advertising option that sells advertising across their network of stations, helping users of the service to monetize their content.

Radionomy has more than 42 million listener hours per month across its group of user generated stations. The new US office will be their fifth – they currently have offices in Germany, Spain, France and Belgium as well.

Radionomy CEO Alex Saboundjian will join a panel discussion on monetization strategies for Internet radio at RAIN Summit Europe on October 5th in Berlin. Also joining the panel will be Caroline Graze, NRJ International (Germany); David Deslandes, Deezer (France); Frank Nolte, RMS.de (Germany); and Zachary Lewis, Liquid Compass (US).

RAIN Summit Europe promises to be an exciting day of discussions focused on Internet radio in Europe. Check out the impressive speaker list here, and make plans now to join us!

Streaming Is The Sweet Spot for Today’s Artists

My daughter, who is 17 and a senior in high school, is one of my best sources for what is hip and trendy. Last week she started talking to me about PSY, the incredibly popular Korean artist Park Jae-Sang, and his incredibly popular music video Gangnam Style. What’s that you say? The video has over 100 million views on YouTube, all kinds of famous artists liking it and imitating it, and lots of people talking about it.

The song debuted at #6 on the Billboard Korea K-Pop Hot 100 for the week of July 28, 2012 and recently hit  #1 on the iTunes Music Video Charts, overtaking Justin Bieber‘s As Long as You Love Me and Katy Perry’s Wide Awake. Of the more than 102 million views, about 47% of the views came from the United States, 7% from the United Kingdom, 6.8% from Canada and 4% from South Korea.

Nielsen recently highlighted the popularity of YouTube among young listeners. One of the most important points about PSY and his song Gangnam Style is that it’s as big as it is without the help of radio. Songs are getting made completely without the help of radio, and that’s a new thing.

There are a lot of levels to this song, the artist makes a bunch of socio-economic statements that are more recognizable to a Korean audience. But the video and songs’ appeal go way beyond that, it’s funny and fun to watch even if you don’t understand get the underlying message. But more than anything, what this video makes clear is this: the US doesn’t make or break an artist anymore, and selling songs is a global game. Island Records signed the artist well after his video became a hit on YouTube. The new way to break music is online, with labels waiting on the sidelines. So here’s what I wonder: how many broadcast stations are playing PSY’s tune this week?…

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