The streaming marketplace is becoming increasingly segmented, with big new brands like iTunes Radio and Beats Music competing with Pandora, iHeartRadio, Spotify, Rdio and a multitude of others for listener’s ears. Many of the streaming services offer similar options – personalized song recommendations based on a listener’s likes and dislikes, playlist building, social features, etc.. Some offer on-demand song plays as well.
Big data – the term used for collections of data that are so big that special processing is needed in order to use it – is a key component of these customized listening features. Services like Pandora, with 200 million registered users, collect information from listeners that includes their age, location, and gender. That basic information is useful for targeted ad campaigns. But there’s a lot more to big data than that – and that’s the stuff that music personalization is made of. Each time you like or dislike a song, skip an artist, type in an artist’s name, that’s more information that can be processed.
Key to effective use of big data are services that specialize in processing that information. Companies like The Echo Nest (recently sold to Spotify) and Gracenote (owned by Tribune Company) work with many of the platforms, creating data sets that enable Pandora, Spotify and others to better understand their listeners.
Big data processing is important on the advertising side as well. Companies like Pandora and iHeartRadio employ their own fleet of programmers to keep their data proprietary and make it understandable and useful. Third party providers like Triton Digital work with many companies to process their data and create identifiable audience characteristics.
Using a combination of zip code analysis and an individual’s music tastes, Pandora has begun creating audience profiles based on political affiliation. Exploring similarities between music choices and movie preferences, The Echo Nest concluded, among other things, that “if you like crime movies, you most probably enjoy listening to Jimi Hendrix, The Beatles, The Rolling Stones, Jay-Z, The Who, Bob Dylan, and Pink Floyd in that order.”
From selling tickets to the Carole King musical “Beautiful” on Broadway by targeting listeners who like her music, to selling flowers for Mother’s day to guys of a certain age who tune in to kid programming so their kids can listen, it’s exciting to think about the possibilities that big data can offer to streaming audio.
In a deal similar to the partnership they announced with Cumulus last fall, Rdio and Grupo Bandeirantes have announced a joint venture and powerful strategic partnership encompassing marketing, distribution, content and promotions that will significantly expand Rdio’s presence in Brazil. It’s a nice move on the part of the smallish streaming service. Under the leadership of CEO Anthony Bay, the company has been pursuing aggressive marketing tactics and forming alliances like this.
Brazil is the largest economy in Latin America and the second largest in the Western Hemisphere. It’s also the seventh largest economy in the world, and growing quickly. Music and culture thrive in Brazil, making it an attractive play for streaming services. Spotify and Deezer are both streaming in Brazil, and Rhapsody has a carrier deal with the country’s largest mobile phone provider Telefonica while Muve, owned by Cricket Wireless has a deal with the country’s second largest ISP, TIM. (Of course, youtube claims its share of streaming music listeners as well.)
While mobile technology and adoption is strong in South America, challenges such as low credit card penetration make subscription services without a carrier or other mass billing backbone a potential challenge to Rdio’s plans. This deal will support their marketing and brand awareness efforts as well as lend credibility.
“Global expansion and localized customer experiences are key focuses for Rdio. Brazil is one of the most dynamic countries in the world with a vibrant music culture. In fact, Sao Paulo and Rio de Janeiro are among the top cities for Rdio users in the world,” said Anthony Bay, CEO of Rdio. “We’ve had success in establishing a unique customer value proposition with our partners in other territories, and this partnership allows us to create a more diverse, all-encompassing listening experience in Brazil that travels from radio to TV to online to mobile.”
In the global streaming game, Rdio’s unique strategy of partnering with existing traditional media companies seems like a good idea, giving those companies an online audio extension, and helping Rdio extend its share of the streaming market.
Digital measurement firm comScore released new data on mobile and smartphone usage last week, showing that more than 163.2 million Americans own a smartphone. That number represents 68.2% of the mobile market and is up 7% over 3 months before. Apple ranked as the top smartphone manufacturer with 41.3 percent share, while Google Android led as the #1 smartphone platform with 52.1 percent platform market share.
As the smartphone audience expands, streaming music apps continue to benefit. While the most widely used app is Facebook, two streaming apps – Youtube and Pandora – are in the top five, with 48 and 45% reach into the mobile app audience.
Pandora’s mobile strategy is the key to the streaming platform’s amazing success. It was the 9th most downloaded app in the iTunes app store last year – a stat that is particularly impressive given that it’s been around a long time, and many people already have it. By way of reference, Facebook is number 8, and Spotify is nowhere to be seen.
Earlier this week at RAIN Summit West, keynote speaker Jason Calacanis talked emphatically about the importance of mobile, saying that it is the only thing that is important. Those that develop winning mobile platforms win consumers. With more than 70% of their listeners on mobile, Pandora understood that concept early and capitalized on it…