The Securities and Exchange Commission has subpoenaed Pandora as part of an investigation into the way that certain popular applications that run on Apple and Android platforms share information about users. According to the Wall Street Journal, the investigation is centered on the question of whether certain popular smartphone applications used information about their applications’ users, without disclosing the uses properly.
This information follows a report by WSJ in December that Pandora and other popular applications were transmitting information obtained about user locations and preferences to third parties such as advertising platforms without permission. Pandora’s app reportedly fed info about the user’s age, gender, and location.
The news of the subpeona came to light when Pandora filed an amendment to its plans for an IPO. Supposedly other popular applications are included in the investigation – Pandora has said it is not the specific or sole target of the investigation.
Sometimes it’s not all roses when it comes to being the leader of the pack – in this case Pandora’s highly popular mobile apps are causing some higher profile scrutiny. And again, the industry will have Pandora to thank for pushing the envelope and finding the line in the sand. While advertisers demand more targetability, these functions can only be delivered with this kind of user data.
You can hear more about this topic at RAIN Summit West in Las Vegas on April 11th, especially on the Legal Issues panel hosted by David Oxenford and joined by experts from Rhapsody, Live365, SESAC, and EMF Broadcasting. You can register for that event here.
Michael Robertson is one of the most active entrepreneurs in the digital audio space. He’s started, funded and sold several online companies, including digital music company mp3.com to Vivendi/Universal, and VOIP/telecom Gizmo5 to Google. He’s the founder and CEO of mp3Tunes, a cloud based music storage and streaming service.
Now Robertson has launched a new business aimed at listeners who want to timeshift online listening. DAR.fm is a service that allows listeners to store audio from their favorite Internet radio streams via its Digital Audio Recorder, and then stream it back on demand. Users can schedule using just a web browser and then listen from a PC, iPhones, Android, internet radios and other devices. There is currently a list of 600 stations to choose from, no doubt this will expand as the service gains traction.
“Radio hasn’t changed much in 100 years and young people are listening to radio less.” says Robertson. “My hope is that DAR.fm modernizes radio by making it on demand, interactive and available on more than just your am/fm devices.” He adds that this is an “alpha” service that may “stop working or behave oddly” while they are fine-tuning the service.
Robertson is right – making traditional radio more flexible for listening could have a revolutionary impact on radio listening. A tool like this could essentially give listeners some of the control that online only stations have been able to build into their platforms. Broadcasters in particular could benefit – since their streams are often simple retransmissions of their over the air broadcasts and don’t offer listeners any interactive options, adding the ability to skip, playback and pause the recorded material.
There is one twist – while the service itself is legal, there’s a part of the DMCA that prevents streaming stations that use the webcasting compulsory license from promoting the recording of their streams. This was probably adopted, as were many of the other DMCA restrictions on streaming, to make it harder to slice up the streams into song segments – to prevent digital piracy (though, these days, there sure are easier ways to pirate songs if one is so inclined). It shouldn ‘t mean that Robertson and DAR.fm can’t operate or listeners can’t use the service, but it could impede stations from promoting it. Which would be a shame since it’s an interesting tool that could grow audience. On the other hand, perhaps the record labels will understand this and let it be…
Mobile music service Thumbplay has signed up over half a million trial accounts since it launched in March. Thumbplay offers unlimited music streaming for a monthly subscription fee of $9.99.
The downloads are for an initial free trial period, and although Thumbplay won’t say what their conversion is, Techcrunch points out that even at just 10% conversion that is $500,000 a month in revenues.
That sounds like a business model to me.
Some more interesting info on the service. Ninety percent of the use is on smartphones, although Thumbplay does offer a desktop app as well. Most of the subscribers are male, 25-34 years old. 39% of smartphone listening is on iPhone, 36% on Blackberry, and 25% on Android. Thumbplay’s one of the top 100 free apps in the iPhone app store.
And their promotional video/take off on an infomercial is amusing too.
Michael Robertson thinks people should be able to listen to their digital music anywhere on any device. That’s exactly what MP3tunes sets out to do.
Robertson, the founder of MP3tunes, is a huge advocate of cloud based music services. He’s no stranger to the vengeance that record labels have when it comes to protecting digital song copyright law (as they define it.) In fact, he’s actually taken it on the chin before against the record companies – in the late 90’s he founded MP3.com, which he eventually sold to CNET after losing an expensive legal battle with Universal. His new service MP3tunes is currently involved in a lawsuit with EMI over copyright infringement issues.
“I think ownership is critical important in the digital age and worth fighting for.” said Robertson. “I think consumers should be able to choose where they want to use their digital property as they can with their physical property. I don’t want a corporation to be able revoke or limit access – as we’ve seen happening with Apple and Amazon.”
MP3tunes currently has over 500,000 registered users who upload their entire music collection to servers and access it from wherever they want. MP3tunes works on multiple smartphones platforms: Android, iPhone/iTouch, (iPad version waiting for approval) and many Internet radio devices (it’s compatible with devices that use vTuner and Reciva firmware.) This week they’ll introduce a deal with Roku that will enable access to music lockers on televisions.
Currently, the business model is a freemium model that offers listeners smaller sized lockers for free and charge a subscription fee for more storage space. But additional revenue sources like e-commerce and advertising may be in the cards as well.
Google has purchased Simplify Media, a software company that lets you easily share your music across the web, from desktop to mobile devices. The Simplify website is there, but largely inactive – you can no longer download the software, but it does explain that Simplify allows you to access music and photos from your devices (netbook, phone, desktop) without having to sync or download them, which is bound to involve a cloud server solution.
Reportedly, Google’s new mobile streaming music solution will enable multiple user platforms including iTunes, Windows Media Player and WinAmp. It appears that this will – at least initially – be a platform for Android, Google’s smartphone. Last week, Google CEO Eric Schmidt said that 100,000 Android phones are getting activated daily, up from 60,000 in April.
This is an announcement that flies in the face of Apple’s recent purchase of Lala, another cloud based solution. Lala is also currently inactive but Apple will likely use the service to integrate a cloud based feature into iTunes to enable listeners to listen to their song library from whatever device they want access on at that moment.
Interesting stuff, this announcement. Google is selling streaming audio ads, often as an option in an overall integrated approach to advertising that can include audio, video, and display/search through Google AdSense. This is a platform that can extend the reach of the audio portion of that game and make it a more interesting play for advertisers. Which could bring more dollars into the streaming audio ad revenue ballpark…
Streaming music service Slacker is readying an on-demand streaming service for launch, according to a report by Wired. Slacker’s current offerings include interactive streams as well as pre-formatted channels. The service launched in 2007 with a dedicated portable device that could have, would have been a unique selling tool for the platform if streaming apps on smartphones hadn’t started to soar. Instead, Slacker abandoned the dedicated mobile device strategy and turned its attention to mobile apps. It’s available on iPhone, Android, Blackberry and other popular off-the-pc devices.
The new service will reportedly allow for an even greater degree of listener interactivity. The station already allows more interactivity than Pandora – listeners can add specific songs to their stations or playlists, while Pandora only permits adding artists. For five bucks a month, listeners can also nix audio ads, add unlimited song skips and requests.
Slacker intends to use the service to upsell its audience to a more premium offering that gives them greater control over their music. There’s no word on how much the service will cost.
During a panel that I hosted in Toronto at RAIN Summit North on March 12th, Slacker VP Jim Rondinelli indicated that ad sales have been healthy for Slacker. He noted that over the past year, they have sold almost all of their audio inventory through audio sales firm Targetspot as well as through Google’s Audio/Adsense platform.
No doubt, the launch of a highly interactive service is a move to position themselves against Pandora, the most popular streaming radio platform, as well as a few new services. MOG is an on-demand streaming service that costs $5 a month for unlimited streaming of whatever you want to hear. Last week they announced new mobile apps for iPhone and Android, upping the ante for the service that had previously been tethered to pc’s. Spotify is another on-demand streaming service that – although they have yet to launch here in the states – Slacker no doubt has on its radar…
Streaming services have seen great success with their mobile applications and with the mobile ad marketplace beginning to rev up, mobile streaming ad campaigns are becoming an important element of a station’s revenue strategies.
Recently Targetspot, a streaming ad technology and sales company, launched a new mobile advertising ad platform and will sell ads for Slacker’s mobile service on iPhone, Android and Blackberry smartphones. Other stations and services are seeing a growing demand for mobile streaming campaigns as well.
Pandora’s VP of Audio Sales Doug Sterne says Pandora has recently started serving audio ads to their mobile audience as well — and more and more advertisers are interested, either because they’re already engaged in mobile ad strategies specifically, or want to expand their reach further into the Pandora listener base. Mobile listeners add another 8 million active uniques to Pandora’s audience.
Stations working with mobile ad serving platforms Flycast and Airkast can sell and deliver mobile audio campaigns as well. Both services work with an extended list of stations, enabling them to sell their own campaigns. Flycast also offers some network level sales opportunities.
Targetability within mobile ad platforms can vary – Targetspot’s platform can deliver mobile ads to Slacker’s mobile audience by device as well as by registered user information such as age, gender, and zipcode. Pandora delivers their mobile ads based on registered user information as well. Flycast enables stations and advertisers to target mobile ad campaigns by device, age, gender, geo, and format.
Airkast, using AndoMedia ad insertion technology, has the additional capability to target using gps based data on where the listener is – so a listener that’s in the vicinity of a Home Depot can be served that particular audio ad.
As far as cpms, Sterne says they’ll have to see whether the marketplace is willing to pay more for mobile audio impressions – but right now they’re priced the same across web and mobile platforms.
U.S. subscribers owning smartphones grew from 11 percent to 17 percent of total U.S. cell phone users in 2009, and mobile ad dollars are exploding, making mobile audio ad solutions a key element for any successful streaming station.
Clear Channel will offer a special Verizon Wireless only version of iheartradio in a new release/upgrade of the software due out by Christmas. More than 4 million people have already downloaded the iheartradio mobile app which is available for iPhone. This new release will include an application for Android and Blackberry devices.
As part of the latest upgrade to the app, Clear Channel worked closely with Verizon Wireless to integrate V Cast Music and enable mobile purchases of full-track downloads, ringtones and ringback tones into a special Verizon Wireless-only version of iheartradio. V Cast is Verizon’s branded content platform. Ed Ruth, director, strategic business development and partner management at Verizon Wireless calls it “the ultimate in user choice and convenience”.
Clear Channel’s iheartradio platform has developed into a more than just a launching pad for broadcast station’s streams. It includes nearly 400 unique stations, including America’s most popular local radio stations and a growing number of digital-only channels such as Christina Aguilera Radio, Megadeth Radio, White House Brief and others. The company has also used the platform to build out interesting advertiser sponsored channels that integrate brands into the programming such as the recently launched Pirate Radio channel to promote the Focus Features film, and Red Star Radio sponsored by Macy’s. This new partnership with Verizon is an extension of that concept.