Yesterday SiriusXM launched their new personalized streaming platform MySXM, a streaming option available to its subscribers for an add-on fee. The service features 50 channels that can be adjusted using “slider bars” to suit the listener’s personalized tastes. It’s described as more interactive than Pandora, with on-demand features that go beyond what Pandora offers. Backend music intelligence platform The Echo Nest provides the service with its personalization, and Omniphone provides cloud based services.
Make no mistake, SiriusXM is still a satellite company, and this new offering is all about protecting its subscriber base. With an estimated 120 million folks in the US listening online in the past month, streaming is the fastest growing radio platform. Offering that as an option is a way to preserve its subscriber base.
According to year end reports, SiriusXM had close to 24 million subscribers at the end of last year, while Pandora has 200 million subscribers, 70 million of whom are actively monthly users. SiriusXM does not provide information other than subscribers.
Americans are spending more time in their cars, time spent in cars on weekdays has increased by over an hour since 2003. Last week, Arbitron, Edison Research and Scarborough presented an update to a study from 2003 called The Road Ahead that looks at in-car listening options and adoptions.
While radio continues to the the audio listening choice in cars, its dominance has dropped by 12% since 2003. Back then 1% of people chose satellite radio, and listening to ipods and Internet radio streams was not an option. Now, 8% of folks who have driven or ridden in a car in the last month have listened to satellite radio, and a whole slew of new choices have bubbled up to compete with AM/FM broadcast radio. 6% listened to a Pandora stream, 4% to an AM/FM stream, and 2% to another non-Pandora stream. (The numbers are not exclusive so we can’t add them up).
The study also looked at the way people “feel” about various listening platforms, and the results are very insightful. At the top of the list of things people “love” listening to in their car is satellite radio with 54%. 34% “love” listening to Pandora via a mobile phone. And 30% love listening to AM/FM streams via a mobile phone, while 28% “love” listening to the same content on their AM/FM radio. New technologies, notes the study, get better “love” ratings, even if the content is the same..
Despite a proliferation of new in-car technologies, radio remains the “king”. But that’s not a license to be complacent, cautions the study. Instead, radio should recognize that “digital platforms are crucial to protecting radio’s in-car franchise. In fact, the authors of the study believe that HD radio has the ability to “provide the ‘wow’ factor for AM/FM in-car radio. This must be based on the higher “love” ranking that HD Radio gets among people that have it.
Internet radio is getting some attention at SXSW and there are several sessions on the agenda that pertain.
Jake Sigal, Founder of Internet radio device manufacturer Livio Radio, will present “The View From Detroit: In Vehicle Music” on Saturday the 19th. Sigal plans to discuss in car listening options that include AM/FM, Satellite, HD and Internet radio. He’ll ask, and may even answer questions like: Will one emerge as a leader as the others fall to the wayside? Are too many options hurting the overall industry? Where are the opportunities for emerging entrepreneurs?
Rebecca McInroy of WKUT, a public radio station affiliated with the University of Texas in Austin, presents a session called: “Baby’s Gotta Face for Radio: Web Based Radio?” It’s described as a panel that “will explore how public radio stations can build interactive visual components with the goal of becoming a hyper-local non-profit multi-media presence while serving a global audience, and at the same time maintaining the standard and mission NPR has developed.”
On tuesday the 15th Rusty Hodge, Founder and GM of SomaFM, is hosting an Online Radio Meetup at SXSW on tuesday the 15th. If you’re in town, don’t miss this chance to hang out with Rusty and other online radio folks.
There’s buzz around the Internet that Howard Stern will leave Sirius XM at the end of his $500 million contract at the end of this year. Stern has hinted at ending his run with Sirius and turning to the Internet as his next frontier. He’s not alone. Dr. Laura Schlessinger recently announced she will leave terrestrial radio at the end of the year and has hinted that she may head for an Internet based audio platform where she can “say what’s on her mind”.
Howard Stern is arguably the most popular, most listened to radio personality ever. His move to satellite radio revved up Sirius and enabled them to eventually win the battle against XM and gobble them up.
Rumors that he’ll move his show to Internet radio next are exciting. Internet radio could provide a multi-media platform that would be entirely compatible with his larger than life image. Imagine Howard Stern apps, streams, in-studio videos, side channel audio and video programming, all wrapped into one online platform.
If he’s smart, and I think he is, he’s not just thinking about an audio stream, he’s thinking about how his audio show gets unleashed from corporate control and becomes a mega brand, a huge online destination the likes of which Internet radio has yet to see. Yeah, I think Howard Stern would be good for Internet radio. And Internet radio would be good for Howard…
Radio is well positioned for a transition to a digital future, according to a new study by the Pew Project for Excellence in Journalism. Radio has the ability to maintain and grow its audience through several digital audio platforms and is doing a better job than other traditional media such as television, newspapers and magazines.
Radio is on its way to becoming a new medium called Audio, according to this study. Listeners are tuning in via many channels including Internet radio, podcasts and satellite radio, which are contributing audience growth. Not all newer digital audio technologies are growing audience however — the study notes that HD Radio continues to struggle both with the lack of audience and a static number of stations converting to the HD platform of delivery.
Radio is experiencing an “intriguing fragmentation” across other audio platforms, which are also providing broadcasters with opportunities to grow revenue. Over the next five years, Internet radio and mobile revenues will continue to increase.
The main focus of the study is the impact of new media on news, and the appetite for radio news is dropping on AM/FM stations. But 24% of adults 18+ indicated they had listened to a newscast online – either streamed or downloaded. A stated conclusion is that the slow increase in online listening corresponds to a simultaneous loss of broadcast radio audience.
All of this emphasizes the wisdom of broadcasters who are distributing their audio content across multiple channels. It’s more important than ever to strategically develop a diverse digital audio platform that feeds the digital audio audience’s diverse appetite.
AT&T, faced with complaints about its coverage area, is blaming it on users that stream audio and video on their smartphones, and indicating that they may move to restrain heavy users from unlimited streaming.
Last week, at UBS Global Media and Communications Conference in New York City, AT&T head of consumer services Ralph De La Vega told investors that 3 percent of smartphone users are consuming 40 percent of the network capacity, and that the most high-bandwidth activity is video and audio streaming.
AT&T has taken lots of criticism for the broadband coverage offered by their network, and is locked in an advertising war with Verizon over the same. Apparently, they think the solution is to penalize their heaviest users.
AT&T has sold many iPhones and data plans on the excitement of unlimited untethered streaming activity. I know my husband cancelled his subscription to satellite radio, upgraded to an iPhone and data plan, and started listening to Pandora in his car. Now, AT&T customers like him that bought the phone and the data plan, and are getting the most enjoyment out of it, may be limited.
My point is this. Internet radio and Pandora in particular have witnessed great audience growth as a result of smartphones and wireless broadband connectivity. AT&T built a customer base in part around that. People didn’t buy iPhones because they want to talk on them – they bought them to do all the other stuff…including streaming music.
The impact of streaming on AT&T’s network cannot be coming as a surprise to the company, which has been promoting Pandora and streaming radio to its customers since 2007 when they were using Pandora to sell MEdia Max bundles for $19.99 a month. There’s a name for this way of selling your products to consumers, it’s called Bait and Switch, and it’s a bad business strategy for AT&T…
According to a Marketwatch report this morning, Satellite company EchoStar, which owns Dish Network, is buying up Sirius XM debt, prompting speculation of a takeover. The report summarizes the severe negative impact that the poor economy, drastic drop in automotive sales, and competition from iPod and Internet radio as the difficulties that the newly merged Sirius XM faces. EchoStar would be looking for an additional revenue source to its existing satellite television product, and could enjoy some efficiencies by combining two satellite companies and sharing assets and operations.
A recent survey of consumers found that satellite radio was considered to be a luxury expense that was highly expendable – more than 90% of those asked said they would eliminate it along with high end handbags, housecleaning services and facials. The same survey found that 80% of those asked considered Internet service essential and would not cut it, and 60% said the same for cable television service.
As the future for satellite radio continues to look bleak, Internet radio appears to sitting safe and pretty, poised for audience and revenue growth in 2009.