From the Wall Street Journal: A young Silicon Valley technician puts a shiny silver disk in a personal computer and clicks a play button. "You're not going to believe this," he says. He has a point: What quickly appears on his PC's monitor, by many people's estimation, simply shouldn't be possible technologically. It is the opening credits of "The Matrix," in a complete, high-quality reproduction...

Hollywood, your nightmare is here. Thanks to two pieces of software -- one "liberated" from Microsoft Corp. by a global underground of video buffs and computer hackers -- high-quality digital movies, available on a variety of Web sites, can be stored in 10% to 20% of the space that had been required just six months ago. That means that PC users with high-speed DSL or cable-modem connections can download a full-length movie such as "The Matrix" in an hour or two from a spreading network of illicit Internet sites...

The new technology has been dubbed DivX, but is unrelated to the abandoned alternative to DVDs that bore the same name.

The movie industry assumed it would be years before studios faced the sort of digital piracy that is giving the music industry ulcers through sites like Napster. That's because, in contrast to MP3 music files, DVD movie files are extremely large and require many hours, even days, to download...

Now, though, with movie file sizes shrinking because of DivX, Hollywood may be facing its version of Napster in months, not years...

"[The technology] is moving extremely fast," says Jack Valenti, chief executive of the Motion Picture Association of America, the Hollywood trade group. He says he is watching the emerging DivX scene closely: "I worry about the possibility that what happened to music will soon be happening to movies."

Read the full story from today's Wall Street Journal here (subscription required).




From the company press release: Everstream, a global leader in interactive, localized streaming media, announced today that Gerryann Agovino has joined the company as director of national sales.

Agovino will direct the operations of Everstream's newly opened New York City office. She will work with an Everstream partner, Katz Interactive Media, to bring national advertisers to Everstream's network of more than 300 affiliates [specifically, newspapers' websites] accessed by 17 million unique monthly visitors. Last month, Everstream signed an exclusive advertising arrangement with Katz Streaming Media Sales Network.

"Streaming media is where the industry is going, and Everstream is on the leading edge of what's happening," she said. "The company's business model is solid because it is based on a medium (newspapers) that has been around forever. These are heavily trafficked Web sites and Everstream's ability to offer highly personalized content and advertising through these mediums is unprecedented in the marketplace."

Before joining Everstream, Agovino was with the Katz Radio Group, where she started in 1993 as an account executive and worked her way up to sales manager, then director of sales. She lives in Manhattan with her husband, Mike.

New this afternoon...

More reader comments regarding Friday's Arbitron InfoStream story (see below for links to the original story):

"What Internet broadcasters need...is success stories from advertisers..."

You need look no further than "Blair Witch" for the kind of success that the Internet can provide for an advertiser. Perhaps the radio business would be well served to go back and study its past to learn how to cope with the challenges of the future.

"...It jumps to the #1 position with a bullet!"

Just to add to the discussion about converting ATH numbers to AQH....for a syndicated program like ABC's Tom Joyner program, shouldn't you actually divide it by the total number of hours in the broadcast?

Tom's show airs for 4 hours a day Mon-Fri. Even though you can hear it 24 hours a day, there are still only 4 hours/day produced. If you count up the total number of broadcast hours produced in February, it comes to 84 (21 weekdays x 4). Divide his ATH (93,800) by 84, and the AQH is 1,117.

Still low, but it jumps to the #1 position with a bullet!

From today's morning edition...

You can review RAIN's original story on the release of the February Arbitron InfoStream webcast ratings in Thursday's issue and read RAIN's follow-up analysis in Friday's issue by clicking on the screenshots below.

Thursday: Press release	Friday: Analysis

In this special weekend edition of RAIN, we'll share with you some of the comments that RAIN readers have contributed this week. (And send yours using the form you'll find later on this page!)

Aggregate Tuning Hours (ATH): A new statistic, used by Arbitron for the first time last week, describing how many total person-hours of listening a station received over the course of a month. Average Quarter-Hour audience (AQH): A traditional radio statistic that essentially describes how many people are listening to a station at the average moment. To transform ATH into AQH, simply divide ATH by the numbers of hours in a month. That will give you, essentially, AQH -- how many listeners are listening simultaneously during the average hour (which is another way of saying at the average moment).

"There have to be more listeners than that..."

Kurt -- Not to dispute the number crunching, but there have to be more listeners than that in those stations. Our stations don't make the top 50, yet 3 of the 4 exceed the numbers you extrapolated. We know this, because we monitor the administrators on our streams all day long. There has to be more to the measurements than meets the proverbial eye.

... Let me take a moment to clarify the audience size numbers I've quoted. Let's use KMEO/Dallas-Ft.Worth as a representative example. With 16,500 Aggregate Tuning Hours, KMEO's webcast had 25 listeners at the average moment during the month of February. But KMEO might have been 100 or more concurrent listeners during the busiest hours of the day (and hardly any during its light-traffic hours). (Similarly, NetRadio's "Hits" channel, with an AQH of 339 for the month on average, could have had 1,000 or more simultaneous listeners during certain peak hours.) Also, remember that we know from Arbitron's previous InfoStream releases that KMEO's 16,500 hours of listening probably came from about 8,000 different people listening for, on average, about two hours per month each. ...

"Only thing I would adjust..."

I like it. You are direct which I enjoy. Loved the stuff on AQH of 339, etc.

Only thing I would adjust in that area would be to concede that most internet listnening is during biz hours, and I don't think even radio stations use 24 hours to calculate their AQH. So you could be fairer to net stations to use a 10 or 12 hour base.

As an fyi, broadcast.com has lots of stations doing more than 1k simuls, and several sports stations that would pass 20k during games.

"Does anyone realize what a poor showing those numbers represent?"

Does anyone realize what a poor showing those InfoStream numbers represent? Let's put them into perspective: When I was in Greenville SC, individual stations from as far as 100 miles away (Charlotte) often had a higher AQH (in the Greenville ARB) than the top 50 InfoStream station's AQH combined. More people are probably hearing a fire engine in New York City right now than are listening to the top fifty netcasters combined. You could literally reach more people than station #50 right now by opening the front door and shouting.

I can't see how there can be any good news for the Net-only format providers in this report. The latest Edison Research study confirms the low numbers, it says only 4% of of those online have tuned into any audio on the net in the past week and that number was unchanged from a study they conducted six months earlier.

I've already given my reasons for the unimpressive numbers that most netcasters are logging, so I won't go into them again as I don't think much has changed since my original rant on the subject. Regrettably, the blame now appears to be even more provider-related than it did then. Why?

There was good reason to believe, until recently, that people were not receptive to being tied to their PC's to listen to music. The thinking was that once Internet radio became more portable, it would be more widely adopted. Somewhere between 15 and 20 million people are now using Napster for the expressed purpose of listening to music in their PC's, so that argument has been effectively neutralized. Yes, some of those people are burning the music they get from Napster onto CD's, making them portable, but those folks don't represent the majority of Napster users.

There is some potentially good news in the report:

1) The numbers are probably higher than the providers server logs indicate. Many, maybe even most ISP's now practice stream emulation...the audio equivalent of caching web pages. In other words, once they get more than one request for the same audio stream, they'll just duplicate and resend it it, rather than pay for the bandwidth to go to the net and retrieve it multiple times. The provider only gets one request for the stream but could conceivably have more than the one person logged on to it.

2) Kurt's example about re-broadcasting of terrestrial radio has merit. While it won't make anyone rich, a radio station can probably be streamed on the web profitably, or at least on a cash-neutral basis right now.

(Note to all terrestrial radio streamers...processing for streaming codecs is a lot different than processing for broadcast. Streaming a broadcasted signal is the worst sounding option. Streaming an unprocessed signal off the board is better, but streaming a signal that's processed for the streaming codec you're using is by far the best. If you want to hear what good processing can do for an audio stream, go to http://www.thecityradio.com and listen to the 20K and 40K streams.)

Overall, I think the latest InfoStream numbers represent a failing grade for Netcasters. How long before the funding dries up?

To see RAIN's chart of the top 50 stations in the February InfoStream report, with both Aggregate Tuning Hours and our calculation of AQH, click screenshot at right

"So that people...can compare apples to apples..."

Russ is absolutely correct: If we were to assume that all Internet radio listening occurs between 6AM and Midnight, we could create a Mon-Sun 6AM-12Mid AQH estimate for each station that's 33% higher than the ones I quoted on Friday. (But we'd still be talking relatively small audience sizes.) However, the "15-20%" that I mentioned was something else -- it would be the reduction in the AQH audience size of a broadcast station if one were to expand the daypart in question from 6AM-12Mid to 6AM-6AM and included the station's actual overnight audience (which is not, in fact, an AQH of zero).

"When you add the 'concurrent' audience..."

Kurt: Thank you for the analysis. Based upon what you were looking at from InfoStream I understand why you would make the conclusions you've made.

Audience size today on a channel by channel basis is certainly a ton smaller than that of most terrestrial stations. This is exactly why Katz Interactive has built a network of such channels. When you add the "concurrent" audience contributed from our network of providers you have audience levels that rival major market terrestrial stations.

This is the model that will work for advertisers today!

"Most laymen do not understand ATH..."

I wish Arbitron would get their act together. Most laymen do not understand ATH or any other way Arbitron chooses to use to rate our web stations. What they do see is that www.93x.fm went from #10 in Jan. to #41 in Feb. when in reality our hits doubled from 33k in Jan. to 66k in Feb.

My solution to this mess is for Arbitron to rate net-only stations in one group, and net stations attached to a commercial FCC licensed broadcast facility in another group, shown by market size.This method would at least stabilize the # of web stations in the broadcast group to set market sizes and the number of streaming stations in each market. Arbitron could then play the roller coaster game with net only stations, where the number of streamers and who they allow to be in the group may change monthly.

As a radio station owner, I wish to see KNSX compared to other radio stations each with their own stream, vs. being grouped with internet-only stations representing multiple formats. I'll take the heat .My e mail is 93x@93x.fm

"I find the numbers low based on my experience..."

Interesting article. I really appreciated it. You got a new fan <G>.

I don't know the capacity of "net radio" servers, but I find the numbers low based on my experience with my favorite "radio" station: KLON (http://www.klon.org). If I don't log on by 9:30am EDT (the station is in L.A. CA- 6:30am PDT), I'm "locked out" (server full) for the day. Even chaincast overloads on requests for this station.

Again, thanx for an excellent article!

"No matter where you're ranked, it's about the money and how much you keep..."

As an Internet broadcaster with a multi-channel network, we're extremely concerned with how many listen, period. While ratings (based on data that Arbitron seems to change every quarter) are nice for people to say "See, we're on a list of the top-listened," that list doesn't include many of Internet broadcasters so it's not an overall picture because there's more sites not ranked than ranked. And some of us are doing over 1,000,000 users per month with even more on the listening end.

It's also obvious that Arbitron is still trying to figure out what matters and what is substance to base ratings on. I would think that how many people listen and how long is what counts. We don't have to reinvent the wheel here.

If we get into another invention of measurement to make things look big then it will fail. Take "Unique" users. How silly. I can log onto this site with AOL 105 times in one hour and be considered 10 different people... I can log on with a cable modem the same amount of times and be one person -- crazy! It's a flawed system and we hope that Arbitron has finally found the methodology that matters. If Arbitron keeps it simple and stays with a methodology that makes sense more people will jump in with them...

But for now, let's look at what it's all about. Why we're all in this. No matter where you're ranked, it's about the money and how much you keep as opposed to how much you spend to get the eyes and ears of people. If you have 200 streams on your site and can serve up 50,000 listening sessions per day, and the average spot load is 6 spots per hour, and the average user catches just two spots per day, that's 100,000 spots served in one day. Can you make money with that? You do the math. (Answer: Yes.)

While others may say that what multicasters do is not broadcasting... I'd tell them, "Keep saying that; we'll keep gobbling up all those people that you think think like you."

Want to follow the story of the five Arbitron InfoStream webcast ratings reports released to date? These links will take you to most of RAIN's coverage of the topic:

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"RAIN: Radio And Interent Newsletter" -- the leading web-based publication devoted specifically to the subject of Internet radio -- is establishing a summer internship program and is now accepting applications.

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July 13-16	Upper Midwest Conclave, Minneapolis
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xxx

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