October 5, 2000   
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To read yesterday's issue of RAIN, simply click on the blue arrow to the left of the issue date above.


From Inside: "Even as Napster and the major record labels await word from a federal appeals court in San Francisco on whether the file-swapping service can legally operate, a possible resolution is emerging which might end the protracted standoff and, significantly, leave all parties standing.

"At least two large Internet service providers have been engaged, separately, in months-long, on-again-off-again negotiations to purchase the embattled music-swapping company, which has quietly put out word that it is for sale. 'A deal with us could be something close to win-win for everybody,' says an official from one of the ISPs involved, who, like others contacted for this article, agreed to provide a detailed outline of a potential deal...

"With the notable exception of America Online, large ISPs are finding it harder and harder to bring in new members. Most of the easily reached U.S. audience is already online. In addition, AOL has formidable competitive advantages...

"Thus, the other ISPs need some compelling inducement to draw in new customers. Enter Napster. If an ISP bought the company, only its subscribers would be able to swap music on Napster..."

Read the full article in Inside
.com here.

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From CNET News: "While the world waits for a panel of appellate judges to decide Napster's fate, dedicated music lovers and file traders already have their eyes on other swapping technologies. Programs such as Gnutella, Freenet and OpenNap are already attracting thousands of people, helping spur the evolution of peer-to-peer technology, or systems that allow people to search for and retrieve files from individual computers around the world.

"Many of these have been touted by file-swapping advocates as potential safe havens for Napster's millions of music traders if the popular service is shut down in the courts. But for all the burgeoning optimism that surrounds these programs, experts say the other options may prove to be poor alternatives for Napster's millions of members if that company's business is deemed illegal..."

Read the full story in CNET News here.

...
...
The experts quoted in this story are saying, essentially, that Gnutella and Freenet are hard for the average consumer to use. But they're ignoring the fact that the next generation of these programs would be better than the current one (e.g., easier to use) and the next generation of that would be better yet!

In other words, it seems to me that they're not thinking ahead a step. -- KH
...



From The Internet Standard: "About 75 percent of companies advertising on the Internet are dot-coms. So it would seem that online ad revenues would be hit hard by Net business failures and shrinking marketing budgets. But Net ad numbers are fairly rosy, leaving offline dot-com advertising to feel the cuts.

"Internet retailers increased online spending to 59 percent of the total of their average marketing budget – up 10 percent from the first quarter, according to Shop.org and the Boston Consulting Group...

"Internet ads are expected to make up almost 10 percent of all U.S. advertising spending by 2004, according to advertising industry analyst Veronis Suhler. That's a big step up from the 4 percent of ad spending for the Net anticipated this year."

Read the full Industry Standard article here.




From PRNewswire:
"GlobalMedia.com...(has) announced that industry veteran Mike McHenry has joined the company as executive vice-president, sales and marketing. Reporting to president and CEO Jeff Mandelbaum, Mr. McHenry will be a key member of the GlobalMedia executive team and lead the growth and development of a world-class sales and marketing organization...

"Most recently, McHenry filled senior management roles at Loudeye Technologies, a Seattle-based new media firm. As vice-president of international operations and vice-president of world wide sales, Mr.McHenry grew revenues by 2,000% in the last fiscal year and helped the company through a successful IPO."




Sirius-2 in-orbit testing completed
From R&R Online:
"The second of three birds was launched in early September, and Sirius now says that payload and signal testing shows all systems are performing to specification. In layman’s terms, that means it will beam down sound. Sirius-3 is to be launched in late November, and broadcasting is expected to begin in January. Meanwhile, Sirius says it expects to have a delivery date for Sirius-4, its ground spare, later this month. Satellite manufacturer Loral dropped and damaged the $200 million bird in July during construction, causing a delay in delivery." Read more of R&R Online here.

RIAA to treat Napster users as customers
From All Access: "The RIAA says it will treat Napster users as potential customers, not copyright violators. RIAA President Hilary Rosen (pictured) told the press after Tuesday's hearings on the industry's copyright suit against the file-sharing program that the suit is not about 'punishing users,' but is meant to hold Napster liable for the activity of its users." Read more of All Access here (registration required).


From John Dvorak's column in this week's Forbes:
"It's hard to say how many people listen to streaming radio. I've heard estimates that claim up to 45 million people are equipped to listen to streaming radio and might have heard a broadcast. The numbers are unclear and hard to prove.

"Whatever the case, I have listened to radio over the Internet myself, but I noticed that I have not made a habit of it. As this is written, I probably have not listened to an Internet radio broadcast for two or three months. I myself wonder why...

"My experience with specialized players is that, with no exceptions, they have interfered with the performance of my computer...

"It remains to be seen whether anyone can make money with any of this. It's starting to look like the emergence of a new popular hobby, not a new business opportunity. Take a listen and see what you think."

You can read the entire column
here.

...
...
If you click the link above, you'll see that Dvorak writes primarily about the 18,000 "hobbyist" radio stations on Live365.com and the appeal of listening to air traffic control scanners.

In this particular column, notice that Dvorak doesn't really spend any time examining whether Internet radio is a good new business opportunity or not. (He simply notes that he doesn't listen himself). -- KH
...


Simply click the headline at left to bring up a convenient pop-up form -- or click here to use your own e-mail software.


Reprinted from yesterday's issue:

The following is regarding RAIN's piece Tuesday (here) on Infinity's long stopsets on Howard Stern's program.

"Not only is the listener being hosed, but the sponsor is too..."

On those interminable Stern stop-sets: Not only is the listener being hosed but the sponsor is too. Can you imagine paying five hundred dollars for a spot that is buried deep inside the pungent bowels one of these nasty "breaks?" In point of fact, most Stern listeners bail out at the first indication of a spot and return ten or fifteen minutes later when the clog is passed into the porcelain bowl of the airwaves.

This is "money-lust" programming at its most flagrant. Stern can expect to continue to slide in the ratings with these fatty blockages.

  Michael C. Keith

...

"The GM (would) want to run six 10-second spots instead of one :60..."


In general, station management is responsible for determining the length of stop sets and units per break so, if they're losing audience, it's their own fault. I worked for a news station in a major market that strictly enforced a two-unit break rule while our competitor (who happened to be owned by the same broadcast group) would run as many spots as their sales people could sell... and in any length.

The result? We consistently beat them in the ratings and in billing. Allegedly, our competitor has since had a problem hanging on to their PD's because they would inevitably get frustrated about having the GM yank programming time from them and want to run six 10-second spots instead of one :60.

However, Howard presents a slightly different "challenge" because, it's been my observation that Howard does not appear to make much of an effort to stop his show for commercial breaks... Stations running his show are pretty much forced to go to commercial breaks whenever Howard decides to go to a break. As a result, they've got to squeeze in all of their the commercials when they can. Heaven help a station like WCKG with long breaks AND Howard...

  "Deep background only"


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October 5-7 Billboard/Airplay Monitor Seminar, New York
October 9-12 QuickTime Live! Conference, Beverly Hills
October 10-12 Streaming Media Europe 2000, London
November 5-7

NAB European Radio Conference, Berlin

November 12-14 Canadian Association of Broadcasters (CAB) "Broadcasting 2000: On-air / On-line," Calgary (NEW!)
Nov. 28-Dec. 1 Radio Ink Internet Conference, Santa Clara, CA, featuring a brand-new national study on Internet radio usage presented by Eric Rhoads & Kurt Hanson



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