BY KURT HANSON
Although the top-line findings of the most recent Arbitron InfoStream webcast ratings report are not painting a particularly pretty growth story for Internet audio, the problem may be in part due to a fairly-common statistical phenomenon called "regression to the mean."

Here's what that phenomenon is about: Back a few decades ago (if my memories from a college statistics course are correct), Air Force pilot trainers faced a puzzling situation: Whenever a pilot did great on an exercize, if they praised him, he did worse the next time, but if they criticized him, he also did worse the next time. On the other hand, when a pilot did lousy, they didn't know what to do to improve his next effort -- because anything they did (praise, criticism, etc.) seemed to work.

What they eventually realized was this: Any spectacularly good performance is, by definition, way above average. And to some extent, there's a bit of luck involved. Similarly, any poor performance is at the opposite end of the bell-shaped curve of possible outcomes. There's an natural tendency, statisticians realized, for the next event to be a little bit closer to the average (or "mean") event.

So a stellar performance is statistically likely to be followed by one that's somewhat less so -- and a lousy performance is likely to be followed be a better one. The next one will be closer to the average one. There will be regression to the mean.

Here's how this relates to Internet radio:

Arbitron is only providing InfoStream webcast ratings reports on the top 25 performers (out of 290 channels this month). According to this phenomenon, those are the 25 stations that are statistically most likely to decline in the following report.

By contrast, if Arbitron printed results for the bottom 25 stations instead, it's likely that most of the 25 would improve the following month. And we'd think "Trends are going up!"

More on this tomorrow.

This morning, I'm flying out to Arbitron's Columbia, MD, headquarters to meet with Bill Rose, Joan FitzGerald, and other Arbitron executives to learn more about their Internet initiatives.

If you've got any questions that I can pose to them, or any comments you'd like me to pass on, please send me an e-mail this morning (here) and I'll try to do so. (Read questions from other RAIN readers here.)



Reprinted from yesterday's Weekend Edition of RAIN:


BY KURT HANSON
Those small-market station webcasts that looked so great in the first couple of Arbitron InfoStream webcast ratings reports seem to be declining in Monthly Cume at the rate of about 20% per month, according to the data released by Arbitron last week.

Meanwhile, the few major-market stations that have been consistently in the top 25 Monthly Cumes report seem to be growing slowly but steadily, adding about 10% per month to their cume...

Read the full story in yesterday's issue of RAIN. Click here.



From Wired magazine: "Corporate sponsorship of music is so commonplace these days that most fans don't even bat an eye when their favorite artist pops up in a Pepsi commercial or at a Microsoft launch party. But how will online music fans feel about ad banners that pop up every time they listen to a music track?

"New York-based EverAd will test that concept with a new technology that embeds banner ads in the free music tracks listeners download to a PC. When the track is played, a revolving series of ads comes up regardless of whether a user is online or offline, and stays in the forefront of the screen during the duration of the song....

"EverAd's music format is proprietary and is an encrypted version of MP3, which ties the ads to the music. The security also prevents tracks from being burned onto CD-R discs or sent to MP3 portables...The company is trying to get support for PlayJ in the Winamp, RealNetworks and Musicmatch players...

"The cost of the ads will be about $15 cost per mega' (CPM), or per 1,000 impressions. Each track will include eight to 10 spots, and a user must view a spot for 20 seconds for it to count as an impression. DoubleClick and Netgravity will place and track ad impressions, and EverAd will collect data on every song a user plays, how often, and for how long..."

Read the full story from Wired magazine here. A screenshot of the company's proposed MP3 player is shown at right.



From iRadio (TM): The NAB in Vegas is fast approaching -- April 8-13. There are numerous Internet related sessions in the RAB Sales/Marketing Conference and the Radio Management Conference. Some of the highlights are listed below:

**Save My Web Site: April 9, 2000 2-4PM, Peggy Miles discusses how to keep your web site compelling

**The Buying Power of Streamies: April 10 4-5:15 PM, Larry Rosen discusses Edison Media Research and Arbitron's latest findings on Internet research -- always SRO!

**What Streams May Come: April 11 10:30-11:45, Panel on streaming decisions you need to make for your station that I will be participating in!

**Web Partners: April 12 10:30-11:45, Presentation by Stacey Artandi of There.com, Who makes sense for you as a strategic partner for the Internet?

**How to make money on the internet: April 10 10:45-12noon, Mike Mahone and Dave Casper of RAB discuss success stories.

**There is Internet Money in Small Markets: April 10 2:30-3:45, How small markets are doing it differently with RAB folks?

**E-commerce can mean big buck for your station: More RAB folks discuss this targeted at sales and managers-no geeks allowed

**A Unique Radio web site is outbilling half the stations in the market: NAB folks discuss UncleWebster.com and how its site traffic is huge!

For complete NAB convention info, click here.





Their panels immediately preceed the main NAB convention. For details, click here.



More on this topic tomorrow in RAIN.




Thanks very much to everyone who helped spread the word about RAIN in Week #1 of the RAIN Viral Marketing Contest. However, we didn't have a winner (see details here), so we're adding another prize to the RAIN Viral Marketing Contest Prize Package and trying again!

This week, you could win both the Sony Music Clip digital music player (pictured below) and a gorgeous Nextel i1000plus Internet-ready cell phone (pictured at left)!

It's totally packed with features -- including the ability to give you wireless Internet access when Nextel begins that service in some markets next month (see full specs sheet here)...but the best part, in my opinion, is this: It's got an integrated speakerphone.

That means you can use it holding it halfway at arm's length -- exactly like Kirk, Spock, and McCoy used to hold their communicators!   ("Scotty, I need warp power in ten minutes or we'll all dead.")

Here are the contest rules: You're invited to recommend RAIN to your friends and colleagues. If RAIN gets 100 new "subscribers" this week (i.e., new readers who fill out the "Enjoying reading RAIN?" form above), we'll give away the entire prize package to one lucky winner (chosen randomly from everyone who has sent out an e-mail recommendation to date).  If not, we'll roll over all the entries, add something more to the prize package, and try again next week. (Three more paragraphs of fine print here.)

So think of a few people you know who would benefit from knowing about RAIN -- co-workers, subordinates, friendly competitors, clients, vendors, college friends -- and tell them about this fine Web-based daily newsletter. And win!

(Want to write an e-mail to a couple of colleagues right now, but need help composing the e-mail? Click here for some suggested language.)

More coming soon! Contribute your suggestions here. (Suggestions already in the hopper include CableMusic.com, RadioWoodstock.com, Nerve Radio, Radio Gogaga, and HotCountryHits.)

Miss an issue?
Visit the RAIN News Archives here.



If you'd like an easy-to-read set of tables of the Arbitron InfoStream December 1999 results, they're now available for your viewing here in RAIN. Click here for...

           Top 25 stations in Monthly Cume
           Top 25 stations in Time Spent Tuning
           Side-by-side comparison of the above two lists

           Monthly Cume trends
           Time Spent Tuning trends

To read RAIN's coverage of the release of the first, October 1999 InfoStream report, select from any of the following stories:

We're still working through Sunday's e-mail, but it looks as if new "subscriber" sign-up continues at Friday's rate, we'll be giving away the RAIN Viral Marketing Contest prize package this week for sure. If you can think of a couple of more industry friends who might like to read RAIN, it wouldn't hurt to drop them a line today or tomorrow. Thanks...and good luck!

You can easily click through previous issues of RAIN by using the blue arrows next to the issue date at the top of the page. (This navigation element has been added retroactively to all of March's issues.)