From PC World: "Sony hopes its mobile Internet device, to be launched this year, could be a product as strategic as its Walkman, the firm's newly appointed president Kunitake Ando was quoted in Monday's Asian Wall Street Journal...

"'We believe that the mobile terminal will be a very...strategic product for Sony,' Ando said. 'Just like we created a Walkman culture, we'll have a sort of mobile culture.'

"Sony wanted to work with telecommunications carriers worldwide to develop wireless Internet services such as online music and movies to be shipped to advanced cellular phones, Ando said...

Read the full Reuters story here.


Reprinted from yesterday's issue:

BY KURT HANSON
About 600 people from the worlds of radio and Internet audio are going to converge on Boston today for the Radio Ink Internet Conference East, Eric Rhoads's follow-up to his extremely successful Silicon Valley conference last fall.

Before we all converge on the Copley Theater this afternoon, I thought it might be worth a few minutes for us to review what we've already learned about where radio vis-a-vis the Internet is going...and what we still aren't sure of.

In other words, let's take a look at what we're going to Boston to learn.


At the Radio Ink conference last fall, we heard a lot of what today seem like naive comments about the size of Internet webcast audiences -- e.g., "We don't know how much more to charge a broadcast advertiser to have their spot played on the webcast, but certainly it's worth at least 10% more."

Well, thanks to Arbitron's InfoStream first three monthly webcast ratings reports, we now know that the most successful large-market radio station webcasts they measured added only perhaps 1% -- or even only .1%! -- to the size of their broadcast audience.

Meanwhile, we know next to nothing about the size of the Internet-only broadcasters' audieces. They either choose not to participate in the InfoStream study or they don't make the top 25 stations.

However, from what we can infer and speculate, here's what webcast listeners seem to want:

	1	Some office workers who have reception problems -- or who for whatever reason don't have a radio at work -- may enjoy listening to their favorite local station via the Internet.
	2	Some people who've moved to a new city may enjoy listening to the radio stations from their old hometown (including sports broadcasts).
	3	Some people -- but more like tens of thousand than tens of millions -- enjoy listening to niche formats that aren't available in their markets (e.g., Americana).
	4	Some people seem to enjoy the novelty -- at least for a while -- of using the Internet for listening to radio station webcasts from around the world
	5	Some people may be abandoning broadcast radio entirely for the Internet-only broadcasters, which offer less (or no) talk, fewer spots, and a wide range of niche formats.

What we don't know at the current point in history are several things:

Will Internet radio listeners
migrate to the Internet-only broadcasters?
The multi-channel broadcasters offer lots of music channel choices and fewer and shorter interruptions to the music -- but, on the other hand, the opposite side of the coin is that they have less personality (a/k/a "stationality").

In any event, if broadcast stations cobntinue to load up too many minutes of spots per hour -- and economize in other areas -- are they sewing the seeds of their own future destruction?

Can broadcasters complete effectively against Internet-only broadcasters -- e.g., with subchannels?
Let's say I'm an AAA listener who lives in Chicago, but I actually want to listen to a more "retro" version of the format than WXRT offers nowadays.

Am I going to be able to find and prefer to listen to an Internet-only broadcaster's AAA channel (e.g., NetRadio or Gogaga)...or will WXRT offer its own variety of subchannels for its listeners to enjoy -- and would those channels, with WXRT branding and talent, be more preferable to me?

Last fall, no one seemed to know what type of advertising was going to work on webcasts. (Some speakers even suggested that the only viable revenue stream was going to be e-commerce.) This spring, it's starting to become clear.

It now looks as if there are several different potential revenue streams available for Internet-delivered radio: (1) Banner ads and sponsorships can be sold on the station's website. (2) Banner ads can be inserted into the station's audio player. (3) Broadcast stations can benefit in the traditional manner from having local listeners to their streamed webcast as long as those listeners write down their listening in Arbitron diaries. (4) Alternatively, radio stations can sell different spots to their webcasts listeners by using "ad insertion" technology.

And there are even several different approaches to ad insertion possible. (A) Spots called "gateway ads" can be inserted at the beginning of each access of a stream. (Broadcast.com, for example, makes money by running a gateway ad before delivering each stream request.) (B) At the radio station level, spots can be inserted oto cover the over-the-air signal's spots ("server-side insertion"). (C) Or different listeners can be fed totally different spots based on their age, sex, and location ("client-side insertion").

The three best-known players in this space, I believe, are RadioWave, which demoed server-side insertion at the RAB last February, LightningCast, which offers client-side insertion for Internet-only broadcasts (i.e., those that are comprised of sepeate .asx files for each programming element), and Hiwire, which offers client-side insertion into live streams. All three are also are building staffs to make ad sales.

How should sales staffs be organized?
On a local level, one of the things we still don't know is whether Internet sales (banners, sponsorships, and/or audio ads) should be the responsiblity of the current AEs or should be sold by a special dedicated team. There are reasonable arguments in favor of each approach.

What kind of CPMs are audio ads worth?
Another thing we don't know is the kind of CPMs that audio ads may be able to get from advertisers. They're highly-targeted, audited, and I would think are going to be proven to be clearly more effective than banner ads. Does that mean they'll sell for three or four times the CPM of banner ads or traditional radio spots? It's currently unclear.

Also, who will sell these national spots most effectively -- traditional rep firms, "interactive" rep firms (ala Interep Interactive), ad insertion networks (see below), or some other entity?

By the way, if you aren't going to Eric's conference today, many of the same questions will be addressed next month at Erica's conference -- i.e., Radio & Records publisher Erica Farber's "R&R Convention 2000," which will be held in Los Angeles, June 14-17, with an Internet track produced in association with Webnoize. (The next Radio Ink conference will be their second annual Fall show, November 28th thru December 1st in Santa Clara.)

What do consumers want when they visit a radio station's website? That's obviously a key question that I hope would expect will be addressed thoroughly this week.

First and foremost, I believe we've learned, is that consumers expect (1) access to the station's streamed audio. (As previously observed, however, the CBS/Infinity radio stations in particular have chosen not to satisfy this desire.)

Other desired items may include: (2) The title and artist of the song currently playing -- and a log of those played in the recent past. (3) The ability to enter a station contest, request a song or dedication, or send an e-mail to station personnel. (4) Particularly for a talk-based station, national and/or local news headlines, weather, sports, and traffic information. (5) Jock photos. (Joke.) (6) Games, animations, and other amusements. (7) Music news and concert information relevant to the station's format. (8) Information about station advertisers. And more.

Some of the best-known firms that build websites for stations include First Internet Media Corporation, CBS/Infinity's Feed the Monster, which develops very elaborate,albeit slow-to-download) sites, and new entrant SiteShell.



There are now over a dozen firms competing for streaming business. The high-end firms offer lots of capacity and multiple servers operating closer to each listener. Other firms offer decent-quality streaming at prices ranging from low to free (although they keep some revenue-generating opportunity for themselves, such as rights to a gateway ad or an ad on the player). Some aggregate your station on their radio guide or portal -- which could be either a benefit to you or a detriment.

I would assume that we'll be looking at these options during the conference for a better understanding of the pros and cons of each firm's offering.


And which encoding format is best?
As for encoding techniques, different ones of which are supported by different streaming vendors, there are now at least four competing alternatives -- RealAudio (the original "standard"), Windows Media (the aggressive newcomer) , Emblaze (which requires no download or plug-in), and Apple Computers' QuickTime (which CBS has chosen for their its first step into streaming archived programming).

There's a lot of debate over which encoding format delivers the best audio quality at the most reasonable price. This also warrants discussion.

One possible impediment to the growth of Internet radio has been its current tie to PCs -- particularly when it's contrasted to the portability and ubiquity of broadcast radio.

However, numerous new approaches will be arriving this year to help free Internet radio from that tie, including the following: (1) Kerbango plans to offer an "Internet radio" that plugs directly into a phone line for Internet access (with no need for a PC). (2) Sonicbox plans to offer a system that feeds Internet audio from a consumer's PC to his home stereo -- and includes a wireless remote control for changing stations. (3) Akoo plans to offer a similar system to Sonicbox's, although without the remote control. (4) Voquette offers a system that allows streamed audio to be downloaded into portable audio players.

Also... (5) Although it's not marketed as such, Netpliance's iOpener seems to be a $99 device that would allow consumers to affordably listen to Internet audio. (6) A new start-up called Savos is planning to give consumers a way to listen to Internet radio via the new generation of wireless-Internet-ready cell phones that are already in consumers' hands. (7) Motorola has announced plans to offer a wireless Internet-based car radio called the iRadio, supposedly before the end of the year.

What we don't know yet is whether consumers will be inclined to pay any significant amount of money to get access to streamed audio at locations other than at their PCs.



There was an interesting dichotomy of opinion at last fall's conference over e-commerce opportunities for radio -- particularly regarding the sale of CD's via station websites and audio players. Some speakers suggested that this was the most obvious e-commerce opporunity of all for radio stations; however, one or two other speakers said that their experience so far was that CD sales were virtually insignficant.

Among the new approaches that have appeared on the scene since last fall is GetMedia's "Now Playing" Java applet, which shows the last hour of songs that a station played, plus CD cover art and a purchase link. Whether that has improved sales levels is a subject that I hope will be addressed.

Other possible e-commerce opportunities for radio websites include: Classifieds. Auctions. Datings services. A complete local portal (ala Lawrence Amaturo's UncleWebster.com). Station merchandise. Employment classifieds (i.e., a "jobs board"). And more.

It will be interesting to hear which e-commerce features radio stations are having the most success with.



As revealed in RAIN last Friday (here), Emmis Broadcasting is building a consortium of several broadcast groups to develop a national portal -- the Local Market Internet Venture (LMIV) -- that will be accessed through individual radio station's websites and supported by a billion dollars' worth of marketing support annually.

This is certain to be a hot topic this week. The key question, I believe, is whether a radio's station's brand can be extended to encompass a full-service portal. (In other words, even if I'm a P-1 to Star 99FM, does that mean I'm going believe that Star 99FM has as good an Internet portal as Yahoo or AOL?)

And just as the Internet is giving radio stations a chance to compete more aggressively with newspapers (visuals accompanying spots, coupons, targeting by zipcode, classifieds, etc.), it's also giving newspapers a chance to compete with radio stations by adding branded audio channels to their websites.

Cleveland-based Everstream is developing a network of such sites, and I would think that there's a career opportunity for a savvy radio guy who knows how to sell audio ads (e.g., a LSM or GSM) in each situation.



That's my take on the big issues as we know them today. And RAIN will keep you appraised of the goings-on here in Boston as they transpire.

(By the way, did I miss a key topic or point? Want to disagree with me on any of this? Contribute your feedback here.)

This overview, by the way, is available by popular request as a 50-minute-long speech, with attractive accompanying graphics, for group meetings, conferences, and similar events. E-mail me here for details.

May 15-18	Radio Ink Internet Conference, Boston     -- SOLD OUT!*
* This week's Radio Ink Internet Conference, which begins this evening, may be sold out, but if you were still thinking about attending, fortunately for you, RAIN has anticipated your needs! You're in luck! Before it sold out, we purchased a small block of seats for those RAIN readers who make decisions at the last minute. Still interested in attending? Call Kurt at 1-312-656-5878.
May 22-26	Real [Networks] Conference 2000, San Jose
June 12-14	Streaming Media East 2000, New York City
June 14-17	R&R Convention 2000, Los Angeles
June 14-17	PROMAX & BDA, New Orleans
July 13-16	Upper Midwest Conclave, Minneapolis
August 3-5	Morning Show Bootcamp, New Orelans
September 20-23	NAB Radio Show, San Francisco
October 5-7	Billboard/Airplay Monitor Seminar, New York
November 5-7	NAB European Radio Conference, Berlin

From today's New York Times: "Like the European cartographer who inscribed the Lenox Globe 500 years ago with the Latin for "Here are dragons," off the east Asian coast, newspaper executives had begun looking at the Internet as terra incognita, an almost mythical place of revenue-devouring, reader-devouring pixels that would cripple their businesses.

"Now, with three or more years of Internet experience behind them, including both failures and modest successes, when publishers look at the World Wide Web, they don't see business-destroying dragons any more.

"They see a new breed of competitor, it is true. But they also see themselves..."

"Asked about the dangers of the Internet, William S. Morris III, chairman and chief executive of Morris Communications...said in an interview: "We can play that game ourselves. We've got reporters going out all over the place getting information. We've got incredible promotional power. We've got a fantastic relationship with our customers -- our advertisers..."

Read the full article here (registration required).

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If you're hiring for a position that's radio- and Internet-related this week, we'll post it -- free! Simply e-mail the job description here. If you're looking for new opportunities that involve the Internet, you can take a look at the first three available positions here.

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