BY PAUL MALONEY
The latest Bridge Ratings study reveals that Internet radio shows the most significant audience growth among a group of media which includes satellite, HD, and terrestrial radio as well as podcasting and cell phone audio.

Bridge estimates that 80 million Americans (27% of the U.S. population) listen to radio online at least monthly (up from 72 million/24% at the end of last year); 60 million listen weekly. Based on these figures, the research company forecasts that Internet radio will reach 33% of the U.S. population monthly by the end of the year, then 40% by the end of 2008.

And while the lion's share of online radio listening has traditionally belonged to "Internet only" stations like AOL Radio and Yahoo! Music's Launch, terrestrial broadcasters' online simulcasts continue to gain. While the study indicates that 1 in 4 Internet radio listeners listened to at least one terrestrial radio simulcast in the previous 30 days, Bridge anticipates that share to grow to 32% by the beginning of 2008 and 38% by 2010.

Mixed findings for other media
Bridge's study also offered insights into usage of other music-delivery media. Satellite radio, for example, currently enjoys a rising rate of interest among general consumers. Yet XM and Sirius are  seeing quarterly "churn" rates (the percentage of subscription cancellations in a company's gross subscriptions count) of 64% and 44%, respectively. In other words, significant portions of subscribers choose not to renew their subsriptions (or convert previously free subscriptions).

Bridge calls HD Radio the "most disappointing story" among the media surveyed. They say only 7% of consumers are "very interested" in owning an HD Radio, as most "don't see a need" and/or are "not aware of its benefits." [Bridge summarized a recent study called "HD Radio vs. Internet Radio - Which is Radio's Future?" here.]

Things look better for AM/FM radio, both compared to HD and to earlier projections based on 2004 listening attrition among  lower demos. Bridge now sees a "slow reversal" of 12-21 year olds leaving broadcast radio, which it attributes to: "(1) renewed interest in terrestrial radio through its Internet simulcast and (2) 'iPod fatigue' among a significant number of 12-21 year olds." Bridge adds that it has also found a growing number of younger listeners rediscovering traditional music radio formats as "music discovery" sources.

While traditional radio (especially News/Talk and NPR) has encouraged growth in use and awareness of podcasting, according to Bridge, that growth is "severely limited by the process," of downloading and using podcasts. 20% of respondents said they were interested in downloading podcasts of audio or video content — more than double Bridge's 2004 findings.

Finally, Bridge found that while use of cell phones as music devices is still low among the general population, cell phones "are emerging as a legitimate entertainment device and due to its pervasiveness in American society pose the greatest threat to terrestrial radio and MP3 devices."

Read Bridge's study summary online here.

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	There's huge, and growing, demand among consumers for Internet radio (at least during the 9AM-5PM workday), as shown by the rapid growth of our AccuRadio project. AccuRadio features a variety of popular music formats that you simply can't find on the broadcast dial: Swingin' Pop Standards, Brit Rock, Piano Jazz, Broadway and more at www.AccuRadio.com.

From the Washington Post, by Rob Pegoraro: "Some of my favorite radio stations don't have DJs. But they do include some other features not found on FM: a button to pause playback, another to skip to the next song and, most important, a playlist I can customize.

"Free, interactive music sites like Pandora and Last.fm are a hybrid of radio station and jukebox...

"Perhaps as a result, the music industry can't figure out what to do with them. Should they be treated as a substitute for a record collection or as a promotional tool that helps expand those libraries?

"So far, the business has leaned toward the first idea. It has secured a dramatic increase in the royalties Web sites pay to musicians and record labels, effective as of July 15.

"But that increase is a mistake, a rush to judgment that first needs an answer to a larger question: Is music something people consume or something they keep?...

"[I]f the royalty rates recently set in the United States remain intact, rates that hit $500 per listener per year by some estimates, some of these sites say they can't carry on.

"'We are paying the new rates,' Pandora founder Tim Westergren said Monday. 'But we are only continuing because we do have some hope that this is going to get resolved in a rational way,'...

"Last.fm, however, says it can live with higher rates because of the online-community aspects of its business that don't incur royalty payments...

"Today, most people have no easy, cheap way to listen to these sites away from a desk. But imagine if fast, reliable, cheap Internet bandwidth were available everywhere... Would a site like this become the functional equivalent of an iPod loaded with all your music and set on shuffle?

"That's the contention of John Simson, president of SoundExchange, a nonprofit organization that collects the royalties...

"Could that be so? Look at your own music player to find out. When's the last time you set it to play a specific artist, instead of letting it pick music randomly? How often do you listen to an album from start to finish? How soon will you need to hear a favorite song now?"

Read the entire article at the Washington Post.

From the Scotsman.com: "Live music is enjoying a resurgence not seen in decades, thanks to the very technology it was thought would kill it.

"The boom in downloading music and internet social networking appears to be encouraging larger numbers of people to see their favourite performers, according to a new report.

"The amount being spent on live music, which was in steep decline just a few years ago, has been revived by a combination of new venues, a boom in festivals and networking websites, such as YouTube, MySpace and Bebo.

"An estimated £743 million was spent on live music this year — an 8% rise on last year...

"Geoff Ellis, managing director of the staging company DF Concerts, said: 'It has always been word of mouth that has "broken" a band. It used to be school kids telling each other, or people sitting in the pub, but nowadays it's on the internet...

"The trend has been bolstered by the closer relationship between fans and artists such as Lily Allen and the Arctic Monkeys through the musicians' own websites and blogs.

"Many bands are bypassing traditional music labels by building a reputation for performing live and via internet sites, according to the Mintel report...

"There were also an estimated 240 festivals, up 20% on 2004. Richard Cope, leisure analyst at Mintel, said."

Read the entire article at Scotsman.com.

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