A Story

Make way for the big boys.

"Companies like Google, Apple and Facebook are eyeing the streaming and on-demand music business now dominated by smaller niche companies such as Pandora and Spotify. When they do -- and most analysts agree it's really just a matter of time -- they could give nearly everyone the ability to listen to whatever they want, whenever they want -- and mostly for free," wrote San Jose Mercury News' Heather Somerville yesterday.

If true, this brings up a whole host of issues, some of which Somerville explores, like the impact on artists, consumers' relationship with music, and others. But where does it leave Internet radio: both pureplays like Pandora, and music broadcasters who'll rely more and more on digital efforts to grow? Smaller companies will have to become even more creative and agile to offer a value proposition the larger companies can't -- a sort of "boutique" existence, catering to niche and local audiences. 

"There is no doubt that when companies this large enter into the field, it will be disruptive," Jonathan Handel, a media and entertainment attorney, told the paper.

Read more here.

There's (literally) a world of competition online, and RAIN Summit attendees are always looking for strategies to increase their service's share of the online audience. Several of Europe's leading online and broadcast radio experts will take up this very topice at RAIN Summit Europe, May 23 (that's in two weeks!) at Brussels' Hotel Bloom.

The "Growing Your Online Audience" panel will cover topics from simulcasting on-air content, customized online radio, and on-demand streaming.

Radionomy's Alexandre Saboundjian (left) and 7digital's Ben Drury (right) are both CEO of their respective companies, and will take part in the discussion. Calling itself "The Radio Experience," Radionomy provides a tech platform for amateurs and professionals to create their own online radio stations for free (the company even covers music licensing). When a station's audience reaches certain levels, Radionomy then shares advertising revenue with the station creater. Apparently a busy guy, Saboundjian also heads (and founded) MusicMatic (an in-store media company), and Jamendo (which is a platform for royalty-free music).

Ben Drury co-founded 7digital, a UK-based digital media company, which sells music downloads to consumers, but also provides branded products for traditional media companies, consumer brands, and social networking services. Some examples are powering Samsung's Music Hub, and the music store for Songbird. He also founded dotmusic.com, later acquired by Yahoo.

Kjartan Slette (at left, he's head of music at WiMP) and Steve Whilton (director of product at Last.fm, right) are both tasked with crafting a product that ensures audience growth. WiMP is an on-demand music streaming service with a library of 18 million tracks (and growing). Based in Oslo, the service employs local editors in the countries in which it's available (Norway, Denmark, Sweden, Germany, Poland and in the Netherlands) to help ensure it meets the demands of these different markets.

Last.fm, founded in the UK in 2002, is known for its music recommendation "scrobbling" system that integrates with other services, and for its online radio service and social networking features.

KISS FM and rs2 general manager Christian Schalt (left) is the panel's representative of the broadcast world. He's based in Berlin, from where KISS FM has been broadcasting nationwide as part of the Germany's DAB digital radio system. He's a career broadcaster with experience at Planet Radio in Frankfurt and Energy in Vienna. He was also Program Director for Kronehit, Austria's only national commercial radio station.

"Growing Your Online Audience" will be moderated by VP/Europe for RCS Sound Software, Sven Andræ. Sven's also experienced in broadcast radio, and later joined RCS to launch its Scandinavian division. RCS, of course, is the well-known (and largest) broadcast software company, with products at over 10-thousand stations worldwide. It's known for its music and promo scheduling, digital playout, automation control, and traffic and sales management software (Sven's pictured right).

The RAIN Summit Europe agenda also includes five "feature presentations" (that's not including Kurt Hanson's "State of the Industry"). One will be "The Do's and Don'ts of Social Media Branding," to present tactics for online radio to better encourage discussion among, and connection with, listeners.

Our social media expert making this presentation is Paula Cordeiro of Lisbon. She's the radio ombusdperson for Rádio e Televisão de Portugal (RTP), Portugal's public service broadcaster. A visionary of radio's future, she also coordinates the Radio Hub, which is a project for training, research, and radio production at the Universidade Técnica de Lisboa (where she lectures on radio and digital media).

This year's RAIN Summit Europe promises to top even last year's inaugural Berlin event. Space is still available for this year's event. All the details, including registration links, are on the RAIN Summit Europe page here.

With its March Webcast Metrics online radio listening ranking, Triton Digital included the news that mobile listening to its panel stations now accounts for 56% of all its measured listening (M-Su 6a-12M, U.S.-only), crossing the 50% threshold for the first time.

Pandora, which accounts for a monster share of Webcast Metrics "domestic" listening, says mobile accounts for somewhere near 75% of its listening. In March, as a way to control royalty costs, the webcaster imposed a 40 hour/month limit on listening to free streams via mobile devices. As a result, Triton says, Pandora's mobile listening dropped 3% in March.

"At first glance, 3% may not seem overly concerning, but we have to take into account the scale of Pandora’s audience," the news release reads. "Did capping Pandora drive a portion of their mobile listeners to other Pureplays, such as Slacker, who saw an 18% gain during the same period? It's possible. Or, perhaps this growth is attributed to the fact that mobile audio consumption was our fastest growing segment in March 2013."

Mobile listening to other pureplay webcasters went up 23% during the month (mobile listening to terrestrial streams grew 5%).

Slacker's 18% gain in mobile listening was part of a great month for the second-largest pureplay webcaster. Its combined M-Su 6a-12M domestic Average Active Sessions (AAS) was up 23% over last month. Slacker AAS is up 49% from March 2012.

While Pandora did slip 4% overall from February, its AAS is still 39% more than 12 months ago.

Among broadcast streamers, Univision had a strong March (up 22%), as did the NPR Member Stations group (up 16%).

Triton Digital's March Domestic Ranker (M-Su 6a-12M) is below. You can find the full March 2013 report here. Our coverage of the February 2013 rankings is here.

Triton Digital is a sponsor of our upcoming RAIN Summit Europe event, May 23 at Hotel Bloom in Brussels. CCO and general manager of data and measurement Rob Favre and SVP and general manager of international markets Jay Supovitz will participate in panel discussions. Info and registration links are on the RAIN Summit Europe page.

Triton Digital president of publisher development Dominick Milano acknowledged that there's a "disconnect" between the unprecedented amount of audio consumption made possible by Internet and mobile technology, and the fact that advertising dollars haven't moved to those platforms in levels reflective of the audience. That "disconnect" served as the premise for the Triton Digital-sponsored "Accelerating Your Revenue" panel, which Milano (at right) moderated, at last month's RAIN Summit West event in Las Vegas.

The panel covered the three principal revenue models for online radio: advertising, premium (or subscription), and listener-supported (i.e. donations).

Katz360 VP of broadcast services and online audio and video sales Dean Mandel suggested one key is the right combination of broadcast radio and online radio -- not only for ad campaigns, but in creating worthwhile listening experiences. He encouraged radio programmers to "take better advantage" of what technology has to offer to improve their online product.

"The programmers are brilliant and if they can come up with interesting content to fill instead of a lot of PSAs and ads, it will help grow the audience," Mandel (left) said.

He said he sees lots of value in what sets local broadcasting apart from national/global database-driven music webcasters: a local brand, personalities, and local content.

Mandel is also a big supporter of targeting advertising, and suggested effective listener-registration helps a lot. His "pro-tip" was for stations to look for online listening happening in markets outside your own that may command higher CPMs (his example was a Charlotte station that might have significant listening in New York City).

He also suggested that media buyers have indeed become sophisticated, and being able to provide them with targeting and third-party tagging on audio will raise CPMs.

Andrew Polsky, as VP of digital media for SBS Interactive, also deals in the advertising world. He says what his company needs is "advocacy" at the agency and buyer level, especially for the Hispanic market.

His company, aside from Hispanic-focused broadcast and online radio, owns MegaTV (video content and network) and SBS Entertainment (which is concert production). Key for him is being able to leverage all the properties as a unified platform, "offering a 360 approach to advertisers," and using content from one property on the others (see his company's LaMusica mobile app as an example).

Polsky (right) seconded Mandel's notion that there needs to be a better solution than "PSAs" to fill long stopsets when streaming broadcast content.

Michael Jackel, who is Spotify VP of West Coast advertising sales, also agreed about the power of being able to target listener groups for advertising (he addressed the perception of his company as a "subscription service," but insisted Spotify is a "dual-model" business with the large majority of its users accessing via free, ad-supported streaming).

Moderator Milano asked Jackel (left) if there were a model for subscription alone to work -- or if services need a free version to remain viable.

"If the value proposition is really there, pure subscription can work," Jackel answered. "Spotify has a great product that's free, but the premium is a great value proposition." He said, in the U.S. especially, people are used to "free," so Spotify's free streaming makes sense. "Pandora isn't winning on the subscription model because there's not that much value to their premium service," Jackel went on. "Few people will pay just to 'not have ads'. You have to offer something that's really compelling in order for people to pay for it."

Compelling content is also key to driving donation revenue for listener-supported stations, like Joe Gallagher's MVYRadio.com. After some background on WMVY-FM and its early foray into streaming (Net Radio Sales, now Katz360 and AndoMedia/Webcast Metrics, now owned by Triton Digital, were both born of these efforts), Gallagher said successful donation support relys on offering content that "serves a niche, serves a vertical" and allows for "a passionate connection" with listeners.

Gallagher is the "#1 volunteer" for Friends of MVYRadio, the non-profit 501(c)3 that runs the (now) Internet-only, listener-supported station (more in RAIN here). He's also president and CEO of Aritaur Communications, former owners of WMVY-FM. He says his listener-supported model has "worked well, really well," and allowed for year-over-year growth for the past four years. The station recently raised the necessary $600k to operate for the rest of the year.

Gallagher (right) explained that listener targeting allows him to (for example) entice donations from L.A.-area listeners by giving away tickets for a concert there.

Milano polled the panel on the likely entrance of Apple into online radio. Katz360's Manel said, "It'll grow the business, it's a good thing. It might make local AM/FM focus more on their local value proposition" -- again, meaning the personalities and local content.

Spotify's Jackel said, "It's good. When (Apple) come(s) in, advertisers and Wall Street will see the value... it lifts the industry, it publicizes other businesses, to consumers AND advertisers."

You can listen to audio coverage of this panel, and all of RAIN Summit West's content, at kurthanson.com (look in the right-hand margin).

Triton Digital CCO and general manager of data and measurement Rob Favre and SVP and general manager of international markets Jay Supovitz will be part of RAIN Summit Europe, May 23 at Brussels' Hotel Bloom. Spotify's Benelux managing director Tom Segers will also be there. Info and registration links are on the RAIN Summit Europe page.

Jacobs Media released the results of this year's TechSurvey 9 today -- their study of the habits and adoption of technology by radio listeners. Jacobs, for what it calls the "largest technology survey ever conducted for radio," examined how "Baby Boomers" plus "Gen's X, Y, and Z" across twelve radio formats use Internet streaming, social media, mobile technology, and more.

The TechSurvey 9 "Media Usage Pyramid 2013" (below) shows that 45% of Jacobs' respondents are now weekly Internet radio listeners. Interestingly, this is the same percentage Arbitron and Edison Research (in their Infinite Dial 2013 study) found as monthly Net radio users. Their weekly reach was just 33%. Keep in mind that The Infinite Dial examined a wider base of study subjects. See more in RAIN here.

Fully 20% of those studied are weekly Pandora listeners -- but Jacobs points out nearly a third of Pandora listeners are getting annoyed by commercials (that number was 20% last year).

This year, 11% of TechSurvey respondents own a "digital dash" system like Ford Sync in their cars. More than half of those surveyed can connect iPods or smartphones to their car's dash (62% of Gen Y).

In the press release, Jacobs Media President Fred Jacobs says his "takeaway" is "radio’s ability to uniquely connect with consumers on their preferred platforms is the secret sauce for future success in the digital space." Likely a thought Jacobs will explain in more detail during the six webinars the team will present on the study (each focusing on a different radio format group). Details and registration are here. See more graphs from the study, including a larger version of the "Media Usage Pyramid," here.

Clear Channel's iHeartRadio reached 29 million registered users in the first quarter, more than half of whom were on mobile devices like smartphones or tablets.

Mobile listening accounted for 55% of the service's total listening hours during the first quarter, which were up 31% year-over-year, the company revealed in yesterday's 2013Q1 earnings report.

Competitor Pandora says more than 75% of its listening is now on mobile devices (see The New York Times here). And though Pandora says its mobile revenue is now growing faster than its mobile audience (see RAIN here), the webcaster recently capped mobile listening at 40 hours a month for users of the free, ad-supported streaming (more here).

There's more on Clear Channel's Q1 earnings here.