streaming

Gizmodo contributor Mario Aguilar decided to find the best "automated DJ" on a streaming music or Internet radio service, pitting eight top services against each other for his "The Best Streaming Radio."  

His original intent was to find the service with the algorithm that created the best sounding user-generated station (he only considered services that offer "generative playlists" -- the ability for users to create "stations" on the fly by simply typing in a single artist, song title, or genre). Nearly immediately he realized picking a winner based solely on a good mix was futile, as they all, by and large, do a pretty good job at this task.

So he widened his considerations to other facets of the services -- "integration with social networks to the design and overall usability of each service's unique features" -- for the shoot-out.

I'll let you click through to see his ranking, but I'll include a few of his points here about specific services:

Turns out he's not a fan of Clear Channel's iHeartRadio service, which (he wrote), "does so little and doesn't do it especially well." He called it "radio in the most traditional sense," and didn't mean it as a compliment, since "regular radio stations are terrible, which is why we turned to the Internet in the first place."

Pandora, which is "showing its age," only fared a little better. He found the service "less evolved" with only "very basic" social integration -- but "if Pandora has a selling point it's simplicity."

And though Last.fm may still have something to offer, in 2013 it "feels ancient." In fact, its concentration on scrobbling (tracking what you listen to on other services) makes it "more of a recommendation engine than a polished way to listen."

Aguilar actually had some high praise for Slacker's human-curated stations, which he says offer the "kind of variety you can't get from a machine." But, alas, this shoot-out was for algorithm-driven "generative playlist" channels. And the newly-redesigned Slacker interface seemed "ambitious and very good- looking, but it's pretty confusing" and "needs streamlining." Perhaps even worse, he said Slacker "completely missed the potential of social" media integration.

So -- does any service offer anything he likes? See which topped Gizmodo's The Best Streaming Radio here.

New record industry research indicates licensed music streaming may be helping, not hurting, their business, including the sales of music downloads -- at least for independent label music.

Indie label global rights agency Merlin has conducted an analysis of 6.5 billion streams, and a worldwide survey of its membership, in which two-thirds of those members report an increase in "a-la-carte" download sales year-on-year. More than 90% of Merlin members say streaming and subscription license revenues also increased -- for a third of them, they more than doubled.

Merlin is the organization that administers performance licenses for many leading independent record labels (like Domino, Beggars, and Merge, representing artists like The Arcade Fire, the xx, Nick Cave & the Bad Seeds) -- accounting for 10% of the world's music market.

Merlin's market share for streaming is outperforming the overall digital market, by up to 20%, the organization says. Between 2011 and 2012, 73% of Merlin's study respondents said their overall business revenues grew from 2011 to 2012. Of these, 21% reported overall revenues had increased by more than 50%.

The study included streams from services like Spotify, Deezer, YouTube, and Rhapsody; and download sales from the likes of iTunes, Amazon, eMusic, beatport, and more. Read the study results from Merlin here. 

TechCrunch reports on this too here.

Digital Music News editor Paul Resnikoff asks, "Do consumers really care about having every last song at their fingertips, millions of songs deep?"

While streaming music services like Spotify, Rdio, and Rhapsody seem to think so, as they tout library size as a major feature, most listeners don't care, concludes DMN.

"This matters far less than the industry thinks."

SiriusXM has over 24 million subscribers, dwarfing any other music subscription service. But "Sirius has selection, and even Pandora-like stations. But you're not picking the songs, playlisting, or otherwise DJing with millions of deep tracks. You're driving, working, reading, sleeping, or doing something else, while someone else is curating an ultimately limited selection."

Another example: Pandora, with a far more limited library and lacking the on-demand component, it's topped 200 million registered users.

"Many consumers will say they want everything, but actually don't," Resinkoff wrote. "And all you have to do is look at virtually any chart from any 'comprehensive' streaming service. Because even with the widest selection imaginable, the world's chosen playlist is amazingly thin."

Read this entire article from Digital Music News here.

NPD Group SVP/Industry Analysis Russ Crupnick sees the music industry headed towards another cliff -- and thinks streaming audio and capturing the favor of the 100 million "casual music fans" may be the keys to averting it. Crupnick presented recent research findings at RAIN Summit West last month in Las Vegas. 

"We desperately need streaming radio to succeed," Crupnick told attendees. "We need to get the lawyers, guns, and money out of the way, and start having a better understanding of how to get consumers on to the next model."

Back in the '90s, 90% of adult Americans regularly bought CDs. NPD research shows it's now 35%, and that's not being replaced by paid downloads. Just about 23% of people have purchased a music download in the last year, which means 3 of 4 haven't! And, as much as CD purchasing has dwindled, it's still more prevalent than downloading! And the amount of time people spend listening to these legacy formats (CDs, MP3 files, and even radio a bit) is down too.

Here's the bright spot: online radio usage is up 6% among young people (see the chart) -- and up 23% among baby boomers -- in the past year. Online radio is even the "way number-one" reason people are quitting P2P downloading: "It's just so much easier to use a streaming service," Crupnick paraphrased.

And, Crupnick adds, "these are really valuable customers" to the music industry. While the average American spends $24 on music in a year, Pandora listeners spend $40, and Spotify users $52. Streaming audio listeners also strongly out-index average Americans buying concert tickets.

But the real opportunity for streaming radio to succeed, and the music industry to avoid another cliff, Crupnick argues, is not going after the "core" music fans (the 30% of the population that accounts for 80% of the money spent on music). Radio and streaming services are already "serving them really well." The opportunity lies with attracting the other 70% of people -- the "casual" music fan.

Consider: Nearly all "core" music fans listen to AM/FM, and 77% listen to non-subscription online radio, according to NPD figures. And while a good majority of casual fans also listen to music on AM/FM (74%), just 25% listen to free online radio. That's the 100 million people market opportunity. That's the potential audience gain for Internet radio, if it can reach beyond the hard core music fans and get to everyone else who listens to AM/FM.

And to do that, Crupnick advises, it's necessary to understand the mentality of that casual listener. He stresses that the research shows these people aren't at all focused on those things broadcasters and webcasters obssess over. NPD found, as he put it, "98% of people don't know what 'an Rdio' or MOG is!" Most casual listeners don't really have any interest at all in mobile apps (though he suggested an Apple streaming radio entrance might change the game).

The lack of interest in mobile apps notwithstanding, Crupnick says "this battle is going to be won in the car," as that's where the vast majority of casual music fans' listening takes place.

And casual listeners aren't interested in subscribing for music either. "We've gotta figure out a way to help these services thrive outside of subscription," he concluded. "We can work together, labels, artists, services, to grow the pie."

RAIN Summit West was April 7 in Las Vegas. You can listen to audio from Crupnick's presentation, and all the RAIN Summit West content, on our website. Look for the SoundCloud links in the right-hand margin of kurthanson.com.

Our next event is RAIN Summit Europe, May 23 at the Hotel Bloom in Brussels. Limited space is still available. Information and registration links are available on the RAIN Summit Europe website here.

New Clear Channel-developed technology would allow stations to substitute songs in streams with other tunes -- even of different lengths.

The company has filed an application with the U.S. Patent & Trademark Office that describes the process as using a "variable buffer delay" to handle differing song lengths, allowing the stream to resume the original progamming "downstreams," as it were.

Billboard.com explains, "content for one broadcast station may include songs or advertisements pertinent to one audience but not for the audience of another broadcast station. Another scenario finds content in a transmission from one radio station may content undesirable for the diverse audiences of the radio stations carrying the transmission."

Tom Taylor Now (which is how we learned of this story) today conjures up a good example: "It could also be applied to syndicated shows which service multiple formats - like the John Boy & Billy show, which clear on both country and rock stations."

You can read the Billboard coverage here; Tom Taylor now here; and the patent application here.

The Financial Times reports that Apple's development of its "iRadio" streaming service are caught up by rights negotiations yet again, this time with Sony Music.

Apple reportedly has reached and agreement with Universal Music, and is close to a deal with Warner Music, leaving only Sony among the "big three" label groups.

Though Apple won't verify any details, or that they're even developing such a product, the Financial Times reports:

"These people said that Apple had first offered a royalty of about 6 cents for every 100 tracks it streams, but had raised this to about 12.5 cents, in line with the rate paid by internet-radio service Pandora. But it was unclear whether Universal had accepted the 12.5 cent rate, and other labels are thought to be pushing for better terms."

The paper's sources also suggest Apple has offered to pay for music rights on a per-track royalty, an ad revenue share, and a guaranteed minimum. Read the Financial Times' coverage here.