Web Music/Web Radio Revenues Set to Rev?


While most eyes are on AllThingsVideo right now [WebTV/Webisodes/Viral Video, etc] there is another major play going on from the Broadcast world: Radio to the Web.

Some call it Internet Radio, some call it Web Music Streaming, some call it Paid Subscription Music. Whatever.

Make no mistake, there is serious movement here. But unlike the Web TV/Video side of this emerging game perhaps, I see a distinct, glaring paradox in the Web world when it comes to the Radio side:

We have seen Millions of dollars thrown at ‘Paid’ models for music [mostly Subscription and/or Paid music channels, less for Radio], most of which have gone bust. Contrast that with the bootstrap, ‘Free’ models that, like NPR programming, rely on listener-support to survive: yes, donations.

And yet, from what I see, which ones are actually surviving? The ones with millions? Or the ones on a shoestring? From the ‘DeadPool’, you’ve got SpiralFrog, Last.fm, Imeem, Qtrax and others. Millions of dollars thrown, belly up.

Others like Rhapsody, Listen.com and REAL Networks have done multiple very costly iterations [meaning they probably raised extra rounds of support] or would have been in the ‘DeadPool’.

Then look at something like Groovera, which, when the “listener-support” is not there in a given month, probably has to be propped up as a labor of love by its Owner, Tim Lumen. But Groovera is still on the air. Same with another, SomaFM out of San Francisco. SpiralFrog? Long gone. MOG, as discussed here on AllThingsD, in “re-launch” mode…with another $10M in VC funding.

Now granted, some of the sites I am comparing could be looked at as Apples-to-Oranges comparisons. But my original point still stands: Millions spent and gone/Donations sought and still on-air.
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All is not meant to be dire here, though, as Music on the Web IS finally getting a revenue model, along with millions of legal listeners. Pandora has had ups & downs, and seems to be holding well at 15M Unique Visitors. [See the TechCrunch 2009 Top 10 List > here.] But you’ll notice that even current leader, Vevo, is more about music VIDEOS, than MUSIC.

And, we are starting to see standardization for online listener-audiences, which means that Web Streaming Metrics for radio are pretty much now at a point where radio Media-buyers [and their clients] are beginning to accept them. There have been several other articles recently pointing to a shift in perception by Agencies & Clients, to the point that they are starting to put budget towards Internet Radio. That is a trend set to grow, for sure.

More, firms like TargetSpot are aggregating audiences, defining relevant clients, and bringing ad dollars onto Web Radio channels across the US. On the Sales side, other Radio entities may face challenges in how to package and “sell” on the Streaming side [much as they did with their Web sites, same as Newspapers, same as Magazines], but with the Metrics gaining validity, the budgets will be there for the taking. In fact, I think there could be a race over the next 2-3 years for the fastest % rate of growth, between Internet Radio and WebTV/Video.

Last, these trends are likely to apply to the smaller, but growing areas of Satellite and Cable Radio as well.

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~ by MindOnMediaSales on March 3, 2010.

One Response to “Web Music/Web Radio Revenues Set to Rev?”

  1. Interesting subject, and timely as I am finding myself streaming music on a regular basis. Not all for free, either. La la is a cheap alternative to purchasing entire albums and the choice of music is decent; however, the ones you mentioned–Groovera and SOMAfm, specifically–have a much more eclectic genre going on. Advertising on any of these could be the way the music stays cheap, but someone has to pay, be it the subscribers/listeners or the advertisers. And with advertising, we, the listeners, “pay” by being annoyed by those ads. Just my two.

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