2/1/13: Journalist blames music services' low ad rates on low cost of music

Paul Maloney
February 1, 2013 - 1:30pm

Many have said that the Internet has taught a generation that music is free -- or at least, with little or no monetary value. One writer now suggests that the ad-buying community has learned the same lesson.

"The strongest headwind facing not only Pandora but the entire music business is the continued fall of the market price of recorded music, whether that price is paid by listeners or by advertisers," contributor Dan Mitchell writes in CNN Money. "No matter which type of delivery, the hard fact is that a growing segment of the audience no longer expects to pay for music, or at least expects to not pay much. Ad rates, particularly on the mobile platforms that people increasingly favor for streaming music, are in the basement."

Interesting, but advertisers aren't paying for music, they're paying for the attention of services' users. The value listeners get isn't just the music, but the curation and selection and discovery -- that is, the value that servcies like Pandora add. Mitchell explains that the ease with which people can access music for free (YouTube, file sharing) could make sitting through ads to listen too high an admission price. If ad rates stay low, services like Pandora need to run more ads, which will drive rates down further. 

Read more in Fortune's CNN Money here.

Paul Maloney
February 1, 2013 - 1:30pm

BRS Media has tallied the Top 100 ".fm" websites of 2012, based on site hits. Chinese music site Douban.fm tops the ranking with over 65 million hits. CBS-owned music and webcast service Last.fm was second, with just under 39 million. Not surprisingly given the association between "FM" and music and/or radio, most of the services in the ranking are music and radio related.

Others that U.S. readers might recognize include Spotify app Sounddrop.fm, webcasters 1.fm and 181.fm, Toronto radio CJRT's Jazz.fm, music service Turntable.fm, industry blog Evolver.fm, Townsquare Media's indie rock Diffuser.fm, webcaster Sky.fm and DI.fm (Digitally Imported), and music discover Shuffler.fm. BRS Media is the parent of domain registries dotFM and dotAM.

See the full ranking here.

Paul Maloney
February 1, 2013 - 1:30pm

According to new ratings figures, digital radio (broadcast DAB) in the UK now accounts for a third of all listening. That's 14% growth from last year, the BBC reports, "helped by better access to DAB receivers."

All digital stations saw their weekly audiences grow year-on-year, despite several stations losing listening in the last quarter of 2012. Digital Radio UK CEO Ford Ennals said, "Digital radio continues to transform the way people listen to the radio and one third of all listening to digital platforms represents an important milestone."

Figures from ratings service RAJAR show BBC 6 Music has overtaken Radio 4 Extra to become the leading digital-only station, now with 1.9 million listeners a week, 31% more than last year. Smash Hits is the largest commercial digital station, reaching nearly a million listeners. Smooth 70s hits more than 700-thousand.

Read more from the BBC here.