8/9/13: Billboard on Pandora: If it monetizes listening like AM/FM, it's sustainable

Paul Maloney
August 9, 2013 - 1:00pm

Labels and performers critical of Pandora's efforts to lower the royalties it pays often say the webcaster should simply sell more ads and generate more revenue. Billboard says its analysis of Pandora's business model indicates it is, in fact, "well-positioned to turn its massive listening audience into profits."

It's simply a matter of monetizing its audience at the same rate as broadcast radio, according to the analysis.

"Pandora had roughly a 7% share of U.S. radio listening in June," writes Billboard's Glenn Peoples. "A 7% share of the $16 billion radio advertising market is worth $980 million to broadcast radio. Pandora’s revenue during the last four quarters was just $417 million. That implies Pandora’s current market share could generate an additional $563 million."

Morgan Stanley analyst Scott Devitt predicted a 15% share of radio listening for Pandora by 2015, which at its current montetization would amount to half a billion in ad revenue. Billboard reasons that if Pandora squeezed the same revenue out of its inventory as radio, it would be four times that ($2 billion).

So, would Pandora need to load up on ads like so many local broadcasters, with several 6- or 8-minute spot breaks per hour? Wouldn't that substantially affect audience? Or would superior ad-targeting mean Pandora could charge advertisers a substantially higher rate than broadcast radio, requiring fewer spots to generate the same revenue?

That specific question isn't addessed in the analysis, but Peoples does write, "no other platform can deliver both audio and display ads to more than 71 million monthly active users while allowing advertisers to target by demographic characteristic and location."

Read the Billboard analysis here.

Paul Maloney
August 9, 2013 - 1:00pm

A new online audio "aggregation" service called Agogo is designed to collect music and spoken word content to generate a custom feed, and specially for use in the car.

Agogo launched Wednesday via its free app for Apple mobile devices, CNet reports. With it, a listener can connect to a Spotify or Rdio account for music, and "interconnect" with NPR content, local traffic reports (from Clear Channel), text-to-speech news articles, book excerpts (from Simon & Scuster), and even audio from online television programming. A Stitcher of sorts, but with music content.

Founder J.D. Heilprin told CNet, "Awesome audio programming is bountiful, but today it is trapped inside content silos and spread across apps. We built Agogo to radically improve the audio experience for people on the go."

Read more in CNet here.

Paul Maloney
August 9, 2013 - 1:00pm

With a patent filed last year, Apple seems to be working on a way to embed links or other device instructions in audio files -- not in the metadata, but in the audio signal itself.

This "audio hyperlink," reports TechCrunch, "would use audible or inaudible signals embedded in a music or other audio track to link out to other media, or to perform some function on the device when encountered."

Imagine listening to a podcast, and the speaker makes note of a particular picture or graph. The link embedded into the audio could display that image at the right moment -- sort of a Powerpoint-type experience. Or, it might be a way to better associate liner notes and "purchase" links with music files.

By embedding the information into the audio itself, the link could become more portable (not subject to metadata changes or deletion), but not impossible to destroy (through transcoding the audio itself, one could imagine).

TechCrunch suggests could make "audio files into something truly interactive, and better-suited to the multimedia-rich mobile platforms that exist today."

Read more here.

Paul Maloney
August 9, 2013 - 1:00pm

Beasley Broadcast Group announced yesterday it has hired Stacey Sedbrook as Vice President of Digital, to manage its social and online initiatives, develop and implement new media strategy, and coordinate digital and interactive efforts for all Beasley radio stations.

Sedbrook comes to Beasley from print media, with experience at The Dallas Morning News, The Houston Chronicle, and the Denver Newspaper Agency.

Beasley owns and operates 43 stations in eleven U.S. markets.