9/17/13: RAIN Summit today in Orlando

Paul Maloney
September 17, 2013 - 12:00pm

In a memo to Cumulus employees, CEO Lew Dickey commented today on yesterday's announced deal with music service Rdio, more specifically revealing the Rdio features that Cumulus will likely make available to listeners.

The broadcaster announced yesterday it has acquired a "significant" ownership stake in the music subscription service, which has been struggling to gain the visibility of competitors like Spotify. Rdio will represent Cumulus' primary digital strategy.

Dickey confirmed Cumulus programmers will be tasked with "refining the technology" that Rdio uses to create its "custom radio" services (the Pandora-like feature that allows listeners to create their own streaming experiences based on the artists and songs they like best). Dickey very explicitly stresses "this is not radio," and takes a little poke at Pandora for selling this "feature" as "radio."

He also revealed Rdio functionality will be used to create nationally-focused audio content (Cumulus recently acquired radio network Westwood One-Dial Global). "The Rdio partnership will allow us convert this valuable programming into new digital audio products," he wrote. "Cumulus will draw upon our stable of iconic brands, content and talent to produce new, exclusive channels and short-form programs that give listeners an unparalleled listening experience on a single digital platform." Dickey said Cumulus local radio streams will remain on Clear Channel's iHeartRadio for the time being, and while there's no plan yet to incorporate them into Rdio, that may indeed change.

Dickey mentioned Rdio's core offering -- its on-demand streaming feature -- but didn't explicitly describe if or how Cumulus would leverage this feature.

He told employees: "Partnering with Rdio, we are now able to meet the full range of audio needs for listeners nationwide and begin to export our content and brands worldwide. This strategic alignment uniquely positions us to compete aggressively against all digital audio services for the benefit of our entire platform."

Relatedly, outgoing Rdio CEO Drew Larner told GigaOm's Janko Roettgers that Rdio plans to bundle its streaming movie and TV service Vdio with Rdio's streaming music for a global subscription offering (read more here).

News source Radio Ink acquired a copy of the Dickey memo, and has published it here. See yesterday's coverage of the Cumulus/Rdio deal here.

Paul Maloney
September 17, 2013 - 12:00pm

The long-awaited Internet radio play from Apple, iTunes Radio, officially goes public tomorrow with the release of the company's latest mobile operating system, iOS 7.

Never before has the launch of an Internet radio streaming service been so anticipated, and perhaps rightly so. Apple's marketing power and built-in customer base are unparalleled in this space. Apple commands name recognition beyond any in the field, including leader Pandora. And even though the service's inital launch is U.S.-only, since the iTunes Music Store is all over the world, "the potential stage is global," CNet's Paul Sloan wrote.

This point is one that makes radio consultant Mark Ramsey think the fattest chunk of potential audience for iTunes Radio will be those who've never even tried Internet radio.

"The 'everyone else' who listens to music on their iGadgets and Android devices and desktops who may never have bothered with the incremental 'work' required to download and use a specialized app or platform but who nevertheless are iTunes users," he wrote. "This is particularly true in the many corners of the world where Pandora doesn’t exist."

What's more, since it's "baked in" to iTunes, there's no need to specially "acquire" this radio, which replicates broadcast radio's pathway to ubiquity: "Almost nobody ever 'buys' a radio. When you buy the clock, the radio comes along for free. When you buy the car, the radio comes along for free," Ramsey contends. "You own several without buying any, and you use them simply because they’re there and you can."

One very important way in which Apple will take a slightly different path than its predecessors may be the amount of human curation -- the programming -- of the service. Sloan's sources at music labels believe the service will rely on the tastes and insights of people, just like Apple does with the iTunes Music Store.

"Apple now will get an opportunity to recast a decade-old debate about the respective roles of man versus algorithm when it rolls out this new piece of streaming music software. Apple has built a service in its own image that, to a large degree, leans on taste makers as well as mathematics," CNet says.

We've discussed this many times before -- services' growing understanding that no matter how sophisticated their recommendation algorithms, humans still have the edge in creating compelling, unique listening experiences (see: the new Beats Music, Spotify's new "Browse," and the just-announced deal between Rdio and Cumulus).

Read Sloan's article in CNet here, and Ramsey's post for PBS's MediaShift here.

Paul Maloney
September 17, 2013 - 12:00pm

Leading webcaster (and public company) Pandora plans to sell 10 million more shares of stock as a "follow on" offering, to raise $279 million for "general corporate purposes." The company's biggest investor shareholder, Crosslink Capital, also plans to sell 4 million shares it holds.

And though it says it has nothing in the works, Pandora may use some of the money it raises "for potential acquisitions of businesses, products or technologies."

Within its announcement of the proposed offering, Pandora warned it doesn't "expect to be able to sustain (the) rapid growth in both listener hours and advertising revenue" it has enjoyed in the last few years -- meaning it expects to continue to lose money in the near future. The company continues to battle sound recording and composition copyright owners over royalties (by far its largest expenses, consuming more than half the company's revenue), and faces perhaps its biggest competitive test yet with tomorrow's launch of Apple's iTunes Radio

Read more on this in The Wall Street Journal here, Tom Taylor Now here, and from Pandora here.

Paul Maloney
September 17, 2013 - 12:00pm

Last week when word hit that pioneering music service Rhapsody might shake up its leadership, RAIN editor Brad Hill asked (here): "Can a subscription-only service provide compelling value against free-listening platforms? For that matter, can any streaming-music business hold its own against content costs?"

The official word came yesterday (and was covered right away by The Verge's Greg Sandoval) that Rhapsody will "rebalance and restructure U.S. operations," has laid off 15% of its staff (30 workers), and will replace top managers like president Jon Irwin (who'll move into an advisory role) and CFO Adi Dehejia. Rhapsody's new "executive operating committee" will be made up of executives Brian Ringer (CTO), Paul Springer (SVP/Americas), Thorsten Schliesche (SVP/Europe), and new CFO Ethan Rudin.

The company also announced investment firm Columbus Nova has taken some ownership of the company. Columbus Nova, by the way, owns Harmonix, which owns the Rock Band videogame franchise. Rhapsody says it will "add resources to enable the company to accelerate its efforts in Europe and emerging markets."

Sandoval puts Rhapsody's fortunes in the larger context of the tough go online music services have had.

"In the post-Napster era, we've yet to see a single digital music distributor generate lasting or significant profits," he wrote. "More recently, Spotify's losses have grown. Grooveshark has cut the size of its workforce. Rdio has struggled to keep pace with Spotify in terms of building an audience. In this environment, Rdio and others are trying to stay competitive. Operators of these sites say the obstacles are significant, as consumers remain reluctant to pay for songs and the cost of licensing music is still too high" -- the two very points Hill made last week in RAIN.

Read Rhapsody's official announcement here. Read Sandoval in The Verge here.

Paul Maloney
September 17, 2013 - 12:00pm

Digital radio software and services provider Abacast has officially beta-released a feature to allow song-skipping on "live" radio streams, and announced a new feature to ensure radio streams begin with music (we first reported on this in February, here).

The song-skipping beta is now available for streaming listeners on Federated Media’s WMEE in Fort Wayne, IN.

"When a listener chooses to skip a song that is currently being played, another song from the station’s playlist will be played immediately and in its entirety for that listener," the company says. Its "Personalized Live Radio" is designed so that the rest of the stream plays seamlessly and in its entirety as well.

The new "MusicStart" feature should roll out in Q1 of next year. Abacast created it to deal with the problem of a listener launching a stream and not immediately getting content that will make her stay (e.g. commercials). Also part of the "Personalized Live Radio tech," the new feature guarantees that all streams start off with music.

Paul Maloney
September 17, 2013 - 12:00pm

(from earlier today:)
Welcome to Florida, for RAIN Summit Orlando.

Kurt Hanson, Jennifer Lane, and Brad Hill of (the newly-christened) RAIN Enterprises welcome you to Orlando's Rosen Shingle Creek Resort for today's event. We hope you find it interesting and beneficial.

We're very happy to announce that once again live audio from the event will be available via TuneIn, using Backbone Networks technology. You can begin listening when the Summit begins at 12N ET here.

The day's first panel, Alternative Revenue Strategies, will look at other ways ad-supported webcasters can make money in addition to CPM-based audio ad campaigns. We're happy to have Inside Radio's Paul Heine moderating, and he'll speak with Pandora's Dan Weiner, Ted Gurley of Univision, Matt Cutair of Dial Global, and LDR Interactive's Daniel Anstandig.

Entercom Communications president and CEO David Field steps up to the podium at 1:30p ET to deliver the RAIN Summit Orlando keynote address. Last week Field publicly supported the announced royalty deal between Clear Channel and Warner Music Group (more in RAIN here).

Later, GroupM Next will present their most-recent research findings on the future of streaming radio. That's at 2:50p ET.  Kurt Hanson has his State of the Industry address scheduled for 4:15p ET.

The Summit closes with the presentation of the fourth-annual RAIN Internet Radio Awards. You can review this year's finalists here, including those in the brand-new "International" category. After, we hope you'll join us for the RAIN Reader Cocktail Party on the terrace of the Rosen Shingle Creek Resort, sponsored by Pandora and RCS Works.

The full Summit agenda and speakers list is here. Please join the conversation on Twitter (follow RAIN Summits)  and use the hastag #RAINSummit or #RSO) and on the RAIN Summits Facebook page. We'll have coverage of RAIN Summit Orlando beginning tomorrow in RAIN.