forecast

eMarketer: Association with music, in-stream audio ads make Net radio appealing to ad buyers

Wednesday, February 6, 2013 - 1:05pm

A forecast from a new eMarketer report, "Internet Radio: Marketers Move In," has the U.S. Internet radio audience growing 11.1% to 147.3 million this year. "Expansion will continue for the next several years, though rates will taper off to single-digit percentages," says eMarketer.

During that time, eMarketer expects U.S. Internet radio ad revenues to hit $970 million, then grow to $1.31 billion by 2016 (this includes all streaming, website, text, e-mail, and mobile advertising, and advertising on HD Radio). The news source points out that while positive, these growth forecasts are more modest than those for other digital media.

"Still, advertisers are eager to attach their brands to internet broadcasting and other music-streaming properties. There are several reasons for this, among them: the appeal of associating a brand with a particular genre or artist; the extent to which internet radio is driven primarily by ads; and the appeal of in-steam audio ads, which are harder to avoid or skip than other forms of digital advertising," reads the eMarketer press release.

See more, including a link to purchase the report, here.

BIA/Kelsey expects online/digital to make up 25% of local ad market

Tuesday, July 17, 2012 - 12:00pm

BIA/Kelsey expects a 11.7% compound annual growth rate (CAGR) for radio's local online revenue in the 2011-2016 period. While television's local online revenue will grow a little more quickly (almost 13% CAGR), both trounce newspaper's (5%).

The firm also expects local ad revenues in the "online/interactive/digital" category to grow more than 13% this year, pushing the digital category past the 25% mark in the local ad market.

Probably not surprisingly, the "star" categories in BIA/Kelsey's new "U.S. Local Media Forecast (2011-2016)" are mobile, social media, and online video. The analysts expect the local mobile search segment to grow 77% this year, local online video about 52%, and social media 26%.

A summary of the report is here; purchase the full report here.

eMarketer: Streaming music to get a "full test" in coming year

Wednesday, January 4, 2012 - 11:00am

eMarketer predicts 2012 will be a test for streaming musicJennifer Lane reports today in Audio4Cast that eMarketer's recent webinar predicting key digital trends of 2012 highlights streaming music. It will be the year "cloud-based streaming gets a full test," says eMarketer.

"Rapid adoption of smartphones, tablets and other connected devices has shifted consumer expectations. Now, consumers expect consumption to be seamless across all of their connected platforms. This creates both a challenge and an opportunity for content providers and advertisers as they move to meet those expectations," writes Lane.

You can find her coverage here and listen to eMarketer's webinar here.

BIA/Kelsey expects radio's online/digital revenues to grow from $479 million this year to $758 million by 2015

Wednesday, November 30, 2011 - 12:35pm

BIA/Kelsey growth forecastBIA/Kelsey says radio will finish 2011 with $479 million in online/digital revenues, up 15% from $405 million in 2010. The firm's five-year outlook, published in its Investing in Radio Market Report has that segment reaching $758 million by 2015, a 13.4% compound annual growth rate. [You can click the image of the chart to link to a larger, easier-to-read version.]

Among the specific opportunities powering online/digital growth for radio, according to BIA/Kelsey: local "deals" (think Groupon or Living Social).

The Investing in Radio Market Report profiles each of the 282 Arbitron-rated markets "with historic and projected market demographic and financial statistics... (including) estimated advertising revenues, technical data, ownership and acquisition information, and more for every market." This includes individual market-level online advertising revenue estimates based on BIA/Kelsey’s work with broadcasters and industry resources.

Read the press release here. Audio4cast reports on this story as well, here.

Popularity of net-connected devices to drive demand for content, says Gartner

Wednesday, November 9, 2011 - 12:55pm

Gartner logoA new study indicates that consumers worldwide are becoming more willing to spend money for premium online music content -- including subscription-based and (to a lesser degree) ad-supported Internet radio (which Gartner lumps in with subscription-based services in their study).  

As consumer spending on CDs and LPs is expected to slide from $15 billion to about $10 billion 2010-2015, Gartner forecasts end-user revenue for online music sales and services will grow more than 31% over that same time span: from $5.9 billion in 2010 to $7.7 billion in 2015. Subscription services (e.g. Spotify, MOG, Rdio, Pandora) alone will take in $532.1 million this year, growing to $808 million next year. 
Gartner chart
While the more mature "a la carte" download market will still drive the bulk of overall online music revenue (a projected $3.62 billion will be spent on downloaded music this year) through 2015, music subscription services are expected be the main growth sector in this market. Gartner says the music subscripton segment itself will show fivefold growth from 2010 to 2015, accounting for nearly one-third (29%) of end-user online music spending by 2015.

"We expect that their (a la carte music download) growth will slow down as more consumers begin to turn to subscription services that are leveraging the popularity of consumer smartphones, media tablets and, in the future, devices such as TVs with Internet connectivity built in," reads a "top line assumption" from the Gartner report. "We include advertising-supported Internet radio services with this class of offerings — for example, Pandora, which offers advertising-supported and monthly subscription options (although our focus is on the end-user spending, rather than on the advertising revenue)."

Read Gartner's press release here; and the report findings here (.pdf file).

Not only will listening grow, but Internet radio CPMs will climb as ads are locally-targeted, says analyst

Thursday, October 27, 2011 - 12:55pm

SNL Kagan this week announced its new report, "The Economics of Internet Music and Radio," predicting continued growth for Internet radio ad revenue, outperforming traditional media, over the next decade.SNL Kagan

"We expect radio station digital/online ad revenue to grow... from an estimated $713 million in 2011 to $1.55 billion in 2021," reads the report summary. "Based on our 10-year radio ad spending projections, radio station digital ad revenue is expected to rise from 1.5% of the total in 2007 to 7.0% by the end of 2021."

For "Internet-only" radio, Kagan forecasts a faster growth, from $293 million this year to over $1 billion by the end of 2021.

ForbesCertainly, as Internet radio's audience grows, it'll attract a greater number of advertisers. What's more, as Forbes reports, "SNL analyst Justin Nielson says that with Internet radio services migrating to mobile devices and in-car systems, companies will soon start pushing local and targeted ads." That should raise ad rates from current $5-7 CPMs to the $10-$20 range, Forbes says.

SNL Kagan publishes corporate, financial, and market news and analysis in the media and communications sector. SNL senior consultant Robin Flynn has spoken at the RAIN Summit and was a judge for the 2011 RAIN Internet Radio Awards.

The SNL Kagan report is available here (password required).

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