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International webcaster issues mirror those in U.S.: Royalties, revenue, and potential Apple competition

Wednesday, April 10, 2013 - 1:40pm

RAIN Summits included the "International Trends in Online Audio" panel in Sunday's RAIN Summit West program because of the positive response to last fall's RAIN Summit Europe (as well as to serve as a preview for this year's Europe event).

Turns out, what these online radio professionals viewed as some of their biggest challenges mirror those in the U.S.: high content costs and complex regulations (royalties), those costs' drag on their companies' profitability, revenue beyond ads and subscriptions, and the prospect of an Apple entry into the space.

CEO of Berlin-based webcaster AUPEO!, Holger Weiss (pictured right), admitted licensing across borders is a steep challenge. He said it's a long, arduous process, yet his service is licensed in 40 countries, so it can be done.

Radionomy VP/Business Development Thierry Ascarez agreed there are "solutions out there, it can be done." His company provides a platform for hobbyist and smaller professional webcasters to create and stream their own online stations.

Saavn co-founder Paramdeep Singh (pictured left) described the especially difficult circumstances in India: "We have deals with over 900 record labels, as there's no one-stop for licensing in India. Labels and artists think we're hugely profitable, so they want lots of money."

So what about that money? How do these business leaders intend to increase revenues?

Radionomy's Ascarez described his company's advertising platform in which it splits ad revenues with those webcasters whose audiences surpass a minimum threshold (incentivizing good content).

"There are unique opportunities for monetization beyond ads and subscriptions," said Singh, whose Saavn service streams Bollywood and Tamil Cinema music. He says his company partners with carriers as a "use case" and a benefit to upgrading to a data plan (of India's 800 million mobile customers, only about 50 million have data plans).

"Who'll finance (these types of services) until the ad revenues make it profitable?," wondered Weiss. "It's not great and fantastic yet. We're not profitable yet. We have to think beyond pure advertising and subscription. Advertising is not the only way to make money. We'll see this in 2013," he said.

The AUPEO! CEO teased a Monday announcement about his company "working with" Panasonic, saying services could create new revenue streams by bundling the service with device makers, especially for the car. What we learned Monday is Panasonic has actually acquired AUPEO! for its in-dash audio entertainment platform.

Live365 CEO Hong Lau, experienced in business in China, illustrated the opportunities in that country. "It's not a lot different there than here," he said. He explained that phones are considerably cheaper, and there are hardly any significant online audio services there.

Moderator Ali Abhary (right), CEO of Spectrum Medya in Turkey, concluded by asking his panelists how they view a potential webcasting competitor in Apple.

Saavn's Singh said his company's specialized music libraries aren't easy for a new competitor to relicate. "It took us years to aggregate our content."

Weiss agreed. "You can win in a fight (with Apple), which can't copy you, but "can only buy you if you're niche."

We'll continue to recap the content from Sunday's RAIN Summit West in the coming days here in RAIN.

"International" RAIN Summit West panel a preview of our May European event

Monday, April 1, 2013 - 1:00pm

In anticipation of our second annual RAIN Summit Europe (May 23 at Hotel Bloom in Brussels, details here), we're adding a global perspective to our RAIN Summit West program with the "International Trends in Online Audio" panel. And we're honored to have several leading Internet radio and digital music CEOs taking part.

In February we announced AUPEO! CEO Holger Weiss as a panelist (announced in RAIN here) to help us explore the realities of streaming radio outside North America.

To moderate the "International Trends in Online Audio," we'll be joined by Ali Abhary, CEO of Spectrum Medya, one of Turkey's leading radio broadcasters. Abhary (right) is also founder of Biletix, Turkey's leading entertainment ticketing company, and one of that country's first and most successful Internet startups (it's now owned by Ticketmaster/Live Nation). Abhary was a panelist at our first RAIN Summit Europe last year in Berlin.

Hong T. Lau is CEO of Live365, and will join the panel. A graduate of the London School of Business with an MBA, Hong (left) has held a number of senior positions in North America and Asia in diverse industries, including that of managing director with the Jim Pattison Group. He has extensive experience in finance, acquisitions, and corporate growth strategies.

Also on board is Paramdeep Singh, Executive Chairman and one of the co-founders of Saavn, a digital distributor of Bollywood and Tamil Cinema music. Under Paramdeep's leadership, Saavn has secured partnerships with the top film production and music houses in India, and amassed the largest legitimate Bollywood music catalog available directly to end users online. Singh (lower right) graduated from the College of Arts & Sciences at Tufts University with degrees in International Relations, Economics and Entrepreneurship.

Thierry Ascarez, Radionomy VP/Business Development, rounds out the panel. Ascarez has been based in San Francisco since the company's September U.S. launch, and was once the compnay's Marketing & Communications director. Prior to joining Radionomy (which also has offices in Brussels and Paris), Ascarez (lower left) worked in promotions and digital sales for the EMI music group.

RAIN Summit West is this Sunday in Las Vegas. The annual full-day Internet radio conference is a co-located education program of the NAB Show. Now in its 12th year, the Summit focuses on the intersection of radio and the Internet. Keynoting the event will be RAB president and CEO Erica Farber (more in RAIN here) and Rhapsody International president Jon Irwin (more here). Register today via the RAIN Summit West page. And look for the RAIN Reader Discount Code in the P.S. of your RAIN Daily e-mail (subscribe here)

New Studio365 app lets Live365 programmers manage stations from mobile device

Tuesday, March 5, 2013 - 1:10pm

Live365 has launched a new mobile app called Studio365, which allows station programmers to manage their radio stations from their mobile device.

Broadcasters can record "Shout Outs" (short, recorded announcements) directly from their phone, and set them to play on their station via the mobile app. The app also gives broadcasters the capability to "go live" on the microphone, again right from the device. Programmers can also manage station ID and pre-roll messages, update station profiles, review listening stats, and monitor stations.

Live365 says the new Studio365 mobile app is the first of many new products they'll release this year. Read more here.

Fuzz lets users be a DJ, and enjoy music "curated by humans"

Friday, September 28, 2012 - 1:15pm

Entrepreneur Jeff Yasuda (he created the "Twitter for music" Blip.fm) has beta-launched Fuzz, the newest online radio service that enables users to create channels using their own music (see Live365, Turntable.fm, Radionomy).

Fuzz's marketing angle is that the stations are "user-curated, robot-free online listening experiences" created solely by human music fans, and not by cold, heartless computer algorithms. The positioning statement (which appears just below its logo on the front page) reads "Fuzz is great radio made by real people."

Setting his business apart from similar services, Yasuda says Fuzz won't be ad-supported. CNet wrote "Yasuda knows that's a losing path, that the numbers don't work." Rather, he plans to fund the business with premium subscription services, and then move into mobile and the app business. "Those are the breakout opportunities," he told CNet. They write, "He wants to take what he learns on Fuzz, create apps -- maybe games, maybe something different -- that he markets to his users."

Try Fuzz here; read CNet's article here.

RAIN news "quick hits": PWC on Net radio ad revs; Songza; SoundExchange; Live365; Senzari

Thursday, August 16, 2012 - 1:15pm

-Billboard reports (here) that a new PWC projection (here) says online radio advertising will grow by 11.5% from $465 million last year to $802 million in 2016. Satellite radio ad revenue will also rise, 9.4% compounded annually, from $74 million in 2011 to $116 million. Satellite radio subscription spending will increase from $2.6 billion in 2011 to $4.1 billion in 2016.

-Webcaster Songza says it's registered more than 2 million U.S. and Canadian users since June 1st, and that of all the users that have ever used Songza (since its official launch last September), over half of them are still active. Read more in TechCrunch here.  

-SoundExchange, the organization that collects and distributes money from Internet-, satellite-, and cable radio, has released a database of 50-thousand artists and labels that are owed over $60 million in unclaimed royalties. More from The New York Times Media Decoder blog here.

-Internet radio aggregator Live365 has announced the release of its dedicated application for the iPad. Read more here.

-Webcaster Senzari has launched a new proprietary music recommendation engine it calls AMP3 ("Adaptable Music Parallel Processing Platform"). Sensari says "The AMP3 technology is revolutionary within the music recommendation space, as it is the first engine to be modeled after a semantic network that includes an API architected similarly to Facebook's OGP (Open Graph Protocol)." Read more here

SoundExchange: SiriusXM, Pandora royalties constitute "substantially" less than 90% of total revenues

Wednesday, April 18, 2012 - 12:45pm

SoundExchangeLast week we wrote about new calculations from Live365 general counsel Angus MacDonald, which found that 90% of SoundExchange's 2011 revenue came from just SiriusXM and Pandora (RAIN coverage here).

Now SoundExchange refutes the claim, though the collection agency says they "are not able to publicly disclose the payments to SoundExchange from specific digital music services." SoundExchange argues that royalty payments from SiriusXM and Pandora made up "substantially below" 90% of their revenues.

Billboard.biz has more coverage here.

MacDonald calculated that Pandora's royalty payments alone made up 36.66% of SoundExchange's revenues. The webcaster paid "about as much in royalties for its FY 2012... as it made in TOTAL REVENUES for its previous fiscal year, FY 2011," wrote MacDonald.

Pandora paid 49.7% of its FY 2012 revenues to SoundExchange, according to its 10-K submitted to the SEC.

SiriusXM is currently suing SoundExchange and A2IM, accusing the record industry organizations of interfering with its efforts to reach direct deals with rightsholders (RAIN coverage here and here).

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