RAIN Summit

Robertson warns radio: NAB needs to get involved, or you're screwed

Monday, May 14, 2012 - 11:35am

If the current music royalty arrangement is a "mountain" between webcasters and profitability, Michael Robertson says broadcasters have two choices: go around the mountain, or blow it up.

Robertson is founder and CEO of DAR.fm (which enables recording/time-shifted listening of online radio). He spoke on the panel "The Streaming Music Landscape" at RAIN Summit West in Las Vegas.

The first option, according to Robertson (left), entails radio creating an entirely new model that allows webcasters to avoid the high royalties. Fellow panelist Paul Campbell is founder/CEO of Amazing Radio in the UK, and is doing exactly this sort of thing. A terrestrial station, Amazing Radio plays only independently-owned music. In exchange for the promotion the publishers and performers receive by being aired on Amazing, they waive their royalty claims (allowing the station to perform the music for free).

Radio's second option is get far more involved in the royalty-setting process than it has to this point. "Unless the NAB gets off their ass and gets on the Copyright Office and influences those rates," Robertson exhorted, "as your business goes digital, you guys are screwed."

While Rhapsody Chief Product Officer Brendan Benzing thinks the "renaissance around consumer demand" for curated audio online will shine a brighter spotlight on untenably-high royalties webcasters pay, Robertson was less optimistic. "None of this other stuff matters unless royalties are radically changed," he said. His optimisim lies in the news of Sirius' lawsuit against SoundExchange (see background here). "That is the most important development this year for the Internet radio business. Fantastic development. You better hope Sirius wins."

After Robertson (also founder of the MP3Tunes.com, which recently declared bankruptcy, more here) brought up public earnings reports from Pandora that showed the company pays fully 50% of its revenues for royalties, moderator Ted Cohen (right) asked why that's so out-of-line. Cohen, TAG Strategic Managing Partner, said, "Look at physical retail, durable goods, where 60-65% (of retail revenue) goes to supplier. Is 50% that eggregious?"

The difference, according to Robertson, is in the nature of the business involved, and radio's important role as a copyright "intermediary" between creators and the public. "Look at broadcast radio, which pays about 5% (of its earnings for musical content, in the form of composer/publisher royalties to ASCAP, BMI, and SESAC). Would any radio station have a business if they paid 50% of revenue? No." The problem, he Robertson insisted, is that lawmakers now see the purpose of copyright not to benefit the public (as many interpret the Constitution to mandate), but rather to benefit copyright owners. And what the rate structure fails to take into account is the importance of "distributors" of copyright -- those entities like webcasters and radio -- that are necessary for the public to reap the benefit of copyright by broadcasting and streaming that content.

On the topic of distribution, Robertson advised broadcasters to "pay attention to mobile. That's where the majority of your listening will come from in the future." He said, "Get your signal everywhere, don't do exclusive deals. Any digital guy that comes to you (to make a deal), as long as it doesn't cost you any money, you should do it."

That is, of course, once the royalty matter is solved. The Internet radio business "is a rocket," Robertson said. Right now, "unfortunately, it's a North Korean rocket."

See the entire video of this panel, and all our RAIN Summit West content, at RTTNews here.

Deal brings audio recording and time-shifting tech to IBS college and high school stations

Friday, May 11, 2012 - 12:25pm

DAR.fm has partnered with Net radio platform provider Backbone Networks to provide time-shifting and recording technology to the nation's largest network of college and high school radio stations.

Now, Backbone announces, "sporting events, news and other community focused programs can be captured and then played back at a convenient time for listeners on PCs, smartphones or tablets making it accessible to a wider audience."

DAR.fm (think "DVR," but with "A" for audio instead of "V" for video) is entrepreneur Michael Robertson's company which enables online radio listeners to schedule and record live content for listening at different times and/or on other devices (much like a DVR works for television). Robertson was a panelist at our recent RAIN Summit West event. See video of his panel (and all the Summit content) here.

The Intercollegiate Broadcasting System is a not-for-profit association of educational institution-based broadcasters and webcasters. Its IBS Student Radio Network is operated by Backbone Networks.

Read the press release here

TargetSpot releases whitepaper on Net radio listening trends presented at RAIN Summit

Thursday, May 10, 2012 - 12:00pm

Digital audio ad network TargetSpot has officially released the results of its latest annual Digital Audio Benchmark and Trend study.

TargetSpot CEO Eyal Goldwerger presented some of the top data points of the study at our recent RAIN Summit West conference in Las Vegas. For some of the study's most interesting findings, see our coverage here. Additionally, you can watch video of Goldwerger's presentation, as well as every other presentation, speech, interview, and panel from RAIN Summit West at RTTNews here.

Parks Associates conducted the study for TargetSpot, and surveyed one-thousand Internet radio listeners in the U.S. in January of this year. A free, detailed synopsis of the research is available from TargetSpot here.

In RAIN Summit West, ESPN SVP Keller shares philosophy for success (and details on that new app!)

Friday, May 4, 2012 - 11:00am

ESPN Radio is scheduled to update its industry-leading mobile app on May 15th, and keynote speaker Traug Keller shared details on some of the new features with RAIN Summit West attendees.

First, though, we were thrilled and honored to welcome Keller, ESPN SVP/Production & Business Divisions, to our recent Las Vegas event (more info here).

[We're very happy to announce that on Monday, we'll offer video of each RAIN Summit segment! Be sure to see Monday's RAIN.]

In his address, Keller described the transformation of ESPN Radio's content culture as an "evolution from 'radio' to 'audio,' and emphasized the word "wherever" (from the company's mission statement: "To serve sports fans, wherever sports are watched, listened to, discussed, debated, read about, or played") as the key to ESPN Radio's innovation. In other words, getting the content sports fans care about on to any available platform is paramount.

He vehemently stressed that the idea of spreading content to the web, mobile, and satellite might cannabalize more traditional outlets as "a myth!" He equally strenuously drove home the importance of relentless promotion of the content you offer: "You have to tell people, in this very complicated digital world with a multitude of options and choices, where to find your content," Keller advised. Equally important to success, according to Keller, is attracting quality people to your team. "Man do we need to attract good people. It doesn't happen without it."

While some in the industry have written seem to have written off podcasting as an early dead-end, Keller seemed enthusiastic. In fact, he called podcasts "a whole new business." ESPNRadio, according to Keller, is now producing 80 podcasts every month, which get downloaded 50 million times. When ESPN columnist and podcast Bill Simmons publishes a new podcast, it's downloaded 1.8 million times within the first 24 hours, Keller claimed.

So, about that app update! Keller says the ESPN Radio mobile app, at its May 15th update (for iOS and Android, Windows will be later), users will be able to create their own stations (in much the same way users of ESPN partner Slacker can now), focusing on news from their favorites sports, teams, and players. Very exciting will be the "rewind live" feature, which will allow users to access a show or a game from its beginning -- even if the user tuned in after it had already begun. The app will have expanded "social" capabilities to enable users to share content (Keller called radio "the original social fuel, especially when you're talking about sports"). Finally, the app itself will know the teams and players you like, and customize access to content to fit your preferences. (By the way, you may want to see that SiriusXM's new Android app has some of these same features -- see our coverage here.)

Look for full videos of each RAIN Summit West segment soon.

TargetSpot CEO at RAIN Summit: 42% of U.S. population listens to web radio

Wednesday, April 25, 2012 - 12:05pm

Eyal Goldwerger at RAIN Summit West 2012Listening to Internet radio is "no longer a trend, it's a behavior," said TargetSpot CEO Eyal Goldwerger at RAIN Summit West 2012. That behavior spans a range of devices, listening locations, and listening sources.

Goldwerger presented a preview of TargetSpot’s Digital Audio trending study, set for release in early May, at RAIN's conference in Las Vegas earlier this month.

He revealed that 42% of the U.S. population listens to Internet radio, a growth of 8% over last year. Listeners said they enjoy web radio because it plays "music I want to hear," offers fewer commercials, "better music selection" and "more control," Goldwerger explained.

Listeners are tuning in to Internet radio on an increasingly wide variety of devices, and in different locations. Goldwerger revealed that 44% of listeners say they primarily listen on a tablet, 44% on a computer and 38% on a smartphone. 77% listen on home computers, while 53% listen on work computer.

Interestingly, a large number of web radio listeners change channels and services throughout the day. Around 3 in 4 listeners change stations within the same service at least once a day, while 64% change services at least once daily (like switching from Pandora to Slacker).

Internet radio's audience is "valuable and desirable," said Goldwerger. TargetSpot found that 42% of listeners have kids, 22% live in households with $100,000+ incomes and 64% own their own home. And 67% of listeners "often look at the player" to see currently playing artist information.  Around 80% of listeners tune in for 1-3 hours per day, while 40% listen to 1-2 hours per listening session. 

TargetSpotGoldwerger said that 65% of web radio listeners spend at least the same amount of time listening to AM/FM radio as the did before. But among 18-24 year-olds, 47% are spending less time with AM/FM radio. "If that’s a predictor of how that demo is going to behave as they get older, that’s something to watch," commented Tom Taylor of Radio-Info. Additionally, 57% of web radio music listeners said they prefer listening to Internet radio (compared to 26% who prefer AM/FM radio).

"Digital audio is firmly established," concluded Goldwerger. "Listeners remain highly engaged" and new devices are driving "increased listening."

More coverage of Goldwerger's presentation can be found in Audio4Cast here and Radio-Info here.

Top sales vets see geo-targeting, local campaigns as keys to better monetizing growing audience

Tuesday, April 24, 2012 - 12:20pm

SNL Kagan senior analyst Robin Flynn moderated the day's second panel at our recent RAIN Summit West event in Las Vegas. Flynn reported on the discussion, called "Charting Digital Audio Ad Dollars," as well as other content from the Summit, in the SNL Kagan blog "Economics of Internet Media."

While online radio usage is growing across the board, operators are faced with the challenge of better monetizing that listening, especially on mobile devices (where the ad market is less mature).

"Currently, Internet radio CPMs are in the range of $3 to $6 for nontargeted ads and higher for geo-targeted ads," said panelist Alexis van de Wyer, who's president of AdsWizz. Pandora SVP/ad sales Steven Kritzman said ads that include a video element fetch $20 CPMs. (Kritzman also mentioned that Pandora enjoys an 80% renewal rate among ad clients.) Katz360 President Brian Benedik told the panel geo-targeted advertising can boost Internet radio CPMs to the $6 to $12 range and higher.

In fact, the prevailing sense was that Internet radio's growing power at reaching truly local audiences (see Pandora) is what will truly be the game-changer in monetizing listening.

"Local CPMs at $8 to $10 are tastier than the $3 to $5 network CPMs for online platforms," Pandora's Kritzman said. Jon Mitchell, Spotify's vice president for U.S. ad sales, also on the panel, said advertisers can purchase local campaigns for as little as $500 to $1,000.

Read Flynn's entire article here. There's more on our recent RAIN Summit here; and look for more coverage (including video) of the event soon. Jennifer Lane has additional coverage in Audio4Cast here.

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