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Traditional summer slowdown hampers audience growth, but not as much as past years

Wednesday, September 5, 2012 - 11:00am

Metrics rankingsAs in years past, the "summer doldrums" took their toll on webcasters' audiences in July. Minus one exception, all the webcasters and broadcasters tracked in Triton Digital's Top 20 Webcast Metrics for July 2012 were flat or down month-to-month. 

The Internet radio industry typically sees audience numbers flat-line or drop slightly in the summer months. Listeners spend relatively less time in the office -- where, at least in the past, a majority of Internet radio usage took place -- due to holidays (like the Fourth of July), vacations, and other activities (like the Summer Olympics which began on July 27 and, this reporter seems to think, were a huge drain on productivity). We refer to this traditional decline as "summer doldrums." 

All told, the combined AAS (Average Active Sessions, essentially equivalent to AQH) of the Top 20 webcasters declined a little over 1% month-to-month. That's actually an improvement over 2011, when webcasters' combined AAS dropped nearly 7% from June to July 2011. Could this be in part due to Internet radio's growing mobile and out-of-office listening

Top-ranked Pandora was roughly flat month-to-month in July, according to Triton's Domestic Mon-Sun 6a-12m daypart ranker. The webcaster stands at an AAS of 1,214,119 -- up 151% year-over-year.

The #2-ranked Clear Channel, backed by its iHeartRadio platform, declined 4% month-to-month to reach an AAS of 174,333. Clear Channel's AAS has grown 140% year-over-year.

The race for the #3 spot became more heated in July: CBS Radio, currently holding the #3 spot, declined 12% month-to-month. Slacker (at #4) dropped 6% month-to-month but is now within nearly 300 AAS of overtaking CBS Radio. Slacker has grown 60% year-over-year while CBS Radio has dropped 45%. The change is in part due to AOL Radio's migration from CBS to Slacker.

The one exception to all this declining and flat-lining is NPR Member Services, ranked at #11. Its AAS, as measured by Triton, increased 37% month-to-month. June was the first month NPR Member Services appeared in the Top 20 ranker.

ESPN Radio saw the largest month-to-month decline with a 14% drop (though Radio One and Hubbard weren't far behind with 13% declines). Most others saw month-to-month drops of 3-9%.

(The chart above shows the growth of Pandora, CBS, Clear Channel, the top 5 terrestrial radio groups and Slacker from September 2009 through July 2012. Note that Pandora's AAS numbers from December 2010 through mid-August 2011 were affected by the omission of tracking code in some of its mobile apps. Click to view in full size.)

You can find the Domestic Mon-Sun 6a-12m ranking below. Find out more from Triton Digital’s Webcast Metrics report here (PDF) and find our coverage of June 2012’s ratings here.

July Webcast Metrics

Earlier polls confirmed: More than half of U.S. mobile subscribers use a smartphone

Tuesday, August 14, 2012 - 2:15pm

SmartphonesA new report based on data from U.S. mobile carriers shows that more mobile subscribers in the U.S. own a smartphone than regular non-smart "feature" mobile phones. The new study, from Chetan Sharma Consulting, found that smartphone penetration surpassed 50% in Q2.

Earlier this year a Nielsen study came to this conclusion (RAIN coverage here), but as GigaOM explains, "while Nielsen’s number are based on polling data, Sharma’s come from the operators’ quarterly reports."

GigaOM has more coverage here.

Music listening the fastest-growing mobile usage category, comScore finds

Friday, August 3, 2012 - 1:10pm

Mobile musicNew quarterly figures from comScore show 27.6% of mobile subscribers listen to music on their mobile devices. That's up 2.3% from March to June, making it the fastest-growing usage category tracked by comScore.

That said, it's still the least popular activity, coming in behind items like downloading apps (51.4%), playing games (33.4%) and texting (75%).

ComScore also found that the mobile market is more or less divided between Apple and Google. Overall, 47% of the U.S. population now owns a smartphone and 234 million Americans use mobile devices.

TechCrunch has more coverage here.

RTDNA survey: Majority of stations unsure if website profitable or not

Thursday, August 2, 2012 - 11:35am

Profitability over time chartThough nearly all news radio stations now offer a website, just over half do not offer streaming audio, fewer than one in four stations have a mobile app and a majority of NDs/GMs don't know if the website is profitable or not. Those are just some of the findings from the Radio Television Digital News Association's 2012 TV and Radio News Staffing and Profitability Survey.

The survey found that overall, more than 96% of news radio stations have a website. About 80% of the websites offer local news, down 3% from last year (and compared to 100% of TV station websites that offer local news). Just under 50% feature streaming audio, 61% audio, 15.3% "live newscasts," 32.1% "recorded newscasts" and 26.7% podcasts (the survey does not go into detail about what the differences are between some of these categories). The most popular website offerings are text (86%) and pictures (64%). Interestingly, 28.2% offer news video.

Stations said that about 25% of their web content is "web-only." 6.5% of content is user-generated.

As for mobile, the fastest-growing segment for Internet radio in general, only 24.1% of stations offer a mobile app. And 10.7% of stations say they offer mobile-releated content on their websites.

RTDNA's survey also found that the average number of radio employees working on the website was 1.8 (that's 0.8 full-time and 1.0 part-time). Both figures are down from last year. But 67.8% of stations said other staffers help out on the website. About one in five news directors said they were in charge overall of the website, 55% said they were in charge of news content only and just under 17% said they had no management role.

RTDNAAbout 60% of station GMs/NDs weren't sure if the website was profitable or not. Aproximately 13% said the site was profitable, another 13% said it was breaking even and around 15% said it was operating at a loss. "Radio profitability numbers are all about 3% worse than a year ago," writes the RTDNA.

As for how many people are visiting radio station websites, "radio web traffic numbers are still reported by too few news directors to be viewed as reliable." The RTDNA was able to put together overall radio website traffic figures though: 917,500 pageviews and 151,900 unique visitors over the past 30 days. Page views have doubled, but unique visitors are down 25% from last year.

You can find the RTDNA's results here (PDF). This is the fourth part of the RTDNA's 2012 TV and Radio News Staffing and Profitability Survey and was conducted by Bob Papper.

Coady Diemar says royalty, scalability issues hamper AM/FM growth online

Wednesday, August 1, 2012 - 12:30pm

Investment banking group Coady Diemar Partners released a report today in which they suggest the prohibitive cost of streaming sound recording royalties, coupled with programming that doesn't translate well to the Internet, has led to radio's passive approach to pursuing an online audience.

A quick glance at Triton Webcast Metrics ratings (see a graph here) shows little positive growth for most terrestrial radio's online listening. The Coady Diemar report shows only 8 of 14 terrestrial broadcast companies posting online listening gains from May 2011-May 2012. The investment bankers suggest it's broadcasters' content (simulcasts with "8-12 minutes of commercial time" and lack of customization features) and "lack of scale" (it's not likely for most local radio stations to build Internet-sized audiences) that keep audience growth, and thus profitability, down.

Internet radio listening trends

Pandora, however, has used its advantages as a web-only service (customization features and the ability to build a national brand) for "phenomenal growth in reach and time-spent listening... According to Triton Webcast Metrics, Pandora’s listening in June 2012 accounted for approximately 5.98% of all radio listening, up from 3.37% of listening in June 2011... In fact, since September 2010 in any given month Pandora has captured between 78%-95% of the incremental internet listening."

So Pandora's created a huge online audience, but they face the same royalty hurdle as broadcasters. Despite an explosion of usage, Pandora's royalty obligation prevents them from being profitable. "We believe this lack of profitability is a major reason why terrestrial radio operators have not been more aggressive in marketing and promoting their online streams," reads the report.

"Venture capital firms continued to invest in Internet radio or digital music opportunities in the last year," writes Coady Diemar director Chris Ensley, despite a "lack of profitability" for companies like Pandora due in part to high royalty rates. But "most terrestrial radio companies, many of whom have public shareholders, were not in a position to incur" the type of losses associated with getting started in web radio. In Pandora's case, that totalled "$82 million in operating losses over the last six years."

AM/FM online listening flatlining or dropping for most

Those who've followed the Internet radio space since its inception will remember the industry's bewilderment at potential royalty bills amounting to many multiples of what any service was making at the time. How could something so one-sided in favor of the recording industry as the Digital Millennium Copyright Act -- which (largely) birthed the obligation for webcasters to pay for sound recording copyrights, at rates determined by the CARP (Copyright Arbitration Royalty Panel, now replaced by the CRB) -- have been passed? In 1998 there was no Internet radio industry to speak of to fight it. Had the NAB been "asleep at the wheel?"

The legend grew that broadcasters at the time weren't too worried about high online royalties. They served as a barrier to new media competition. And what did online streaming -- where audiences, and thus ad revenue, were miniscule -- have to do with end-of-the-quarter goals anyway? Radio certainly was in no position to spend $82 million and six years to find out.

As it turned out, of course, high royalties did not prevent the rise of Pandora and Slacker, nor has it prevented terrestrial radio's (still moderate) listening declines. It's also true now that broadcasters like Clear Channel recognize the importance of the Internet and see radio's gradual shift from "local over-the-air" to a market of audio content producers operating on all platforms.

In fact, Clear Channel and its iHeartRadio web and mobile platform are growing well. Ensley credits the company for being "aggressive in promoting iHeartRadio." Clear Channel has also sought clever ways of reducing the costs of streaming, like its new agreement with Big Machine (RAIN coverage here).

Coady Diemar Partners

"By combining its promotional prowess with a more satisfactory online royalty rate, Clear Channel should be able to reduce operating losses while increasing the speed at which iHeartRadio reaches profitability."

Indeed, Clear Channel and iHeartRadio may then be AM/FM's best hope, Ensley writes, especially when it comes to future car dashboards. "No radio station group on its own is likely to be able to compete with Pandora when it comes to being in dashboard on future car models." But by joining services like iHeartRadio or TuneIn, "radio companies can ensure they have a compelling service to compete with newer in-car/in-dashboard services such as XM Satellite and Pandora."

You can find the report from Coady Diemar Partners here.

Jacobs Media survey: "High-tech revolution continues" for public radio audience

Monday, July 30, 2012 - 12:55pm

Media usage stats from PRTS4Jacobs Media's fourth annual survey of public radio listeners shows "the high-tech revolution continues," with big growth for mobile device ownership, the use of Internet radio, social networks and other digital services.

The fourth Public Radio Techsurvey (PRTS) found that nearly half (46%) of respondents listen to Internet radio weekly or more. That's up 16% from PRTS3, which was released in early 2011 (RAIN coverage here). Moreover, 18% use Pandora weekly or more (up 17% from PRTS3), while 14% use SiriusXM (up 5%). As for AM/FM, 87% say they listen to at least one hour per day. That's down 2% from PRTS3. 

More than half (52%) of public radio listeners said they own a smartphone -- a growth of 50% from PRTS3. Of those folks, more than 90% download apps. A little under a third of respondents (30%) own a tablet (up 407%). Of those who don't, 37% said they are very or somewhat likely to buy one this year.

Around half say they are able to connect a smartphone or mp3 player to their car and nearly 10% own a car with a "digital dashboard" like Ford's SYNC. That's a desirable platform for web radio -- and a dangerous one for AM/FM to lose -- as 41% of respondents say they do the majority of their radio listening in cars.

PRTS4Jacobs Media's study found "spectacular growth" in Twitter usage, with 18% of respondents using the service. That's up 57% from the previous study. A little over six in ten respondents (63%) have a Facebook profile. All told, 70% of respondents use social media in some way, up from 64% in 2010.

"The data from PRTS4 continues to point to the public radio audience rapidly using new media and gadgets in the pursuit of informing themselves," said Jacobs Media president Fred Jacobs. "Station programmers and managers would do well to better understand the fast rate of adoption, and shape content offerings accordingly."

The fourth-annual PRTS involved 49 public radio stations across the U.S. and more than 30,700 respondents. You can find more information from Jacobs Media here.

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