revenue

Significant growth of digital performance royalties, music subscriptions, and download sales pushed U.S. record industry revenues into positive territory in 2011 for the first time since 2004, the RIAA reports.

SoundExchange distributed $292 million in digital performance royalties (the fees webcasters and satellite radio pay to play copyright recordings) to labels and performers last year, an increase of 17% over 2010.

Music subscription services (e.g. Spotify) paid the industry $241 million in 2011, 13% more than in 2010.

And digital downloads accounted for $2.6 billion, up 17% from the prior year. For the first time ever in a a single year, digital album sales topped 100 million digital albums. In fact, the 9.2% overall digital sales growth offset the decline in physical decrease of 7.7%.

"Overall, digital formats comprised slightly above 50% of total music shipments in the United States, as digital became more than half the market for the first time ever," the RIAA press release reads. "No longer just a niche, digital music has shown it can be a model - or perhaps more accurately a variety of models - for the music industry going forward." Read it here.

BIA/Kelsey says today that local radio 2011 online revenue was up more than 15%, to $439 million (for comparison, local television's online revenues grew even more). And they're predicting "a steady year of online growth" for local radio and television alike.

The data will appear in BIA/Kelsey's new Investing In Television and Investing In Radio publications. BIA/Kelsey credits local media's "assets" ("from valuable local content, to cross-promotional opportunities between on and off-air, and a trained sales staff that understands the local market and the advertiser community") which enable stations to "expand their position in their local markets from solely an over-the-air media source to a local media company that can provide access to local audiences in different, effective ways for their advertiser clients."

Read the company's press release here.

Radio's digital revenues for 2011 increased more than 15% over 2010, according to new data from the Radio Advertising Bureau (RAB).

That said, radio's digital revenues in 2011 ($709 million) accounted for just over 4% of total revenues. "While that number is growing, it’s not growing fast enough to replace ad dollars lost in the form of declining spot revenues," writes Jennifer Lane in Audio4Cast (here). Spot revenues reportedly dropped 1% from 2010.

Overall revenues for radio in 2011 increased about 0.6% from 2010. 

However, the industry's growth rate may actually be over 3 times higher if one includes revenue from Internet radio and satellite radio services!

If revenues from Pandora, other webcasters and SiriusXM were added to the totals from the RAB, the industry's revenue actually grew around 2% from 2010 (math below).

Moreover, including Internet radio revenue in the RAB's digital radio numbers would double the 15% annual growth to more than 30%.

Here's the math (all figures rounded): Radio's 2010 revenue, combined with Pandora (about $138 million), other webcasters (estimated at nearly $21 million) and SiriusXM ($2.82 billion) would be about $20.3 billion. In 2011, also including Pandora (projected to be $273-$277 million), SiriusXM ($3.01 billion) and webcasters (est. $41 million) would be about $20.7 billion.

Meanwhile, radio's 2010 digital revenue -- with web radio included -- would be around $773.4 million and 2011 digital revenue just over $1 billion.

You can find the RAB's data here. -- MS, KH

Pandora has been enjoying some attention from business and mainstream media lately. The webcaster took the opportunity of the International Consumer Electronic Show last week to show off not only their latest audience numbers, but their growing set of automotive- and consumer electronics-alliances.

A new survey shows the benefits to media companies of a "digital-only" salesforce. The new study, by Borrell Associates, compared media companies with digital-only sales people to companies with a combined, all-platforms sales staff.

Borrell found that those companies with an online-only sales staff generated 2.5 times as much gross online revenue per rep as other companies ($185,900 vs. $73,300). 

"It’s clear that having a staff dedicated to selling online advertising -- and combining it with the efforts of the legacy media sales force -- drives more digital revenues," the study ("Assessing Local Digital Sales Forces") states.

Borrell also found that just 11% of radio businesses employed dedicated online sales staff, compared to 55% of newspapers and 39% of TV companies.

"Too many radio stations are structured like a Border’s book store at a time when consumers are using Kindles," writes Paul Jacobs -- General Manager of Jacbos Media -- in reaction to  the study. "By utilizing traditional sellers, radio will be hard-pressed to morph effectively into viable digital media outlets that generate serious revenue." You can find Jacobs' full analysis at the jacoBLOG here.

Borrell's study also raises questions about how many digital-only sales reps are needed and whether it's better to split digital sales into a separate division. MediaPost has more coverage here.

BIA/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.