revenues

Radio's digital revenues up 10% in first quarter, says RAB

Monday, May 21, 2012 - 9:00am

RABRadio's digital revenues "surged" 10% in the first quarter of 2012 (compared to Q1 2011), according to the Radio Advertising Bureau's new report. That growth, along with increases in the network, off-air and "a stable spot sector," helped overall radio revenues grow 1% in the quarter.

"While advertisers continue to capitalize on radio's spot and network efficiencies," commented RAB President and CEO Erica Farber, "they're increasingly utilizing local digital capabilities and audience engagement that this medium affords."

You can find the RAB's full report here.

Salem web revenues up 37% in Q4, making up 14% of total earnings

Friday, March 9, 2012 - 11:30am

SalemInternet revenues represented 14% of Salem's total earnings in Q4, the broadcaster announced yesterday. Web revenues grew 37% year-over-year, reaching $8.1 million.

That includes local websites (up 20%), national Christian websites (up 45%) and political opinion sites ("strong double digit" growth). For the total fiscal year, Internet revenues increased 35.8%.

Broadcast revenues were up 2.8% in Q4, reaching $45.8 million. Total revenue increased 6.2% to $57.1 million. You can find Salem's full financial results here.

Ad revenue simply can't outpace the royalty cost of Pandora's listeners

Wednesday, March 7, 2012 - 12:15pm

PandoraPandora's usage and audience size grew ever larger in the financial fourth quarter (which ended January 31), according to stats released yesterday by the webcaster. Revenues showed strong growth as well, but it wasn't enough to offset growing royalties and other costs. The company posted a loss of over $8 million for the quarter, missed analyst expectations and traders have so far reacted negatively.

Pandora reported Total Listener Hours for Q4 stood at 2.7 billion, up 99% from last year. “On a typical weekday, we now stream half a billion songs,” said CEO Joe Kennedy. He also stated that Pandora now represents 5.55% of total radio listening -- more than double what it was last year.

The number of users actively listening to Pandora increased to 49 million in February, up 57.5% from last year. Around 70% of Pandora's listening now takes place on a mobile device.

Kennedy said Pandora will release updated “key audience metrics” each month, starting for February. Pandora's February stats include reaching 49 million active users, 975 million total listener hours and a 5.74% share of total U.S. radio listening (more here).

Kennedy pullquote"Pandora continues to rapidly disrupt the radio industry and has only just begun to realize the potential of our $37 billion U.S. market opportunity," said Kennedy.

On the financial side, Pandora generated $81.3 million in revenues during Q4 -- a growth of 71% from last year. Ad revenue growth outpaced subscriptions, growing 74% to $72.1 million (compared to 51% and $9.2 million for subs).

However, costs outpaced revenue during the quarter. Content acquisition costs (which includes royalty payments) reportedly reached $48.2 million in Q4, up from $23.9 million last year (an increase of around 100%). Those costs represented around 59% of total revenue in Q4, up from 50% last year.

Overall, Pandora posted a loss of $8.2 million in Q4.

The stock market's reaction to Pandora's Q4 results so far has been negative. Pandora's current stock price as of publication ($10.95) is down around 20% from Tuesday's closing price of $14.27 per share, which was in turn down 3%.

Monetizing mobile listening continues to be a challenge: Pandora said its revenue per 1,000 listener hours on desktops is $60 to $70, while only $20 for mobile devices. That said, the company reported generated $100 million in mobile ad revenue throughout the fiscal year. That means Pandora saw "more mobile ad revenue last year than any entity other than Google."

Joe Kennedy, CEO of Pandora

For the fiscal year 2012, total revenue was $274.3 million, a 99% year-over-year increase. Said Kennedy (pictured right): "We have barely scratched the surface of our market opportunities” for monetization. “We will [soon] be larger than the largest AM or FM station in most markets... our relevance to buyers of traditional radio advertising is skyrocketing." 

Kennedy also said Pandora is staffing local radio ad sales teams in most top 10 U.S. markets. Plus, the company is reportedly working with Triton Digital to create metrics that appear "in the same format advertisers are accustomed to seeing."

You can find Pandora's press release about Q4 results here. You can also find more coverage in the Wall Street Journal here, TechCrunch here, Radio-Info here, Audio4Cast here and Billboard here.

Mobile ad spending to grow 80% in 2012; grew 82% for music, video, game services in 2011

Thursday, January 26, 2012 - 8:00am

eMarketer's predictions for mobile ad spending over the next few yearsThe U.S. mobile advertising market is "growing far faster than expected," according to new predictions from eMarketer. Users may be happy to accept these ads as well...so long as the mobile app or service is free.

eMarketer now predicts that mobile ad spending will grow 80% in 2012, reaching $2.61 billion. That's an upgrade from their earlier prediction of $1.8 billion. It predicts display advertising will grow 93.5% and video ads will increase 122%. "By 2015," eMarketer writes, "ad-supported mobile content revenues in the U.S. will surpass $1 billion, with growth rates slower but still strongly in the double digits."

Looking specifically at ad-supported mobile music, games and video services, eMarketer predicts ad revenues will grow 52.7% in 2012 (reaching $433.8 million) after growing 81.9% in 2011. By 2015, eMarketer estimates around 30% of mobile music, video and gaming revenues will come from ads. 

Borrell Associates recently predicted that mobile audio ad spending would reach $667 million by 2016 (RAIN coverage here).

Moreover, mobile users seem to approve. Nielsen's State of the Media report for 2011 found that 51% of mobile users are happy to accept mobile ads, as long as the app is free. The report also found that 45% of tablet and smartphone users downloaded a music app in a 30-day period. And 27% of users paid for a music app.

Mobile devicesThis all may be great news for Internet radio. Monetization of mobile listening is reportedly less than that of desktop listeners for some webcasters -- even as mobile becomes the dominant way to tune in to web radio.

For example, in October 2011 a Morgan Stanley analyst claimed that Pandora's desktop listeners generate nine times the revenue of the service's mobile users (RAIN coverage here).

You can find eMarketer's predictions here and here. Ars Technica has more coverage on the Nielsen report here.

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