Net Radio Audience Ready for More
by Craig Johnston
Web Watch is a roundup of all things radio
and the Web. Send your news and tips to Internet Radio editor
Laura Dely via e-mail to LD@imaspub.com.
This Web Watcher is confused: Why does Internet
radio appear to be stalled, while broadband access continues to
grow and other online media metrics continue to report increased
online listening? How can this be?
Check this
For example, according to the latest Internet
radio study from Arbitron and Edison Media Research,
although broadband access has been less widespread than originally
projected, it continues to be a consumer catalyst for streaming
media.
According to the study, released at The NAB
Radio Show last month, 64 percent of those with broadband
connections are at least monthly Internet radio users as opposed
to just 43 percent of dial-up users.
"One (common) assumption about broadband
access is that it increases media experience. Another 13 percent
(of survey participants) plan to get broadband access in the next
year, in addition to the 18 percent that already have broadband.
That is a significant number," said Bill Rose, Arbitron’s
Webcast Services vice president and general manager.
Also, more than half of Americans online have
at least tried audio or video streaming media, according to the
Arbitron and Edison study. That 52 percent is up from 44 percent
from the first of the year and amounts to some 78 million people.
This number may be similar to trying but not
inhaling, as the study also shows only 12 percent of Internet
usxers say they have listened to Internet-only audio channels
and radio station Webcasts on a monthly basis.
And consider that the FCC, too, reports that
broadband access has seen healthy growth. Its figures show that
the number of high-speed connections grew 63 percent in the second
half of last year.
Of the 7.1 million high-speed lines, 5.2 million
were connections to homes and small businesses. About 4.3 million
of those lines provided service at speeds over 200 kbps in both
directions. The total number of DSL phone lines swelled to 2 million,
compared with the 3.6 million cable-modem connections. (DSL uses
traditional phone lines, while cable modems use cable-television
lines.)
And the total time spent listening at the end
of August had more than doubled since the first of the year, according
to MeasureCast Inc. This increase came in spite of the
fact the measurement occurred over a time when many workers are
traditionally on vacation.
So why is Internet radio stuck?
Two-thirds of listeners reported that they were
"very" or "somewhat" upset that radio stations
they listen to online stopped streaming, according to the new
Arbitron/Edison study.
Rose said there is a danger for terrestrial broadcasters
in silencing their streams.
"Stations are at risk of losing these listeners
to Net-only Webcasters who are available online despite legal
and regulatory challenges facing them," said Rose.
"Over half (55 percent) of all online listeners
say they have found other sources of Internet audio to listen
to in its place," he said.
Listeners on the rise
Rose said the study found that, for the first
time, Internet-only stations have equaled streaming radio stations
in number of listeners.
"It appears that the head start that radio
stations enjoyed in this arena has been lost," Rose said.
The Arbitron and Edison study found strong consumer
interest in subscription services to gain access to content that
is only available online.
"There is another model out there,"
Rose said. "There is a willingness to pay for unique and
compelling streamed content, as there continues to be for cable
pay channels and pay-per-view. Broadcasters should consider a
mix of ad-supported and subscription-based revenue," Rose
said.
Topping the list of kinds of content that Net-radio
users would pay for are concerts and performances by favorite
artists, followed by sports events. Rose pointed to the success
of this summer’s Major League Baseball subscription deal
with RealNetworks Inc., providing audio streams of MLB games for
a fee, as an example.
In September, some terrestrial broadcasters began
to stream again, including Clear Channel’s KIIS(FM) in
Los Angeles and New Wave Broadcasting’s KPIG(FM) in
Santa Cruz, Calif.
KIIS was the first Clear Channel station to go
back to Webcasting, but the company said it would soon follow
with many others. With a new partnership with the ad-insertion
company Hiwire, the media giant appears ready to comply
with AFTRA’s triple-rate online fees by using only
non-union, local talent and music beds in place of national inventory.
On the ratings front, 45 stations appeared in
both the July and August ratings from MeasureCast. Of those same
stations, 8.5 percent streamed more hours in August than in the
previous month.
But the comparable Internet-only stations streamed
1 percent fewer hours in August than they did in July,
while the comparable terrestrial stations streamed 30.5 percent
more hours in August than they did in July. (There are still many
more Internet-only stations in the top-50 ratings since the AFTRA
move in April.)
MEDIAmazing.com once again took the No.
1 spot in the MeasureCast ratings, which it has held for the past
six months. MEDIAmazing is a listener-formatted, Internet-only
Webcaster that allows its listeners to chose their formats.
In Arbitron’s latest Webcast ratings, for
March 2001, Launch.com’s Launch Media joined the pack
in the No. 7 position. NetRadio.com’s NetRadio remained
in first place, with more than four million aggregate tuning hours.
The company has maintained its leading position since Arbitron
began reporting network ratings in October of last year.
Live365.com held fast in the No. 2 spot
with more than 3.5 million ATH, a number that has doubled in the
four months since the December 2000 network ratings report. ABC
Radio Networks ranked No. 3 with more than 2.1 million ATH.
Arbitron defines Webcast networks as radio station
owners who stream their content online or companies that aggregate
online audio programming.
Total Internet traffic growth exceeds that in
previous years, according to a study done by Dr. Larry Roberts,
CTO at Caspian Networks. (Caspian designs and builds Internet
and network infrastructure equipment.)
With figures supplied by 19 U.S. Internet service
providers, he found Web traffic increased by a factor of 3.75
times this year.
Conclusions
Among his conclusions, he predicts that increased
demand will mean carriers will no longer be operating with a surplus
of ports. He said they will rapidly approach the point where their
networks will begin to show blocking of traffic unless more infrastructure
is built.
Roberts’ scenario reminds this Web Watcher
of what happened when AOL began to offer unlimited access
in early 1997. For months to follow, AOL dialups more often than
not resulted in a busy signal.
Audio advertising via Internet streaming increased
brand awareness in a study done by Lightningcast and Diameter,
the research division of DoubleClick Inc. The Web ads,
done for a major cellular carrier whose identity the companies
said is confidential, showed an ad awareness increase of 64 percent
and an ad tagline recall increase of 60 percent.
The study compared brand awareness of the cellular
carrier’s audio ad among a randomly sampled target group
of 560 Web users on Internet radio, where roughly half of the
study’s participants were exposed to a 6-second audio ad
while the rest formed the control group that did not.
"For some time, brand marketers have been
wondering when and if the Web would satisfy their requirements
as an advertising medium. This case study indicates that their
wait is over," said Karl Spangenberg, Lightningcast
president and CEO.
DiscJockey.com, a Webcaster that provided
live and on-demand channels on a range of topics and music genres,
has ceased operation and is in Chapter 7 bankruptcy in the United
States Bankruptcy Court for the District of Massachusetts, Boston
Division.
The company’s URL directs Web visitors to
Swiggart & Agin LLC, a law firm that handles bankruptcies
and insolvencies.
DiscJockey.com revised its business model last
September when it introduced a subscription-based, commercial-free
"Gold" service.
That was followed less than a month later by
a 50-percent staff reduction.
Domain names DiscJockey.com, Disc JockeyGold.com
and DiscJockeyPlus.com were put up for sale.
Mobile Internet radio lost an enabler when Metricom,
a wireless Internet access company, shut down their network in
August. This followed a Chapter 11 bankruptcy filing for the company
that offered wireless access of up to 128k in 15 cities in the
United States. Metricom stranded more than 40,000 users and left
a billion dollars in debt.
Live365, whose wireless MP3 player
system was capable of using either Metricom’s modem or
mobile phones, said the Metricom system was far and away the fastest
connection. According to Live365’s Alan Wallace, the
loss of Metricom represents a hiccup in their plans, but that
the company is still distributing Metricom’s software via
download on the Live365 Website.
Hope
He said the G 2.5 and G 3 cell phone services
offer additional promise for wireless Internet radio. (Live365
is also hopeful someone will revive Metricom.)
Live365 had big news at The NAB Radio Show: It
added IP-based Geo-targeting to its services. Advertisers and
broadcasters will be able to insert local ads into their global
streams that will target listeners wherever they are.
"We have always said that buyers should
look at advertising on Live365 as they would as local radio campaign,"
said Paul Adams, Live365’s vice president, advertising
sales. "Thanks to geo-targeting, we can not only deliver
advertising by market, but also provide the advertiser with the
reports that deliver real results."
SiteShell Corp., which offers services
that help radio stations keep their Web sites up to date, confirms
that it is in discussions with other companies regarding topics
ranging from outright acquisition to indirect support for a major
financing, which would keep the company independent.
The company has 165 live local radio station
Web sites and about 250 affiliated stations.
No.1 needs help
NetRadio may be the top Webcaster by Arbitron’s
count, but the company has signed on a new president and CEO:
turnaround specialist Cary L. Deacon.
Deacon succeeds Eric Paulson, who has
served as interim CEO. Paulson will remain as chairman.
Prior to joining NetRadio, Deacon served as president
and COO of SkyMall, the struggling in-flight and e-commerce
retailer he prepped for sale this summer to Gemstar-TV Guide
International.
He has a 26-year background in cable and retail
marketing.
To allow listeners access to NetRadio channels
away from a PC, the company also announced an agreement with OpenGlobe,
which specializes in bringing Internet radio to entertainment
devices other than personal computers.
Mobile
"Our agreement with OpenGlobe is a another
significant step towards extending the delivery of NetRadio’s
content beyond the reach of the PC by allowing listeners to access
it in their homes, while shopping in malls, retail stores, in
corporate private networks and eventually in the car and on portable
devices," said Steve Holderman, executive vice president
of marketing and sales, NetRadio.
Through this agreement with OpenGlobe, NetRadio’s
channels will be streamed on the Compaq iPAQ Music Center,
Kenwood Sovereign Entre and others yet to be announced.
(OpenGlobe announced a similar partnership with Radio Free
Virgin two months earlier.)
AccuWeather.com teamed with Yahoo!
to introduce "Shoot the Breeze," a weekly,
interactive talk show that focuses on different weather-related
topics. According to the companies, weather is the No. 1 topic
on the Internet.
The program will feature AccuWeather’s expert
meteorologists for live feedback during the show, which is Webcast
at 7 p.m. EST Thursdays from www.accuweather.com.
FM stations that are still shopping for tools
to begin streaming their signals may be interested in BRS Media’s
"My Radio.FM."
According to George T. Bundy, chairman
and CEO, the service provides a ".FM" Web address, Web
hosting that includes e-mail and a customized version of AllCast’s
streaming broadcast software called the "AllCast Broadcaster."
Bundy said the AllCast streaming software considerably
reduces bandwidth costs for broadcasters as it employs a "peer-to-multi-peer"
technique.
"With this method, users distribute the
content to each other rather than receiving it all from one central
place and so it reduces bandwidth requirement and with it the
cost of Webcasting," Bundy said.
The fee for the My Radio.FM starts at $19.95
per month, according to Bundy.
iBEAM, a streaming services provider,
received a $30 million investment from Williams Communications
in addition to $10 million from unnamed investors. Williams, a
broadband content distributor, will own 49 percent of the company.
Now iBEAM will have access to Williams’
growing fiber optic network.
Loudeye Technologies Inc., launched its
"Loudeye Radio" service at The NAB Radio Show.
The company, which holds licensing agreements with the five major
music labels as well as approximately 800 independent labels,
will now offer custom programming based on that authorized content,
"personalities" to host programs, geographically-targeted
ad insertion and verification, a national sales team, syndication
services and a customized radio player.
"Loudeye Radio represents what we believe
to be the next generation of Internet radio and signifies the
first time the industry has realized a complete Internet radio
solution from one company," said Joel McConaughy, Loudeye’s
chief technology officer.
Fingerprinting
The Radio Show launch followed Loudeye’s
announcement that it will provide song identification and metadata
for Napster’s upcoming file sharing service. Loudeye will
generate digital signatures, or fingerprints, for Napster’s
songs.
The service is necessary to allow Napster to
identify songs that must be filtered out, as ruled by a court
decision earlier this year. This requirement has been a continued
challenge for Napster.
It’s Loudeye’s music label-authorized
catalog that enables this deal. It seems that the company, which
has made several strategic Internet radio acquisitions in the
past five months, is making a play to own the Internet radio arena.
This is going to be hard to believe, but those
additional windows called pop-up screens that open while viewing
some Internet pages are annoying, according to psychologist Susan
Weinschenk, Ph.D.
"In our lab, we see users closing pop-up
screens as quickly as possible, even before the pop-ups finish
loading," said Weinschenk, who heads Weinschenk Consulting
Group.
"They’re definitely annoyed –
and annoyed people leave a site sooner and are less likely to
return. Furthermore, the pop-up screen distracts them from their
task, said Weinschenk. "They might have been trying to purchase
something."
She warns that people who feel pestered at a
Web site transfer their annoyance to the company that appears
responsible.
"Consequently, pop-up screens are not a
plus for your image," Weinschenk.
Craig Johnston is an Internet and multimedia
producer in Seattle and is a frequent contributor to RW.
Contact him via e-mail to Craig@CraigJohnston.com.
