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AG News: Wednesday - 11/18/2009

The Radio Wind Blows Towards Internet

Put aside the apathy that the broadcast radio industry showed for a decade. Forget about the royalty rates that have continually been the sword of Damocles hanging over internet radio's head. Stop with the worries that player incompatibility and buffering problems might prevent the masses from moving to online radio.

Many people predicted that internet radio would impact the radio industry. Many people in broadcast radio ignored those calls. It's been a long time coming, but now the whole radio industry is finally buzzing with forecasts that "online" is the promised land. The new topic is streaming and what you can do with the internet.

The details of how to make things happen online are still rarely found in radio publications. What is discussed are people being hired to fill positions like "director of interactive sales" and "director of digital operations." We also have the latest buzz being covered; the movement to mobile platforms, with stations having special Apps for iPhone and Blackberry. Why all the ruckus now? Maybe this will help explain.

The graphs below show response to a question originally asked in 2005, then again in the last few months: "By this time next year, what do you see yourself listening to most?"

To set the stage with stats, the above 2009 chart comes from an Audio Graphics/Borrell Associates survey of 1,293 internet radio listeners. The 2005 numbers come from 2,038 internet radio listeners. (This AG-created online survey system was started in 2001. It's the longest running survey of its kind.)

Not important for this discussion is the stability in percentages from the combined female/male respondents who chose Broadcast Radio and Cable Music Channels both times. Easily explained is the 4.4% drop in people who thought the MP3 player was going to be the future; same phrase applies to Satellite Radio's 1.2% drop. The honeymoon is over.

This is where things get interesting, and bring us around to claim internet radio is moving into its own. As a percentage of all respondents, 6.3% more people in 2009 - than in 2005 - see internet radio as what they will listen to "most" next year. Since this is a survey of current internet radio listeners, the inference is respondents are finding satisfaction with radio online.

Shifting to gender predictions, take a look at the percentage of females who said back in 2005 that they would be listening "most" to broadcast radio in one year - 22.6%. That is a very healthy number, but one which has dwindled to 12.8% this year.

The percentage increase of females expecting to be listening to internet radio next year is 14.2%. The increase for males is 4.8%. Numbers like these show that internet radio is moving into its own. As we get deeper into mobile platforms, expect these percentages to grow. Wait until the public finds out how easy it is to get internet radio in the car.

Think about what's described above as winds blowing the audience towards a new form of audio entertainment. We're only in the buildup stage where people are starting to notice the change. Just wait until this storm gains full force.

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Ken Dardis
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