Key Lessons from Online Radio Abroad

Two things separate the way online radio works in the US from the way it tends to work internationally.

First, there’s far more cooperation between the interested parties abroad.

And when people work together on common goals, common incentives, common platforms, they are more likely to achieve results.

Broadcasters in the US need to recognize that the online radio marketplace is not an extension of the radio platform – it’s an all new platform.  And new platforms grow because they’re nursed with tender loving care by all those who stand to benefit from the new platform.  If it’s strictly “me against you,” then we will be fighting for crumbs.

Second, there’s a sense that more consumption of content is good – and not simply more expensive.

In the US many broadcasters deliberately throttle back consumption of online content and limit access to it. Why?  Because of difficulties monetizing the content and the onerous licensing fees.

Which brings us back to point one.

Watch as I discuss these very issues with Triton Digital’s EVP Marketing, Patrick Reynolds:

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  • Paul

    Good interview Mark. Glad to see that at least some in the industry are starting to think more clearly about ways to improve the listener experience and enhance the opportunities for revenue.

  • Richard Clifford

    Right you are, bucko! It's amazing that European broadcasters are trying to reach out to audiences worldwide, including in the USA. And it's a shame that people outside the USA cannot acess our programming from here in this country. The broadcasters here in America have to reach out and embrace the world instead of hiding in its own shell.

  • a Michigan broadcaster

    1) “Because they do it that way in Europe” is probably the WORST reason possible for doing something here; 2) Not only do I not want international listening, I don't want listening in Ohio (or anywhere else outside my local market area), and I certainly don't want to pay royalties to provide something that has zero value to me; 3) And, of course, resistance to streaming would go away if the RIAA royalties were to go away, DUH! By the way, I'm quite familiar with European radio broadcasting, especially in Italy. The mixture of government and private broadcasting, and the dominance of national and regional multi-transmitter “stations” make for an entirely different competitive situation when compared to our local-based system.

  • If you can monetize folks outside your market why wouldn't you want to reach them?

    Do you have any idea what fraction of your streaming usage comes from outside your market now? It is probably a lot more than you think.

  • a Michigan broadcaster

    That's a big “if.” I don't think listeners outside my market area are very interested in my local advertisers, and I'm sure the feeling is mutual.

  • In fact, that's the only “if” that counts. Listeners have profiles and can be identified and targeted (if you will) individually. This means that you can reach your audience – one at a time and at a premium – wherever they are with whatever interests them. And that is good for your clients.

    If you truly feel this is not your business, then there is no point whatsoever to streaming for your station. Everybody already gets you on the radios in their home, work, and car.

  • dpomic

    Glad to see your thoughts on Internet radio in the UK and EU, compared to the US. Unfortunately, reality is not nearly as clear and progressed as your impressions.

    First, much of Europe, led by the UK, (and publicly funded broadcasters in other countries) is still trying to force DAB—replacing FM and AM. Their efforts far exceed US HD commercial attempts. DAB efforts are primary, and Internet radio efforts are maintained way below. In the UK, DAB is reported as 15% (up from 12%), with Internet only 3% (up from 2%)–from the RAJARs ratings for the BBC and larger commercial subscribers. But, deducting for FM and Internet listening on DAB/FM/Internet multi-reception radios decreases the 15% to probably 8-11% DAB listening. And, separately reported on-demand, podcasts, and personal tracklisting total more than live listening, doubling their 3% Internet live to 6% Internet total listening. And, adding for the non-subscribing smaller commercial, community, student, hospital, pirate, and Internet-only—and all the rest-of-the-world—increases the Internet total listening to probably 8-12%. A more thoughtful comparison seems to result that both are probably now about 10% total listening, with Internet radio growing more quickly–particularly driven by mobile (where DAB has failed).

    Second, the BBC and radio industry maintain that Internet radio is severely limited by capacity and costs constraints for the foreseeable future. They have not yet recognized Internet radio as a growing complement to all terrestrial standards–FM, AM, DAB/DAB+/DMB/HD–adding location and time transfer. The BBC touts last summer’s 800,000 simultaneous World Cup video streams, without recognizing that it is capacity for more than 8 million audio streams now–and growing (including increased multicasting for the 2012 Olympics). And, content delivery networks with excess capacity, with high quality. low bandwidth AAC streams (driven by mobile), now allows distribution costs comparable with terrestrial (particularly considering relative capital investments).

    Third, standard UK music licensing excludes streaming to ex-UK. And, Internet-only licensing fees in the UK (and the EU) are even more onerous than in the US (also substantially more than can be afforded by any near-term operations–~10X distribution costs). The mandatory-license-fee funded BBC (Total Income £4.8 billion 2010) is wealthy enough, and with sufficient programming and interest, to negotiate global rights. Commercial radio licensed for only UK to avoid higher license fees, and hoping to keep ex-UK out and Internet-only down. (They negotiated 30 seconds from music tracks in podcasts.)

    Fourth, the UK Radioplayer development is driven by BBC funding and promised promotion—BBC self-promotion “advertising” and recommendation linking (with more listening than all commercial radio and http://www.bbc.co.uk a top website in the UK and globally). It is driven by the BBC Trust pushing the BBC Executive to share the wealth, some–“take tangible, measurable steps to partner, support and share some of its advantages to other media players”–in preparation for the next charter and license fee renewal negotiations. The UK Radioplayer will be great next steps to ease Internet radio access and play, promote Internet radio, and introduce an advertising platform. But, the intended February public introduction with perhaps 200 stations (after the early 2008 announcement of an all UK online radio player) will not satisfy many listeners; there should be increased desire for more expanded offerings. http://www.ukradioplayer.info/

    [The UK commercial radio trade association’s RadioCentrePlayer, (a version of Ressen Design’s Radeo Internet Player) introduced in 2007, continues to stream more than 800 stations in the UK—plus the rest of the world. http://www.radeo.net/cgi-bin/rc/radeorc.pl]

  • dpomic

    Please correct typo in my Comment below. In “(after the early 2008 announcement of an all UK online radio player)”, should be “2009”.

    Tim Davie, the BBC's head of audio and music, believes an online radio player open to all broadcast radio providers could be available within the year.]

  • GordonMarcy

    RE: then there is no point whatsoever to streaming for your station. Everybody already gets you on the radios in their home, work, and car.

    Do you still feel this way today?

  • I haven’t re-watched the video, Gordon, so I don’t know exactly what I said, but I didn’t feel that way then or now. The way I feel is clear: Streaming ONLY your station is great for people who prefer to listen on streaming-only gadgets, but that need is MUCH lower for those who live in-market than for those who live outside of the station’s market. This is why such a large fraction of streaming usage (up to 40%) comes from (surprise) outside the home market.
    The opportunity for established brands to fulfill MORE of a listener’s audio needs through additional streams in market makes much MORE sense. Assuming that this can be done without breaking the bank and with reasonable potential for monetization (thus, the hangup).