Now that the CRB has established performance royalties for Internet Radio broadcasters, two Internet Radio companies, Last FM and Jango, are using Pay-for-Play mechanisms, in addition to online advertising as part of their business model to generate additional revenue and offset royalty costs.
In their attempt to act like terrestrial radio and deliver music for free, offsetting costs with online advertising, the new royalty rates make it difficult for most Internet Radio companies to continue operating under this ad based business model without either, charging listeners for access, or charging artists trying for recognition.
We already know that charging listeners is unsuccessful, meaning that Pay-for-Play may become a legitimate revenue resource. If in fact, this is true, and all Internet Radio Stations start charging Pay-for-Play fees, most artists will have to pick and choose which station they want to Pay-to-Play on, because it is unlikely that they can afford to pay for more than one or two locations. Meaning, less content, but possibly less noise inflicted upon us by non-pros.
How does Pay-for-Play fit into your business model?
In their attempt to act like terrestrial radio and deliver music for free, offsetting costs with online advertising, the new royalty rates make it difficult for most Internet Radio companies to continue operating under this ad based business model without either, charging listeners for access, or charging artists trying for recognition.
We already know that charging listeners is unsuccessful, meaning that Pay-for-Play may become a legitimate revenue resource. If in fact, this is true, and all Internet Radio Stations start charging Pay-for-Play fees, most artists will have to pick and choose which station they want to Pay-to-Play on, because it is unlikely that they can afford to pay for more than one or two locations. Meaning, less content, but possibly less noise inflicted upon us by non-pros.
How does Pay-for-Play fit into your business model?