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NY Times: Will The Internet Kill Traditional Radio?

I love it! Writers who live and work in NYC seldom seem to get out west of the Hudson River. And it shows.

This writer wrote "The attraction is that rather than being shackled to the same old hits from local radio stations, listeners can customize the music channel to suit their tastes."

Which seems to mean that, over terrestrial radio you would be listening to the "same old hits" but on your customized music channel those wouldn't be the "same old hits" - even though they would still be your "same old" favorites. Since people seem to choose music radio stations based upon their playlists it follows the same would exist in the brave new world of music over iPhone.

I see no difference.....well, except that it will cost substantially more to listen via your phone and perhaps there will be no commercials....at first......and then there is the in-dash equipment to buy. All this so you can listen to a playlist that may or may not be as tight as the one you downloaded to your mp3 player?

The Internet and mobile phone may indeed eventually replace terrestrial music radio but it appears to be a long way from doing so at this time. And radio still has the opportunity and time to fight back. But will they?
 
landtuna said:
The Internet and mobile phone may indeed eventually replace terrestrial music radio but it appears to be a long way from doing so at this time. And radio still has the opportunity and time to fight back. But will they?
Click to expand...

I share your concept. It is interesting to read the rants of Jerry del Colliano as he screams at broadcasters to prepare alternate concepts to find something that is going to be viable in the future.

Holland Cooke comes at it from a totally different direction but I read into many of his comments a similar encouragement to broadcasters to think a bit more creatively about what their future may include.

I conclude there are a number of "small operators" in the business who are keeping their eyes open and doing some experimenting. They are probably not interested to being too public with their thinking lest someone else use their own creativeness against them before it is ripe.

We focus in these discussion on the negatives a lot. That includes me too often. But I, too, quietly spend some time and energy playing "What if?"

Unfortunately I currently only have Monopoly play money invested. ;D
 
landtuna said:
I see no difference.....well, except that it will cost substantially more to listen via your phone and perhaps there will be no commercials....at first......and then there is the in-dash equipment to buy. All this so you can listen to a playlist that may or may not be as tight as the one you downloaded to your mp3 player?
Click to expand...

If cost is the issue, simply do what I do. I record hours of Internet radio in the mp3 format on my computer, then transfer the files to an iPod or disc. My car player has an "aux" input for an iPod, and it also plays mp3 format discs.
 
It's all about the playlist and the mindset of the listener if a:
  • person desires to "discover" new music of any selected genres, a Pandora-like "station" could be the first choice.
  • person wants a "comfortable, familiar" music sound of any particular tempo and genre types.
The playlist is king when composed of an appealing tempo, mix of familiar/unfamiliar, and whether its thrust is new artists.
In addition, some new way must also consider real listeners' need for a real, human "friend" on the air.

Now, how can over the air boadcasters use these options to re-invent their services to the community?
 
Personally, I agree that streaming radio is a bigger threat to Sirius/XM than it is traditional terrestial radio. Better sound quality, more choices, and more portability.
 
landtuna said:
And radio still has the opportunity and time to fight back. But will they?
Click to expand...

Once again, "radio" isn't some monolyth that acts as one unified industry. Difefernt stations and companies are reacting and responding in individual ways. Some are embracing digital and mobile, some are not, and some are making adjustments to on air.
 
As I said in another post, I agree with the Motley Fool article. I think that once the dust settles, everyone will see the various advantages and disadvantages, and digital will simply be another choice that people make, rather than actually causing the death of traditional radio.

Because as we've seen, greed comes in many forms, and nothing stays the same. Right now, costs for internet usage are low. But at some point, the ISPs will find ways to come up with new charges, especially on bandwidth, and the use of internet for audio and video will be much more expensive than broadcast. Especially since all the broadcast infrastructure is already built and simple to use. Cost will trump choice, as people realize they don't make use of all the choices they have. That's starting to affect cable decisions. I myself made an adjustment to my plan based on an assessment of what I watch.

At the same time, although the value of music from a consumer point of view is zero, the music industry seems hell bent on increasing royalty costs to broadcasters. The fact is that if consumers don't want to pay record labels to buy their music, what makes anyone think they'll pay broadcasters to hear it? Regardless of the cost. Consumers want free music. Forcing internet broadcasters to pay increasing royalties that the broadcasters can't recoup just puts a squeeze on the internet broadcasters, and will cause consumers to go back to OTA radio.
 
TheBigA said:
Forcing internet broadcasters to pay increasing royalties that the broadcasters can't recoup just puts a squeeze on the internet broadcasters, and will cause consumers to go back to OTA radio.
Click to expand...

Doesn't the music industry want OTA radio to pay royalties as well? If that happens, Internet radio and OTA radio would be on an even playing field. I do think that we will see commercials on internet radio eventually. Certainly not to the extent of OTA radio. But Internet wouldn't need as many because their operating costs are lower. And the Internet listener might not mind a few commercials. At least they wouldn't be programmed in blocks together with news, weather and traffic.
 
TheFonz said:
Doesn't the music industry want OTA radio to pay royalties as well? If that happens, Internet radio and OTA radio would be on an even playing field.
Click to expand...

No because OTA can't charge subscription fees for music. Internet radio, like cable TV, has two sources of revenue. OTA only has one.

Internet radio stations like Pandora have commercials. They are brief now. But if they sell to investment bankers, you'll see their spotload increase. There was a time when FM had only a few commercials an hour. That changed after it became popular. Once something becomes a success, the drive to monetize follows. Look at MySpace.

I expect the costs for operating an internet radio station will increase once the feds find a way to regulate it. The legal costs alone will cause operating costs to triple.
 
TheFonz said:
I don't understand the second source. Are you saying that my ISP has to pay the Internet stations that I listen to?
Click to expand...

Commercial advertising plus stations can charge listeners subscription fees. Pandora does both. OTA radio can't require a subscription fee.
 
TheBigA said:
Commercial advertising plus stations can charge listeners subscription fees. Pandora does both. OTA radio can't require a subscription fee.
Click to expand...

OTA radio can't charge a fee for legal reasons, or as a practical matter?
 
Goat Rodeo Cowboy said:
OTA radio can't charge a fee for legal reasons, or as a practical matter?
Click to expand...

OTA radio can't put its signal behind a pay wall. '

For example, non-commercial radio can ask for donations, but can't require membership in order to receive the signal.
 
TheBigA said:
For example, non-commercial radio can ask for donations, but can't require membership in order to receive the signal.
Click to expand...

Then an Internet station that doesn't require membership shouldn't have to pay royalties, right?
 
Wrong. An internet station has to pay royalties, period. In the days just before cable penetration got big, there were OTA stations that were subscription part of the day. See ON-TV. Is there technology to "scramble" a radio signal?
 
TheFonz said:
Then an Internet station that doesn't require membership shouldn't have to pay royalties, right?
Click to expand...

I know people who took that argument to SoundExchange, and when they returned from negotiations, they had added subscription fees.
 
Goat Rodeo Cowboy said:
TheBigA said:
Commercial advertising plus stations can charge listeners subscription fees. Pandora does both. OTA radio can't require a subscription fee.
Click to expand...

OTA radio can't charge a fee for legal reasons, or as a practical matter?
Click to expand...

I asked the question poorly. I know that an OTA station cannot charge people who listen via the transmitter.

My question was about ON-LINE listening. Assume I am running some very unique programming. My community can tune it in. But then I stream it but THE STREAM is only available to people who pay a subscription to hear the stream. It would be somewhat parallel to what WGN and WTBS did years ago: TV avaailable to local viewers as normal. Available to others around the country who pay for cable service which includes the "super stations".

I don't know if the Super Stations were able to collect a fee, a royalty from the cable systems or not. (either as a practical business issue or legally.)

We all share these super-intelligent explanations of what we are sure listeners WANT to hear. So if I am running a little 1kw AM teapot in some Appalachian community that is a community where people love to retire, and some personality from the Golden Age of Disk Jockey radio settles nearby and I put him on the air locally, could he and the station come up with a scheme where Internet listeners could listen for a fee?

Obviously we could NOT broadcast it and just run it as an online service like Pandora and others. But maybe both the jock and the listeners would find it a uniquely different experience if they both knew it actually being broadcast, and the jock talked about, and with, real people in the community.

I'm not asking for a discussion as to whether the concept would be financially viable. Would it be LEGAL with the FCC is the question.
 
gr8oldies said:
Wrong. An internet station has to pay royalties, period. In the days just before cable penetration got big, there were OTA stations that were subscription part of the day. See ON-TV. Is there technology to "scramble" a radio signal?
Click to expand...

O.K. Now I'm not feeling so bad about commercial (OTA) radio having to pay royalties. In fact I'm going to write my congressman right now and tell him to go for it!
 
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