I’ll Fight For You, Internet Radio

I don’t like what I’m reading today about new fee structures for internet radio.
Orbitcast and Arts Technica warn of the format’s demise. While Kurt Hanson of Radio and Internet Newsletter (RAIN) breaks down the mathematical implications:

Because a typical Internet radio station plays about 16 songs an hour, that’s a royalty obligation in 2006 of about 1.28 cents per listener-hour.
In 2006, a well-run Internet radio station might have been able to sell two radio spots an hour at a $3 net CPM (cost-per-thousand), which would add up to .6 cents per listener-hour.
Even adding in ancillary revenues from occasional video gateway ads, banner ads on the website, and so forth, total revenues per listener-hour would only be in the 1.0 to 1.2 cents per listener-hour range.
That math suggests that the royalty rate decision — for the performance alone, not even including composers’ royalties! — is in the in the ballpark of 100% or more of total revenues.

Given that I listen to WNCW’s internet stream pretty much all day at work, anything that threatens them, threatens me. If you come here often, you already know I have an enormous appetite for media consumption. Now you know which type of media I cherish most.

About David Burn

I wrote my first ad for a political candidate when I was 17 years old. She won her race and I felt the seductive power of advertising for the first time. Today, I'm the founder and creative director at Bonehook in Portland, Oregon. We bring integrated marketing solutions to our clients in healthcare, human services, real estate, fashion, outdoor recreation, and food and beverage.

Comments

  1. theo kie says:

    From the land of conspiracies…
    Odd, the similar timing of this announcement – a gift to traditional radio conglomerates and their recording industry co-horts – and the announcement of the meek settlement with the same conglomerates for payola.
    Might they have anything to do with one another? Hmmmm….