How Money Is Lost With Internet Radio
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Having followed the internet radio industry since its inception, I'm aware of the problems within. Growing costs for bandwidth are coupled with exorbitant monies being paid for music fees.
Couple these negatives with an almost endless stream of internet radio programs, and you have an industry battling for a way to pay its way. In short, money in is less than money out.
Though satellite radio is proving it can make a go of it using this formula, there's a big difference between a duopoly and internet radio. And that gets you shaking your head when reading the next sentence. Today there's word that an online station is selling the ability to strike ads from its program, which leaves the question, "How is the independent internet radio market going to survive?"
Dailysonic is the station that's introduced "Subtract," a system that allows audience members to remove audio ads in its program. Here's a section of the sell-line featured at DailySonic: "For each Subtract that you buy, you’ll get one less advertisement inserted into your show. And it’s pretty inexpensive. Each Subtract costs 6 cents..."
OK, people don't like advertisements. But the fact that we have reached a point where an industry that is trying to survive from selling ads is telling its audience that these ads are bad, is bad.
There are a couple of demons here, the first being the advertising industry that has overplayed its hand by pounding the public with advertsing. That the quality of those ads has disintegrated over the past dozen years doesn't help.
We also have an internet radio industry which, so far, has proven that its very survival depends on the ability to attract advertisers to pay its bills. Yet, online radio now believes it's all right to tell the audience that these advertisers don't deserve to be heard.
There was a programming philosophy that dissolved a decade ago; it said that commercials were part of the program. Today ads are nothing more than an interruption of the program... that's another "bad."
Here's a truism that runs through any form of radio: Radio serves two clients, the audience and the advertisers. For the first ten years of its existence, online radio has catered to only one of these groups. Unless it finds a way to better serve the advertisers, online radio stations will continue to play lots of music as they die off from not paying their bills. That's bad too, and sad.
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