Ineffective Online Radio

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Various news sources are reporting that the radio industry, under pressure to pay performance royalties for over the air song plays, has come up with a proposal to pay – along with a list of demands. It’s a very telling list that exposes the radio broadcasting industry’s desperate desire to turn back the dial and ignore the growing popularity of online streaming and other digital platforms with listeners.


Realizing that they’re going to have to pay performance royalties, the radio broadcasters have  come up with a proposal that offers a (1) tiered rate of 1% or less. In exchange for that they want the (2) Copyright Royalty Board’s jurisdiction forever removed from their rates, (3) lower streaming royalty rates, (4) inclusion of FM chips in cellphones, and (5) “AFTRA issues” resolved for streaming broadcast ads.

I get the relationship between #1, #2, and #3. They’re negotiating with the same folks, and they want to use their negotiations to improve and simplify their overall deal, including streaming. The CRB has been unfriendly in this regard, so they would like to take them out of the equation.

But what does all of this have to do with FM chips in cellphones? Nothing. Or AFTRA issues? Not much – performance royalties are paid to musicians, AFTRA monies are owed to actors and voice talent employed by advertisers and agencies to record commercials. These are pretty arbitrary demands.

So what’s so telling about this? It’s a list that is all about going backwards. Cellphones are already radio enabled – for streaming that is. Smartphones have proven to be enormously popular mobile streaming devices. Why fight a battle that’s already won?

As far as the whole AFTRA thing….I’ve gone on and on about this one, you can read some of my opinions here. Simulcasting over-the-air radio commercials on a streaming station is a BAD IDEA. It discourages advertisers and broadcasters from developing ads that have an online/interactive call to action. It encourages broadcasters to view their streams as simulcasts of their broadcasts. WHICH THEY ARE NOT. It’s the fast lazy train to ineffective online radio…

— Jennifer Lane, President, Audio4Cast.com, has a long career in Internet radio. Read her blog about the business of Internet radio and digital audio at  www.Audio4cast.com .


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Carl has been with RBR-TVBR since 1997 and is currently Managing Director/Senior Editor. Residing in Northern Virginia, he covers the business of broadcasting, advertising, programming, new media and engineering. He’s also done a great deal of interviews for the company and handles our ever-growing stable of bylined columnists.