Interactive Marketing

Online radio services such as AOL Radio, Pandora, Slacker and Last.fm have become rather popular lately and are even available on many portable wireless devices such as cell phones. Does this mean the end of traditional radio stations I will look at the impact of streaming radio on the radio landscape.

Local radio stations do seem to have a hard time these days. Satellite radio has been cutting the market share of traditional radio stations severely in the past few years by offering mobility, a large number of commercial-free music channels as well as news and entertainment channels. In particular, online radio has become quite popular by offering a virtually unlimited number of radio stations.

Many internet radio services such as Pandora are now available on portable devices such as cell phones and other wireless audio devices via appropriate apps. This adds mobility to online radio which has still been the trump card of local radio stations.

AOL Radio which boasts 200 plus music channels of 25 genres uses CBS radio as its underlying platform. It also offers access to 150 national CBS radio stations. The underlying platform play.it also has a feature that allows listeners to create their own radio stations by entering preferred albums, artists etc. The individual tracks of each music channel are also available for storage on an iPod through 3rd-party software.

Other online music services have followed suit and are offering similar customized music channels. Pandora and Last.fm allow listeners to enter the name of an artist and then play music by randomly selecting titles by the chosen artist as well as other titles which are similar in genre or character. However, most online radio broadcasters lack the ability to create fully customized radio stations such as the play.it platform.

Does online radio mean the end of local radio The growing number of options clearly is going to shrink the market share of traditional radio broadcasters. Online radio is particular useful for niche broadcasters who have been unable to broadcast due to the high cost and licensing of frequency space.

While the variety of stations is a benefit to listeners, it is at the same time diluting the audio and online radio broadcasters are finding it difficult to attract a reasonably large number of listeners and be profitable. At the same time, however, there is less pressure to insert commercials due to the lower costs of broadcasting compared with traditional stations. This has made online radio content more appealing than terrestrial radio.

One big plus of local stations though is local content such as news or current events. In addition, local radio is now improving the audio quality by using digital transmission technologies versus traditional FM broadcasts which has been a big plus of online radio thus far. The big factors that will ultimately determine the fate of each technology are content and convenience. Online radio and traditional radio each have their own niche in terms of offering unique content and both offer high mobility and convenience so there will probably be no clear winner.

You can find additional details regarding AOL Radio and wireless audio products from Amphony's website.