Internet radio involves the delivery of audio programming via digital means from one computer to other computers over the internet. It involves both simulcast of existing over-the-air radio stations and content from internet-only stations. Internet radio was made possible in 1995 by the arrival of streaming technology.

Prior to streaming, users were required to download an entire audio file before listening to it. Streaming technology allows Internet radio listeners to listen to audio as it arrived in real time so users don't have to download an entire audio file. Internet radio streaming can involve both live material and archived clips of audio content recorded earlier. In either case, the user must have special software that matches the software used by the station to encode and transmit the data.

Internet radio was a booming enterprise into the late 1990s but legal decisions and a downturn in internet advertising effectively shut down many Internet radio stations. In 2002, a dispute between Internet radio broadcasters and the music industry came to a head when a copyright appeals board required Internet radio stations to pay a per-song, per-listener fee that was prohibitively expensive for many stations.

The fee was especially tough for smaller Internet radio stations to handle requiring them to pay thousands more dollars than they made. This led to hundreds of Internet radio stations shutting down.

Unlike broadcast radio which is an audio-only medium, Internet radio stations are free to offer interactive programming and can include images, animation, and even video. Whereas broadcast radio relies on estimating the size of audiences via ratings, Internet radio can measure each time a user accesses a particular page or program an din many cases can provide detailed demographic data about the people visiting their sites.

There are three ways for Internet radio stations to make money on-line; advertising, transactions, and subscriptions. Advertising is the model broadcast stations have adopted and used for decades. The ability of Internet radio to reach a global audience means not only the potential for a greater number of listeners but also that stations may be able to attract national as well as local advertisers. Internet radio listeners represent a desirable demographic of technology-savvy young people to advertisers as well.

Beside the standard audio-only commercials so familiar on the radio, Internet radio allows stations to generate revenue through graphic advertising banners and pop-up ads as well. The banner ad is an easy and effective way to display advertising on a station's website. Stations charge different amounts, depending on banner size, placement, and duration on a page.

As with many things in the world today media is transitioning to the internet. You can now get News Casts, online movies and of course radio on the internet. As the broadband user community grows rapidly so does the use of these online services. The transition is being closely watched by many of the industries biggest players as they reap the benefits of broadband usage. Many smaller and independent broadcasters as well are also getting satisfaction from the change.

The majority of internet radio broadcasters are individuals that broadcast from their homes using SHOUTcast, a free broadcasting script developed by NULLSOFT. They are not looking to make a profit but rather share their collection of music via streaming radio and possibly gain some recognition for their efforts.

Guidelines have been set up with the agencies that monitor the music industry which makes available licensing to play copyrighted music online to the internet radio community. In this way musicians can receive royalties for their work and internet radio broadcasters remain within the legal boundaries of the industry.

Due to the availability of wireless internet connections spreading across the country there has even been mention of including internet radios within the auto industry. There have even been predictions made that internet radio will replace satelite radio within the next 10 years.

Internet Radio has seen an ever-increasing trend since its inception. Given the growth rate of Internet usage all over the world, there are enough reasons for Internet radio broadcasters to pull up their socks. Particularly in the US, the number of Internet radio listeners has increased significantly. A simple question that often comes to mind is the reason behind this popularity of Internet radio.

I should say there are not one but multiple reasons that actually contribute to its popularity. The nature of content is one of the prime attractions of any Internet radio station. Firstly, most Internet radio stations are free from corporate influence and the broadcasts are actually decided by the broadcasters personal choice. Also, the variety of music genres those are available on the Internet radio is unmatched and would beat the AM FM radios stations hands down. Besides the Internet radio has a wonderful pricing structure, that's always better than any other entertainment in the world, because it's FREE. Yes, the listeners don't need to pay a dime to listen to the Internet radio of their choice. In addition, the ease of listening is also incomparable. You can listen to the Internet radio even when you are at work. All you need is a computer with Internet connection and a set of speakers and you can log on to favorite station.

While the difference between an Internet radio station and a terrestrial radio channel (AM FM) can be simplistically attributed to their medium of transmission, - one is served on the airwaves and the other on the Internet. Ask a regular listener and they will tell you the truth. Internet radio stations are more open to embrace new upcoming artists and the variety of music served is much wider. While the terrestrial channels are sort of restricted to the top chartbusters, Internet radios actually help unknown faces to make it to the top of the chart. It works as a cradle for the newborn artists or bands and many of them have shot to success and signed record contracts after they were wired on some Internet radio channel. The inherent nature of the Internet is applicable even in this case and Internet radio actually levels out the playing field between the famous and yet to be famous artists. It gives you, as a listener, the opportunity to listen to music that you would have never heard if not for this channel and it also gives the opportunity to your favorite local band to reach out to the global audience.

In spite of the fact that Internet radio has an ever-increasing listener base and is also very effective in promoting new artists and albums, Internet radio broadcasters are not really welcomed by the recording industry. Internet broadcasters need to pay Royalty for the music they play while the recording industry offers terrestrial radio channels to play those for free - reason They consider terrestrial radio as a medium of promotion but not Internet radio. A misconception about Internet radio is that they give away music for free, which is absolutely wrong. Internet radio broadcasters are as good as any other terrestrial radio channels and in no way do they promote distribution of music for free.

Internet radio has actually flourished to great extent; however, the irony is the growth has only been in terms of listeners and not really in terms of money. Vast majority of broadcasters actually pay from their pocket to bear the expenses (royalty payments, bandwidth etc) - profit is a far cry. The major portion of Internet broadcasters are made up of hobbyists who are getting licensed and infrastructure through larger Internet radio stations or broadcasting companies at relatively affordable rates. Otherwise it would have been almost impossible for most broadcasters to bear the cost individually.

It is necessary for the Internet radio industry to take a more constructive and professional approach towards monetizing and generating revenues through the medium. While it is highly appreciated that most Internet radio broadcasters emphasize the happiness of sharing their choice of music with thousand of listeners who tune in as the price for their hard work, it is going to be a survival issue for the channels in near future if they do not start generating revenue at this stage. Also companies are increasingly becoming conscious about the power of this medium and are often willing to advertise with the popular Internet radio stations. As an Internet broadcaster, it is high time that you pick on these available opportunities and add that $ilver sheen to your broadcasting happiness.

This article is written by Ray Smith, a marketing expert with years of experience in different industries and specialized knowledge on SEO and Internet marketing. Internet Radio