Wednesday, March 30, 2011

Cloud storage and media streaming will put severe pressure on many radio programming strategies

One theme that has been running through quite a number of posts here on Talking New Media has been media streaming and its potential for print publishers. The ability of mobile and tablet editions to stream audio and video to stereo components and large screen through Apple's AirPlay has opened up infinite possibilities for creative publishers.

But just as streaming opens up non-broadcast media companies to new areas for content, there are traditional media properties who see the continued growth of streaming as a threat. Certainly ther is tremendous tension right now between the content creators and their distributors -- that is, the television networks and the cable and satellite companies.
But radio has faced increasing pressure because of streaming for a number of years. The day WXYC began to stream programming on the Internet seemed to open up the station to additional listeners online. Pioneers in this area no doubt saw the advantage of using the web to reach new listeners, but that advantage certainly began to fade as other stations began to do the same thing -- including stations that wouldn't have seemed to be competitive in the past.

Today, as someone who listens to more radio through the Internet than through the airwaves, it is far more likely that I will listen to KCSM in San Mateo, California when I want to hear jazz than WDCB, the Chicago area jazz station; more likely that I will "tune" to Accent 4, a Strasbourg, France classical station than my local classical station WFMT.

This new competition has only lightly touched most radio stations. Talk radio, with its syndicated radio talent, probably is effected by competition through streaming, but the music format is where the real action is.

The history Internet radio and the music labels can be found online, but readers should be reminded that it wasn't so long ago that it appeared that Internet radio was on the ropes. Start-ups like Live 365 which allowed anyone to create their own Internet radio streams, were on the verge of being killed off by the issue of royalty payments. The 2007 agreement between SoundExchange and the larger webcasters was just barely enough to keep the platform alive.

But while Internet radio appears to be a fact of life, with new companies like Pandora paying more than $45 million just last year in royalty payments, individual streaming poses a new threat to traditional radio.
Yesterday's launch of Amazon's Cloud Drive and Cloud Player are seen as both new competition for Apple's plans in the same area, but will continue the trend of consumers streaming their own music content using technology including cloud storage.

To recap Amazon's announcement yesterday: Amazon announced that registered customers of the online retailer's website could now have cloud storage of up to 5 GB of data for free, as well as the ability to pay for even more storage at $1 per GB at six different storage levels starting at 20 GB ($20 per year) up to 1 TB ($1000). This storage would house any kind of digital content, though music is the assumed content that would be used most often.

This digital music content could then be streamed to be listened to using another Amazon launch, Amazon Cloud Player. The new player is compatible with popular browsers such as Internet Explorer, Firefox, Chrome and Safari, for both PC and Mac users. Further, an Android app from Amazon will allow users to play the music on their mobile devices -- no such app currently is available of iOS device owners.

The issue of content licenses has already been brought up by media properties such as, but Amazon feels pretty sure it won't be necessary to negotiate with the music labels. We'll see.

How popular this kind of streaming will be is open to debate. At home, the streaming of content from one's PC to another device is already becoming commonplace. The streaming occurs over the home's WiFi network and so users can have access to unlimited sharing of music content. But streaming on the go and from a cloud storage system is another issue altogether. All this data has to go over a carrier's data network, and those same carriers have been moving to eliminate unlimited data plans for more tightly controlled levels of data.

Until Amazon becomes its own telephony company, users will have to deal with AT&T, Verizon, etc. That means limited data, and therefore, limited use of cloud streaming.

Nonetheless, if I were the owner of a network of radio stations that specialized in, say, classic rock, I would be wondering if one day I might consider my biggest competitor not the crosstown rival broadcaster, or even a broadcaster using the web to reach listeners, but my listeners themselves -- enabled by companies such as, of course.