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A federal judge has ruled that Yahoo, AOL, and RealNetworks could owe songwriters as much as $100 million over seven years as payment for streaming their songs on the web. 

ASCAP has been caught up in a court case with the web giants over a blanket licence to compensate songwriters for the music they have created.  More on this story here.

ASCAP has posted a press release of the decision on their site.

One of the more interesting panel discussions of the Leadership Music Digital Summit yesterday was “Digital Retail: What’s The Future?”

On the issue of the future of CD product, UMG Nashville EVP Sales, Marketing & New Media Ben Kline said, “I can’t imagine CD’s ever going away.  I can’t imagine Wal-Mart and Target not selling hard product.  It’s the ones (retailers) in the middle that will be hurt.  I don’t think you’ll be able to walk into a mall and purchase a CD.”  Kline went on to comment, ”We still can’t afford to be in the singles business” when asked about the current state of selling digital singles and why labels are not being more singles driven.

One of the major discussions prevailing was how to grow digital sales as CD sales fall.  Each panelist had their own ideas including:

• Better devices
• Ubiquitousness
• Multiple product offerings in one bundle
• Player compatibility and coordination between platforms
• Exceed experience of music ownership with consumers
• Stop narrow focusing on subscription based models

On the subject of future business models within retail, the industry vets responded with:

• Ben Kline:  “Demand price models (where price is equal to the demand of the music).  Not every song should be .99 cents.”
• EMI CMG VP Sales & Marketing Mark Adkinson added, ”Steve Jobs can’t run our business for us or he will run it right into the ground.  He wants to sell devices, not music.”  Mark also stressed the need for pervasive distribution within the music industry.

Leadership Music Digital Summit is going on today in Nashville.  The keynote was delivered by the CEO of iLike, Ali Partovi, who mentioned that it was the first keynote he has given.  

With all of the questions, concerns and potential regarding the future of music technology, Ali made a point to say, “What I’m most excited about is the discovery and promotion of music”. 

Ali compared traditional broadcast media with new media:
**Traditional media is “untargeted, focused only on hits & singles, while album development suffers”.
**Digital media is “personalized, social, syndicated, targeted and enables artists to pursue their dreams.”

Partovi went on to say that digital media “could replace or solve the problems of traditional broadcasting”.

More highlights from the Digital Summit will be posted this week.

Radio Ink recently released the findings of a phone survey of 1,004 U.S. adults.  Among the findings the survey showed that 53 percent of listeners said they stick with a station through commercial breaks, 35 percent change the station, and 8 percent turn off the radio. And those who change the station tend to do it quickly: Seventy-seven percent of those who tune away do it within 30 seconds after commercials begin.  I‘ve seen other surveys where the numbers for losing listeners during commercial breaks are even higher. 

Personally, I will punch out of a station that is playing a really bad spot, especially if the ad is poorly voiced by the owner of the company (hello Tom Shane?).  I’ll also find another station if an advertisement is loud and annoying or if there are more than three or four 60 second spots back to back.  Production and content of the commercial really does matter.

When I was in radio we had a full time production person and that’s all they did.  Not many of those anymore with budget cuts and staff members wearing multiple hats and spreading themselves thin.

In thinking about the future, how much longer can the current advertising spot system last?  Is there a better way to set up advertising and partnerships to better utilize time, money, positioning and ratings?  Especially with the current battle that has emerged with other entertainment options (some of them commerical free).

The only time I find myself sticking around is if the spot is delivered with personality by the DJ or talk show host.  If it is done live with improvisation, all the better.  Give me authenticity and creativeness.  If a host can pull that off, it is not only entertaining, but the represented company is better served.  However, this can backfire when the host is delivering too many live spots and they suddenly become recorded “live” reads.  Which leads us back to annoying.

An even better scenario for advertisers is the shorter and focused spots that are live or that “sponsor” an entire half hour or other segment of time.  You know the type….”This half hour brought to you by insert company here…..”

Am I the only one that thinks something different should emerge in the way ads are produced, presented and scheduled?  Maybe an entirely new and innovative type of advertising revenue stream will emerge through podcasting, texting, or social networking?  There has to be a better way.

It will take a bold radio company to step out and set a new course.

How would you feel about a music site that organizes music according to your moods?  What would be your thoughts about a destination where you can legally download MP3’s based on emotions?

Guitarati is conducting this grand sonically visual experience by assigning colors to music.

It is certainly unique and outside the box, but will it resonate? 

If not, why not?  Radio will need to embrace aggressive podcasting and video strategies to compete for the attention of future listeners.  The age of P1 demo of many country radio stations is rising because they are losing younger generations of consumers.  These tech savvy “self broadcasting” demos are getting what they want when they want it.  They aren’t waiting around through ad spots and countless other songs to hear their new favorite.

Creative and innovative use of podcasts, video, web sites, and mobile based activity will not only enable radio to stay in the game, but be active in the lives of listeners.  This could also answer the concerns of being local and developing engaging personalities, but radio companies need to make a commitment in making it happen.  Will they?

These new media outlets will not only expand the brand of the station, but also be more easily monitored and accurately measured for advertising purposes. For example, YouTube users can now better analyze the viewing patterns of videos far more easily according to this story from Media Week.

The bottom line is creating entertaining content value and connecting to the listener and consumer.  The more ways radio can do that the better chance they have to compete and win in a quickly changing landscape.

 RADIO IN 3D

by Daniel Anstandig

Radio cannot grow if its operators insist on constricting the delivery of their brands to the sense of sound.  Sure, there is no way around the fact that “speakers to ears” is our primary delivery method. Still, listeners and advertisers are now challenging radio stations to “think outside the speakers” into the interactive world. They want three-dimensional radio.

Many advertisers are now convinced that an audio ad is no longer enough to reach their customers. New Media has opened up new options to reach consumers—outside of television and radio, and local direct advertisers are buying campaigns that are “diversified” in nature. Radio/advertising companies that offer a multi-dimensional solution to advertisers (including audio, online showcasing, online lead generation, etc.) are more likely to win the lion-share of the business.  Many of the radio companies we consult on building their digital marketing/sales strategies have reported that the street-level enthusiasm for radio buys with an interactive bend is at an all-time high.

McVay New Media’s 2008 Interactive Revenue forecast is calling for a 9% increase in this year’s spending on local banner ads alone. Across the United States in 2008, we will see approximately $10 Billion spent on local internet advertising by local direct buyers. Last year, radio is estimated to have pulled a whopping 1% share of that revenue.

These numbers concur with a study done by Borrell and Associates, which estimates that only 1.1% of last year’s $8.5 Billion spent in local online advertising (banners, audio/video streaming, and paid search engine placement combined) went to a radio station. Approximately $1.2 Billion dollars in streaming audio/video advertising alone will be placed online by local advertisers in 2008 (up 317% from 2007). It is estimated that $6.3 Billion will be spent by local advertisers on banner ads alone.

Broadcasters now stand at a cross-roads on whether to further include interactive media into their advertising-product-portfolio or not. The operators that effectively include interactive media in their strategies for audience and revenue growth will see returns this year. The operators without a vision for including interactive in their plans will leave money on the table—and sacrifice dollars to local internet portals.

Read the rest of this entry »

Does anyone think it is interesting that Lee Abrams left XM to work for Randy Michaels?  Jerry Del Calliano thinks it is not only interesting, but suspicious.  Find out what he means on his blog Inside Music Media.

Lee, in his own blog, makes a comment about his new partnership with Randy:  “We ARE going to re-write the future of media. He’s the kinda guy you want to do it with.”

I look forward to hearing more.

I attended several tech panels today, which I am glad to see on the schedule.  One in particular was a panel that had Sean Ross from Edison Research, Dean Ernst from Play MPE and Jim Kerr from Pollack Media Group.

They each debated and rated the hottest tech trends as “Boom” or “Bust”.  Here’s a quick rundown on how they voted:

• HD Radio:  Majority BUST
• iPhone:  Majority BOOM  (shows you how fast technology moves because this has been an obvious boom for a while now)
• Internet Radio:  Majority BOOM (although they said it would take a while to get up to speed)
• Podcasting:  Majority BOOM
• 360 Label Deals:  Mostly BUST  (in my opinion this is relative to which artists and managers)
• User Generated Content:  Majority BOOM
• Mobile Content Distribution Channel:  Majority BOOM
• DRM-Free Music: Majority BOOM

Jerry Del Colliano from Inside Music Media lists the 5 new rules for radio PD’s (addressed to consolidators or other serial abusers), so look out:

1. One PD per station. It used to be that a successful program director lived, breathed and experienced his or her one radio station 24 hours a day 7 days a week. This was an acknowledgment that the program director of a successful radio station is a specialist not a generalist. Consolidators anxious to get the most bang for the buck have spread otherwise qualified PDs beyond their core competency. If you want great radio stations that can program to the available market (which does not include the next generation), then suck it up and pay for one quarterback per station. Stop with the shortcuts and you’ll see a better return on your investment. And don’t tell me about the handful of PDs who are programming more than one station for you — imagine what they could do with one?

2. No airshift. (Does anyone know CPR for our consolidator friends?). The PD is responsible for talent, commercials, promotions, music or content, audience and community relations. Need I go on. If yours is a small market, an exception is allowed. Bigger markets — no exceptions. You don’t need your brain surgeons cleaning up the operating room at the end of the day. I know you don’t like this one but look at the results you are not getting by repurposing your PD. If you accept the suggestions so far, read on.

3. Outline goals and expectations on one page. How do you expect your content quarterback to do that which you ask him or her to do if you don’t articulate your goals and expectations on a piece of paper? I know. I know. Legal told you not to so when you fire an otherwise good PD who has achieved their goals you won’t have to lose the ensuing lawsuit. But really, put the items on a list. Make the program director sign off. Then, proceed to step four.

4. Give full authority to the PD to do his/her job. No meddling. No backseat programming. Leave your PD to either do what they promise or risk being replaced at the end of the year. Oh, no changing the rules in mid-stream. No using “corporate is making us cutback” as an excuse to stay involved. Warren Buffett, the billionaire who knows a little bit more than the Mays family about making money gives the people who run the companies he acquires full autonomy to do their jobs. Unlike the geniuses in radio, the Oracle from Omaha butts out. In fact, legend has it he only meets in person once a year for about two hours for an accounting of goals.

5. Fully fund the programming budget. Too many PDs have no real budget or the budget they have looks like Swiss cheese. If you suspect that corporate is going to ask for further givebacks during the year, under budget programming by the percentage of cutback you anticipate. You can’t expect a PD to do their job without knowing how much money they have to spend. In fact, put the amount on the goal sheet(#3 above) and make him or her sign off on it. Channel your inner Warren Buffett.

Check out the entire article here.

Chris Anderson & economist Jacques Attali speaking at the 2007 Midemnet Forum about the future of the music business. The revolution is happening……

Chris Anderson, Editor In Chief of Wired, is currently writing a follow up to his incredible book “The Long Tail”.  The subject is the interesting phenomenon of FREE. In the spirit of the subject, a free 6,000 word preview and relating video can be found here.

You can also get a FREE copy of Wired featuring a preview of the much anticipated book here.

Finally, go to trendwatching.com for another informative article on brands making the most of FREE.

Inside Music Media is the blog of Jerry Del Colliano, founder of Inside Radio and current professor of Music Industry at USC.  I could not decide which article to link to because they are all extremely relevant and well done, so I will just encourage you to check them all out.

Thanks to Chris Huff at KSCS/Dallas for the heads up. 

Tell Me a Story
By: Daniel Anstandig

Music legend Ray Charles once said that he “was born with music inside” himself. It could be said that the best loved songs in history are the ones that resonate and harmonize with the music inside of us.

Country music is best known for producing these songs that reach into the souls of their listeners. The stories told by many Country songs can make your heart race, put a lump in your throat, and send tears down your face. They’re the songs and stories that have turned country radio stations into empires. 

The world’s most powerful and best loved radio stations aren’t without persuasive stories themselves. Case in point: KLBJ in Austin… not just another radio station. It’s the radio station that was rescued from bankruptcy in 1942 by young entrepreneur, Lady Bird Johnson. KLBJ does a terrific job of summarizing their rich history at www.590klbj.com/History.  WMMS is known in Cleveland (and beyond) as a way of life for Clevelanders more than a music service. Its logo (the Buzzard) and the many bands it made famous have kept it alive in Cleveland pop culture for years. WSM in Nashville catapulted its way into music history with the Grand Ol’ Opry.  Read the rest of this entry »