Online Radio's Takeover - Part 2

Last April, I posted an article on my Big Picture blog entitled, "Online Radio's Takeover" that outlined how online radio was gaining listeners at the expense of traditional broadcast radio. Now a year later we have a new survey from Bridge Ratings that illustrates just how quickly the shift is occurring, this time with a bit more granularity.

The figure on the left shows that people are listening to a lot less AM/FM radio these days, down from 22 hours per week in 2005 to 18 in 2010. Why has that figure declined? Because Internet radio now attracts more than 60 million listeners a week (predicted to rise to 77 million in a couple of years), putting a real dent in AM/FM listenership. But what's not shown in this chart (but was spelled out in other data by Bridge) is the fact that, although all listeners are listening to more online radio, it's the 18 to 24 demographic that now listens the most. And because they listen to more online radio, they listen to a lot less traditional broadcast radio.

Let me explain why that figure is important to artists, musicians, bands, labels and anyone who makes their living (or hopes to) in music:

1) Broadcast radio was always the biggest form of promotion of a record. You needed airplay to get a hit. If the very demographic that listens to your music isn't listening to AM/FM radio, why do you need to worry about radio at all?

2) Record labels always had two major jobs (forgetting about producing the product for a moment) - distribution and promotion. If your market doesn't listen to radio anymore, but a label is only good at that kind of promotion, why do you need them?

3) If more and more people are listening to online radio, and it's easy for you to get on it (either on the large stations like Pandora or any of the hundreds of small specialized stations), why do you need a label to do something that you can easily do yourself?

4) Because there are so many small niches served by online radio, it's much easier to build an audience than ever before. If you want to listen to only Saharan Cowboy music, you can program a station or find a dedicated one just for that music.

5) Here's the exception - you do need traditional radio if you blow up on your own online to the point that the only way to go to the next level is with the traditional marketing and promotion that a label is really good at. Good for you if you get there, but that's probably not a realistic goal to most artists and bands.

If you've been reading this blog, you know that there's a lot more that goes into distributing, promoting and marketing yourself beyond the points listed above. The main idea here is that to promote yourself, you need airplay. You can get that airplay yourself and for free online. And what's even better, that's where your audience is right now, and that audience is growing by the day.

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