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RAIN 3/28: "Lackluster performance" in online ad sales from broadcasters, says new study

Posted on: 03/28/2011

BORRELL: RADIO INDUSTRYBARELY TREADING WATERWITH LOCAL ONLINE ADVERTISING

A new study from Borrell Associates finds that radio broadcasters posted “lackluster performance in Internet sales” last year and goes on to project “milquetoast growth over the next five years” as a result.

Borrell writes in its “Benchmarking Local Online Media: 2010 Survey,” that the radio industry is “barely treading water” with 2.1% of all local online advertising spent in 2010. “Outside of local cable companies and magazines, radio performed the worst among all legacy media companies” in 2010, Borrell writes.

Though Borrell expects 10% digital sales growth in 2011 for radio, “that growth will not keep pace with market expansion,” and radio’s share of local online advertising will drop below 2% by 2015.

But Borrell also points to several broadcasters that appear to be doing things right. Radio One and Salem Communications earn praise for launching separate Internet divisions (BlackPlanet.com and Christianity.com, respectively). Radio One’s online ad earnings account for 7% of its revenues and for Salem 10%.

That said, Borrell sees a “lack of attention to the Internet opportunity” from many broadcasters. The study points out that some companies even fail “to mention [their Internet ventures] at all in their annual reports.”

To buck the “dim” revenue forecast, Borrell suggests that broadcasters partner with “pureplay” sites like Groupon, Yahoo and Craigslist. Borrell expects such sites to overtake newspapers in local advertising revenue by 2015. Already “pureplay” sites are collecting more revenue than any traditional media company in around 20% of markets tracked by Borrell.

You can find more coverage in AllAccess here, Inside Radio here or from Borrell Associates here.

STUDY SAYS CONSUMERS ESPECIALLY DISLIKE ADS ON NEW MEDIA PLATFORMS, BUT THAT MAY NOT BE A PROBLEM

According to a new AdAge/Ipsos Observer study, the platforms on which people most dislike getting ads are new, digital, fast-growing media: Mobile (63% dislike or strongly dislike); e-mail (57%); social (44%); and websites (42%). Consumers are far more accepting of ads in newspapers (15%), magazines (18%), and “out of home” (21%).

So what’s this mean? Fred Jacobs of Jacobs Media, in his blog, writes, “it suggests that consumers have been trained to accept commercial messages (for better or for worse). And it opens doors to delivering messages via branded content in other platforms… new media platforms viewed as opportunities, rather than as obstacles and obligations. As ways to enhance an advertising program, not as unnecessary capital expenses that are tough to monetize.”

AdAge’s coverage of its study is here, and Jacobs’ blog entry is here. Hear more from Fred at RAIN Summit West, 4/11 in Las Vegas.

BELGIAN COMPOSER SOCIETY WANTS COPYRIGHT FEES FROM RADIO-LISTENING TRUCKERS

Belgium’s national organization of authors, composers, and publishers (i.e. their ASCAP or BMI) is arguing that truckers should pay copyright owners to listen to the radio.

SABAM (Société d’Auteurs Belge – Belgische Auteurs Maatschappij) already collects fees from businesses that allow radio listening in the work area. They say since a trucker’s cabin is a “work area,” they are entitled to fees. Local politicians fighting the proposal say a truck cabin is “an intimate place,” and is not subject to fees.

H/T to Slashdot.org (coverage here). Google’s translation of the article from the Dutch-language De Standard is here.

REPORT: AMAZON READYING ONLINE LOCKER SERVICE FOR MUSIC AND MOVIES

According to a report in CNet.com, Amazon will announce an online music and movie “locker” service as early as next week.

CNet says, “Sources from both the film and music industries said Amazon is working on creating a cloud locker service that would enable users to store their existing music, film, and book collections, even content not purchased at Amazon, on the company’s servers.” Though Amazon has yet to secure all the necessary licenses from copyright owners, CNet says Amazon may announce the service before talks are complete.

As we’ve covered in RAIN, both Google and Apple are readying similar services (coverage here). Read CNet’s coverage here.



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