internet radio as a business model?

Filed in archive Entrepreneurship on March 23, 2004

The NYT has a good piece on why web radio broadcasts finally become a real business model. I must say I almost switched completely to online radio as a listener but I'm not too convinced of the business model. I really ask myself how to reap substantial revenue streams from sending out streams with one (voice) ad per hour. I even wonder how they can survive counting the ISP costs....

"According to a report by Arbitron, a media ratings service, 20 million Americans aged 12 and older listen to Webcasts at least once a week, and about 39 million do so at least once a month."

"For AOL's radio business to flourish, it is getting indirect help from an unlikely source: Yahoo. AOL, a part of Time Warner, said it would announce a deal today with an advertising sales company, Ronning Lipset Radio, in which Ronning Lipset would sell audio ads to marketers that want to reach the combined radio audience of Yahoo and AOL."



"Yahoo's vice president for music, Dave Goldberg, said that based on the current number of Yahoo listeners and the average price attracted for terrestrial radio ads - about $5 per thousand listeners reached - the potential revenue is roughly $2.4 million a month. "So it's a big enough business for us to worry about how to sell it," Mr. Goldberg said."