Abacast Inc.

It was nice to see the Radio Advertising Bureau’s 2009 Year End news release and how it pointed out the momentum in revenues from online radio.  The RAB release showed that the digital sector brought in $480M in revenues in 2009, a 13% increase from 2008.  These results compare to radio’s overall revenue, which dropped 18%, from $19.55B in 2008 to $16B in 2009.  Many large terrestrial stations reported revenue drops of 20% to 25% for 2009. 

Creating some excitement as move in 2010, the RAB report pointed out that 2009 Q4 revenue saw a 15% increase over 2008’s Q4 number.  The RAB reported that “Marketers increasingly recognize Radio’s loyal audiences who tune in via multiple audio devices such iPods, HD, mobile apps, etc.”, and that “…the digital sector has maintained its upward trajectory throughout 2009”.

Yes, it’s nice to be in the online sector.  

In a related report, the Radio and Internet Newsletter’s 2/22/09 edition cited BIA/Kelsey’s U.S. Local Media Annual Forecast for 2009 that online ad revenue will grow from $15.2B in 2009 to $36.7B in 2014, and that there will be “a steady shift toward digital media.”

Streaming quality is heavily dependent on a few key factors. One of them is your ability to push out your content to a distribution server. Even the highest quality content can be rendered choppy with a poor internet connection.

So what are some things to look for in a service? Your key aspect is upload bandwidth. This is normally not as important as download speeds to a normal ISP customer, but because your priority will be sending data out as opposed to downloading, you need to pick an ISP that can provide you with AT LEAST double upstream of the bitrate you will be broadcasting at. You will most likely not achieve full upload speeds to any server due to internet/server fluctuations. Stay away from wireless routers or mobile cards as much as you can as these connections typically drop data packets and need to retransmit. This is normally not a problem with web browsing but in a constant data stream, these are transformed into cutouts and video quality degrading for your viewers. Also, make sure that no one else is using the connection for other work while you are broadcasting, that steals your bandwidth!

SNL Kagen sees a bright future for online radio station revenue growth http://www.snl.com/SNL-Financial/Press_Releases/20091102.aspx . This is great news at a time when terrestial ad revenues are at a decline.

Because of the downward sloping revenues from traditional ad sales, terrestrial stations are accepting the online broadcast space as a viable revenue source. Services such as live streaming, mobile apps, and ad insertion are ways to build monetization for the radio station’s digital initiatives.

One easy and effective way in building online revenue is utilizing an ad insertion service. Ad insertion systems match advertisers with an online audience when broadcasting on the Internet. Basically, online radio ad insertion replaces the station’s terrestrial commercials with online-specific content for the Internet audience. The audience who listens to a radio station over the air hear the terrestrial ads, and listeners on the Internet hear the online ads. Ad insertion services integrate with the station’s broadcast so there is no need to dedicate extra resources to broadcasting an additional audio feed.

With the future of online revenue growth becoming more promising, now is the time for terrestrial stations to start familiarizing themselves with the digital monetization tools that are available.

Before beginning to choose a streaming package it’s important to understand the different delivery methods and codecs. These ultimately affect your viewers experience. You will also need to know if you’re planning to be streaming audio, video, or both?

Windows Media format offers a great delivery for audio/video, can easily be embedded on a webpage but it not natively supported on Apple computers. They will have to install Flip4Mac or Windows Media Player for MAC. Also, Windows Media currently is not supported on most mobile phones.

Adobe Flash streaming is considered a more universal option as Adobe’s Flash player is installed on the majority of internet computers. Adobe Flash is typically more CPU intensive so older machines may have trouble keeping up, and to display the stream on your website requires a separate flash application.

If you are just broadcasting an audio MP3 stream, using Icecast or Shoutcast are very direct methods of streaming to stand alone apps (Winamp, iTunes), hardware (Squeezebox), and are usually supported on mobile phones. Standard MP3 format requires the use of higher bitrates to achieve good sound quality, but recently AAC has allowed reduced bitrates with great sound quality. There are many formats out there, make sure and do your homework on what the pros and cons are for each type to make sure you present your users with effortless streaming!