Music And Radio On The Internet Whats Next


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Music and radio on the Internet - What's next

Presentation by Nico Perez (Mixcloud cofounder)

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  • 1. (Source: IFPI) 2. Graph source: IFPI 2003
  • The first audio transmission occurred on Xmas Eve in 1906 Guglielmo Marconi , who equipped ships with life-saving wireless communications, conducted a reported transatlantic radio communications experiments in 1901 and established the first commercial transatlantic radio service in 1907 Nikola Tesla , who developed means to reliably produce radio frequency currents, publicly demonstrated the principles of radio, and transmitted long distance signals. In 1943 the US Supreme Court upheld Tesla's patent number U.S. Patent 645,576 [2] . The reason it is not obvious who invented radio is that the technology is a product of many different discoveries and developments. Radio Caroline is an English radio station that originally commenced transmissions in 60s as an offshore radio station broadcasting from a ship anchored in international waters off the coast of South East England . Originally unlicensed by any government, for the majority of its early life, it was labelled as a pirate radio station. While Mexico issued radio station XERF with a license to broadcast, the power of its 250 kW transmitter was far greater than the maximum of 50 kW authorized for commercial use by the government of the United States of America. Consequently, XERF and many other radio stations in Mexico, which sold their broadcasting time to sponsors of English-language commercial and religious programs, were labelled as " border blasters ", but not "pirate radio stations", even though the content of many of their programs were in violation of US law. Predecessors to XERF, for instance, had originally broadcast in Kansas , advocating " goat-gland surgery " for improved masculinity, but moved to Mexico to evade US laws about advertising medical treatments, particularly unproven ones.
  • GROWTH - US Internet radio = 27% annual growth since 2000 - New platforms: 6m of Pandora’s 27m subscribers are on mobile, in the last 2 years only REVENUE - 1% of 2010 revenue = $35m from US only advertising - Pandora ad revenue up 80% from 2008, total revenue last year = $20m, predicting profitability this year ( 20% revenue already from iPhone )
  • Wired article: Domain registration: $129 -> $10 - Streaming video bandwidth costs (per GB) $193 --> 2.8 cents - Web storage (per GB) over $1000 --> 15 cents
  • What is Mixcloud? Mixcloud is a platform for on-demand radio shows, Podcasts and DJ mix sets – a “Youtube for radio”. The site provides hosting for all forms of content from talk shows through to music and comedy. The aim is to connect these “Cloudcasts” with listeners and make radio more social, democratic and personal. Why is Mixcloud? The was born based on the insight that radio content on the internet today is incredibly fragmented.
  • We were radio presenters at University of Cambridge (“The Get Down show”)
  • And 3 of the core team are breakdancers
  • Starting company about 14 months ago, funding from UK government (TSB) and working with Queen Mary university Launched 21 st September, just over 2 months ago, press in BBC, Guardian, Telegraph, etc Great feedback already, working with household names like BBC, Roundhouse, Judge Jules The first legal platform for independent radio shows containing music, although Streaming rate challenges for music content as the rates are still more than traditional radio Currently music oriented due to founders backgrounds, looking to expand breadth of content
  • Important trends happening elsewhere but not really at the intersection of music+radio+internet not necessarily ground breaking, but at heart of Mixcloud (and many other websites) and increasingly important
  • Self serve display for community site. Works well for us
  • CONSUMER TRENDS From destination to distribution From search to recommendation ADVERTISING INDUSTRY Traditional radio ad spend moving online Online audio ad market growing - e.g. Google, TargetSpot, Spotify RADIO INDUSTRY Challenge: Are consumers willing to pay for content? What type format: subscription/micropayments? New devices = increased access to wifi Hyper local??
  • Jeff Bezos = California gold rush 1850’s
  • Contact details
  • Music And Radio On The Internet Whats Next

    1. 1. By Nico Perez (Mixcloud co-founder) What’s next? Music and radio on the internet:
    2. 2. Text <ul><li>1. Industry context (brief history lesson) </li></ul><ul><li>2. A bit about Mixcloud </li></ul><ul><li>3. The future - trends and predictions </li></ul><ul><li>4. Challenges </li></ul>Contents
    3. 3. 1. HISTORY
    4. 4. <ul><li>Brief History of the Music Industry </li></ul><ul><li>Beginnings in the 1800s </li></ul><ul><li>Dominated by sheet music publishers in late 19th + early 20th century </li></ul><ul><li>2nd half of 20th century records become largest income source </li></ul><ul><li>Today 4 major players: Universal, Sony BMG, Warner, EMI </li></ul>CD LP Online
    5. 5. <ul><li>Music Industry today </li></ul><ul><li>Worldwide recorded music market size around $30 to $40 billion </li></ul><ul><li>Total worldwide revenues for physical+digital dropped over 25% in 10yr </li></ul><ul><li>In USA alone dropped from $15 billion in 1999 to $10 billion in 2008 </li></ul>
    6. 6. <ul><li>A brief History of Radio </li></ul><ul><li>Since early 1900s </li></ul><ul><li>Developed by Maxwell, Edison, Marconi, Tesla and more </li></ul><ul><li>Famous “Pirate” stations include: Radio Luxembourg, Radio Caroline and XERF in Mexico </li></ul>Tesla Marconi
    7. 7. <ul><li>Radio Industry today </li></ul><ul><li>Radio market size around $35 billion ($2 billion is online) </li></ul><ul><li>Big players: Clear Channel & CBS in USA, Global & Bauer in Europe </li></ul><ul><li>Over 90% of US radio advertising spend is local </li></ul>Annual growth rate = 11% 80m monthly listeners to Internet radio in US in 2008 Global radio ad spend in 2007 = $37 billion Online revenue forecast
    8. 8. <ul><li>A (very) brief History of the Internet </li></ul><ul><li>First developments at CERN by Tim Berners-Lee </li></ul><ul><li>Industry Started in 1990s </li></ul><ul><li>Bubble bursting/crash of 2000/2001 </li></ul>
    9. 9. <ul><li>Internet Industry today </li></ul><ul><li>Ten years since Dot com bubble burst </li></ul><ul><li>Moore’s law applies to hardware/bandwidth prices </li></ul><ul><li>Worldwide Internet advertising today roughly $54 billion </li></ul>
    10. 10. 2. TODAY
    11. 11. Internet music and radio today <ul><li>Mixcloud = recommendation for radio shows, Podcasts and DJ mixes </li></ul>Songs Radio Search Discovery
    12. 12. <ul><li>A bit more about Mixcloud </li></ul><ul><li>Vision: A Youtube for Radio </li></ul><ul><li>Cloudcasts = free on-demand radio shows, Podcasts and DJ mix </li></ul><ul><li>Mission: connect great Cloudcasts to listeners </li></ul>
    13. 13. <ul><li>Why we love radio </li></ul><ul><li>Discovering through experts and enthusiasts </li></ul><ul><li>A great form of communication (multitask friendly) </li></ul><ul><li>We were radio presenters at University of Cambridge </li></ul>
    14. 14. <ul><li>We also love mixtapes </li></ul><ul><li>Four of the six core team are DJs </li></ul><ul><li>We grew up listening to mixtapes </li></ul><ul><li>More than the sum of their parts </li></ul>
    15. 15. <ul><li>Mixcloud today </li></ul><ul><li>Launched in September 2009 </li></ul><ul><li>Working with household names like BBC, NME, Diesel Radio </li></ul><ul><li>Lots of music, now increasing number of talk shows </li></ul>Laid back radio Judge Jules DiS
    16. 16. 1. FUTURE
    17. 17. <ul><li>3 Big future trends online </li></ul><ul><li>Case studies and learnings for internet music and radio </li></ul>SOCIAL +DEMOCRATIC +PERSONAL BETTER EXPERIENCES
    18. 18. <ul><li>Great “ social ” website 1 </li></ul><ul><li> </li></ul><ul><li>Social news </li></ul><ul><li>Challenges: how to prevent groups gaming the system </li></ul>
    19. 19. <ul><li>Great “ social ” website 2 </li></ul><ul><li> </li></ul><ul><li>Social gaming, leveraging the social graph </li></ul><ul><li>Challenges: future big brand competitors </li></ul>
    20. 20. <ul><li>More Social internet music & radio </li></ul><ul><li>Destination -> Distribution </li></ul><ul><li>Sharing what you love (via Facebook, Twitter, blogs, etc) </li></ul><ul><li>Know what your friends are listening to </li></ul>
    21. 21. <ul><li>Great “ democratic ” website 1 </li></ul><ul><li> </li></ul><ul><li>Greatest cultural development in last 100 years </li></ul><ul><li>Every minute, 20 hours of video are uploaded to YouTube </li></ul><ul><li>Challenges: copyright, quality, moderation </li></ul>
    22. 22. <ul><li>Great “ democratic ” website 2 </li></ul><ul><li> </li></ul><ul><li>DIY tool and personal URL </li></ul><ul><li>10 million bands? </li></ul><ul><li>Challenges: navigation, user experience </li></ul>
    23. 23. <ul><li>Democratic internet music & radio </li></ul><ul><li>Anyone can upload songs/shows - old hierarchies are flattened </li></ul><ul><li>DIY = means of production are (nearly) universally available </li></ul><ul><li>Content volume growing exponentially (Search -> Recommendation) </li></ul>
    24. 24. <ul><li>Great “ personal ” website 1 </li></ul><ul><li> </li></ul><ul><li>Personalised shopping experience. Pioneers of intelligent recommendations </li></ul><ul><li>Challenges: shopping history </li></ul>
    25. 25. <ul><li>Great “ personal ” website 2 </li></ul><ul><li> </li></ul><ul><li>Blog reading + writing in the same space </li></ul><ul><li>User centre of design </li></ul><ul><li>Challenges: changing existing blogging behaviour </li></ul>
    26. 26. <ul><li>More Personal online music & radio </li></ul><ul><li>User centric design </li></ul><ul><li>Personalised listening experience for everyone </li></ul><ul><li>Analytics let you track what users listen to and recommend </li></ul>YOU (everything)
    27. 27. $ 4. CHALLENGES
    28. 28. <ul><li>Business Model Challenges </li></ul><ul><li>Traditional radio ad spend moving online (Google, Spotify, TargetSpot) </li></ul><ul><li>Display vs Audio vs Sponsorship </li></ul><ul><li>Transactional (Affiliates, Premium Accounts) </li></ul><ul><li>Experimental (Talent services, Micropayments, Subscription) </li></ul>
    29. 29. <ul><li>Future Access Questions </li></ul><ul><li>New devices, radio over IP wherever there is wifi </li></ul><ul><li>What will “Radio” sound/look like? </li></ul>
    30. 30. <ul><li>Content challenges </li></ul><ul><li>What type of content are consumers willing to pay for and how? </li></ul><ul><li>How do brands fit into the picture? </li></ul><ul><li>Still early days </li></ul>
    31. 31. Please get in touch We’re keen to hear your thoughts Email: [email_address] Twitter: @nicoperez / @mixcloud
    32. 32. Thank you! Flickr CC credits: