O problema de comercialização dos canais de musica

«Today’s relaunch of AOL Radio (in beta) embraces that aspect of radio in many ways. First and foremost is its partnership with CBS Radio, which is replacing XM Satellite as the provider of music for 150 radio stations on AOL Radio (AOL itself continues to program another 200). Along with providing much of the music people can listen to for free, (...) CBS Radio’s ability to sell local ads was major reason why it won the partnership deal, especially with online music royalties increasing sharply. Lisa Namerow, the general manager of AOL Radio, tells me:

The royalties have gone up significantly. We had to reevaluate our business. We needed to partner in order to monetize radio better. We have grown advertising year-t0-year 100 percent, but with the increasing cost of royalties, we need to do a better job by leveraging local markets and advertisers. CBS has a string foothold in that local sales market, with over 140 sales teams.

That statement is an eye-opener for any music service hoping to make money from advertising. If AOL Radio, with three million unique listeners per month (according to Namerow), is having a hard time, how are smaller ad-supported music startups supposed to survive? And affiliate links are not going to cut it. Every song on AOL Radio has a link to iTunes or Amazon, yet Namerow cautions that “those commerce links are a very minor revenue source.”

(...) Two more suggestions: 1) Make personal music recommendations based on my listening habits; 2) Integrate with CBS-owned Last.fm for more music choices and social recommendations», AOL Radio Relaunches, Now Powered By CBS: Going After Local Ads Erick Schonfeld 10/06/08 tecrunch.com