The Internet radio sector got a boost today with two players striking deals to increase distribution and e-commerce.
Internet radio broadcaster TheDJ.com announced alliances today with entertainment firm Launch Media and music site the Ultimate Band List (UBL) to offer content from the two firms and bolster distribution.
Internet radio is still a nascent industry, and analysts have noted that the various business models the players have adopted are largely untested in a digital medium. The competitors, which also include Imagine Radio and Broadcast.com (formerly AudioNet), among others, are trying different strategies to build their brands and attract revenue to augment advertising.
Internet radio in its current form could be a placeholder of sorts for the future of music online, which is likely to involve digital downloads that users can listen to on their computers or "burn" into CDs, said Mark Hardie, senior analyst at Forrester Research. Though much of the technology is available now, it often is used illegally. And because music sales on the Net still represent a tiny fraction of overall music sales, record companies are not rushing use it as more than a marketing vehicle.
As far as NetRadio is concerned, "We will capitalize on our company's monthly global audience of 3 million active music listeners; so, unlike 'traditional' commerce Web sites which are forced to commit tens of millions of dollars to third parties in an attempt to attract customers, CDPoint benefits at the outset from an ongoing stream of millions of loyal NetRadio listeners," Jan Andersen, NetRadio's senior vice president of sales and marketing, said in a statement.
The firm plans to leverage its radio programming to help sell CDs by advertising specials relevant to individual channels.
"If, for example, you are listening to any of the several jazz channels on NetRadio, you will be informed about special offers on jazz CDs available from CDPoint," Andersen stated.
NetRadio offers 150 music, news, and specialty channels. It is a subsidiary of Navarre Corporation, which publishes and distributes software and music. NetRadio launched CDPoint a few months ago with a few hundred titles; the site now boasts 250,000 CDs, according to NetRadio.
For its part, TheDJ.com president Josh Felser said starting late in July, the "Artist Info" button on the TheDJ.com's radio player--a desktop application built directly on the RealAudio Player Engine that allows users to listen to music independently of a browser or the RealAudio Player--will link to a "jump page." That page will contain content about artists by Launch Media and the UBL, including news, features, interviews, album and concert reviews, new releases, and biographies.
TheDJ.com will count the traffic that goes to the jump page and will sell its "above-the-fold" ad banner. When users click through to other content from the jump page, the traffic will be counted by Launch or the UBL, he said.
Also as part of the deal, TheDJ.com has created radio players cobranded with Launch Media and the Ultimate Band List. Launch also will include the cobranded DJ Player on more than 1 million CD-ROMs.
TheDJ.com already has an e-commerce deal in place with Net music retailer CDnow, in which TheDJ.com gets a percentage of sales from click-throughs from its player, which has a "Buy this CD" button. But Felser said that would change in the next two months. He said the new alliance would be "very different from the current deal we have," but he declined to disclose whether it would involve CDNow or another retailer.
Felser noted that though advertising now makes up a greater part of the company's revenue, "we are not a successful business unless we sell music as well. We have to do both well."
He said the new sales arrangement will involve special channels within the player that will be "tightly integrated with our sales partners.
"We will use the promotional power of radio to help our partners sell music," he added.
Marc Geiger, cofounder of the UBL's parent company, Artistdirect, said the deal with TheDJ.com is "a real value-add for our audience. It's a music site--people should be able to listen to music while they search our site." The Ultimate Band List will roll out its anticipated relaunch tomorrow, he said.
In related news, Geiger said Artistdirect will be launching artist-specific merchandise sales sites for the Beastie Boys, Ozzy Osbourne, Slayer, the Who, and Sublime over the next few months. The firm already operates such a site for the Rolling Stones.