iHeartMedia

Posted on February 18, 2016 by Clelia Ryan

iHeartMedia Logo -Source iheartmedia.com

Headquarters

iHeartMedia, Inc.
200 East Basse Road
San Antonio, Texas 78209-8328

Corporate Structure

Bob Pitman: Chairman and CEO [3]

Richard J. Bressler: President, CFO and COO [3]

Wendy Goldberg: Executive VP & Chief Communications Officer [3]

John Sykes: President of Entertainment Enterprises [3]

About

[source – Electro Area Youtube Channel]

iHeartMedia has become a major force in the mass media industry. It was founded under Clear Channel Communications when they purchased their first radio station in 1972. Today, iHeartMedia Inc. is the parent company of iHeartMedia Capital I, Clear Channel Outdoor Holdings (CCO) as well as iHeartMedia (IHRT) [14].

iHeartMedia has the largest impact of any media platform in America, reaching 245 million monthly listeners through radio. Their reach expands to 150 different markets and ownership of 850 stations. iHeartRadio is a digital platform to listen to all iHeartMedia stations [1]. The company proves to be very successful in the digital radio space. In 2014, Clear Channel Media formally changed its name to iHeartMedia. CEO Bob Pittman states, “The new name will reflect the company’s multi-platform presence and ability to embrace innovation and new technology” [9]. This name change allows the company to align itself with the iHeartRadio name that consumers are familiar with. iHeartRadio is responsible for many live music events throughout the year, such as the Jingle Ball national tour, iHeartRadio Music Festival and iHeartRadio Awards.

Radio

Radio is a still huge media outlet and continues to reach 91% of Americans ages 12+ each week [23]. As of January 2016, iHeartRadio has 80 million register users and total listening hours grew by 30% [18]. iHeartRadio has coined deals with some of the most well known on-air personalities such as Ryan Seacrest and Elvis Duran of New York’s Z100. Seacrest hosts of LA’s number one morning stations, 102.7 KISS-FM. He also hosts nationally syndicated programming with the broadcasts of On Air with Ryan Seacrest and American Top 40 with Ryan Seacrest [16].

Ryan Seacrest [16]

The iHeartRadio website and app provides “Live Radio“, allowing listeners to listen live to over 858 stations. They also provide “For You“, a feature that suggests stations based on the users preferred selection of genres. Finally, “Artist Radio” is a custom made station with songs by an artist selected by the listener and related music [17].

Right Here, Right Now: Financial Woes

Bloomberg’s Lucas Shaw Reports on iHeartMedia’s Debt [20]

Click here to view a Bloomberg video summarizing iHeartMedias debt crisis [20].

Recently, iHeartMedia has been making headlines for their massive debt reported at the end of 2015. The company is reported to have approximately $20.6 billion of debt [2]. In 2008 the company was bought by private equity firms Bain Capital Partners LLC and Thomas H. Lee Partners for $28 billion in a leveraged buyout. The buyout came during the economic recession and it was expected that in the coming years iHeartRadio would profit greatly [10]. However since 2008, iHeartMedia has been battling to pay off debt.

In response to the news, it was announced on March 8th that iHeartMedia Inc. hired Moelis & Co. as a financial advisor [4].

Also on March 8th, many bondholders became displeased with iHeartMedia’s executive decision to move $500 million in assets to a subsidiary. As a result bondholders filed notices of default. These bondholders argue that in transferring their shares of Clear Channel Outdoor Holdings Inc. to Broader Media LLC, iHeartMedia violated debt agreements. This was done in an attempt to clear up some of their massive debt [5].

In a press release issued on March 8th, iHeartMedia announced they filed a lawsuit in State District Court in Bear County Texas to prove their transfer of shares was done legally [6]. On behalf of the company, Chief Communications Officer Wendy Goldberg states, “We believe our recent contribution of Clear Channel Outdoor Holdings Inc. stock to our subsidiary Broader Media LLC constituted a permitted investment under, and fully complied with, our financing agreements” [5].

On March 10th, iHeartMedia was granted a temporary restraining order which rescinds the default noticed filed against the company. Moving forward, iHeartMedia and the bondholders, who issued the default notices, will have a court hearing before a judge. This hearing may determine how iHeartMedia will move froward in paying off their $20.6 billion in debt [11].

The trial regarding this matter is set to take place in a Texas state court on May 16, 2106. The shares in question are valued at $1.2 billion [12] .

Click for updating stock prices [19]

On April 25, 2016. iHeartMedia Inc.’s stock (IHRT) closed at $1.18 per share. This is a major drop in price compared to June 2015, when it was selling for $7.50 per share. Subsidiary, Clear Channel Outdoor Holdings also saw a drop in stock price from a year ago. It closed at $4.88 as opposed to its price of $11.21 seen in April 2015 [19]. In their Fourth Quarter and Full Year Report iHeartMedia stated a 3% revenue increase to $1.8 billion [18].

iHeartMedia’s Place in Political Advertising

Brendon DelToro [22]

On February 16th, iHeartMedia announced Brendon DelToro has been appointed to Vice President For Political Strategy. DelToro will aid in managing iHeartMedia’s relations with candidates and other political organizations. This year the company plans to have an iHeartMedia Campaign 2016 Command Center to keep track of over 2,000 elections in 150 markets. Brendon’s role will be to merge the political sales teams across iHeartMedia’s broad market reach [7]. The goal of iHeartMedia’s engagement with the political campaign is to allow political and advocacy groups to have access to iHeart’s 80 million users.

iHeartMedia is also planning on capitalizing on the 2016 election by having advertisers pay to place ads via radio rather than the traditional TV route. Candidates strive to target specific demographics, which is getting more difficult to do through traditional TV. Digital radio platforms, specially iHeartMedia can provide campaigns with data that is relevant for targeting the key audiences [8].

Continuing Their Place in the Entertainment Industry

Despite their well known debt and pending court hearings, iHeartMedia continues to hold their place in the music and entertainment industry.

iHeartMedia celebrated their 3rd annual iHeartRadio Music Awards on April 3rd. This award show is primarily driven by fans and users of the iHeartRadio app to vote for nominees.

iHeartRadio Music Awards Promotional Ad [13]

On social media the iHeartRadio Awards generated 115 billion impressions. This number includes the promotional period of the show throughout the television broadcast. This massive number of engagements far exceeds that of other popular award shows such as the MTV Video Music Awards. Chris Williams, Chief Product Officer credits the shows success to the fan engagement and radio personalities involvement [13].

Photo from the 2015 iHeartRadio Pool Party [15]

This summer, iHeartRadio will also be hosting their iHeartRadio Summer Pool Party. Tickets to this exclusive event at Miami’s Fontainebleau will be given to listeners across the country through on-air contests. This years lineup will feature Kygo, Flo Rida, DNCE and Jason Derulo [15]. Seasonal concert events such as the iHeartRadio Pool Party and Jingle Ball Tours are proven to boost listenership across iHeartRadio stations nationwide.

Summary

iHeartMedia is a well respected entertainment company but struggles with being profitable, due to its burdensome debt servicing obligations. Looking ahead, iHeartMedia’s debt crisis and battle with bondholders will have an effect on the financial future of the company. Overall, iHeartMedia remains competitive in the digital radio industry against companies such as Spotify and Pandora providing similar services.

Works Cited

[1] iHeartMedia Corporate. iheartmedia.com, Retrieved April 23, 2016

[2] “The Largest U.S. Radio Operator Is Saddled With $20 Billion Debt”. bloomberg.com, Retrieved April 23, 2016

[3] iHeartMedia Our Team. iheartmedia.com, Retrieved April 23, 2016

[4] “iHeartMedia hires Moelis to tackle debt burden”. newsdaily.com, Retrieved April 23, 2016

[5] “iHeartMedia, Lenders in Fight Over Disputed Share Transfer”. bloomberg.com, Retrieved April 23, 2016

[6] “iHeartMedia, Inc. Responds to Lender Group Allegation”. Businesswire.com, Retrieved April 23, 2016

[7] “iHeartMedia Names Brandon DelToro Vice President for Political Strategy”. iheartmedia.com, Retrieved April 23, 2016

[8] “Inside iHeartMedia Strategy to Steal Presidential Ad Dollars From TV” adage.com, Retrieved April 23, 2016

[9] “Clear Channel Rebrands As iHeartMedia” adage.com, Retrieved April 23, 2016

[10] “Coming, the collapse of radio’s iHeartMedia”. Medialifemagazine.com, Retrieved April 23, 2016

[11] “Court Rescinds Default Notices Against iHeartMedia”. Insideradio.com, Retrieved April 23, 2016

[12] “iHeartMedia Default Fight Set to Go to Trial” wsj.com, Retrieved April 23, 2016

[13] “2016 iHeartRadio Music Awards Social Engagement Captures 115 Billion Impressions Across U.S.” broadwayworld.com, Retrieved April 23, 2016

[14] “iHeartMedia Loses A Director, Gets More Time To Resolve Its Massive Debt Problems” billboard.com, Retrieved April 23, 2016

[15] “iHeartRadio Is Throwing Miami’s Biggest Pool Party of the Year With Flo-Rida, Kygo and More” miaminewtimes.com, Retrieved April 23, 2016

[16] “Ryan Seacrest Inks New Mega Deal with iHeartMedia” hollywoodreporter.com, retrieved April 23, 2016

[17] iHeartRadio. iheartradio.com, retrieved April 23, 2016

[18] iHeartMedia Investors. iheartmedia.com, Retrieved April 23, 2016

[19] iHRT Stock Price. Google.com/ihrt+stock+price, Retrieved April 23, 2016

[20] “Has iHeartMedia Defaulted on Debt?” uk.finance.yahoo.com, Retrieved April 23, 2016

[21] iHeartMedia Sizzle Reel. https://www.youtube.com/channel/UC6pQXJ0jHO8P9ih4rPRh8Kg, Retrieved April 24,2016

[22] Photo Brendon DelToro. allaccess.com, Retrieved April 24, 2016

[23] “Why Radio Fact Sheet”. rab.com, Retrieved April 24, 2016

iHeart Media

Posted on March 25, 2015 by Stephanie Zolan

by STEPH ZOLAN

iHeartMedia Logo. [1]

iHeartMedia Headquarters
200 East Basse Road
San Antonio, Texas, 78209
(210) 822-2828

Executives:

Bob Pittman, Chairman and CEO of iHeartMedia

Bob Pittman, Chairman & CEO [2]

Richard Bressler, President, CFO and CEO of iHeartMedia

Richard Bressler, President, CFO, & COO [2]

Wendy Goldberg, Executive Vice President and Chief Communications Officer

Wendy Goldberg, Executive Vice President & Chief Communications Officer [2]

Gayle Troberman, Executive Vice President and CMO [2]

John Sykes, President of Entertainment Enterprises [2]

History:

iHeartMedia began with the purchase of a single FM radio station by Lowry Mays and Red McComb under the name Clear Channel Communications. As the company progressed, they acquired not only more broadcast and digital radio stations, but also Clear Channel Outdoor. In addition, iHeartRadio was launched as a website in 2008, and now acts as a digital aggregator for radio brands. In 2014 the company officially rebranded as iHeartMedia in order to create a more cohesive and connected brand. iHeartMedia is now the largest mass media company in America. [3]

Radio:

iHeartMedia currently owns and operates over 850 broadcast radio stations in more than 150 United States markets. They have over 245 million listeners each month, making iHeartMedia the largest multi media company in the country. In addition, the company’s digital music service, iHeartRadio, allows users to create custom music stations. In January, the service exceeded 60 million registered users. [4]

iHeartMedia also operates Premiere Networks, which produces, distributes, or represents over 90 syndicated radio programs and services for more than 5,500 radio stations affiliates. [5] Some of the radio company’s syndicated programs are produced in house, which cater mostly to local markets. In addition to syndicated programming, iHeartMedia also produces Programming for iHeartMedia radio stations greatly varies in order to reach audiences in many different markets. The different radio formats include Alternative, Urban, Smooth Jazz, News talk, Sports talk, Adult Contemporary, Contemporary Hits, Country, Oldies and Classic Hits, Rock, Spanish, and Religious. [6]

Another technique iHeartMedia uses to draw in listeners, is employing trusted radio personalities. For example, On Air With Ryan Seacrest is a syndicated program that is available on over 150 radio stations across the country, and has made Seacrest a household name. [7] His home station, KIIS-FM in Los Angeles produced the most revenue of any United States station in 2014 earning $65.9 million. iHeartMedia continues to increase the awareness of their radio personalities through events. [8]

[9] One of the most well known radio personalities in the country.

Events:

iHeartMedia is more than just the largest owner of radio stations in the United States. The company also specializes in digital media, outdoor advertising, and event production. The national events are used to promote their top notch radio personalities as well as the most popular music on the radio.

[10] 2015 iHeartRadio Music Awards logo, from NBC.

Most recently, they hosted the iHeartRadio Music Awards. Musicians were not the only ones who brought home awards that night. The event itself won the Nielsen TV social ratings and the top trending show on Twitter for both the night and the entire week. During the promotional period and the show, The iHeartRadio Music Awards generated 14 billion social media impressions, which is a huge increase in comparison to last year’s 8.5 billion. [11] Local radio station personalities were engaging with viewers through social media, helping draw in the audience. This included live Twitter Periscope broadcasts of behind the scenes footage, and an iHeartAwards Snapchat Story that featured audience members, nominated artists, and radio host Ryan Seacrest. [12]

Clear Channel Outdoor Logo. [13]

Clear Channel Outdoor:

In addition to owning and operating radio stations and producing events, iHeartMedia also specializes in outdoor advertising. Clear Channel Outdoor Holdings is a subsidiary of iHeart, and is one of the largest outdoor advertising companies worldwide. They have over 640,000 displays including billboards, street furniture, retail advertising, airport advertising, transit advertising, and posters. Clear Channel Outdoor operates across 40 different countries. [14]

iHeartMedia in the Industry:

As a radio focused company, the main competitors for iHeartMedia are Cumulus Media and CBS Radio in the broadcast radio marketplace. SiriusXM has also become a competitor, and iHeartMedia has purchased two satellite stations of their own in order to expand into the satellite market. Since the company has also increased their digital presence with iHeartRadio, they now compete with Pandora and Spotify as well. [15] iHeartMedia’s ability to stand out is largely attributed to their availability across so many different platforms and formats. The scale of the company allows them to reach a large and diverse audience, and their creativity and tools enable iHeartMedia to effectively target their content and advertisements. [16]

Another factor is brand awareness. In December of 2014, iHeartRadio reached 75% brand awareness, which is a huge accomplishment considering they were at 10% only 5 years ago. iHeartRadio has over 500 million app downloads and 80 million social media followers. [17]

Aside from simply reaching such a large audience, iHeartMedia is able to analyze and more effectively monetize from their radio stations. On April 8^th, 2015 the company announced a partnership with the cloud-based advertisement platform, Jelli. Together, they will work to use technology to target their advertisements programmatically. By automating ad sales, it allows advertisers to make informed advertisement purchases. The system will use psychographics to determine groups that are related to music genres, weather and traffic patterns, and consumer purchase behavior. Advertisements have been programmatically sold online for the past 10 years, and iHeartMedia is now adapting the technique to be used with radio. [18]

Finances:

The majority of iHeartMedia’s revenue is derived from selling advertising times or placements on their radio stations or websites. Between 2013 and 2014, the company’s consolidated revenue increased by $75.5 million, from $6,243,044 to $6,318,533, with $29.9 million attributed to political advertising, traffic and weather, broadcast radio and digital revenues. Unfortunately, their revenue from americas outdoor advertising decreased by $37.3 million, mostly due to lower national account revenues and the nonrenewable airport contracts. [19]

Future:

The next move for the company, is the establishment of iHeartMedia SoundBoard. This entertainment studio will be used to connect brands with iHeartMedia’s available talent and radio personalities to create original audio, video, and experiential content. The studio is primarily audio focused since iHeartMedia is mainly a radio company, but everything that is produced will be accessible across all of iHeartMedia’s platforms including broadcast and digital radio, mobile apps, and live events. The success of this program will be made possible by iHeartMedia’s extensive connections and experience in the entertainment industry as well as the company’s knowledge of both consumers and brands. This development will introduce a new method of creating and distributing content to the market, which may have a large impact on the storytelling industry. When the iHeartMedia SoundBoard studio will launch has yet to be confirmed. [20]

Sources:

[1] IHeartMedia. Digital image. Brradio. Published September 16 2014. Retrieved April 17, 2015.

[2] iHeartMedia Corporate Team. iHeartMedia. Retrieved April 17, 2015

[3] Clear Channel Becomes IHeartMedia. iHeartMedia. Published September 16, 2014. Retrieved April 17, 2015.

[4] About iHeartMedia. iHeartMedia. Retrieved April 17, 2015.

[5] Hampp, Andrew. Clear Channel Changes Name to iHeartMedia. Billboard. Published September 16, 2014. Retrieved April 17, 2015.

[6] Station Search. iHeartMedia. Retrieved April 17, 2015.

[7] All Stations And Times. Tune In. Retrieved April 17, 2015.

[8] Overall U.S. Radio Industry Revenues Remain Steady at $14.9 Billion in 2014. BIAKelsey. Published April 1, 2015. Retrieved April 17, 2015.

[9] On Air With Ryan Seacrest Logo. The Drum. Retrieved April 17, 2015.

[10] iHeartRadio Awards Logo. NBC. Retrieved April 17, 2015.

[11] iHeartRadio Music Awards” Generates 14 billion Social Media Impressions. Digital Media Wire. Published April 1, 2015. Retrieved April 17, 2015.

[12] 2015 iHeartRadio Music Awards Generates More Than 14 Billion Social Impressions. Business Wire. Published April 6, 2015. Retrieved April 17, 2015.

[13] Clear Channel Outdoor Logo. Retrieved April 17, 2015.

[14] Company Overview. Clear Channel Outdoor. Retrieved April 17, 2015.

[15] iHeartRadio Grows Even More: How Will This Impact Sirius XM And Pandora? Seeking Alpha. Published June 27, 2012. Retrieved April 17, 2015.

[16] Sisario, Ben. Clear Channel Renames Itself iHeartMedia in Nod to Digital. The New York Times. Published September 16, 2014. Retrieved April 17, 2015.

[17] iHeart Media Surpasses 60 Million Registered Users Continuing to Demonstrate Accelerated Growth, Engagement and Strong Brand Awareness. Business Wire. Published January 23, 2015. Retrieved April 17, 2015.

[18] Marshall, Jack. iHeartMedia Will Sell Radio Ads Programmatically. Wall Street Journal. Published April 8, 2015. Retrieved April 17, 2015.

[19] iHeartMedia 2015 10-K. United States Securities and Exchange Commission. Published February 19, 2015. Accessed April 17, 2015.

[20] iHeartMedia Announces “iHeartMedia SoundBoard,” A New Multiplatform, Audio-Centric Branded Content Studio That Invites Brands, Talent and Fans To Join in Developing Original Productions. iHeartMedia. Published February 3, 2015. Retrieved April 17, 2015.

Spotify

Posted on October 14, 2014 by hlu04

by Helen Lu

[1] Spotify’s Logo

KEY EXECUTIVES

[2] Spotify Founders- Martin Lorentzon & Daniel Ek

[3] Jeff Levick- Chief Business Officer

[4] Steve Savoca- Head of Content

[5] Ken Parks- Chief Content Officer & Managing Director USA

SPOTIFY OVERVIEW

[6] Spotify’s sleek interface layout for their multi-platform service.

Spotify is a privately-owned, digital music streaming service that provides on-demand access to tracks. It is available on multiple platforms, including computers, mobile, tablets, and home entertainment systems. Originally founded in Sweden in 2006, Spotify launched in the United States in 2011; it is now available in 58 markets. [7]

Spotify offers listeners the free model, “made possible by ads,” and the premium model for $9.99 monthly, which is ad-free, high-quality, and available offline. [8] With over 20 million songs, over 20,000 tracks added daily, and over 1.5 billion playlists, Spotify has accumulated 10 million active users and a total of 40 million active users. [9]

COMPETITORS

Rdio, Pandora, Rhapsody, Google Play Music, Beats, iTunes Radio, Music Unlimited, and Xbox Music are worthy contenders in this competitive space. Product reviews assess service quality with major factors include song catalog, user interface, support, and features. [10] Each racing for a market share, these top players in the market are making strategic ploys to stay afloat.

On November 12th, Youtube announced their own streaming service, Youtube Music Key for $9.99. It will be interesting to see how it will affect the music industry when it fully hits the market in 2015. [11]

[12] Spotify and The Echo Nest collaboration

In early March 2014, Spotify acquired The Echo Nest, a big data company to enhance the music discovery feature, forcing Rdio, Rhapsody, iHeartRadio, and Vevo to look elsewhere for a discovery algorithm. [13]

THE SPOTIFY STRATEGY

Spotify has successfully targeted college students, establishing a solid audience base and brand loyalty. With personal information confirming their status, Spotify offers students Spotify Premium for only $4.99. [13]

[13] Spotify engages their target audience: college students and 18-24 year-olds.

COLLEGE CASE STUDY

Spotify’s tenacious grasp on college students’ listening is reflected in their recently released research report of the Top 40 Musical Schools in America. The findings are a close study of the musical norms in the schools.

[14] Detailed graphs document music-genre distribution and listening spikes, showing not only what students listen to but also how they listen.

The data that Spotify is able to collect can be utilized for targeted advertising and marketing campaigns today. Moreover, with such a large following of the developing youth, Spotify is not only able to make significant advancements with the invaluable information about today, but accurate inferences about these soon-to-be adults tomorrow. [13]

#THATSONGWHEN

Spotify launched their #thatsongwhen campaign with advertising agencies Ogilvy & Mather and David to further engage their millennial base. #Thatsongwhen allows users to tie their emotional experiences to their favorite songs, to create, and to tell stories. The customization, personalization, and interactivity of a musical experience attracts and retains a young crowd. [15]

The stories are media clips that are charged with emotion, and of course, music. Don’t Go Chasing Girls is about a man’s early memory of his childhood crush that is easily triggered with TLC’s hit song, Don’t Go Chasing Waterfalls. Stories and songs are updated and posted on a live feed.

AD TAKEOVER

Spotify is introducing two new advertising options for eager advertisers:

1. The dubbed Video Takeover, only available on desktops, allows brands to takeover the screen during 15-30 second advertising breaks.

2.The dubbed Sponsor Sessions forces mobile users to view a 15-30 second video on their mobile devices in order to proceed onto 30 minutes of uninterrupted streaming. [16]

McDonald’s, Universal Pictures, and Ford are just some of the major sponsors that have opted into this advertising innovation. [17]

[18] McDonald’s format and utilization of Spotify’s advertising product – Video Takeover.

SPOTIFY PARTNERSHIPS

VODAFONE

Everything is going mobile, and music is no exception. This rapid trend of playing and streaming music from a smartphone is particularly prevalent in Australia. Due to these recent findings, Vodafone Australia has partnered with Spotify to bundle in Spotify Premium for free with their monthly plan. A Spotify Premium subscription generally costs $11.99 Australian dollars each month. The exclusive offers with Spotify vary, and are known as the Red Plans. [19]

[20] Research shows that 1.5 million Australians stream music from their mobile devices.

Vodafone believes that Spotify Premium’s features complement and maximize the use of their faster network speeds, value plans, and expanding 4G network. Both the companies and the listeners are benefitting from this collaboration as the marriage of these digital services follow consumer trends and meets consumer needs. [21]

CARPLAY

Apple Carplay is an a new feature configured in select 2014 vehicles. Spotify is on board for this innovative ride as it has updated and fixed some bugs for this new multimedia system. [22] The music player allows users to access their Spotify accounts using a compatible iPhone. [23] With a built-in display to play music, Carplay is an exclusive and luxurious market; the Ferrari FF is one of the few select cars with Carplay. Several automobile manufacturers, however, are making an effort to include and support this system in the future. [24]

[24] Spotify collaborates with Apple Carplay to incorporate music services in the latest car models.

UBER

Uber is a hip taxi service, and Spotify is a hip streaming service. These two successful startups partner up for a new listening experience. Passengers can link their custom playlists to Uber vehicles for a fun ride. Although this new feature has started off in ten cities, it makes a big splash in the car service industry and the music industry. This partnership allows both companies to co-promote their respective brands and to change with the times. The service is for Spotify Premium account holders. [25]

[26] Spotify and Uber modernize the standard cab-ride as they join forces to create a new listening experience.

SPOTIFY CONTROVERSY

Taylor Swift pulled her entire catalogue from Spotify’s music database as she believes that it does not fairly compensate artists. [27] As a popular musician, her bold move and her public statements rejecting the streaming business model has made headlines for weeks. Fans and critics are responding to her decision with distaste as both parties point out that there are other viable services, such as Youtube and SoundCloud, to play her music. [28] While she recently accepted the first-ever Dick Clark Award for Excellence at the 2014 American Music Awards Ceremony, she added another snide comment jabbing at Spotify and streaming services again. [29] Jason Aldean has followed Swift’s footsteps, and pulled his new album Old Boots, New Dirt from Spotify. [30]

Spotify executive, Ek, combats this frenzy and reports that artists that use Spotify to promote their music actually sell more, and that Spotify has returned over $2 billion to music industry today. Top artists like Swift are set to project over $6 million in revenue a year. [31] Despite the financial debate and moral controversy, the Spotify team still hopes for Swift to change her mind. [32]

[33] Taylor Swift is a firm believer in the value of music, and that it should not be free. Swift has pulled her music catalogue from Spotify.

It is unlikely that many artists will join Swift’s banning of the digital streaming business, as it is the digital age. Reports confirm that streaming services grew 28% in the first half of 2014. [26] Listeners’ habits changed; artists can sink, but digital streaming services will swim.

SPOTIFY: LOOKING AHEAD

Despite the recent controversies, Spotify has achieved success with their recent collaborations; the student discount and the partnership with Vodafone have led Spotify subscriptions to increase by 42%. [28] Spotify Family Plan has launched with popular demand and proven financial success with previous discount deals. The plan allows subscribers to add four family members to their account for half the price. [34]

Spotify’s name is globally recognized, and Spotify’s services are well integrated into the new digital age. Its key strategies and partnerships keep it on the bleeding edge of the music industry.

Sources

1. Spotify’s Logo, Spotifypress.com, RT:11.29.2014

2. Daniel Ek and Martin Lorentzon, RT: 11.29.2014

3. Jeff Levick, RT: 11.29.2014

4. Steve Savoca, Spotifypress.com, RT:11.29.2014

5. Ken Parks, Evolver.fm, RT: 11.29.2014

6. Spotify Interface Layout, RT: 11.29.2014

7. Spotify Business Information, investing.businessweek.com, RT: 11.29.2014

8. Spotify Official Website, spotify.com/us, RT: 11.29.2014

9. Spotify Press Information, spotify.com/information, RT: 11.29.2014

10. “Spotify and competitors play to their musical strengths”, usatoday.com, RT: 11.29.2014

11. “YouTube Launching Spotify-Style Paid Music Service”, TIME, RT: 11.29.2014

12. Spotify and The Echo Nest Collaboration, RT: 11.29.2014

13. “Will Spotify’s hat trick help it pull ahead of competition?”, Fortune, RT: 11.29.2014

14. How Students Listen, spotify.com, RT: 11.29.2014

15. “Spotify Ties Music to Personal Stories in Its New Ads”, adweek.com, RT: 11.29.2014

16. “Spotify Unveils Video Takeover Ad Product for Free Users”, telecompaper.com, RT: 11.29.2014

17. “Spotify is bringing video ‘takeover ads’ to its free service”, theverge.com, RT: 11.29.2014

18. Spotify Video Takeover Format, spotify.com, RT: 11.29.2014

19. “Vodafone offers postpaid customers free Spotify Premium access”, CNET, RT: 11.29.2014

20. “Spotify partners with Vodafone Australia for down under listeners”, rainnews.com, RT: 11.29.2014

21. “Vodafone Australia and Spotify join forces!”, vodafone.com, RT: 11.29.2014

22. “Spotify adds support for Apple’s CarPlay in update to iOS app”, talkingnewmedia.com, RT: 11.29.2014

23. “Spotify Adds CarPlay Support in Latest iOS Update”, macrumors.com, RT: 11.29.2014

24. “Apple CarPlay comes to Pioneer stereos as Spotify adds support”, engadget.com, RT: 11.29.2014

25. “Tuneup, redefined: You can now Spotify your Uber ride”, CNET, RT: 11.29.2014

26. Uber and Spotify Partnership, Uber.com, RT: 11.29.2014

27. “Taylor Swift is right about music, wrong about Spotify, says CEO Ek”, CNET, RT: 11.29.2014

28. “Why Taylor Swift Will Lose Her Battle With Spotify”, TIME, RT: 11.29.2014

29. “AMAs: Taylor Swift Continues Anti-Streaming-Service Stance in Dick Clark Award Speech”, hollywoodreporter.com, RT: 11.29.2014

30. “Jason Aldean Agrees with Taylor Swift, WIll Remove New Album From Spotify”, musictimes.com, RT: 11.29.2014

31. “$2 Billion and Counting”, spotify.com, RT: 11.29.2014

32. “Here’s Why Taylor Swift Pulled Her Music From Spotify”, TIME, RT: 11.29.2014

33. “Taylor Swift and the Whole Spotify Thing”, uloop.com, RT: 11.29.2014

34. “Spotify launching family plan with cheaper subscriptions for families”, theguardian.com, RT: 11.29.2014

Sirius XM Radio

Posted on October 5, 2014 by areeves

by Allie Reeves

[1] SiriusXM Logo

The Sirius Story:

Sirius XM Holdings Inc. is a satellite radio service that offers commercial-free streaming on over 175 channels in the United States and Canada. These channels are comprised of every type of radio – music, news, sports, talk, and more [2]. It is currently the largest radio broadcaster and caters to about 26.7 million subscribers [3].

[30] SiriusXM Programming

Currently, the most popular way for subscribers to enjoy SiriusXM Radio is in the comfort of their cars. SiriusXM has arrangements with over forty automakers for installation of their services directly into the vehicle [3]. However, as of recent, SiriusXM has become available to stream directly online in your home or office, as well as an app that can be accessed on Smartphones and Tablets.

SiriusXM currently offers three different packages: Sirius Select, Sirius All Access, and Sirius Mostly Music. The packages can be bought on a monthly or annual basis and range in price from $9.99 to $199 [4].

[4] Most Popular Packages for SiriusXM Customers

The Sirius Team:

[6] Scott Greenstein, President & Chief Content Officer

[5] James E. Meyer, CEO

[7] Patrick L. Donnelly, Executive Vice President and General Counsel

Finances:

[31] SiriusXM finances as of December 1, 2014

SiriusXM recently released their 2014 Third Quarter Results, which revealed a 10% increase in revenue since this time last year, putting the company at a record high of $1.1 billion. This is higher than analysts originally anticipated for the company, as they put the company’s assumed revenue at $1.04 billion. The company also increased its subscriber count by 1.2 million [8].

Interest in shares of SiriusXM increased rapidly during the month of November. As of November 14^th, there has been an increase of 2.8% since October 31^st up to 247, 283,696. The company is now up to a $3.75 price on their stock [32].

Competitors:

[11] Apple Inc. Logo

SiriusXM’s current competitors are Apple and iHeartMedia, as well as regular terrestrial radio. Pandora and Spotify have also been named as competitors, but in a recent interview with James Meyer, CEO of SiriusXM, the two services were ruled out.

[12] iHeartMedia Logo

Meyer explained these companies are streaming services, which he doesn’t view as competition, but as its own distinct technology. Meyer also stated that out of them all, terrestrial radio is their primary competition, with 220 million people that use it everyday [9].

However, with Apple’s new CarPlay, that might not be the case for much longer. CarPlay gives drivers access to all of their music, podcasts, and audiobooks with the touch of a button, and major auto companies like Mercedes-Benz, Volvo, and Ferrari are already on board. The venture is still in its early stages, but since SiriusXM is primarily used by vehicle subscribers, CarPlay could end up being a serious competitor [10].

[13] Apple CarPlay

The Sirius Edge:

What sets SiriusXM apart from its competitors at Apple, and iHeartMedia is the company’s original content that can only be accessed through subscriptions to SiriusXM.

[15] The Howard Stern Show, one of the most popular talk shows on SiriusXM

Some of the most popular original content shows include The Howard Stern Show, The Oprah Winfrey Show, and NFL Radio, although many more are available [3]. This original content helps keep subscribers tuning in, and keeps SiriusXM’s churn rate at an impressive 1.9%. It also helps the company keep their acquisition costs low, which has recently become problematic for companies like Pandora [14].

[17] SiriusXM Town Hall Event in the Fishbowl

SiriusXM is also known for their “Town Hall” Series. These intimate gatherings take place in the SiriusXM fishbowl, a private listening studio, where entertainers sit down with a live studio audience comprised of about 30 SiriusXM subscribers who have won an invitation to the event [16].

[19] Taylor Swift at a Town Hall Event for SiriusXM

Recently, SiriusXM was able to snag Taylor Swift for a Town Hall Event. Subscribers had the chance to ask her questions and listen to songs off of her newest album, 1989. This event comes after Swift’s recent decision to pull her music off of Spotify, giving even more leverage to SiriusXM [18].

The Today Show for SiriusXM:

This past year, SiriusXM announced a major deal with NBC, in which simulcasts of the hit NBC show, The Today Show, would be broadcasted on the satellite radio service. The format of bringing a morning show to radio has been done before, unsuccessfully. However, what makes this different is that SiriusXM will not be airing segments of the popular morning show, they will be airing the program identically as it airs on television [20].

[24] The Today Show

This move was a strategic boost for both companies. The show airs during popular morning drive time, when radio listening is at its highest. The deal will allow NBC to access SiriusXM’s 26 million listeners, and SiriusXM hopes to draw in more subscribers that are already fans of the show.

[21]

Suing Sirius:

SiriusXM has come under fire in the past year over use of music recorded before 1972. More recently, individual bands have started going after the company, claiming that they deserve compensation. Although songs recorded before February 15^th, 1972 are not covered by federal copyright law, some artists and labels have been seeking protection under individual state laws – and the courts have been agreeing. As of November 17^th, the 1960s rock band, The Turtles, has had two victories against the satellite radio company [22].

[25] Rock Band The Turtles in the 1960s

The court ruled that music recorded before 1972 still has a public performance right and that digital services cannot use it without permission or compensation. SiriusXM has requested to dismiss the lawsuit, but it has been rejected. The judge ruled that SiriusXM has until December 5^th to show any factual issues that would be cause for a trial. If none are found, she will rule in favor of the band, and “assess damages” [23].

What’s Next:

[28] Joel Osteen

SiriusXM recently announced that Golf Hall of Fame member Sir Nick Faldo will receive his own show, where he will talk golf and get to know golf enthusiasts, while they get a chance to know him [26]. SiriusXM also launched a new pop channel, Venus, as well as adding some of their popular internet only channels like Y2Kountry and Utopia to their satellite lineup. Joel Osteen Radio will also be coming to SiriusXM, a station rooted in the power of “positive thinking with messages of inspiration” [27].

[33] Holiday music channels at SiriusXM

SiriusXM is currently celebrating the sounds of the holiday season with the addition of two new Holiday Music channels, Holly and Holiday Traditions. They plan to release more within the upcoming month [33].

Also effective January 2015, there will be an increase of 1.4 percentage points in the U.S. Music Royalty Fee applied to most SiriusXM audio packages, in order to fund royalty payments to the music industry [29].

Sources

1. SiriusXM’s Logo 2014, Fbnstatic.com, RT: 11/20/2014

2. What is SiriusXM?, Siriusxm.com, RT: 11/20/2014

3. Corporate Overview, Siriusxm.com, RT: 11/20/2014

4. Our Most Popular Packages, Siriusxm.com, RT: 11/20/2014

5. Chief Executive Officer, SiriusXM, Siriusxm.com, RT: 11/20/2014

6. President & Chief Content Officer, SiriusXM, Siriusxm.com, RT: 11/20/2014

7. Executive Vice President and General Counsel, SiriusXM, Siriusxm.com, RT: 11/20/2014

8. “SiriusXM Reports Third Quarter 2014 Results”, Investor.siriusxm.com, RT: 11/20/2014

9. “Sirius XM CEO: I Don’t See Spotify As A Direct Competitor”, Benzinga.com, RT: 11/22/2014

10. “Is Apple’s New Toy a Sirius XM or Pandora Killer?”, Fool.com, RT: 11/22/2014

11. Apple Inc. Logo, Worldofdtcmarketing.com, RT: 11/22/2014

12. iHeartMedia Logo, Billboard, RT: 11/24/2014

13. Apple Car Play, Uncrate.com, RT: 11/24/2014

14. “Sirius XM’s Main Edge Over Competitors”, Fool.com, RT: 11/28/2014

15. The Howard Stern Show, Tuaw.com, RT: 11/22/2014

16. SiriusXM Town Hall, Siriusxm.com, RT: 11/20/2014

17. SiriusXM Fishbowl Event, Howstuffworks.com, RT: 11/28/2014

18. “Taylor Swift’s Exclusive 1989 “Town Hall” to Air Live on SiriusXM”, Investor.siriusxm.com, RT: 11/24/2014

19. Taylor Swift for SiriusXM, SiriusXM Blog, RT: 11/22/2014

20. “Starting in June, ‘Today’ Will Simulcast on SiriusXM”, New York Times, RT: 11/28/2014

21. Today Show Radio on SiriusXM, YouTube, RT: 11/28/2014

22. “Rock band wins again in copyright battle against Sirius XM”, The Times of India, RT: 11/28/2014

23. “New York Court Delivers Third Strike Against Sirius XM on Pre-1972 Sound Recordings”, Sound Exchange, RT: 11/28/2014

24. Today Show Logo, Momsdemandaction.org, RT: 11/28/2014

25. The Turtles, Allmusic.com, RT: 11/28/2014

26. “Sir Nick Faldo to Host SiriusXM Show”, Techsonian.com, RT: 11/28/2014

27. New Channels and Lineup Changes, Siriusxm.com, RT: 11/20/2014

28. Joel Osteen, Lightsource.com, RT: 11/28/2014

29. “U.S. Music Royalty Fee Effective January 5, 2015”, Siriusxm.com, RT: 11/28/2014

30. SiriusXM Programming, Siriusxm.com, RT: 11/20/2014

31. SiriusXM Financials, Google, RT: 12/1/2014

32. SiriusXM Stock Information, Watchlistnews.com, RT: 12/1/2014

33. Holiday Music at SiriusXM, Siriusxm.com, RT: 12/1/2014

Radio One

Posted on April 21, 2014 by Mary Morgan Craig

by Morgan Craig

[1]

Radio One Inc.

1010 Wayne Ave. 14th Floor

Silver Spring, MD 20910

Radio One, Inc founded in 1980 and officially incorporated in Delaware MD[1] is a multi-media company targeted towards African-American and urban consumers. In the U.S It is the largest African-American owned corporation of its kind. Specializing in radio broadcasting, the company presently owns and operates 55 broadcast stations in 16 of the country’s major urban markets. These markets include 6 of the top 10 Abitron ranked African-American radio markets in the U.S.: Atlanta GA, Washington D.C., Philadelphia PA, Houston TX, Dallas TX, and Detroit MI.[2]

Radio One’s additional subsidiaries include: “TV One” LLC: a cable television network, Reach Media Inc: a cross media company which produces The Tom Joyner Show, “Interactive One” LLC: an online platform covering news and pop culture, and OneSolution the companies marketing and brand sales division. Radio One has received a number of revolutionary accolades including “first woman owned radio station to rank number 1 in any major market” and “first african-american radio broadcast company to champion several major markets.”[3]

History: Radio One was founded by the inspiring and passionate Catherine (Cathy) L. Hughes in 1979. As a 16 year old mother Catherine Hughes was kicked out of her parents home and forced to fend for her and her child’s own well being. This tribulation sparked her tenacity to become the media mogul she is today.

[2]

Hughes was born in Omaha Nebraska in 1949. Her first experience with the radio industry was in 1969 when she scored a position at KOWH, a black radio station in Omaha. She was recognized by the Howard University of Communications in Washington D.C. for her accomplishments at KOWH and offered a job as lecturer and assistant to the dean in 1971. [4] In 1973 she became the general sales manager at the University’s radio station WHUR where she brought the stations revenue from $250,000 to 3 million in just her first year. By 1975 Hughes had become the Vice President and general manager of the station.

Eventually in 1980 with her husband of the time, Dewy Hughes, Cathy bought her own station; radio WOL-AM (D.C.) with a bank loan she finally attained after being rejected by 32 banks. [Here she curated her own content: “24-hour talk from a black perspective”. This marked the creation of Radio One. Her acquisition of WOL proved to be her most challenging but also most successful venture. After divorcing her husband shortly after buying the station, Cathy bought his share of WOL and therefore struggled a great deal financially.[5]In an effort to keep her business a float Cathy moved out of her apartment with her son Alfred C. Liggins and made a home at the radio station until 1986 when the station started making a profit. [6] In 1997 Cathy appointed her son Alfred C. Liggins III as CEO of Radio One.

[3]

After receiving an MBA from Wharton School of Business Alfred urged his mother to advance and go public with the company. On January 1st, 1999 Radio One Inc. (ROAI) went public with an offering price of $24 for 6,500,000 shares.[1] As compared to broadcast companies at the time such as Citadel and Beasley this was a large IPO.In the years that following1999 Radio One has acquired multiple subsidiaries and crossed platforms in an effort to expand their reach.

Properties:

[4]

TV One: On january 19, 2004 Radio One (51%) launched a joint venture with Comcast Corporation (49%) called TV One. TV One is a cable network which seeks to target the African-American consumer by providing news, sitcoms, reality TV, and big studio movies from an African-American perspective.[7] The stations most well known program Unsung tells stories of the most influential R&B and Soul artists of our time. As of August 2013 the station has proven to be present in over 57 million households (50.28% of households with a television).

[5]

Reach Media Inc: On February 3rd 2005 Radio One acquired 53.5% ownership interest of their current subsidiary Reach Media Inc. Located in Dallas, TX and founded in 2003 by Urban radio talk show host Tom Joyner, Reach Media is built around the strong marketing muscle that is the Tom Joyner Morning Show. The Tom Joyner Show is present in over 100 markets and reaches approximately 8 million listeners.[8] Reach Media seeks to create and manage on-air and online content that entertains their consumers and provides a successful vehicle for advertisers.[9]

[6]

Interactive One: Radio One crossed the digital platform when they founded Interactive One (iOne) in 2007. [10] Interactive One operates several online brands targeted towards an African-American and latino audience including BlackPlanet.com: a social networking site, Hellobeautifull.com: a lifestyle site for black women, NewsOne.com a news source providing content pertaining to African-Americans, TheUrbanDaily: a pop culture/ entertainment media site, and GIANTlife.com: a celebrity focused news source. Interactive One’s headquarters are located in New York, New York.[11]

Executive Team:

Catherine L. Hughes: Founder, Chairperson, & Secretary

[7]

Alfred C. Liggins III: CEO, President & Treasurer

[8]

Peter D. Thompson: Executive Vice President & CFO

Linda J. Vilardo: Vice President, Assistant Secretary & Chief Administrative Officer

Financials:

Radio One is indicated on NASDAQ as ROIA.

2013 Quarterly data shows that during the first and second quarters of the year Radio One saw an increase in earnings: Its March gross profit of $68,639 to its June gross profit of $86,705. It then took a steady decline however in the third and fourth quarters as its September earnings were $81,112 and December earnings were $74,223. Despite the last half of the years quarterly decrease annually the company is seeing an increase from their final 2012 year gross profit of $288,599 as 2013’s annual gross profit is $310,679.[12] 50.2% of the company’s net revenue in 2013 was generated through radio advertising dollars. [13]Radio One has been seeing a steady increase annually since 2011.

News:

[9]

April 16, 2014 – Radio One’s Advertising division One Solution received three bronze Telly awards for its 2013 ad campaign vignettes for Chevrolet Impala, Johnson & Johnson, and Walmart. [14]

April 14th, 2014 – Radio One will be hosting a conference call to discuss 2014’s 1st fiscal quarter. Investors, analysts and other interested parties are invited to join. The call is set to occur on May 8th, 2014 at 10:00 am EDT.[14]

[10]

April 9, 2014 – Radio One is partnering with Atlantic Records to provide one lucky listener from a radio one radio market with the chance to win a prom date with R&B singer Sevyn Streeter. 1,000 dollars towards prom expenses will be awarded to the winner, Sevyn will provide a musical performance during the event, and a limousine ride too and from prom will also be included.[14]

January 27, 2014 – Radio One is offering $335 million in aggregate principal amount of senior subordinated notes due 2020. The offering is exempt from registration under the securities act of 1933. The company says that they plan to use these proceeds to redeem its currently outstanding amounts under its senior subordinated notes due 2016.[14]

References:

1 . http://ipo.findthebest.com/l/871/Radio-One-Inc

2. http://phx.corporate-ir.net/phoenix.zhtml

3. http://www.creativeanddreamsmusicnetwork.com/legends/cathy-hughes#.U1Uy9OZdW4I

4. http://www.huffingtonpost.com/2012/08/17/catherine-hughes-radio-one_n_1798129.html

5. http://www.thehistorymakers.com/biography/cathy-hughes-39

6. http://www.mediabistro.com/So-What-Do-You-Do-Cathy-Hughes-Founder-of-TV-One-and-Radio-One-a11141.html

7. http://tvone.tv/inside-tv-one/about-tv-one.html

8. http://www.reachmediainc.com/

9. http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=10714662

10. .http://interactiveone.com/10

11. http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=47611884

12. http://finance.yahoo.com/q/is?s=ROIA&annual

13.http://quote.morningstar.com/stock-filing/Annual-Report/2013/12/31/t.aspx?t=XNAS:ROIA&ft=10-K&d=bc777893522a2104916cd6faf3130ea5

14.http://www.radio-one.com/latest-news/

Images:

1.http://media.corporate-ir.net/media_files/irol/63/63747/images/Radio_One_2008_Logo.JPG

2.http://www.radiofacts.com/wp-content/uploads/2013/06/cathy-hughes-corp-pic-111.jpg

3.http://i.huffpost.com/gadgets/slideshows/250187/slide_250187_1550334_free.jpg?1348183188887

4.data:image/jpeg;base64,/9j/4AAQSkZJRgABAQAAAQABAAD/2wCEAAkGBxQQEhQUEB

5.http://www.reachmediainc.com/graphics/logo.gif

6. https://pbs.twimg.com/profile_images/1134594466/IO.jpg

7. file:///Users/MaryMorgan/Downloads/cathy_2.jpg

8. http://www.wharton.upenn.edu/125anniversaryissue/img/lg/liggins.jpg

9.file:///Users/MaryMorgan/Downloads/OneSolution.png

10. Sevyn-Streeter-Diggin-On-You-TLC-Acapella-Cover-EXCLUSIVE.jpg

Clear Channel

Image

By Billy Eisenberg

Overview:

Clear Channel Communications was founded in 1972 by Lowry Mays and B.J. McCombs. After initially purchasing their first station in San Antonio, the company’s explosive growth began when new rules for ownership were established in the Telecommunications Act of 1996. With a focus on local programming for talk and music, both integrated with syndicated programming, Clear Channel Radio is now a subsidiary of Clear Channel Media and Entertainment. Clear Channel remains headquartered in San Antonio, Texas and is the largest radio station conglomerate, with 850 stations nationwide and a reach of 110 million listeners weekly. Clear Channel employs approximately 20,000 people worldwide. Unlike Sirius, XM and many other broadcast companies, Clear Channel is committed to a policy of zero tolerance for indecency in their programming. For example, following the September 11th attacks, they strongly advised banning of numerous songs that had lyrics referencing bombs and burning buildings, including “Free Falling” by Tom Petty and “Live and Let Die” by Paul McCartney. Today, Clear Channel has sold their TV rights, but remains the largest privately owned radio station conglomerate globally. [1.]

Key Executives

Chairman and CEO – Bob Pittman

Bob Pittman came to Clear Channel in 2011, having been a key member of the team that helped get MTV launched. He has served as a CEO for MTV, AOL, SixFlags and Time Warner. With his earlier, extensive background in radio station programming, Pittman has been doing great work, helping Clear Channel reach more listeners weekly. He is a very influential figure in the world of Broadcast. [2.]

President and CFO – Richard J. Bressler

Richard Bressler was a partner at a private equity firm prior to joining the Clear Channel team in 2013. He brings extensive experience in managing financial business development and technology functions. With his impressive career, Bressler serves as an important voice in Clear Channel executive decision making. [3.]

Exec. VP and CCO – Wendy Goldberg

Wendy Goldberg is responsible for overseeing all external communications with brands and other marketing partners. Goldberg has years of experience giving counsel to senior leaders of companies on external relationships. She has served as Executive Vice President and Chief Operations Officer since 2011. [4.]

Financials

Clear Channel Communications in 2008 was acquired by Bain Capital and Thomas H Lee Partners. In 2012, Ryan Seacrest Media agreed to partner with Clear Channel and its new ownership to bring new programming. This will cost THL and Bain $300 million to create this partnership. Clear Channel has the reach but has struggled financially recently and they believe this deal can potentially save the company. Clear Channel will receive a minority stake in RSM while Seacrest cannot have an affect on their business decisions. At the same time, Clear Channel will use Seacrest for new creative programming to reach a targeted audience and diversify their assets. [5]

Pandora Radio

Posted on April 14, 2014 by Andrew Saltman

By Andrew Saltman

Pandora [1]

History

Pandora Business Model [3]

Pandora Internet Radio is an online music streaming service that provides listeners with automated playlists based on their likes and listening habits among many other things. Founded by Will Glaser, Jon Kraft, and Tim Westergren in 2000, Pandora was designed to bring users individualized radio stations with great music and no “junk.” Westergren currently sits on the Board of Directors, and Brian McAndrews serves as the company’s CEO. The Music Genome Project is the sophisticated formula that analyzes each song using up to 450 distinct musical characteristics by trained music analysts. The analysts typically have four year degrees in music theory or composition and had to pass a selective screening process and complete an extensive training program in order to accurately analyze songs for the project. Pandora does not use any listening machines to analyze any song, as all analysis comes from the human analysts. [2]

Pandora users are able to create up to 100 unique stations (or playlists) based off an artist, genre or composer. Users are allowed to skip six songs per hour per station, and up to 24 skips across all stations per day. Pandora also allows users to refine their stations by liking or disliking each track they hear. Pandora continues to learn listening habits as users continue to listen and like songs. The more someone uses their Pandora account, the more personalized the stations become. [4]

Pandora 2013 Anual Report [3]

Financials

Pandora got it’s start with investments from both angel investors and venture capitalists, and in June of 2011 the company went public through an IPO. According to Pandora’s 2013 Annual Report, stock prices traded on the NYSE started at $16.00 per share on June 14th, 2011. At the end of the 4th quarter in January of 2013 the high stock price came in at $11.90 with the lowest price at $7.08. Revenue has increased dramatically in the five years that Pandora has been publicly traded. Pandora brought in $19,333,000 in advertising and subscription fees in 2009. In 2013, Pandora brought in almost half a billion dollars at $427,145,000 before expenses. [3] In 2010 Pandora had 16 million users listening to 1.8 billion hours of music. Three years later in 2013, 65.6 million users listened to over 14 billion hours of music. Pandora’s most recent audience metrics for March of 2014 were just released (graphic below). Pandora also announced that after June of 2014 they will no longer publicize its monthly key audience metrics. [5]

2014 Audience Metrics [6]

Pandora Stock Performance [7]

Current Endeavors

Peet’s Coffee

In March of 2014, Pandora announced a brand new partnership with Peet’s Coffee & Tea. “Peet’s Coffee & Tea, a premier specialty coffee and tea company, and Pandora, the leading internet radio service, announced a new partnership which marks the first time Pandora will feature partner branded radio stations in a brick-and-mortar environment nationwide” (Pandora) [7]. Peet’s coffee will now play its own customized radio stations in all of the stores across the United States. What makes these stations unique to Peet’s is that they will all be curated by a 25-year employee and music aficionado Patrick Main, not to mention the fact that the new Peet’s stations will be available to all Pandora listeners. Peet’s will have four personalized stations that are meant to pair well with their coffees using music outside what is played on mainstream radio. The stations include Peet’s Melodic Indie meant for bright and fresh coffees, Peet’s Jazz Giants reflecting Peet’s Italian Roast and espressos, Peet’s Origins which enhances Peet’s earthy African blends, and finally Peet’s Eclectic Classical station that should be paired with Peet’s French Roast. This partnership is quite the impressive business venture for both Peet’s and Pandora. Peet’s will be able to compete with the music in rivals like Starbucks that already has a partnership with Apple and iTunes. Pandora will also benefit as they are trying to compete with other streaming services like Spotify and Rdio. Peet’s customers hopefully will enjoy the musical selections in Peet’s coffee shops which will help Peet’s retain customers and help Pandora gain more subscribers. This partnership could be the first of many for Pandora as they attempt to gain more market share in the online streaming world.

Royalty Lawsuit

Although Pandora has been doing very well recently in terms of subscribers and partnerships, they have also gained a lot of negative press in regards to their catalog and royalty payments. In April of 2014, the three major labels Universal Music Group, Warner Music Group, and Sony Music Entertainment, along with indie labels ABKCO and RIAA, filed a copyright infringement lawsuit in New York state court against Pandora. The suit on Pandora is for playing pre-February 15, 1972 recordings without making any royalty payments. “The labels say both digital music services (Pandora & SiriusXM) take advantage of a copyright loophole, since the master recording for copyright wasn’t created federally until 1972. But the labels claim that their master recordings are protected by individual state copyright laws and therefore deserve royalty payments” (Christman) [8]. Michael Huppe, the CEO and President of SoundExchange, a non-profit performance rights organization, estimated that artists and labels have lost 60 million dollars in royalty payments for pre-1972 songs in just 2013 alone.

Example Royalty Payment Sheet [9]

This lawsuit has come after many artists, like legendary guitarist and songwriter Steve Cropper, have complained about the lack of payments from streaming services, especially Pandora. Songwriters are asking to be compensated for their work due to the fact that Pandora and other streaming services are profiting off of their original content. The case filed against SiriusXM in February is very similar and further along in the legal process. We can expect to see some important rulings and clarity in this case shortly, which will directly affect the Pandora case and whether courts believe songwriters should be compensated for pre-1972 works. SiriusXM’s hearing is set for May 14th. These two cases are extremely important for the world of streaming, as many music industry experts believe streaming is the future of recorded music. A ruling in favor of songwriters and artists could potentially ease the tension between the two camps and have all artists begin to support streaming. Currently many artists are against streaming because they don’t feel they are being properly compensated; however, streaming is significantly more convenient for consumers and could notably help reduce illegal downloading. [8]

Upcoming

Music Submission Steps for Independent Artists [10]

Step 2

Pandora also recently announced that they will be taking open music submissions. This will now make it easier than ever for independent artists to get their music out to over 70 million active listeners on the site. This is an initiative that Pandora will continue to pursue in the coming year in hopes to give independent artists a chance to reach a bigger audience. All independent artists need to do is submit their material digitally online for consideration.

Pandora has a bright future in the online streaming world if they can solve their differences with record labels and songwriters. Their initiatives in the consumer space, like with Peet’s Coffee, and their goals to help independent artists will make them a more attractive destination for music listeners to go to for content.

Works Cited

[1] Pandora – Pandora Logo RT: March 25, 2014

[2] Pandora – About Pandora RT: March 25, 2014

[3] Pandora – 2013 Anual Report RT: April 15, 2014

[4] Pandora – Skip Policy RT: March 25, 2014

[5] Pandora – Corporate Overview RT: March 25, 2014

[6] Pandora – 2014 Audience Metrics RT: April 15, 2014

[7] Pandora – Peet’s Coffee Partnership RT: April 7, 2014

[8] Billboard Magazine – Pandora Lawsuit RT: April 18, 2014

[9] The Trichordist – SiriusXM Royalty Payment Sheet RT: April 15, 2014

[10] Pandora – Music Submission for Independent Artists RT: March 25, 2014

Spotify

Posted on March 15, 2014 by Hannah Friedland

By Hannah D Friedland

[1] Spotify’s Logo

THE SPOTIFY STORY:

[6] The most updated visuals of the Spotify application on thee platforms

[2] The most updated visuals of the Spotify application on thee platforms. Users have an on-demand stream of music on their computer, mobile device, tablet, and home entertainment system.

Spotify is a music streaming service that puts users in control of 20 million licensed songs [3]. Spotify was launched in Sweden in 2008 and came to America in 2011.

Spotify is financially a private company that offers over 20,000 new songs each day from major and independent labels including EMI, Warner Music Group, Universal, & The Orchard [3]. Artists earn royalty when their music is played, and there are over 24 million active users currently in 55 markets [3].

There are two revenue streams, free, which is “powered by advertisers” and premium for $9.99 monthly with extra features including no ads, offline, and high-quality audio [3].

TEAM SPOTIFY:

[2] Spotify Founders- Daniel Ek & Martin Lorentzon

[4] Spotify Founders- Daniel Ek & Martin Lorentzon

[5] Chief Sales, Marketing, and International Growth Officer- Jeff Levick

[5] Chief Content Officer & Managing Director USA- Ken Parks

[6] Chief Content Officer & Managing Director USA- Ken Parks

[7] Head of Content- Steve Savoca

INSIDE SPOTIFY:

Social Media Merges with Music- Songs, playlists, and albums can be shared on the Spotify application through the "Send To" message option, or users can "post to feed" to their Facebook timeline, Twitter, and Tumblr within the Spotify application. ARROW

Social Media Merges with Music- Using the “send to”, or “post to feed” options users can message music to friends and post music to their Facebook timeline, Twitter, and Tumblr within the Spotify application. Source: Spotify

Spotify gives its users the option to connect with their social media Facebook, Twitter, and Tumblr accounts. Users can create collaborative playlists, share music, view friends music and more which provides for ample music discovery and publicity for the company on social media platforms. There is also a private session users can activate.

Two other elements that Spotify includes are apps and Discover. While these apps add dimension to the Spotify journey, Discover is essentially a constantly updated news feed.

Discover- Spotify's "news feed" feature on the desktop application, artists are recommended, concerts nearby are posted, friends listening habits are shown all based on listening habits the user has shown. Source: Spotify

Discover- Spotify’s “news feed” feature on the desktop application. Updates with releases, playlists, artists recommendations, concerts nearby are posted, friends listening habits are shown all based on listening habits the user has shown. Source: Spotify

COMPETITORS:

Spotify is a strong contender, but it’s competing neck and neck with Rdio, Pandora, Rhapsody, Google Play Music, and Beats on price, catalogue, platforms, and features [8]. Beats Music entered the competitive on-demand music market in January [9], and is Spotify’s biggest challenger.

[10] Beats Music vs. Spotify- The two streaming services are extremely similar with the same catalogue size, the discovery element, and price.

Beats entry in the market put Spotify in “go-mode”.

SPOTIFY’S SITUATION:

Competitor streaming services are continually emerging. With more choices presented to consumers, Spotify has responded by shifting their focus to partnerships, acquisitions, customer satisfaction, and updated product development. The formula is to attract users to Spotify, engage with users, and retain them.

Partnerships

Last.fm

Last.fm is a music recommendation service. In January, Spotify and Last.fm teamed up to bring a beneficial on-demand playbar to Last.fm’s website. This makes it possible for Last.fm users to internally play the entire Spotify catalogue on Last.fm’s website [11].

The collaboration works in both companies favor. Last.fm users have a fuller experience with the power, “to play whatever you want by whoever you want directly on Last.fm” [12]. In addition, Spotify’s catalogue incorporation provides a huge presence and Last.fm users conveniently have motivation to signup for Spotify to take advantage of the essential music player.

The Last.Fm Spotify playbar at the bottom of Last.Fm’s website. Source: Lastfm.com

SoundHound

Spotify also joined forces with SoundHound for the “Add to spotify” feature on its iOS application in February. SoundHound is a popular music-recognition app, similar to Shazam. Banded together, SoundHound is now more interactive. After linking accounts, with the tap of a button users can automatically generate Spotify playlists of recognized songs without leaving SoundHound’s app [13].

Hitting the “Add to Spotify” button automatically turns songs discovered on SoundHound into a Spotify playlist. Source: SoundHound & Spotify

The mutually-beneficial relationship brings life to identified songs through Spotify playlists on SoundHoud, and the incentive to use the button will drive users to subscribe to Spotify while giving them presence on a music app [14].

Coachella

On top of that, Spotify was presented with an amazing opportunity to have presence on site at Coachella as the Official Digital Music Partner of the Coachella Music and Arts Festival in California in April. The Spotify Social tent was an on-site air-conditioned tent that offered relaxation pods, chargers, a “Mosaic Photo Booth” that uses your Spotify account to generate a picture out of your most played album art, and art from artist Apex [15].

[16] The Spotify Social tent, that capped at 150, gave people an air conditioning experience filled with music, more battery power, art, and a Mosaic Photobooth that puts your face on album covers based on your Spotify listening habits.

#WeWereThere was Spotify’s digital interactive strategy at Coachella to “connect, collect, share.” Implanted in every RFID wristband was the power to capture the experience by checking in and collecting custom Spotify curated playlists. The “My Coachella Story” digital snapshot let individuals create memories of their festival concert experiences with playlists gathered [16]. This collaboration not only transformed Coachella goers into premium users, but also created a special experience and built relationships by reliving the festival on Spotify.

[15] “My Coachella Story”- an example of a digital snapshot that shoes distance traveled, the path taken, playlists, artists seen etc. To participate users needed to simply connect their wrist band with their Spotify accounts, look for check ins at the festival, use the wristband to collect playlists and then after generate their digital card and share it with family and friends.

Sprint

Lastly, Beats launched with an AT&T package family plan deal. Rumors are circulating about Spotify planning to bundle with the #3 U.S. mobile carrier, Sprint [17] in April. This partnership will give Sprint customers a free trial. Customers will be able to pay for Spotify directly through their Sprint Accounts, which will help Spotify secure a greater market share and Sprint secure more data plans. Sprint and Spotify will announce the details on April 29th at a New York Event [18].

Acquisitions

In efforts to boost the “discovery” element, Spotify acquired The Echo Nest in March [19]. The Echo Nest is a music intelligence company that examines listening behavior and makes musical recommendations. Spotify paid $100 Million, with 90% Spotify equity [20]. The Echo Nest previously powered Rdio and Rhapsody, both of which ended their deals, deeming its technology invaluable to their operations right after Spotify acquired [21]. This potentially puts Spotify in the position to take The Echo Nest away from competitors.

Combing the two companies gives The Echo Nest a bigger audience and catalog, while Spotify, now with music-discovery data, will improve recommendation’s.

Customer Satisfaction

With intentions to obtain more paying users Spotify has updated its business model. In January the company announced free music shuffling on iOS with a catch, non-premium users ads play in between every few tracks [22]. In February, Spotify added the “repeat one” feature [23]. Repeat one grants users the option to repeat a single track over and over [24]. These highly requested changes illustrate that Spotify cares about users.

Working with a college students budget, Spotify slashed the premium $9.99 monthly rate to $4.99 in March [25]. They partnered with SheerID to validate eligibility. This price change is valuable because college students represent an important key demographic in streaming use [26]. This differentiates Spotify from other streaming services like Rdio and Beats that charge $10 monthly.

Unique Product Development

Competition among streaming services leads Spotify to completely redesign its user interface layout on all platforms. Spotify rolled out a sleek modernized look on April 2^nd. This major design update was the first since its launch in 2008, and to keep current it was a smart move [27].

Spotify’s New Look Video [28]

The new dramatic, dark color scheme highlights important buttons, includes circular images for people, and features square album shapes [29]. The browse tab is revised and categorized between top lists, releases, news, and moods. “Your Music”, a collection of users saved albums, songs, and artists is a new addition [30]. The Your Music addition mimics iTunes library and it is comparable to Rdio’s “collection” feature. It helps users save, organize, and browse through their favorite music. The new layout feels unified and balanced, and should attract new users [31].

WHATS NEXT FOR SPOTIFY:

Spotify is headed in the right direction, but with downloads declining, new rival services like YouTube, Apple, and Amazon that have huge user bases are joining the streaming market [32].

Being active puts Spotify in the forefront, which looks great for Investors. It is rumored that an IPO is in Spotify’s near future. Though the company has declined all comments, a job advertisement for an “External Reporting Specialist” has been posted on their website and LinkedIn [33]. Their future looks competitive but successful.

Sources:

1. Spotify’s Logo 2014, Spotifypress.com, RT: 4/04/2014

2. Spotify’s Application on Three Platforms, Spotifyblog.com, RT: 4/01/2014

3. Spotify Press Fast Facts, Press.Spotify.com, RT: 4/01/2014

4.The Founders of Spotify, Press.Spotify.com, RT: 4/01/2014

5.Spotify’s Chief Sales, Marketing, and International Growth Officer, Press.Spotify.com, RT: 4/01/2014

6. Chief Content Officer & Managing Director USA,Press.Spotify.com, RT: 4/01/2014

7. Head of Content, Press.Spotify.com, RT: 4/01/2014

8. “And The Winner Is… Best Music On-Demand Streaming Service”, Cultofmac.com, 2/18/2014, RT: 4/07/2014

9. “Beats Music Is Here”, Beats Music Blog 1/16/2014, RT: 4/08/2014

10. “Beats Music vs. Spotify: Can Dr. Dre outmix the king of streaming”, Digital Trends, 1/27/2014, RT: 4/07/2014

11. “Last.fm Bands up with Spotify to offer on-demand tracks”, CNET, 1/29/2014, RT: 4/04/2014

12. “Did Someone Say On Demand?”, Last.fm Blog, 1/29/2014, RT: 4/04/2014

13. “SoundHound Launched “Add to Spotify”, Business Wire, 2/21/2014, RT: 4/07/2014

14. “SoundHound Now Lets You Easily Add Your Discovered Music to Your Spotify Playlist”, appdevice.com, 2/24/2014, RT: 4/07/2014

15. “Coachella here we come” Spotify News, 4/7/2014 RT: 4/14/2014

16. “Spotify’s Coachella #WeWereThere Campaign: High Tech and Sweet, Sweet Air Conditioning”, Billboard, 4/11/2014, RT: 4/14/2014

17. “Sprint and Spotify Plan to Partner Up”, recode.net, 4/11/2014, RT: 4/14/2014

18. “Spotify, Sprint Plan Music Bundle To Be Unveiled This Month”, Billboard, 4/12/2014, RT: 4/14/2014

19.“Spotify Acquires the Echo Nest”, Billboard, 3/06/2014, RT: 4/02/2014

20. “Spotify Acquired Music Tech Company The Echo Nest in A $100M Deal” , TechCrunch, 3/07/2014, RT: 4/07/2014

21. “Rhapsody Kills its Echo Nest partnership following Spotify acquisition”, Venturebeat.com, 3/21/2014, RT: 4/09/2014

22. “Spotify’s free shuffle mode arrives on iPhone”, The Verge,1/08/2014, RT: 4/02/2014

23. “Repeat One”, Spotify News Blog, 2/07/2014, RT: 4/08/2014

24. “Spotify users can now repeat the same song over and over and over again”, Hypbot, 2/10/2014, : 4/02/2014

25. “Spotify Offers 50% Student Discount”, Hypbot, 3/25/2014, RT: 4/02/2014

26. “Spotify introduces 50% discount for college students”, Los Angles Times, 3/25/2014, RT: 4/07/2014

27. “The Good, The Bad, The Less Ugly: Taking Spotify’s New Redesign For a Test Drive”, Billboard, 4/03/2014, RT: 4/04/2014

28. Spotify Paints It Black with New Look, YouTube, 4/01/2014, RT: 4/06/2014

29. “Spotify’s biggest redesign ever brings long awaited Collection view”, The Verge, 4/02/2014, RT: 4/07/2014

30. “Spotify paints it black with new look”, Spotify News, 4/02/2014, RT: 4/08/2014

31. “Spotify beautifies”, CNET, 4/02/2014 RT: 4/08/2014

32. “Spotify faces challenge from Internet giants before IPO” New York Post, 3/30/2014, RT: 4/14/2014

33. “Spotify seeks to hire U.S. filings expert as bankers eye IPO” Reuters, 2/17/2014, RT: 4/14/2014

Rdio

Posted on March 15, 2014 by Karly Brecher

By Karly Brecher

Rdio, Inc.
1550 Bryant Street
San Francisco, CA 94103

Phone: 415-763-7211
Website: Rdio.com

Company Overview

Rdio is a privately-owned online music streaming service. Skype founders, Janus Friis and Niklas Zennström launched the company in 2010. Rdio is now available in over 35 countries. The service is ad-supported but users can opt for an ad-less subscription for $9.99 per month. Rdio can be accessed via the internet, desktop client, mobile app, and some in-home entertainment services (ex: Roku, Sonos.) [1] [2]

Key Executives [3]

Anthony Bay, Chief Operating Officer

Niklas Zennström, Founder

Janus Friis, Founder

Scott Bagby, Head of Strategic and International Partnerships

Finances

Rdio is a privately owned company and does not disclose their financial information online. Assumptions about the company’s financial well-being can be concluded from news published online. Rdio laid off approximately 35 employees (1/3 of the staff) this past November. A spokesperson for the company said the offs were in order to create a more efficient cost structure and to promote a sustainable business model. This insinuated that Rdio’s finances were weak. However, in March of 2014, Spotify acquired Dhingana, an India-based music streaming service for an undisclosed amount. This indicates that Rdio is trying to expand and must be doing better financially. [4] [5]

Competitors

Paying subscribers of top streaming services. Image courtesy of Digital Music News.

Rdio is not the only streaming service fighting for domination in the United States, in fact, their market share is very small compared to competitors (but, their numbers are still growing.) Rdio has many domestic and international competitors. The graph to the left shows the number of paying users for a variety of streaming services. Rdio has less than one million paying subscribers, however, this does not include “freemium” users. These numbers can far surpass the amount of paying subscribers. Rdio’s data is not public but for a comparison, Spotify has over 6 million paying users (as of November 2013) and over 24 million total users. The “freemium” accounts are ad-supported and subsidize artist royalties. Rdio’s main competitors in the United States include Spotify, Pandora, Beats Music, Slacker, and Sirius XM [6] [7] [8]

Shazam Partnership

In 2012, Shazam, a music recognition service, partnered with Rdio to allow users to listen to Shazam’d tracks via Rdio . However, this partnership was only available in select countries. In late 2013, Rdio and Shazam announced the expansion of this service to over 29 territories including Ecuador, Guatemala, Hungary, Austria, Sweden, and many more. It is important to note the significance of this expansion because the Rdio/Shazam service is now available in countries where competitors like Spotify are not (including Canada, Chile, and Czech Republic.) [9] [10]

Mobile Integration

Tesla Motor’s in-dash touchscreen display

As streaming services become increasingly popular, more services are emerging and fighting for domination in the market (think iTunes owns the digital download market). This creates more competition between the services and they are scrambling for ways to gain users. Streaming services have been partnering with cell phone providers to increase their customer base. Beats Music partnered with AT&T for a discounted family price and Spotify announced a partnership with Sprint. However, Rdio is going a different route. After being turned down by Spotify, American car company, Tesla, announced a partnership with Rdio in Europe . Gigaom reports “…consumers will be able to play any song from Rdio’s catalog of 20 million or so with a simple voice command,” the service will be integrated in the car’s dashboard system. Tesla CEO, Elon Musk says the service will be available very soon. It is unknown whether or not Tesla will use Rdio as their default music service in the US market. Tesla currently has a partnership with Slacker Radio in the US territory. [11] [12]

Above is a photo of Tesla Motor’s in-dash touchscreen display. The Rdio client in the in-dash display will likely mirror the iPad application. This will ensure a positive and easy user experience.

Dhingana Acquisition

The Rdio lay-offs in late 2013 indicated that the company was struggling financially. However, it seems that the streaming service is doing better because they had sufficient funds (although we do not know the exact number) to purchase the Indian music streaming service: Dhingana.

Dhingana was founded in 2007 by brothers Snehal & Swapnil Schinde, and Sushil Choudhari. Dhingana primarily streams genres of Indian music boasting a catalog of over one million songs in 42 languages. Dhingana has other Indian competitors including Saavn and Gaana. Dhingana has approximately 10.5 million monthly users; the acquisition will add significant traction to Rdio’s numbers.

Smartphone sales growth.
Image courtesy of The Guardian.

Dhingana announced the acquisition on March 14, 2014 via their website and shut down the service. According to the press release, the Dhingana team will be working with Rdio to launch the service later this year. Rdio CEO, Anthony Bay, was quoted in Billboard Magazine, “India is a tremendously vibrant market for music and culture and one of the largest and most important in the world,” Bay’s strategy seems to be to expand their service in emerging markets, like India . Part of the Schinde brothers and Mr. Choudhari’s initiative at Rdio will be to expand into other emerging foreign markets.

This acquisition was a brilliant move on Rdio’s part. Recently The Guardian reported that India will pass the United States in smartphone sales this year, “India will be the country where the largest proportion of smartphones sold will go to new users,” this creates a larger market for potential streaming users. The map above shows significant smartphone growth in Brazil, Indonesia, and China; it will be interesting to see what territories Rdio will expand to next. [5] [13] [14]

Rdio Drops The Echo Nest

The Echo Nest is a music intelligence company that provides data to a variety of music industry entities. All of the competitors mentioned above (with the exception of Beats Music) use The Echo Nest to power music recommendation features on their platform. In March, Spotify announced that they acquired The Echo Nest. Following this, Rdio announced they will no longer use The Echo Nest’s service. Anthony Bay was quoted by The Verge saying: “As far as we are concerned, they were a good partner, but we have other good partners and we’ll move on… So we will stop using that source of data and use other sources.” . Rdio’s decision to unsubscribe to The Echo Nest can pan out to be either a unique, positive change to the service or, depending on the service they choose to work with, can damage the company’s reputation. [15]

Sources:

[1] Rdio | About Us RT: April 1, 2014

[2] Rdio | Apps RT: April 1, 2014

[3] Crunch Base | Executive information RT: April 1, 2014

[4] Tech Crunch | Rdio Layoffs RT: April 4, 2014

[5] Billboard | Rdio acquires Dhingana RT: April 4, 2014

[6] Digital Music News | Paid subscription numbers RT: April 4, 2014

[7] Investopedia | Definition of “Freemium” RT: April 15, 2014

[8] Spotify | Fast Facts RT: April 8, 2014

[9] Android Central | Rdio and Shazam Partnership RT: April 8, 2014

[10] Make Use Of | Rdio vs Spotify availability RT: April 8, 2014

[11] Giagaom | Rdio partners with Tesla Motors RT: April 3, 2014

[12] Techspot | Rdio Tesla Motors Partnership RT: April 3, 2014

[13] Dhingana | Acquisition press release RT: April 4, 2014

[14] The Guardian | Smartphone growth RT: April 4, 2014

[15] The Verge | Rdio drops The Echo Nest RT: April 15, 2014

Radio One

Posted on May 1, 2013 by Jasmine Holloway

Radio One, Inc.

Location: Corporate Office – 1010 Wayne Ave. 14th Floor,  Silver Spring, MD 20910

Web: www.radio-one.com

Executive Team: [2]

Founder, Chairperson and Secretary – Catherine L. Hughes

CEO and President – Alfred C. Liggins, III

Exec. Vice President and CFO– Peter D. Thompson

VP, Assistant Secretary and CAO – Linda J. Vilardo

Overview:

Radio One, Inc. is an urban multimedia company primarily targeting African Americans. The company consists of four subdivisions: radio broadcasting franchise, Radio One; cable television network, TV One; cross platform media company, Reach Media; and internet companies Interactive One, an online platform and Community Connect, specializing in social networking. [5]

In regards to radio, the company is ranked number one among Black listeners with a weekly audience average of 19 million. It is the largest radio broadcasting franchise that targets an African American audience. [5] In 2011, it owned and/or operated 55 stations in 16 U.S urban markets including Atlanta, Houston, Washington D.C and many others. The company also has 9 nationally syndicated radio shows, expanding its geographic reach. [6]

History:

Catherine Hughes’ tumultuous life journey led her to found one of the most successful multimedia companies and become a great business example to African-Americans and aspiring businesswomen everywhere. Born to a scholarly family in 1947, Hughes took to radio and media at an early age. At 16, she became pregnant with her first child, Alfred Liggins Jr., and was disowned by her influential family. After a brief two-year marriage, Hughes decided to attend the University of Nebraska, Omaha and become involved with the campus radio station where she was quickly named general manager. She left the school early to become a lecturer and a general manager of WHUR at Howard University. There she perfected the Quiet Storm format, a collection of love songs played at late night. This would become a successful program format adopted by urban stations across the country in years to come. [8]

Catherine along with husband, Dewey Hughes, gathered $950,000 from personal savings, Syncom, an African-American venture capital firm, investors, and a bank loan to acquire WOL, a 1000-watt AM station located in DC. [8] The financial constraints and difficulty of making the station profitable broke up the Hughes marriage and Catherine bought out her ex’s interest in WOL. After bouts of poverty to keep the station afloat, Hughes’ son began to attract more advertising for the station and it turned its first profitable year in 1986. Using profits, Hughes began to acquire other stations in urban markets across the East Coast and build the empire that would become known as Radio One. In 1999, the company went public with an IPO of $172 million. Using this and additional investors, Radio One acquired 12 additional stations from Clear Channel for $1.2 billion. [9] The company has continued its growth and has branched out to include other media sectors, most notably T.V One, a rival to Black Entertainment Television with a target audience of affluent African-Americans between 25-54. [8]

Financials (2012): [10]

Total Revenue: $424.57 Million

Gross Profit: $288.8 Million

Other Operating Expenses: $217 Million

Radio One Inc. continues to see increased revenue as the urban market continues to grow. Its primary revenue stream is local and national advertising sales on its radio stations. Boasting as the “urban media specialist,” Radio One offers advertisers effective ways to reach urban and African American audiences. Multiple program formats in key urban markets allow advertisers to reach intended demographics and lifestyles. In the company’s 2011 annual report, it notes the rising population, income, and Internet usage of African Americans as well as the growing influence of African American culture on mainstream American society. Advertisers spent $748 million on Black radio in 2009 despite the economic recession. [11]

News:

2013 has been a relatively quiet year thus far for the company. Recent news stories include the renewing of popular programs on TV One including R&B Divas, Rickey Smiley Show, and Family Time. Other notable news stories include:

April 8, 2013 – Radio One Selects WideOrbit Inc.

Radio One selects WideOrbit Inc.’s WO Traffic system for its advertising sales, traffic, and revenue management. The system would allow the company “to view real-time, consolidated reporting, maximize revenue and inventory, and optimize performance across all of its stations and markets. “ [12]

April 2, 2013 – Acacia Subsidiary Enters License Agreement with Radio One

Acacia Research Corporation, which licenses patents to corporations and share the revenue [14], entered into a license agreement with Radio One as part of its settlement with district courts in the Southern District of New York and the Northern District of Illinois. [15]

March 5, 2013 – Radio One Launches Telemundo Affiliate

Radio One’s WDNI Channel 19 in Indianapolis will launch the market’s first Spanish-language broadcast station. It will feature Telemundo’s full line-up of original programming. [17]

References:

[1] http://www.frequencynews.com/wordpress/wp-content/uploads/radio_one_logo2.gif

[2] http://www.radio-one.com/about-us/who-we-are/

[3] http://www.blackeconomicdevelopment.com/wp-content/uploads/2010/12/cathyhughes_1.jpg

[4] http://www.radiofacts.com/wp-content/uploads/2012/12/Radio-One-Alfred-Liggins.jpg

[5] http://www.radio-one.com/about-us/

[6] http://topics.nytimes.com/top/news/business/companies/radio-one-inc/index.html

[7] http://i.huffpost.com/gen/788993/thumbs/r-CATHY-HUGHES-AND-SON-large570.jpg

[8] http://www.fundinguniverse.com/company-histories/radio-one-inc-history/

[9] http://streamingradioguide.com/blogradio/?page_id=707

[10] http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=ROIA&dataset=incomeStatement&period=A&currency=native

[11] http://www.radio-one.com/investor-relations/sec-filings/