On the Sluggish Evolution of the Streaming Audio Audience

A few weeks back I posted a piece about how audience measurement issues were affecting the development of the TV Everywhere initiative  being rolled out by the cable industry.  As this piece indicates, similar issues are affecting online music streaming services such as Pandora.

Pandora CEO Tim Westergreen asserts that it is the lack of a “common currency” in the audio media space that is contributing to the company attracting a share of the pie of audio advertising dollars that is well below the company’s estimated 4% share of the overall music audience.

What is particularly interesting is Westergreen’s emphasis on the need for a common currency that allows for cross-platform comparisons and aggregation of audio/music listenership across the full range of relevant platforms, including computers, mobile devices, satellite radio, and terrestrial radio.  As the TV Everywhere discussion highlighted, though, there are often a variety of reasons why certain stakeholders would resist a common currency, particularly if the CPMs that can be obtained on some platforms are significantly higher than the CPMs that can be obtained on other platforms.

And, as we typically see in the realm of audience measurement, the demand for the expansion or improvement of measurement systems and/or new currencies needs to be fairly widespread across the relevant stakeholders (particularly the largest stakeholders, who pay most of the freight when it comes to audience measurement services).  This is in fact one of the key ways in which incumbents are able to slow the development of new media technologies, services, and platforms — by resisting the development (and by resist I mean by refusing to cover the costs) of measurement systems that could provide a more level playing field between old and new media platforms.  As I discuss in Audience Evolution, we’ve seen this pattern in radio; we’ve seen it in television; and we’re starting to see it online as well.

This entry was posted in Arbitron, Currencies, Radio, Stakeholder Resistance. Bookmark the permalink.

3 Responses to On the Sluggish Evolution of the Streaming Audio Audience

  1. What a fascinating angle! Haven’t cable networks complained about their lower CPMs, caused in part by the inaccuracy built into Nielsen’s sample size? Interesting to think about how measurement can be a competitive weapon between old and new media.
    Could it be possible that advertisers interested in Pandora’s listeners are not the same advertisers interested in terrestrial radio audiences? And so would those advertisers have less incentive to pay for such cross platform measurement?

  2. pnapoli says:

    I think that’s a good point. One does have to wonder a bit at this point about the kinds of advertisers who still consider terrestrial radio the best way to spend their money.

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