More Than 100 Million Americans Now Listen to Online Radio

This is a format exploding in front of our very eyes.

It’s bigger than Pandora, and in fact, it’s the reason why Pandora has so many jabbing competitors!  According to just-released survey data from Edison Research and Arbitron, 103 million Americans are now accessing online radio in some form, in any month.

It’s a growth curve that looks like this:

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That’s nearly 40 percent of the US population 12 or over, and a massive chunk of breathing Americans.  Which all sounds high-growth and rah-rah, but can the online radio sector afford its own growth?  Pandora is struggling to reach profitability, and serious questions now surround its financial model.  After all, the more listeners Pandora and the broader space attracts, the more money in licensing it has to pay – and so far, streams aren’t covering costs.

And they aren’t necessarily replacing traditional radio: 9 out of 10 Americans who listen to online radio still dial into a traditional, over-the-air AM or FM station.  In fact, on any given week, 87 percent of Americans who access platforms like Pandora have also listened to some form of ‘traditional,’ ‘terrestrial,’ or ‘from a tower’ radio station.

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That smashes the notion that one format must replace another.  Indeed, we could be witnessing the development of the most overlapping and redundant media landscape in history.

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Full research report.


7 Responses

  1. DJ Jeannie Hopper

    The other big question ‘where did they listen’? Car culture is a captive audience for radio and what radio focuses on as their golden hours ‘drive time’. App’s etc.. can bridge this, but people like to ‘seek’ ‘trip up and down the FM/AM band and can do so with ease while driving.

    The other big issue is ‘choice’. AM/FM is finite..only so many stations to choose from and so many markets homogenized with seemingly ‘same’ formats i.e. Clear Channel model which owns the most radio licenses in the USA. While the internet is packed with ‘million of streaming stations’…but not easy to bounce between favorites while ‘hands are not free’.

    Internet radio units, which pretty much mean you can pre-set internet stations, but you still need that bandwidth/connectivity to get to them if mobile in a car which is where primary ‘radio’ listening takes place.

    I operate a streaming station, non-commercial, est. 2004 and been a terrestrial community broadcaster on WBAI, Pacifica Radio since 1988, weekly show Liquid Sound Lounge 7-9pm. With online I feel like I’m living in the future but technology hasn’t been realized fully yet and with terrestrial I feel like I’m living in the past with hopes of the medium keeping up with what’s to come in the future of HD Radio and/or internet.

    Take a look at the history of internet licensing/royalty legalize…and you will find the land of bizarro…trying to adapt terrestrial law to online law while they in the end are truly two different delivery methods and the internet is still to be realized in potential as technology evolves.

  2. GJinSydney

    The point that the article doesn’t draw out is how many of those Internet radio services are streaming broadcasts from existing AM/FM stations.

    I listen to rediffused stations over the Internet, which (a) keeps me in touch with home when I’m on overseas business trips, (b) lets me target music genres I want to hear at any point in time, and (c) adds interest by accessing foreign, exotic stations.

    Anyway, my point is that many “Internet radio” services are simply delivery extensions of existing services.

  3. Jim McNabb, MA

    This is interesting but not surprising.

    Research has shown that so-called “new media” is adapted and absorbed rather than replaced. Consumers/users of media are savvy and see value in what has gone before, what is, and what is to come.

    Example: Resurgence of vinyl.

    Jim McNabb, MA, Austin, TX