Right now the ever weakening record labels are sticking it to broadcast radio. And some of those bullies over there in terrestrial radio are just taking it.
There is growing evidence the music business is looking to charge AM and FM stations flat fees for permission to play their music. The CRB has already dealt a blow to the fledgling Internet radio business by jacking up royalty payments beyond which most operators can afford to remain in business.
Let me get this straight. Isn't this biting the hand that feeds them. I mean, what is the record business without radio? Most record sales are still influenced by airplay although Internet-based alternatives are growing in popularity with the next generation. I guess you can forgive the labels for not being able to see the coming power of Internet radio when universal WiFi is available -- they aren't good at seeing trends these days. But radio? Are they really going to stick it to radio when radio is down and out?
Oh yes.
So here it is. A game plan I'd ask the radio industry to consider:
- Take one of your too-many stations in a cluster and designate it as a station that will play only DRM-free music that is submitted to them by artists who are willing to waive their royalty rights. (I know what you're thinking, what kind of music will this be -- it will suck). Not so fast. The next generation is happily involved with this kind of music on social websites.
- Make all the music available for sale on the station website -- even take a piece of the action. Be fair here. Put the proper legal announcements on the air to avoid payola problems and let the music make it on its popularity not on pay for play. Try. Really try. This is your future you're playing with.
- Have a game plan to make all the music you play for sale via mobile as soon as you can. Mobile is the future device all young people own and will continue to own. You need to be there.
- When your station breaks acts, make sure you have a piece of the action because you could also handle the touring (or corporate could). They will smell money.
- Start a social networking site --- local, please. Can link with a national one, though.
If you're not motivated to overcome the challenges and problems then don't worry, Internet radio will do this for you. They will have no choice as the royalty fees make playing licensed music impossible for them. And they will embrace social networking. And they will be addicting to the next generation. If this is too much for you to try, then sit back and spend years battling over royalties while your listeners continue to abandon you.
Now I said, take one of your terrestrial stations and try this experiment. And remember the lesson of Westinghouse Broadcasting, the founder of the all-news format. It takes a long, long time to develop a new business model. They stuck with it and let the market eventually come to them thus, the success of all-news radio.
If all this talk about flat fees and the ability of the CRB to put most of Internet streaming out of business doesn't scare the hell out of you then maybe this will.
Apple -- and the music industry's nemesis Steve Jobs -- is already doing it.
