One of the last major decisions of the Dickey brothers at Cumulus was an agreement to switch their online streaming to Rdio. The announcement came out of nowhere and the sudden conversion of the Cumulus websites went poorly – the template had no provision for program schedules for instance. Cumulus had been partnered with iHeartradio run by their rival iHeart Media (Clear Channel) which made no sense.
At the conference call a week ago, Mary Berner announced the 15% investment in Rdio was being written off as worthless. Now we know why – Rdio is preparing to file Chapter 11 in preparation of being acquired by Pandora, the antiChrist of “radio”.
http://variety.com/2015/digital/news/pandora-rdio-acquisition-1201641583/
http://techcrunch.com/2015/11/16/confirmed-pandora-buys-key-rdio-assets-for-75m-in-cash-rdio-files-ch-11-to-shut-down/#.nj9qml:Yjaa
How did Pandora become the anti-Christ? In it’s formative years, it was innovative and had a grass roots following that helped it grow. Was it corrupted from within?
In the eyes of the “radio biz”…
Radio can never compete with playlists unique to each listener. My main complaint with Pandora is that when I use it, after a few songs I know and it starts fading into the background, it starts playing 15 th century monastery chants and Lithuanian accordion music, probably because it doesn’t have performance royalties and I’m not generating revenue
There are so many streaming choices now only the big guys buying everybody out like iheart will survive. Problem is when iheart goes down it creates major streaming problems for stations they affiliate.
The fundamental change seems to be that people are getting “OK” with the idea of not owning music, but instead paying a monthly fee to either hear a curated playlist or on demand. Apple caused a lot of this change.
Contrary to “common knowledge”, looking at the popular radio stations, people want to be part of a live process created by interesting people. People only want “less talk” when the “talk” is prerecorded voice tracking. People eventually catch on.
There was an article from an interview with Spotify that is right on target, and points to the difference between mindless random playlists and smart humans. People want to hear different music based on the context of what they are doing – playing Barry White at 10 PM on Saturday night, playing music with a steady rhythm while running on the treadmill at the health club, etc… An event like the attacks in Paris are a profound mood change, but knowing the appropriate songs to play requires knowing the songs and being connected to the emotions.
A good DJ or PD will also arrange a sequence of songs that are related or are a progression. I notice some country stations will create a narrative of – meeting that special person, falling in love, getting married, cheating, breaking up, revenge and asking for forgiveness . I don’t care for the narrative, but I understand why it works
CMLS is down to $.20 a share
Market cap is below $50 million with debt of $2.4 billion.
The problem the creditors have is there is no obvious way to turn the company around. Going right to Chapter 11 would be an interesting option. It does create the problem though of the stations going dark until the stations are auctioned off. Some of the stations are integral to the functioning of EAS, I’m pretty sure.