Mobile AM/FM capabilities
Nearly all of today’s smartphones have FM radio capabilities, but the FM chip to access the radio is not activated on two-thirds of devices, according to NPR. Samsung, Apple and LG are among the providers who have kept the switch off. While the National Association of Broadcasters has been pushing for this activation, the mobile industry claims that consumers gravitate toward streaming apps, thus the demand for radio just isn’t there. However, FM radio threatens digital streaming and downloading, which would inhibit revenue for the mobile world. Sprint was the first major exception to this. Starting in 2013, the carrier worked in partnership with Emmis Communications, a radio and publishing firm that created NextRadio. The deal means that select Sprint phones had the FM chip turned on and in turn, Emmis earns a portion of the revenue generated by ads that appear in the NextRadio app, according to the Boston Globe. AT&T and T-Mobile, two major players in the mobile landscape, have also begun to support FM capabilities, while the newest Android devices will come enabled with FM-chips on. Across the aisle, Apple continues to holdout on FM activation for iPhones. Nevertheless,
Read MoreMobile AM/FM capabilities
Nearly all of today’s smartphones have FM radio capabilities, but the FM chip to access the radio is not activated on two-thirds of devices, according to NPR. Samsung, Apple and LG are among the providers who have kept the switch off. While the National Association of Broadcasters has been pushing for this activation, the mobile industry claims that consumers gravitate toward streaming apps, thus the demand for radio just isn’t there. However, FM radio threatens digital streaming and downloading, which would inhibit revenue for the mobile world. Sprint was the first major exception to this. Starting in 2013, the carrier worked in partnership with Emmis Communications, a radio and publishing firm that created NextRadio. The deal means that select Sprint phones had the FM chip turned on and in turn, Emmis earns a portion of the revenue generated by ads that appear in the NextRadio app, according to the Boston Globe. AT&T and T-Mobile, two major players in the mobile landscape, have also begun to support FM capabilities, while the newest Android devices will come enabled with FM-chips on. Across the aisle, Apple continues to holdout on FM activation for iPhones. Nevertheless, the radio scope will only grow as more and more mobile carriers allow for FM radio capabilities through cell phone devices.
Interactive audio on streaming
XAPP Media has introduced new interactive audio advertisements that allow listeners to verbally respond to messaging and take immediate action, such as downloading an app, making a phone call or visiting a website. While the typical mobile ad conversion rate sits at 0.05 percent, conversion rates for interactive ads run between 3.25 to 5.94 percent during fall 2015, according to XAPP Media. What’s more, voice recognition from engaged listeners is at 99.7 percent accuracy due to the system already anticipating specific phrases. Mack Avenue Records, a company typically promoting audio content with display and print ads, sought out this new technology to build awareness of its new jazz star with a sample track. The company saw a 3.24 percent engagement rate, about 30 times higher than the typical touch engagement rate on mobile audio across the same platform. And of those that engaged with the sample track, 18 percent used their voice again and made the decision to visit the album purchase page.
Streaming growth to-date
Streaming audio listenership continues to experience rapid growth in the U.S., the world’s largest music market. From 160 million users in 2014 to 180 million users today, with projections to reach 190 million users in 2018, nearly 60 percent of all U.S. citizens and 66 percent of all U.S. internet users will be tapping into streaming digital audio within the next two years. Worldwide, more users than ever are turning to streaming audio for their music consumption, surpassing even video in the first half of 2016. Streaming audio platforms, such as Apple Music, Tidal and Spotify, are reporting a 58 percent increase in audio plays compared to 2015 numbers. That represents tens of billions of more plays in 2016 than in the same period over the previous year. These numbers make 2016 the biggest year to date for streaming music, which will have numerous implications on the music industry as a whole. Unsurprisingly, there is also a steady uptick in audio platforms’ revenue, which is expected to reach $5 billion in 2018 from $2 billion in 2014, drawing primarily from subscriptions and advertising. However, while streaming audio listenership and revenue trends up, actual music sales continue to decline; song sales dropped an additional 24 percent and album sales dropped an additional 18 percent in 2016 thus far.
- Quick facts: share of ear across platforms
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- Even with the growth of streaming, AM and FM radio still owns the lion’s share of daily time spent listening to audio within the U.S. (54 percent), with owned music and streaming audio accounting for 16 percent and 15 percent, respectively.
- That said, streaming audio is projected to continually increase its footprint within the overall U.S. audio listenership, especially given the rise of smartphones and accessibility of mobile streaming apps.
- Mobile accounts for nearly 75 percent of all U.S. streaming audio listening share, versus desktop at 25 percent.
Pandora leads the market with 41 percent of all U.S. internet users listening on the service. YouTube, iHeartRadio and Spotify fall behind at 25 percent, 12 percent and 12 percent, respectively. There is no lack of competition in the space, as more large players (Google Music, Apple Music, TIDAL, etc.) are continuing to enter and consequently disrupting the space