Wednesday, July 15, 2009

The Demise Of Free Internet Radio

It looks like the days of free internet radio are numbered, the major players are already starting to charge and it probably won't be long before more of them jump on the bandwagon. Some are charging pretty reasonable rates, others not so much. is still free in the US, UK and Germany but if you're anywhere else in the world you'll have to pay €3.00 per month to continue listening. They are owned by CBS radio anyway, the same group who recently ruined Yahoo's LAUNCHcast radio when they took over that service.

XM have completely lost their minds, they expect you to pay $12.95 a month for an online radio subscription. That's $155 a year to listen to the radio! No thanks.

Even Pandora is starting to charge fees now. Users are allotted 40 hours per month, if that limit is exceeded there are three choices. 

  • Do nothing and wait until the following month to resume listening.
  • Pay $ .99 for unlimited listening for the remainder of that one month, you will still have limited skips and you will still hear advertisements.
  • Buy a premium Pandora One membership for $36 per year. That's unlimited play, unlimited skips and no ads.

I suppose Yahoo's LAUNCHcast is still an option, but since CBS took over you no longer have your own customized station, all the time and effort spent on ratings and preferences to customize your own personal listening experience were wasted.

The royalty rates which internet radio are forced to pay per play per user was just cut roughly in half, so there's still hope that the industry itself won't disappear completely. There's going to be some stiff competition from new tech gadgets so it's still not going to be easy for internet radio to survive. Devices like the Aluratek USB Internet Radio Jukebox sell for less than $40. This particular device looks like a USB thumb drive, you simply plug it into your computer USB port and it's own launcher and micro-browser take over to give you access to 13,000 radio stations in 300 countries. You can search the radio stations by genre, state, or country, and you can even create favorites lists.

I think the idea of charging radio stations to play music is an asinine thing to do and I'm sure it's motivated purely by greed. FM radio doesn't have to pay royalties to play music, and satellite radio pays much lower rates than internet radio although that gap has been all but reduced by the new arrangement. I listen to far more radio online than I do on an FM receiver, and very rarely listen to any satellite. Almost all of my exposure to new music comes from internet radio which influences almost all of my decisions to purchase a CD yet artists and record companies demand payment for that exposure. Personally I think it should be the other way around.

So what do you think, will free internet radio survive or do you think it will go away completely? Do you use a free service not mentioned above, and if so which one?

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