Since Pandora’s IPO a year ago, the online audio story has been something of a broken record. Pure play audience numbers keep growing (Pandora’s audience more than doubled from April 2011-April 2012) but the revenue growth trajectory, while steep, has yet to produce profitability. This is because – unlike the traditional radio world – audience is expense for online radio with a hefty performance royalty that mounts each time a consumer listens to a song. Dramatic increases in mobile and in-car listening will only continue to skyrocket the tally as we move forward.This catch 22 has slowed the shift to digital for traditional radio stations. For nearly a century now broadcast radio has operated without a performance royalty. However, these same brands face oppressive performance royalty fees from their online listenership. To date, it has been impossible for online music plays, whether they be from a pure play or a broadcaster, to turn a profit. So what motivation does a local station have for streaming its content?
Keep reading: The Rebirth Of Radio | TechCrunch