AccuStream Research: Online Music Radio Spins 6.6 Bil. Track Play Hours in ’08; Media Spend at $84 Mil.

MARINA, Calif.--(BUSINESS WIRE)--Online music radio and track play listening hours increased 37.6% to 6.67 billion in 2008, while in-stream audio sold against ad-supported cumulative hours improved by 46.1% to $74 million over the 12-month frame, according to a comprehensive report published by AccuStream iMedia Research.

“Online music programmers are passionate about radio, and adapting their businesses to an inspired yet challenging marketplace. In 2009 their focus is on running lean, efficient operations, capping international streams while pitching local, regional and national avails”

The report, Online Music Spins and Media Spend: 2003 – 2012, shows that AOL’s Shoutcast platform remains the most utilized outlet for online music, capturing 52.5% of total time spent listening, followed by Clear Channel sites with 7.8%.

Shoutcast cumulative music hours grew 47% in 2008 (after a 47% rise in 2007) compared to 27.9% for music listening hours supported by paid media placement, up from 10.6% growth in 2007, a year revised royalty guidelines were formally established.

However, while Shoutcast clusters audiences, along with thousands of channels and hundreds of independent webcast brands it remains largely an ad-free environment.

An analysis of ad-supported music listening reveals Clear Channel the market leader, with a 16.5% share, followed by AOL Radio with 13.2% share. The two major music radio subscription services have a combined 6.7% share, according to the report.

Ad-supported music hours as a percentage of total online listening has declined each year since 2005, registering 44.2% in 2008; a trend forecast to continue.

Sell-out rates improved in 2008 to an estimated 45%, up from 35% in 2007, forecast to reach 50% in 2009. Webcasters are allocating anywhere from 6 – 9 avails per listening hour, and CPMs range from $3 - $10+ for in-stream audio, $20 for video.

An analysis of the online music royalty structure adopted in 2007 suggests that by taking average estimated hourly listeners of 341,509 (based on 2.9 billion hours), and applying licensing rates equally across sites generating $84 million in 2008 media sales, that approximately $40 million would be owed to rights organizations, or 48.3% of the gross.

“Online music programmers are passionate about radio, and adapting their businesses to an inspired yet challenging marketplace. In 2009 their focus is on running lean, efficient operations, capping international streams while pitching local, regional and national avails,” commented research director Paul A. Palumbo.

This AccuStream Research report is available to independent and ad-supported webcasters at a discount.