Music industry VS Internet Radio

Remember those days when life was so much simpler? It did not cost a penny to play music on radio stations up until satellite radio stations made their special entrance.  After that day satellite radio stations were charged 1.6 cents for every hour and listener they engaged. Now in 2010 satellite radios are charged 2.91 cents per listener per hour.  Where do the fees go? To the music industry of course!

Popular internet radio provider “Pandora,” is facing extreme obstacles regarding high royalty fee systems.  It seems to be that the very popular Pandora is not being able to gain sufficient revenue to pay the RIAA bill. Although the station has many viewers, the unreachable amount charged for each viewer per hour is hard to pay off. In fact, the internet radio provider might even be shut down because of this. 

Pandora is an internet radio site, which exposes music lovers to the latest music. The site allows visitors to search by their favourite artist. While exploring the music produced by their favourite artist, recommendations for similar artists along with songs are instantly provided for the visitor to listen via iTunes and/or Amazon. Sites like Pandora allow listeners to get a chance to explore what kind of music fits their taste best and also helps them figure out what album to buy next. Upcoming new artists can easily gain fans through internet radio by online exposure that doesn’t cost them a penny.

Pandora and other sites in the same category encourage excellent retail sales. However, RIAA wants to limit how much spotlight an artist can have. Thus, the “royalty fee systems” is applied to internet based radio. The only problem with this system is that it asks for a ridiculous amount of money for something that actually promotes artists and helps publicize them. Internet is the best source of entertainment and also the easiest source. It is easier for listeners to figure out who the artist of a particular song is. It is easier for listeners to listen to internet radio more than regular just because everyone is connected to their computer more. Whereas, listening to a regular radio wouldn’t give the listener as much information to disgust. 

The music industry is obviously facing decline in their revenue since listeners prefer to download music and sync it to their music system rather than buying CDs. Not everyone listens to CDs anymore because not every one of us carries a CD player anymore, we carry an iPod or mp3 etc. 

So what do you think?

Should RIAA lower their fees? 

Do you think internet radio is helping the music industry or sabotaging it?

Sarah Khan

Source: http://dvice.com/archives/2008/08/shift_how_the_m.php