June 11, 2005

Podcasting Lures Wary Music Biz

SAN FRANCISCO (Billboard) -- Podcasting has emerged as the Internet's hottest fad, but is it more than just a passing fancy?

Forrester Research estimates that 300,000 podcasts -- which deliver digital audio content from the Web to computers or portable media devices -- will be available by year's end, growing to 13 million in 2009. The number of podcast listeners is more difficult to track; there are so few that research firms like Forrester cannot get an acceptable sampling to survey.

This is partly because there is a lack of worthwhile content and partly because the current user experience is unappealing. Podcasting may sound sexy and easy to use, but downloading the necessary software and searching for compelling programming is anything but.

However, with Apple Computer adding support for podcasting to the next version of its iTunes Music Store, as well as interest from such market leaders as Clear Channel Radio, Infinity Broadcasting and Microsoft, content and ease-of-use are expected to improve.

With all of this interest, the music industry is eager to determine how -- or if -- it should support the nascent medium.

Frontier Phase

"It's the Wild West right now, and it's incumbent on anyone involved to look at this now to address the business model and the social implication and come up with some rules," EMI Music senior VP of digital development and distribution Ted Cohen says. "If we just sit and stare at it for a while, we'll end up having to go back and modify behavior again."

Podcasting refers to the software and service that deliver digital audio content from the Web directly to the computers or portable media devices of consumers who request it. It's like TiVo for radio in that it allows users to access shows whenever they please, not just when the shows are aired.

The content is delivered automatically to users' computers, with no need for them to search for or download it. The content can then be transferred to a portable device like an iPod (hence the name).

Adopted initially by amateur broadcasters, podcasting is now drawing attention from mainstream radio, which is pursuing the technology in much the same way that traditional journalism outlets are pursuing blogging.

"The 'professionalism of podcasting' is what I'd call it," Forrester analyst Ted Schandler says. "The biggest shift under way is from 'homebrew' to professional. There's just so many real companies putting material up." 

There are many examples from the nation's biggest radio chains. Clear Channel's mainstream top 40 WHTZ (Z100) New York recently began offering the prank phone call segment of its morning show as a podcast. Premiere Radio Networks in April began podcasting seven of its most popular syndicated shows.
Infinity Broadcasting plans to offer free daily podcasts from nine news stations. And NPR has begun podcasting some of its programing.

Musical Complications

Shows that contain music are not part of these offerings, however, because of licensing issues. NPR even strips out the jingles that precede programing segments.

Infinity has launched the first podcast radio station, KYCY-AM San Francisco. The radio group and Sirius Satellite Radio are using podcasting technology with music, but only to receive guest-DJ programing from listeners.

"We think there's an opportunity to push content to a variety of devices in a variety of ways, and we're exploring how to do that with music as well," Infinity VP of marketing David Goodman says.

Others have begun experimenting with using podcasts to promote music. BMI created a monthly podcast of unsigned artists who have licensed their work through the society. Also getting into the game is label Razor & Tie, which launched a series of podcasts from its roster, starting with Danko Jones.

Garageband.com includes technology on its site so artists can record, mix and publish podcasts of their work. "American Idol" runner-up Bo Bice used the technology in May to release podcast-only track "Papion."

As for record companies, they view podcasts as large MP3 files containing hours of unlicensed music.

"I'm wrestling with using it to promote new artists or basically being a mass-dissemination tool," EMI's Cohen says.

"Podcasting can be a great tool for exploring new music," he continues. "But podcasting is a file download. If you're going to do a 'best of Bruce Springsteen' two-hour podcast and 30 million people subscribe to it, is that a 30 million-song download? I think it is. Just because the technology is sexy and it has got some cachet doesn't validate the business model."