The Future of Radio?

I’ve been listening to satellite radio during my (long) drive to Michigan. Having a variety of niche channels, without ads, and without fading reception, is wonderful. I’m wondering if this is the death knell for standard terrestrial over-the-air radio.

That brought up a question: why don’t radio stations sell music on-line? After all, music labels are very eager to get their songs “in rotation” on these stations – in fact, they pay for the privilege. Airplay is strongly correlated with sales. It’s true that the labels don’t like the provision of copyright law that lets radio stations play their music without (much) remuneration, under blanket licenses, but radio stations seem like a good Internet distribution channel for three reasons.

First, they have brand loyalty. No one knows which label provides an artist (unless, like Sony, the label is stupid enough to install rootkit-based DRM on the computers of listeners who put the CD in their optical drives), but most radio listeners preferentially select WXYZ and have some identification / interest in that station. Thus, if they hear the new Tom Petty song on the station, they know which Web site to go to in order to buy a copy of it.

Second, linking radio stations to sales gives labels excellent data on the effectiveness of this channel. If airplay increases 10% and sales increase 10%, then supporting a station or its DJs financially to push the song makes financial sense.

Finally, the current distribution model – physical product sold in aggregated sets of songs known as “albums” (with the cross-subsidization that the few hits on a CD provide to the other filler) through bricks-and-mortar stores like Sam Goody – is dying in slow motion. Radio stations are established players that already divide up geography and have relatively limited overlap (no market has 10 top-40 or heavy metal stations, for obvious reasons).

Why is this infolaw? Cultural products have specialized legal protection – copyright and trademark – and enormous social influence. The ways by which we access these goods, and the barriers to doing so, should be of great interest not only to record execs and musicians, but to lawyers and indeed to all of us.

3 Responses to “The Future of Radio?”

  1. I am highly disturbed that you found time to write this approximately 1 hour after arriving in your new home. . . in any case, welcome to Michigan!

  2. […] My co-blogger Derek Bambauer must be too modest to promote his own stuff — or maybe he’s too busy driving across the country to his new job as a law professor — so I will point out that he presented the weekly lunch at the Berkman Center on Tuesday, where he discussed how intellectual property and other legal protections can interfere with robust software security research. He is working with fellow Berkmanite Phil Malone on a paper about the issue. […]

  3. Satellite radio isnt the only thing that threatens them. I think radios stations are more worried about selling the ads and building their brand. I am sure some take part in selling music online, but most just play their radio stream online.