Re: Here, guys is the CORRECTED math concerning the CARP decisions' effect on the future of Internet Radio

[Kim Flint <kflint@loopers-delight.com>]

ah great, numbers. let's take a look at that:

At 05:09 PM 6/24/2002, Rick Walker/Loop.pooL wrote:
>I'm afraid you are, Mark..........you made an understandable calculation
>error and
>made your equation based on 7/100 of a cent per song when, in reality it 
>is
>7 cents per song.

Mark's numbers were per listener, your's are per 100 listeners. (if I've 
got that right.) The correct rate is .07 cents per listener, or 7 cents 
per 
100 listeners, or 70 cents per thousand listeners, for one song play.

>here's a quick revision of your math:
>
>288 songs  X  $.07/song       =   $20.16/24 hours worth of songs
>$20.16     X  7 (days)   =   141.12  a week
>$141.12    X  4  (weeks) =  $564.48
>
>That's an impossible figure and will put almost every 'legal' free 
>internet
>radio station out of business. period. point. dot

No it isn't. I can't understand how you guys keep reaching that 
conclusion, 
without following up with any analysis of the business of running a real 
web site.

Let's see what kind of advertising rates you would need to charge to make 
this work.

288 songs per day X 100 listeners = 28,800 plays/day
28,800 plays X 28 days = 806,400 plays/month

let's say you play 2 ads every 5 songs.

2ads X (806,400 / 5) = 322,560 ad plays.

So you have ads being heard 322,560 times during the month. Visual ads are 
usually sold on a "cost per thousand impressions" (CPM) basis. I'll assume 
web radio ads are sold on a "cost per thousand listens" basis.

$564.48 / 322 = $1.75 CPM

In other words, you have to charge only $1.75 per thousand listens for 
your 
ad space. If audio ads are comparable to banner ads, that is well within 
industry rates for completely generic, splattered-anywhere ads. For 
targeted advertising you can easily charge 4-5 times that or more. I would 
expect audio ads could charge even more than banners anyway. Which makes 
$1.75 a fairly low ad rate.

This is not hard to accomplish, even for small time operations. I'm doing 
it right now, for real. It is NOT impossible, or even close to impossible.


>There goes the underground, my friend.

only the underground that can't figure out the most basic business 
concepts.


>And,as my wife points out, commercial radio doesn't even have these fees 
>in
>place and they have advertising revenue

Radio stations have to pay considerably higher fees for licenses to 
broadcast over the radio spectrum. And since the number of radio channels 
available to them are very limited for any given region, those licenses go 
into bidding wars and become even more expensive. Plus the costs of 
broadcast equipment, studios, staff, etc. make a radio station a lot more 
expensive to run than a web station. Yet somehow they manage to pay much 
larger bills by selling ads. Clearly it is possible. How come webcasters 
are unable to do the same? That's why at the beginning of all this I said 
Herb Tarlek was a genius compared to these guys, and this notion that 
webcasters are being driven under by these royalty rates is BS.

kim


______________________________________________________________________
Kim Flint                     | Looper's Delight
kflint@loopers-delight.com    | http://www.loopers-delight.com