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Sci-Tech

Why Smart Speakers Were Popular Gift Idea Again This Holiday Season

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Smart Speakers 101  The trendy devices can help you with everything from appointment reminders to grocery shopping lists to playing your favorite music and podcasts. It’s that last item that has the radio world excited. Find out why all the buzz is good news not only for broadcasters but also importantly for you.

A recent trend has shown an increase in radio listenership through popular smart speakers such as Google Home and Amazon Alexa. So what can broadcasters do to take advantage of this trend? Steve Goldstein of Amplifi Media and Sonic Ai aims to help.

A broadcaster by trade, most recently as EVP at Saga Communications, Steve saw a shift to on-demand content, and in 2015 launched Amplifi, a firm focused on developing on-demand audio—the intersection of podcasting and broadcasting. Earlier this year, Steve partnered with Jacobs Media on Sonic Ai, who develops smart speaker skills (more on skills later) for podcasters and broadcasters.

So what is it about smart speakers that make it easier for people to listen to radio? Steve explains, “There are a number of factors. For starters, the number of radios in the home has been on a steady decline. By some estimates, two-thirds of homes do not have radios. Generationally it’s even fewer.” Steve says the notion that it’s a choice between a radio and something else isn’t really true anymore – in some homes, there is no radio.

While it may be hard for those of us in the broadcast industry to imagine, the smartphone has replaced the radio and clock radio in many homes. “The smartphone is an entertainment hub,” Steve says. “It’s where people listen to music, get the news, watch videos, and so on. It’s transitioned from a telephone to a full-fledged hub. Part of that hub can be radio, but very little listening to radio occurs through the device.”

Steve says radio stations need to think beyond the transmitter and audio stream. While there are only so many radio stations in a market, there are 100,000 radio stations available via the TuneIn Radio app, streaming services like Spotify and Pandora, and 400,000 podcasts. “You’re talking about an awful lot of audio,” he asserts. “The focus needs to be on-demand content. That’s the trend. The expectation today is that content is available on-demand.” The ability to listen whenever and wherever a listener desires—in the car, while they’re walking the dog, when they’re exercising—is in step with today’s lifestyles.

Steve Goldstein

It’s the same arc we’ve seen on the video side with on-demand services such as Netflix, Hulu, and others. While adoption has been slower on the audio side, the conversion is happening rapidly among millennials.

An Edison Research study from NPR earlier this year showed that somewhere between 7-11% of homes in the U.S. have these devices and the largest group of users is millennials (18-34). And we should expect this trend to continue, especially with the holidays upon us. “We should expect these devices are going to sell like hotcakes over holiday season,” Steve says. He points out that some analysts predict that market penetration may increase to 15-18% by the end of the year.

Smart Speaker

With the trend toward radio and audio consumption through smart devices, it’s apparent the way forward for broadcasters is to develop new ways to connect audiences to their content.

Got Skills?
You’ve probably heard the term skills thrown about when smart speakers are discussed. So what exactly are skills? And how do they relate to broadcast audio consumption via smart speakers? Steve explains. “Think of smart speakers as computers… They don’t know what to do until you teach it. In this case, Amazon refers to the learning aspect of the device as a skill. We develop skills and invocations for the stations we work with.”

As an example, Sonic Ai built a skill for WMMR in Philadelphia called ‘Open MMR.’ The listener hears a greeting from the morning show, then is offered a menu of choices. Listeners can choose to listen to the live stream, the latest podcast of the morning show, or the show’s top feature, called ‘The Bizarre Files’—an 8-12 minute piece of audio you can listen to without sitting through the entire morning show. Steve says WMMR has seen significant traction from listeners who missed the segment on the morning show tuning in to listen at a time convenient to them.

For a top-performing morning show, this is huge; for the first time, there’s a retention strategy, with the ability to repurpose and reuse audio. Additionally, in PPM markets, listening to content within 24 hours of the original broadcast is accretive to a station’s ratings.

Steve points out that when it comes to a radio station’s invocations and skills, getting it right is essential. Depending on the name or phrase used to identify a station, the invocation might not provide the audio stream you’re looking for. Steve cites the phrase ‘Lite FM’ as an example. “If you say ‘Play Lite FM’ as your invocation, you’re going to get Lite FM in Beirut, Lebanon, or an Inspirational station in Albany, NY. So you need to get your name and invocation correct, and register it.”

Steve suggests however that if stations are only doing this for streaming purposes, that’s not enough. “The real opportunity is with on-demand audio, which is what we’re focused on.”

The capabilities of smart speakers are constantly being enhanced, and they’re used for a variety of tasks, but audio is by far the top option. That’s the good news, Steve says, but the challenge for broadcasters is that that audio is coming from a variety of sources. “The linear AM/FM notion is going away, but the notion that broadcasters create relevant content is not, so they need to be more flexible about where content is being consumed, less focused on the transmitter, and more focused on devices that can play audio.”

It’s a new challenge, but with booming sales of smart speakers and potential for a measurable increase in listeners, it’s a challenge broadcasters need to embrace. Steve sums it up. “Broadcasters need to get out of the radio business and into the audio business. That will change your thinking about everything.” For the Silo, Dave Sarkies/Telos Alliance.

Supplemental-
For more about the impact of smart speakers on the broadcast industry, check out TWiRT 372 – Tom Vernon on Smart Speakers 

Culture

Streaming Companies Spotify And Labels Sony Making The Money Not Artists

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Potter Box

Definition:

Is it ethical for media streaming companies, such as Spotify, to take advantage of IP loopholes, which are known to negatively impact artist revenues?

Values:

>Balance & Fairness

>Legal Values

Loyalties:

a. Duty to service

b. Duty to subscribers

c. Duty to shareholders

d. Duty to Intellectual Property

e. Duty to Art & Commerce

Principles:

Aristotle’s Mean: “Moral virtue is a middle state determined by practical wisdom.” Virtuous people will arrive at a fair and reasonable agreement for the legitimate claims of both sides somewhere in the middle of two extreme claims.The two sides must negotiate a compromise in good faith. “Generally speaking,in extremely complicated situations with layers of ambiguity and uncertainty, Aristotle’s principle has the most intellectual appeal.”

BASIC CONCEPT:

Negotiated compromise.

>>Streaming Media Company

For the Purpose of analyzing an isolated streaming media company, Spotify will be examined through the lens of the potter box. Spotify is a streaming service with cross-platform availability that specializes in music, and generates income from its 20 million premium and 75 million free users, respectively. Spotify boasts an extensive catalogue for free and for a nominal fee. Spotify’s extensive catalogue is made possible due to established agreements between various record labels and media companies. Agreements that are known to negatively affect artists, while benefiting both Spotify & Record labels, plague the music industry. Payout deals between Spotify and record companies range from royalty payout to equity deals.

Spotify does not want to make adjustments to the model of its free service, because if their users are not able to find it on Spotify, they will utilize other streaming services such as youtube, which is likely to have the content. They have identified this free offering as being their driving force for getting new subscribers to the service. New subscribers that turn into increased revenue for record labels, as 70% of revenue from $10 per month subscriptions and advertisements are paid to record labels, artists, and song publishers.

>>Artists—Influence: Art/Media Creators

The Artists on Spotify collectively stream over 30 million songs across 58 different markets. Despite collectively making up a heart from which Spotify thrives, Artists receive 6.8% of streaming revenue, the smallest share of the pie.

Artists receive 10.9% of the post tax payout between artists, labels, and songwriters/publishers. Many artists including Adele, Taylor Swift, the Beatles, and Coldplay have opted for keeping music off of Spotify.

Spotify Breakdown Chart1

Spotify does not have direct agreements with most artists. The streaming company has agreements with labels, whom are responsible for not only securing licenses to music, but to are also responsible for payouts to artists. So essentially, Spotify pays labels, and the label is empowered with payout to artists. The problem is not that Spotify refuses to fairly pay for royalties; it is the trickling down of payment from labels to the respective artists. Spotify has wholesale access to music catalogues from record labels, which makes it hard to fairly split royalty payments amongst artists that are under contractual agreements with respective label.

Even with leaked contract between Spotify and Sony Music available, it is still unclear how much of payouts to record labels actually get to the hands of the artist. It is clear that Sony Music is getting a hefty payout annually, but the question is still whether or not these hefty payouts are passed on to the artists.

>>Major Record Companies

The music catalogue on Spotify is mostly populated by content from major record labels that include Sony Music, Universal Music Group, EMI, Warner Music, Merlin, and The Orchard. Self-published artists as well as artists from independent labels also help makeup Spotify’s catalogue.

Record companies have begun to further question Spotify’s free model since Taylor Swift and other artists have proactively opposed Spotify’s extensive free offerings to users. Streaming consumers of music increased by 54% between 2013 and 2014 according to the Nielsen SoundScan. Major record companies are often made better deals, which disproportionately disadvantage independent artists and labels.

Executives at major record label such as Universal Music and Warner Music have made statements about the extensive free offering of its licensed music is not sustainable long-term. It was suggested that there needs to be a more clear differentiation between content available to free and premium users. Bjork has suggested that Spotify should not allow access for certain content right when it comes out, but should allow for content to go through certain rounds of monetization before ending up on Spotify, similar to Netflix’s rollout method for its content. Major record labels are currently in the process of renegotiating agreements, and are mostly pushing for adjustments to free service offered.

Their goal is to have the “freemium” model disappear as time persists.

What is the current policy?

A legal agreement between Sony, the second largest record company in the world, and Spotify recently leaked, which further intensifies questions about fair payouts for artists. The contract confirmed that major record companies benefit from the success of the streaming service Spotify. The contract details advance payments of over $40 million, with a $9 million advertising credit. Sony has declined to comment on the leaked contract, as it was illegally obtained. Labels routinely keep advances for themselves according to an industry insider.

The leaked contract detailed agreements between Sony Music and Spotify, but not between Sony Music and artists. Such fruits of private agreements don’t necessarily trickle down to the artist, because in most cases they are not even aware of an under the table deal unless a leak has occurred. Unstated under the table deals are not ethical, because artists do not benefit from funds received on account of their intellectual property. The International Music Managers Forum urges European and American authorities alike to use the Sony leak as an example of why more transparence is necessary.

Artists are not being fairly compensated for use of their intellectual property.

Streaming companies have established a revenue arrangement with major Record Companies that often does not favor artists. The obvious shortfalls with existing policy include the lack of transparency when it comes to agreements between record labels and Spotify. There are no systems of checks and balances for ensuring that labels adequately and fairly share Spotify revenue with artists. There needs to be a streamlined system that puts everything on the table in clear view, for fair agreements between artists, label, and streaming company to be arrived at. Current policy also allows Spotify to take up to 15% off the top from revenue generated from ad sales.

What needs to be changed?

Spotify seems to be fairly paying for royalties, but the flow of cash does not always get to the artists. Substitute apps; try to compete with Spotify, by challenging the freemium model. Other apps such as Tidal aim to provide audience with exclusive content that they won’t find anywhere else. The problem is that apps such as Tidal market themselves as a music-streaming app by the artists for the artists. Nowhere in that equation is the interest of the average potential consumer considered. Artists may receive more money per stream, but the service is double the price of Spotify. Record companies, and artists alike, are moving away from Spotify’s freemium model. The digitization of music is not the problem, as most artists and labels generally trust certain digital services such as itunes, because it translates into revenue for artists with no veil or strings attached. Extensive free offerings seem to be the major issue that involved parties have with Spotify, but it is the only thing that drives traffic according to Spotify. The freemium offerings need to be changed in some way, but in a way that is non-disruptive to Spotify’s commerce. Since Spotify pays its fair share of royalties, a more streamlined agreement between record labels and artists should be established and transparent, as should deals made between Spotify and record labels.

Major record labels need to stop double dipping. Not only do they receive cash advances & royalties, but they also benefit from Spotify’s overall revenue stream as they have equity in Spotify of up to 18%. Billboard magazine interviewed two dozen record executives and they agreed that they were confused as to what Spotify was replacing, whether being a substitute for sales or piracy. Examples of setting limitations of the freemium service have showed signs of slowing down subscription growth rate. Spotify has stated that if artists are not fairly compensated from stream revenue, then it is a result of recording contracts and or label accounting practices. Some major record labels are fine with Spotify using their music to build business, because of their equity; they are looking ahead for profit from a future IPO. The artists would not benefit in the same manner, despite their content being the driving force for the app in the first place.

Click me! Future Art Sound
Click me! Future Art Sound

Scenarios

In a time of changing platforms and distribution methods, consumer trends has undoubtedly been in transition. The radio still accounts for an estimated 35% of music consumption, followed by CD consumption at 20%, free streaming at 19%, and paid streaming at 1%. Multichannel consumers, mostly millennia’s, account for 66% of music consumers. A multichannel consumer may pay for a streaming subscription, and make a physical and/or a virtual music purchase. The most common multichannel consumption combination is free streaming coupled with CD listening which accounts for 49% of multichannel listeners, followed by free streaming coupled with music downloads which accounts for 44%. Millennia’s are also known to engage in both free streaming and downloading.

Evidence

During the first quarter of 2014, Pharrell Williams garnered 43 million Pandora streams, which only paid him $2,700 as a songwriter. A statement from Pandora indicates that all rights holders were paid upwards of $150,000 within the first 3 months, and that the real issue is the financial dispute between labels and publishers. Pandora also indicated in the statement that labels are free to split royalties between themselves and artists, however they see fit. Clearly there needs to be more transparency for the cash flow between streaming company, label, and the artist.

Spotify returns 70% of its revenue to rights holders, with information about each artist to aid in the royalty split process. Streaming companies are engaged in fair due diligence where payment of royalties are concerned. The evidence is as follows:

Spotify Breakdown Chart2

Actionable Policy

The music industry needs a streamlined agreement between streaming companies, record labels, publishers, and artists. It is imperative that there is increased transparency, especially where cash flow is concerned. Artists should be able to see all cash and data exchanged between streaming company and label. Royalty holders need to publicly split funds amongst themselves and artists. Record labels need to be accountable to both their artists and streaming company, because an artist that feels swindled can create bad blood between the artist and the label and/or the artist and streaming company.

Recommendation

>>Actionable

1. Artists are cut into equity deals based on audience pull to streaming service per qtr

>>Streaming Services should provide analytics with specific data to aid audience pull observation for given artists

2.Major Labels are transparent with cash flow of compensation from Streaming Companies

Is it ethical for media streaming companies, such as Spotify, to take advantage of IP loopholes, which are known to negatively impact artist revenues?

Judgment:

It is ethical for streaming services to take advantage of IP loopholes, which are known to negatively impact artist revenues. Music platform are changing, and as such, better agreements need to be drafted to complement this change. Streaming companies have shown the numbers, and they are paying for royalties, which is essentially paying for the use of the music in their catalogue. Music streaming is an emerging market, which record companies themselves are invested in. The common mode of music monetization is moving away from CD sales, and that is undeniable. Music downloads take up a lot of data, so streaming is the most practical way for consumers to enjoy their music.

The freemium model of Spotify should not be eliminated, but it should certainly be reconsidered, or at least limited in music access. Premium, new, and sought after music should not be as accessible as music that has already exited the promotion stage. Their needs to be some sort of compromise between record labels and Spotify, to better differentiate between premium content and freemium content. Spotify does not want to compromise the availability of its music on either platform, and labels reserve right to pull any of their artists from Spotify as they wish. Spotify should do a better job differentiating free content from premium content, it’s only fair. Spotify should not compromise to the point that it becomes impractical, but should compromise in a way that is cost-effective for all parties. If this were to be attained, streaming companies, record labels, and artists would be happy, circumventing social dilemma.  Jordan Muthra The New School University, M.A., Media Studies, Graduate Student

Click here to read PDF version: The_Ethics_of_Streaming_Music

 

Sci-Tech

Dubai DJ Sets Underwater Broadcast Record

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The crew at Channel 4 FM in Dubai responded when the marketing team thought it might be fun to do a live 5-10 minute broadcast segment from the Ambassador’s Lagoon outside the iconic Atlantis the Palm Resort, more or less as a publicity stunt to promote this exotic location. We’re not talking poolside, mind you, but broadcasting from within the pool – an underwater broadcast from a pool that hosts a variety of sea life!

This might have been interesting enough, though such an aquatic broadcast had been done before, but the plan soon evolved into something more when Station Producer Lucas Poole (ironic, right?) suggested that Stu Tolan, host of the Celebrate Mornings breakfast show, attempt to break the record for longest underwater broadcast.

Mobile Rack featuring Telos Z/IP ONE used for underwater broadcastChannel 4 learned that this would mean staying on air and underwater for nearly five hours – no small amount of time to broadcast live while wearing scuba gear! The team was up for it, and preparations began to break the record. But would the tech hold up for such a stunt? Channel 4 IT and Broadcast Manager Muhammed Rafeeque says there were a number of challenges, and the engineering team initially didn’t feel prepared for the record-breaking broadcast.

“We were informed that one of the requirements to set the record was that the broadcast crew could not disconnect from the studio for more than two minutes, so we would need to ensure a stable link from the site of the broadcast to the main broadcast studio at all times,” Muhammed explains. In addition, the broadcast hosts would need to remain in communication with a representative from the Guinness Book of World Records, outside the pool, at all times. Muhammed continues, “These requirements presented some challenges for the technical crew to ensure these lines of communication would remain stable throughout the broadcast, and that any delays in communications or getting callers on the air would be minimal.”

Complicating things further, the resort could not provide a stable internet connection because it is reserved for guests, so the only access would be via cables. As such, a good bit of equipment would need to be hauled to the broadcast site so everything would be at the ready.

As a solution, Muhammed says the team used a router, which connected to a Telos Z/IP ONE, and then to the main broadcast studio. The studio features 100% Livewire infrastructure, so getting the audio feed into the studio would be easy using the Z/IP ONE, especially with sufficient backups. Muhammed assigned two Z/IP ONEs to the studio, so if one failed, the second one would take over and the broadcast could remain live. “For this broadcast it was all about convenience, quality, and low latency,” he points out.

“For this broadcast it was all about convenience, quality, and low latency.”

—Muhammed Rafeeque, IT and Broadcast Manager, Channel 4 FM

All the coordination paid off, and on May 13th, Stu and the Channel 4 Celebrate Mornings went live from underwater! Everything went smoothly, and presenters Saif, Vicky, Helen, and Kolter, Program Director Tom Ferguson, and news reporters on hand to interview the team, joined Stu underwater at various intervals during the show, while co-presenter Eve presented poolside.

With the help of the engineering staff—Ramesh, Chandana, Chaminda, Ibrahim, Mannan, and Shahid Kazmi—and the marketing team of CEO / Group Program Director and AlMurad Group CBO Talal Murad, and assistants Neeil and Yogesh, the broadcast came off without a hitch.

In the end, the record was not only broken, but shattered, as the broadcast went well beyond the five hour mark, giving future underwater broadcast hopefuls a high bar to shoot for. Check out the video highlights and the photo album.

Mr. Abdullah Murad, Chairman Al Murad group, parent company to Channel 4, phoned Stu to congratulate him once the record was officially broken, and the Guinness Book of World Records representative on hand certified the record presented Stu with the honor at the end of the broadcast.

It certainly wasn’t your everyday broadcast, but at a place like Atlantis the Palm, “A World Away from the Everyday” is the norm. The Telos Alliance is proud to have played a small part in this unique event, and help the Channel 4 team achieve a slice of radio broadcast history. For the Silo, Dave Sarkies.