Last.fm has partnered with online music publisher, Sound Alliance in its Australian expansion plans. The move comes as JB HiFi also moves into the online music business, with both services posing significant challenges to radio’s power for introducing new music to listeners.
Music listeners still use radio as an important source of finding new music and learning about the artists, but this is under challenge from ventures such as Last.fm and JB’s new service. A Colmar Brunton survey for CRA some years ago found that 67% of people still use radio as their primary source of information for new music, but, as more online competitors come into the market, radio’s strength is bring continually challenged.
The ‘recommendation’ function performed by radio announcers, top 40 countdowns, and new music shows over so many years is now not the sole preserve of the radio medium. This is particularly important for Australian new music.
Community radio is a big supporter of new music, especially through the AMRAP project, triple j has recommended many new artists through Unearthed, and commercial stations such as Radar Radio and the sector’s New Artists to Radio play a big part in finding and popularising new artists. But self programmed online music services have the potential to expand the listener’s musical horizons based on their own listening patterns and those of people with the same music tastes.
It is a powerful challenge to radio.
Nova recently introduced a new countdown show which uses iTunes rankings to gauge immediate music consumption patterns, but radio will continue to be challenged by new online offerings in this area.
Sound Alliance will operate Last.fm’s Australian advertising sales arm and integrate with its portfolio of music websites.
Last.fm recommends new songs, artists and events based on its subscribers’ listening habits. Its streming radio service boasts: “Listen to endless personalised radio stations based on an artist, tag, or even a friend’s taste!”
Last.fm describes its recommendation service like this: “A scrobble is a little note The Scrobbler sends to Last.fm to let us know what song you’re playing. Scrobbling helps us tell you what songs you play most often, which songs you like the most, how much you’ve played an artist over a certain amount of time, which of your friends have similar tastes… all kinds of stuff. By focusing on the music you already play we can help you discover more music. Scrobbles mean we can deliver personalised recommendations for every single Last.fm listener.”
JB Hi-Fi will release a streaming music service by the end of the year and eventually open a new music store according to a company announcement last month. JB HiFi is a big player in the ‘hard copy’ music market for CDs and DVDs, but it has noticed purchases of CDs is declining. Its recent financial year earnings were down on previous years in this area of its business.
The division of its business that offers hardware such as televisions and computers is achieving comparable sales growth of 4.1%, but the software side, games, DVD s and music, experienced a 9% drop in the past financial year.
JB is planning to redress this problem by selling more ‘soft copies’ of music and by offering radio streams.
Announcing the new initiative, JB HiFi chief executive Terry Smart said the new service will be available to customers on PCs and Macs first, and then expand to mobiles on all major platforms – iOS, Android and Windows 7 Mobile. The new product will have millions of tracks available from hundreds of thousands of individual artists, both local and international, and users will only have to pay a flat fee for unlimited streaming.
Last.FM and JB HiFi have both worked with record labels to ensure the services meet copyright requirements and give a fair return to artists.
Stations that have not yet considered their own strategies in this increasingly competitive area may be caught napping if services such as Last.fm and JB HiFi Now gain rapid popular acceptance.