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ONLINE AUDIO SITES SET TO CHALLENGE TRADITIONAL LOCAL RADIO STATIONS, ACCORDING TO NIELSEN//NETRATINGS
Increase In Broadband Use Will Force Local Media Outlets Into The Online Space NEW YORK, NY – June 12, 2000 – The increasing availability of broadband will continue to encourage individuals to access streaming media sources online, according to the latest research findings from the fastest growing Internet audience measurement service in the industry from Nielsen Media Research, ACNielsen eRatings.com and NetRatings, Inc. (Nasdaq: NTRT). The research indicates that as individuals obtain more streaming media content online, traditional sources of audio media content, such as local radio stations, face greater competition, forcing them and other media providers to shift their focus onto the Internet and develop original online content. "Broadband and even satellite-delivered content pose both a challenge and opportunity for traditional media providers, especially the local radio stations," said T.S. Kelly, Director of Internet Media Strategies at NetRatings. "Just as cable properties slowly gained market share against their broadcast competitors in the 80’s and 90’s, non-broadcast audio and video sources from the Internet and elsewhere will make similar inroads in the current decade against traditional sources of content in local markets." "As individuals go to streaming media providers such as spinner.com and broadcast.com, radio stations will have to make the leap to the Internet to protect local brand equity and attract new listeners who have come to rely on this new medium for content," said Kelly. "KIISFM in Los Angeles is one of
the few early examples of radio companies making the move to the Web
with original content. As in cable, where ESPN and CNN each successfully
spawned outlets extending their brands horizontally into ESPN2 and CNNfn,
KISSFM has launched KIISFMi (www.kiisfmi.com), a niche player focusing
on more specific music types, to leverage its brand dominance."
In the past six months, the number of streaming media users has jumped 38 percent, according to Nielsen//NetRatings. In April 2000, 36 percent of all active home users accessed some form of streamed audio or video content online, a dramatic increase from 28 percent in November 1999 (see Table 1). Table 1 Nielsen//NetRatings Streaming Media
Audience Trend,
Source: Nielsen//NetRatings, June 2000 "Online streaming media consumption has risen significantly as users switch in large numbers from slower access to 56 Kbps modems and higher speed connections," said T.S. Kelly, "We will see more people accessing streaming content as broadband connectivity solutions such as DSL and cable modems become cheaper and their availability in US households become increasingly widespread. This in turn allows content providers to offer users an improved streaming experience." Nielsen//NetRatings data shows that eight percent of all active home users, or 6.8 million persons two years and older, are accessing the Internet in a broadband environment with speeds higher than 56 Kbps (see Table 2). More than half of all Internet users currently access the Web via a 56 Kbps connection, and the rest of the Web population connects at a speed of 33.3 Kbps or lower. Table 2 Total Web Audience, by Connection Speed
Source: Nielsen//NetRatings, June 2000 Web users with broadband connections use rich media content at a far greater rate than narrowband users. Twelve percent of those active home users who accessed some form of streaming content have a broadband connection. Table 2 compares the connection speeds of the total active Internet users against the total active streaming content audience. Regarding the future development of streaming audio, Kelly said, "Radio is consumed in three general areas, the home, office, and in mobile settings such as the car. Thanks to the Internet, two of the three environments, the home and the office, already offer increasing levels of choice for consumption of streaming audio content. Both wireless and satellite-delivered audio will soon make their way into the car as well. When this happens, the huge radio players will be forced to broaden their content offerings through either development or acquisition to compete against the coming audio superstations." About Nielsen//NetRatings The Nielsen//NetRatings service uses unique technology capable of measuring both Internet use and advertising to provide the most timely, accurate and comprehensive Internet usage data and advertising information in the global marketplace. Nielsen//NetRatings leverages proprietary data-collection technology from NetRatings, Nielsen Media Research's 50 years of expertise in research and audience measurement, and ACNielsen’s international leadership in supplying market research information covering more than 100 countries. Editor’s Note: Please source all data to Nielsen//NetRatings. # # # |