Non-Interactive Music Streaming

According to Nielsen’s 2017 Comparable Metrics Report, if you add up the total minutes of AM/FM radio and streaming audio in the US this equates to more than 202 billion minutes per week, and of those 202 billion minutes AM/FM radio represents 93% of total weekly audio listening minutes as compared to only 7% for streaming audio.

According to Neilsen’s 2020 Total Audience Report, Working from Home Special Edition, people indicated that the number one type of TV and streaming content viewed while working from home was news. Thirty-three percent of people listen to their news updates on a music radio station and 28% of people listen to a public radio station for their news. This highlights the diversity of radio’s program offerings and radio’s resiliency even during COVID-19.

Results from our 2020 Music Industry Report show that 33.3% of respondents discover new music from AM/FM Radio and 25.1% indicated that they discover new music from Satellite radio. Additionally, in response to “how do you usually listen to music?” 36% of respondents listen to AM/FM radio—the second-highest response behind only Spotify. Nearly 25%listen to SiriusXM (satellite radio) and 11.2% listen to Pandora. Additionally, satellite radios have become much more prominent as 75% of all new vehicles in the U.S. sold after 2016 have satellite radio installed. Also, with the continued rise and prevalence of computers, tablets and smartphones, Internet radio has also seen steady growth.

Though it may seem like interactive streaming is the sole form of music consumption today, research and data show that non-interactive streaming is still very relevant. Given the popularity of this form of music consumption, its rapid growth since the beginning of the 21st century, and its huge potential to provide new and existing sources of royalties, any interested party should seek to understand the ins and outs of non-interactive music streaming and their implications for the future of the music industry.

What Is “Non-Interactive” Music Streaming?

Non-interactive music streaming differs from on-demand, or interactive, streaming because it allows users to play music but does not allow them to select the song that plays next. Non-interactive streams generate a performance royalty for both the sound recording and composition of the song. The performance royalty associated with the sound recording of the song is paid to SoundExchange, while the performance royalty associated with the song’s composition is paid to the PROs.

Both “webcasting” and “Internet radio” are terms used in reference to non-interactive music streaming; however, the term “webcasting” can be defined as a broadcast over the Internet from a single content source to many simultaneous listeners. Therefore, webcasting also technically applies to on-demand streaming. In this guide, however, “webcaster” will primarily be used to refer to non-interactive streaming services. Internet Radio can be defined as a digital audio service transmitted over the Internet. Internet Radio presents listeners with a continuous audio stream of songs which, in the case of non-interactive music streaming, cannot be skipped or replayed, similar to traditional broadcast media like AM/FM radio.

The most important thing to remember about non-interactive music streaming is its namesake: the Digital Service Provider (DSP) does not allow you to skip, rewind, skip forward, or know the playlist of songs ahead of time. You may only “tune in.”

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References

http://www.mediapost.com/publications/article/220860/half-of-us-listeners-tune-into-online-radio.html

http://www.edisonresearch.com/monthly-online-radio-listeners-exceed-half-the-population-12/

https://futureofmusic.org/article/fact-sheet/ascap-bmi-consent-decrees

https://blog.songtrust.com/types-of-streaming-royalties

https://www.exploration.io/music-industry-report-2020/#:~:text=Overall%20economic%20impact%20of%20the,%25)%20since%202013’s%20%24471B.

https://www.soundexchange.com/service-provider/licensing-101/

https://support.cdbaby.com/hc/en-us/articles/360059496391-What-is-SoundExchange-What-money-do-they-collect-

https://exploration.io/how-the-music-business-works-a-birds-eye-view/

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Excerpt from What is Non-Interactive Streaming by Will Donohue, Luke Evans, Mamie Davis, Jacob Wunderlich, Rene Merideth, Jeff Cvetkovski, & Aaron Davis is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

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Media Communication, Convergence and Literacy by Enyonam Osei-Hwere and Patrick Osei-Hwere is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.

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