It should be pretty obvious by now to those reading my recent posts, to those who know me, and to anyone who is paying attention, Internet radio has been in big trouble in the past few weeks. New royalty rates designed by the copyright royalty board with heavy lobbying from SoundExchange gave Internet radio stations a simple question to answer: Can you afford to continue broadcasting? The answer, as it turned out for many stations was “no.” And to those stations, July 15 was to be D-Day.

Well, now Wired is reporting that only a few hours ago SoundExchange made a statement to Congress that basically said that it was ok for the stations to stay running, and that these rates are not going to actually happen. Confusingly enough, they also reported about 2 hours earlier that the rates were going to stay as is. We’ll see how it all shakes out.

I guess there had been a flood of calls to Representatives. I emailed mine.

But this brings up an interesting point about the market for music, which is to say that among other things, the market is further segmenting. Tastes have always run the gamut, and although no radio station has ever been able to reach the breadth of interest, more and more stations are carving out niches. This comes as no surprise, really, when you see that FM stations have already segmented themselves out by genre, and even sub-genre sometimes. Internet radio, because it has the ability to reach more people for less money (let us hope) has the ability to further segment the market. That is why in iTunes Radio (and elsewhere) you see categories like 50s/60s Pop separated out from 70s/80s Pop, instead of an Oldies station.  There is also an Ambient station and an Eclectic station (whatever that means).

Well, so long as Wired is right, the AARP’s recently announced new radio station will stay afloat. The station was to be run by Pandora, which was looking to suffer a double whammy from the new Internet radio rates: not only are they an Internet radio station, and therefore subject to the new rates, but also their technology creates new radio “channels” based on listener preferences. So they were looking at, what, 500 channels a day? 5,000? 50,000? Anyway, as I said, we’ll see how this shakes out.

But back to the AARP for a moment. This announcement rocks. Or it swings. Or 2-steps, or something. But the point is that it’s great.

It’s great because it means that listeners who were becoming displaced as it became more and more challenging to find Perry Como and Bing Crosby on the radio, and the Easy Listening sections of record stores dwindled more and more (almost as much as record stores themselves)…well, it means that they can stay connected to the music they love. That isn’t trivial because just like all music, this music matters; and just like all audiences, this one matters.

To be clear, I once bought a collection of LPs that had about 50 Perry Como and Sing Along with Mitch Miller LPs. Then, I threw everything away except for the first pressing Beatles Hard Days Night and a couple of other, less known, very valuable LPs. I tried to sell the Perry Como records et al, but no one would buy them. That’s because the market for these things, well they already own these LPs.

Anyway, follow the story and you then find fans who have the LPs and own turntables but can’t find a record needle, so their collection is obsolete. Or maybe they want to be “with it” and use the Internet for their listening. Or maybe they dumped their collections when they moved into a retirement home. Or maybe they sold me the collection because I wanted that Beatles record. But the point is that they ARE a market, and that they were not being served.

But, even cooler than that is the fact that this also makes way for audience development, because there are younger listeners who like this music. They get into it because it’s a way to connect with their elders, or maybe because they heard some hip hop tune that sampled the Claude Thornhill arrangement of Donna Lee (which is amazing, and Mark Ronson – if you are reading this – you should sample this tune. If anyone can turn this into something totally hip, well you get the idea. Let me know if you don’t have a copy). Or maybe it’s because of the Kevin Spacey movie about Bobby Darrin. But younger listeners do get hooked on this stuff too, and someday they will be members of the AARP.

So let’s hope that the new royalty rates don’t happen, and that Internet radio stays alive, if not for my sake (read: if not for the sake of someone with an insatiable appetite for new music), then for our parents, grandparents, and great-grandparents.

That’s it for me. Time for bed (meanwhile, in my head, “Mairzy-doats and dozy-doats and little lamsy divey, A kiddly divey, too – wouldn’t you?”)

Thanks,

Rick McLaughlin

PS – yes, I recognize that the Washington Post article never mentioned Perry. But it’s more fun this way, don’t you think?