Monday, December 29, 2008

A different kind of audio, thats profitable!

If you haven't hit the Apple App Store lately, you might be surprised to see that an application named "iFart" has reached the "Top Paid Apps" section this week. As you may have guessed, the application generates an array of fart sounds.

The app was developed and released by a New York Times best-selling author named Joel Comm. He has posted his sales figures since the application's launch on December 12.

Check this out:

From the day of launch through Christmas day, the company sold 100,536 copies of an application that generates fart sounds.

At $0.99, that's $99,530.64 in gross sales over the period of 14 days. This translates to a profit of $29,859.19 for Apple, which takes 30 percent off the top of every purchase, and $69,671.45 for the developer.

While 100,000 copies in the first 14 days is impressive, perhaps more impressive is the sheer volume sold in three days. The 22nd, 23rd, 24th, and 25th of December accounted for 85,073 of the 100,536 sales, with Christmas day making up 38,927 of those sales.

Here's a timeline:

12/12 - 75 units - #70 entertainment
12/13 - 296 units - #16 entertainment
12/14 - 841 units - #76 overall, #8 entertainment
12/15 - 1510 units - #39 overall, #5 entertainment
12/16 - 1797 units - #22 overall, #3 entertainment
12/17 - 2836 units - #15 overall, #3 entertainment
12/18 - 3086 units - #10 overall, #3 entertainment
12/19 - 3117 units - #9 overall, #2 entertainment
12/20 - 5497 units, - #4 overall, #2 entertainment
12/21 - 9760 units - #2 overall, #1 entertainment
12/22 - 13274 units - #1 overall

I can't believe what people will pay for! I'm going to release an app called "iBurp" --- oops too late.

Thursday, November 6, 2008

Diversity 
 
Today, the FCC unanimously approved the use of an unlicensed frequency spectrum for wireless broadband. I find it surprising that this is not on the front page of every radio mag in the country considering that is where their business is going.  Broadcasters in general, including those in radio have been adamantly against the use of this spectrum.  These opponents, including the National Association of Broadcasters, criticized the ruling.
 
"While we appreciate the FCC's attempt to address significant issues raised by broadcasters and others, every American who values interference-free TV should be concerned by today's Commission vote," the group said in a statement.
 
Sorry to burst your bubble NAB, but over 89% of Americans get their TV over Cable or Satellite, the other 11% will be moving to Digital transmission in February 2009.  I think the NAB is smarter than that.  In my opinion, they are using that as an excuse because they are scared of what ubiquitous wireless broadband really means. 
 
If wireless broadband Internet access is available everywhere, the need for AM/FM/Satellite/HD goes away.  There are serious implications for a number of companies who right now control the 'broadcast space'.
 
Let me be clear about who I'm referring to when I say "AM/FM/Satellite/HD".  I am talking specifically about the transmission mechanism, not the content providers. 
 
Transmission mechanism = AM/FM/Satellite/HD SIGNAL
Content Providers = The Radio Stations & Content owners
 
In other words, a company like Sirius/XM will still be in business, but as a content provider only.  They will broadcast their content over the Internet, instead of over satellite.  KROQ will still produce all of its programming and content, but instead of piping it to a transmitter, they will send it online. 
 
The listener will tune in and listen to the content, but instead of receiving it over a satellite transmission, it will be over a two-way wireless IP network. The end result is the same.   
 
Don't get too excited about this, because we have quite a while to wait before the number of people listening over the Internet outnumbers those listening over the air.  Some people say 10 years.  I say, if technology propagates as fast over the next 10 years as it did for the previous 10 years, we'll all be 'driving' flying cars and consuming entire meals in pill form.
 
10 years ago: 
  • 1 in 7 Americans were online, today, two out of every three Americans spend time online.
  • Online Ad revenue was $270 million, now its more than $22 billion.
  • The top 5 online radio networks have on average nearly doubled audience every year since 2004 and there will be exponential growth as more devices become "Internet capable".
To further illustrate my point, I copied the "Ando Media 1998 website" from a hard disk the size of a refrigerator and posted it on the web.

Here it is in all its glory:
 
 
 
Seriously though, I believe the tipping point will happen significantly faster than 10 years.  To put it into perspective, the iPhone3G was released in July, since then, half a dozen new companies have jumped into the "Mobile Internet Radio" market.  They are developing software and tools that take Internet radio from the desktop to the mobile device.  

In the period of 7 days after releasing their iPhone app, one major broadcaster garnered 7% of their listenership from the iPhone.  Pandora, sees a new listener every 2 seconds from iPhone. 

There are 6 million iPhones out there now.  What happens when these apps become available to the other 220 Million mobile phones?  Radio's rebirth.

This year has certainly been interesting to say the least.  Many companies are finding themselves redefining their business model to stay competitive.  Ando is no different in this regard.  We are developing software and services which will exponentially increase revenue for digital radio networks and content owners over the next couple years.  Stay tuned! 

Until next week my friends!
 
Jordan Mendell  
 
P.S - The links above are obviously a joke.  Everyone needs a good laugh.
 

Wednesday, October 29, 2008

Confessions of a Chart Junkie

Remember: Half the people you know are below average.

My name is Jordan Mendell, and I'm addicted to charts.

I just can't get enough of them.


The amount of pie consumed.










The number of things Arnold Shwarzeneggar has been trying to get to.



Chances of an important call being returned


There are any number of potential interesting data points available in Internet radio. While you have no interest in charting the number of times Arnie yells "Get to da choppa", you may have a need to chart the differences between listening time of people on Rock stations versus Classical stations.

I believe one of the biggest value propositions between Internet radio and broadcast radio is that the former is a 100% measureable medium. Broadcast radio is a unidirectional medium, where the tower simply broadcasts the audio into the air and the actual number of people who hear it is completely unknown (or estimated). Internet radio is different because there is a two-way communication going on between the listener and the server sending the audio streams. Therefore, you know *exactly* how many people are listening to that stream.

Obviously I'm biased because I'm part of a company who's business model is based on measuring Internet radio, but why would you use estimates when you know exactly how many people listen?

Some people say that there is a difference between "knowing how many computers are connected and how many people are actually listening". This is the typical argument that there is a difference between counting listeners and counting computers. There is assumed to be a tiny percentage of people who repurpose Internet radio in commercial establishments such as restaurants, grocery stores and other places where there may be more than one person listening. This would indeed undercount those people. As it stands now, I have yet to go into my local grocery store and hear a local radio station's Internet stream playing.

I'm not going to bash any companies by name, but there is one who's name starts with an A has BITRO in the middle and an N at the end who states that putting 50 people meters in a large city will somehow tell you how many people are actually listening to Internet radio stations in that city. How absurd.

I was recently asked to give my opinion on a single station who's data was collected via PPM and Ando simultaneously over the course of a week in September. PPM reported that there were over 32,000 people listening to the station in question. Ando showed that there were an actual total of 1,746 people listening.

Let's make this absolutely clear.

PPM: 32,000 listeners
Ando: 1,746 *actual* listeners

I've been tracking listener data on Internet radio stations for over a decade, and to burst someone's bubble, there are NO STATIONS IN EXISTENCE who reach more then 32,000 listeners on a single channel station. Don't believe me? Hit http://rs6.net/tn.jsp?t=pjyxftcab.0.0.xyb5ilcab.0&ts=S0373&p=http%3A%2F%2Fwww.shoutcast.com%2F&id=preview between 12 and 3pm EST on a weekday. The number one station listed there (.977 The Hitz Channel) is the largest single channel Internet radio station on the globe and they peak on average at about 25,000 listeners.
The fact that radio stations are using this seriously flawed data to sell against and promising advertisers a certain reach based on these numbers is quite scary. Especially when the advertiser expects some level of response (clicks, calls etc). In other words, if a radio station sells to an advertiser who is expecting to reach (for example) 32,000 people, but in reality they are *actually* reaching 1,746 people, they will immediately see that their campaign is not performing, and that radio station may ultimately lose them as a client.

Ok, time for me to go. I've got to print new cover sheets for my TPS reports.

Till next week!
Jordan Mendell

Friday, October 17, 2008

A Brief History of Time

My name is Jordan Mendell and I'm the CTO of a company called Ando Media.  I started the company in my living room in September of 2001.  Since then, it has grown to be the dominant software and services company to the Internet radio industry.  We now have offices in 3 states, manage inventory and ad insertion for 46 of the top 50 radio companies in the United States.  We inject more than 7 million seconds of ads into radio stations every day.  If you are the world record holder for solving the Rubik's cube, you'd be able to solve it 636,363 times in that amount of seconds.

 

I've been involved in radio streaming since July of 1998 when Internet radio streaming was in its infancy.  It's funny to think back to how the technology world was back then.  Streaming radio was virtually non existent because bandwidth costs were so high.  My first negotiation with a bandwidth provider was with a company called "@ Lightspeed", terrible name I know.  But they were the largest colocation and bandwidth facility in Denver.  I was able to negotiate a $100 per Mbps rate.  At the time, that price was very low.  Now, you can get wholesale rates through providers like Cogent for under $4 per Mbps.  Amazing how 10 years and a glut of fiber optic cabling will bring prices down.  

 

At the time, it was virtually impossible to get a highspeed Internet connection at your home or office.  DSL wasn't really around, and that was years before cable modem was prolific so everyone was stuck using dial up modems or ISDN connections from the phone company.

 

Things were much different then.

 

Anyway, this is "Volume 1" of a newsletter I'll be sending out weekly.  I've had the opportunity to be intimately involved in the digial radio industry since these days.  I have watched and contributed to the advancement of the industry by developing software and working with radio networks to define and evolve their businesses.

 

There are many interesting things going on in radio right now. In this newsletter, I will write my candid thoughts about where I believe digital radio is going both from a technology and business perspective, where Ando is going, and how we will continue to innovate and educate the world to drive up revenue and increase awareness of this medium.