150223 blm bvdw webradiomonitor 2014_goldmedia_english version

Web Radio Monitor 2014Online Audio Servicesin Germany

December, 2014

Goldmedia GmbH Strategy ConsultingProf. Dr. Klaus Goldhammer | Mathias BirkelOranienburger Str. 27 | 10117 Berlin-Mitte | Germany

Phone: +4930-246 266-0 | Info[at]Goldmedia.de

www.Goldmedia.com

1

Vertraulich/Confidential, © Goldmedia 2

Web Radio Monitor 2014:

Objectives, methodology and market definition

Study/client:

Commissioned by the Bavarian Regulatory Authority for Commercial Broadcasting (BLM) and running since 2009

First cooperationwith the BundesverbandDigitale Wirtschaft (BVDW) in 2014

Objectives:

Overview of the German online audio market

Quantification of the development in Germany

Market and Potential analysis

Estimations of current trends

Methodology:

Primary research by performing both online and offline surveys with several German online audio providers

15 expert interviews with industry representatives

Detailed secondary data analysis

Prognoses: Top-down/bottom-up methodology

The study examined online radio offerings that met the following criteria:

IP-based distribution(via browser or music player)

Linear audio stream(s) with afocus on music and/or information

Germany-based provision of service via own website

Compliance with relevant law and regulations (i.e. legal notice)

Web radios, music platforms, radio aggregators, user-generated radios and personal radio stations included

Download platforms and podcasts not included

Client/objectives/methodology Market definition

Source: Web Radio Monitor 2014Study commissioned by and


Overview 2014: Online audio services

Seven forms of online audio services were examined

(download platforms excluded)

Source: Web Radio Monitor 2014

Examples:

Serv

ices

track

ed b

y W

eb R

adio

Monitor

Online-only webradios

One-to-one streaming of classic radio programmes, which can be received via FM or DAB+

Online radio/FM/DAB+ (simulcast)

Additional web radio streams of the classic FM brands, which are exclusively broadcast via Internet and mostly focus on one music genre

Online radio/FM/DAB+ subbrands

Mostly subscription-based music platforms through which the users can unrestrictedly use a music database at any time and create playlists

Often with radio function as well

Music platforms

(music-on-demand)

Listening behaviour is recorded and analysed

Based on the data, a personalised offering is calculated by algorithms or manual editing

Personal radio

Users create playlists or radio stations which other users can accessUser-generated radio

No original content

Bundling of several online radio services on a common surface/platform

Content-related clustering for better user orientation

Radio aggregators

Music shopping portals on which the users can listen to extracts of their searched songsDownload platforms

Radio programmes exclusively produced for the Internet, which are only broadcast online

Mostly specialised radio programmes with a particular music genre or other orientation


Overview 2014: German online audio services

2,021 online audio providers were tracked

Source: Web Radio Monitor 2014

Examples:

Serv

ices

track

ed b

y W

eb R

adio

Monitor

Online-only webradios

256 providersOnline radio/FM/DAB+ (simulcast)

28 providersOnline radio/FM/DAB+ subbrands

16 providersMusic platforms

(music-on-demand)

3 providersPersonal radio

2 providersUser-generated radio

5 providersRadio aggregators

1,711 providers


Strong growth of online audio services, especially

in the category of UG radio and streaming platforms

Number of online audio offerings in Germany 2006-2014

Consolidation of traditional web radios (-7% compared to 2013); however, high growth of other online audio offerings (+68%); total growth of the offerings at +37% in 2014

Web radio streams include online-only, FM simulcasts and online sub-brands of traditional FM stations

User-generated radio streams and editorially created playlists of music platforms:rapid development of music streaming platforms resulting from the GEMA tariff enacted in 2012

Details

Source: Web Radio Monitor 2014, Medienanstalten, Goldmedia analysis, CAGR: Compound Annual Growth Rate

450 5211,600 1,914 2,681 3,055 3,005 2,851 2,670200

400630

9501,870

4,050

6,800

450 521

1,8002,314

3,3114,005

4,875

6,901

9,470

2006 2007 2008 2009 2010 2011 2012 2013 2014

User generated Radio-Streams undredaktionell erstellte Playlists

Webradio-Streams

User-generated radio streams and

editorially created playlists

Web radio streams

Vertraulich/Confidential, © Goldmedia

39% 26%

6% 4%

12% 10%

5% 6%

27%

35%6%

9%

5%

9%

Juni 2014 Juni 2016

Autoradio

MobileWebsiteMobile App

Smart-TV

WLAN-Radio

Sonstiges

PC oderLaptop

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Distribution of usage across devices in June 2014 vs. June 2016 & relative growth of shares

Outlook: Mobile consumption grows up to 44%

by 2016. Car radios growth skyrockets: +72%

Source: Web Radio Monitor 2014, Basis: Online audio offerings, n=558

44%mobile

Car radio

June 2014 June 2016

website

Mobile app

Smart TV

WLAN radio

33%

Other

PC/laptop


Positive mindset: 71% of the providers are either

satisfied or very satisfied with the number of hits

Source: Web Radio Monitor 2014, Basis: Online audio providers with ad-based offerings, n=138

Picture: © Kirill Kedrinski - Fotolia.com

German online audio providers’ perception regarding the number of hits to their site,

June 2014

71%

Rather

satisfied57%

Very satisfied

14%

Very dissatisfied 2%

Rather dissatisfied 8%

Neutral18%


5172

10513

19

32

65

91

137

2013 2014 2015

Mobile Audio

Online Audio

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Online audio ad market includes

the different kinds of web radios

(FM/DAB+ simulcast, online-only)

as well as aggregators, music

streaming services etc.

It also Includes the ad forms

“online/mobile audio”, but no

pure display ads, sponsorings or

any other kinds of advertising

Frame of survey: Ad revenues and

expectations of the providers as

well as industry experts: Many

providers expect a high growth,

esp. from 2014 to 2015

Key drivers: Stronger profession-

nalization, better understanding

and demand on agency side,

effects of reach measurement

Forecast: Gross online audio advertising revenues rise to EUR 137 million in Germany by 2015

Development of the German ad market for online audio until 2015 (gross), in million EUR Key assumptions

≙ 9% radio*≙ 5% online*

Source: Goldmedia analysis, Web Radio Monitor 2014, CAGR = Compound Annual Growth Rate

*Relation to gross advertising revenues of EUR 1,59 billion (radio) resp. EUR 2,96 billion (online) in 2013 according to Nielsen Media Research

Mobile audio

Online audio


Source: Web Radio Monitor 2014, Basis: Online audio providers with ad-based offerings, n=138Pictures: Screenshot radioszene.de, screenshot detektor.fm

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Increasing uptake of networking technology in the living room: Smart TVs gain in importance for online audio offerings

Totallyagree: 23%

Rather agree: 29%Neutral:

18%

Do rathernot agree:

29%

Do not agree at all: 2%

Online audio providers’ views concerning the role of Smart TVs in GER, June 2014

52%

“Internet-capable Smart TV devices play a growing role for the usage

of online audio offerings.“


Industry considers in-car streaming to be

the key driver for usage of online audio offerings

Totallyagree: 53%

Rather agree: 16%

Neutral: 12%

Do rathernot agree:

16%

Do not agree at all: 2%

Online audio providers’ views concerning in-car audio streaming in GER, June 2014

69%

“In-car audio streaming will significantly increase the user numbers

within the next 3 years.“

Source: Web Radio Monitor 2014, Basis: Online audio providers with ad-based offerings, n=138

Picture: screenshot gsma.com


Web Radio Monitor 2014

Executive summary (1)

Source: Goldmedia analysis, Web Radio Monitor 2014

MARKET

STRUCTURE

TECHNOLOGICAL

FRAMEWORK

USAGE

2,021 online audio providers in Germany (June 2014)

Online audio offerings include web radios, music platforms, radio aggregators, user-generated radios and personal radios

Long tail: >90% of the offerings with only one audio stream; 10% of the providers considered to be commercially relevant

60% of the providers say technological restrictions are no longer a key factor: Growing availability of broadband

The mobile sector is expanding the most: LTE considered to be the key driver by two thirds of all audio providers

More than 30 million Germans aged over 10 years (42%)

use web radio: +9% compared to 2013 (source: ma Radio II)

Positive mindset: 71% of commercial radio providers satisfied with their user numbers

In 2014, one third of hits came from mobile devices – growth of mobile will rise to 44% by 2016



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Executive summary (2)

Source: Goldmedia analysis, Web Radio Monitor 2014

EMPLOYMENT

AD MARKET

OUTLOOK

On average, the responding online audio

providers have 16 employees – mostly freelancers

According to providers, this number will significantly

increase in 2015 by 31%

Compared to 2013, providers expect

advertising revenues to double by 2015

Online audio gross advertising revenues

expected to rise to EUR 137 million by 2015

Continuous strong market growth due to increasing

professionalization, better understanding of and

demand on the agency side as well as positive

effects of standardized reach measurement

69% consider in-car entertainment systems and 52%

Smart TV to be further important market drivers

150223 blm bvdw webradiomonitor 2014_goldmedia_english version

Internet

online radio services

online radio offerings

web radio monitor

radio function

music platforms music

german online audio

personal radio stations

specialised radio programmes