In a post-Web 2.0 era in which the major apps have already taken their place in the media pantheon, how do new players break into the game?
Take the Internet radio genre. Pandora, iHeart Radio, Slacker, and TuneIn Radio are already well dug in on the consumer’s radar. Is there room for another radio app on iPhones? And how does the maker of that app make room for itself in the market?
Raditaz, which launched this year, is looking to become the future of Internet and mobile radio. The app takes the popular Pandora personalized radio channel model and adds a location layer that allows a user to discover music based on what’s trending in various regions of the US.
By following the model of taking what already works and adding to it, Raditaz looks to tap into the 240 million radio listeners who represent 80 percent of US music consumption and drive $17 billion of annual revenue, according to the company’s own figures.
According to Raditaz CEO Tom Brophy, the big apps that came before it paved the road and made the timing right to jump into online radio.
“Pandora gave us a great start by creating a service and a model that consumers have enjoyed, and that's really driven innovation in digital music,” Brophy said. “We're evolving that model and building on it as we move forward. We think there's still much innovation to come, and we're excited to be a part of that.
“We've all seen how quickly markets can flip and players can change,” he said. “Take MySpace and Facebook, for example. And Pandora's done great, but the online streaming market is still in its infancy, and we think our offering is pretty compelling. We hope consumers will dig it.”
He also cited the transition of the radio industry to the Internet. “That, coupled with the proliferation of smartphones, Internet enabled-vehicles, and other devices -- all that coupled with better connectivity -- makes for a very compelling opportunity for Raditaz.”
To generate revenue, Raditaz will monetize via advertising -- a stream strengthened by the fact that location is a core component of how people use the app.
“We'll be able to deliver much more relevant advertising to people based on where they are and what their preferences are,” Brophy said. “Users can tag stations with what they’re doing while listening and giving us insights into their personal interests. That, tied with location information, makes for a nice proposition to marketers.”
Here's how he describes the rest of the model: “We license our music through a third party. We are registered and pay royalties to SoundExchange. We are aggressively building our user base and plan to do so for a long time. So far, we’re seeing great usage patterns.”
Brophy plans to let the market decide what branding image his service needs to build.
“We'll let our users tell us who they are as they come on board and respond to what we've built. They’ll make suggestions that help us innovate further,” the CEO said. “That said, we think we appeal to most people who want a ‘lean back’ type of listening experience, as well as people to whom discovery plays a role in their listening choice. That person tends to skew a little younger, to be pretty technology savvy, to enjoy listening to music on their mobile device and on the go.”
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— John Scott Lewinski is a journalist and author based in Los Angeles.
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