Rdio Broadcasters and Online Music Services have not entered a symbiotic mode of existence due to the increase in competition and a crowded market. This can safely be said since on the 16th on September, Cumulus Media (which operates 525 radio stations), announced a deal with Rdio.
Rdio is a music service subscription initiated by Skype. The deal will hence give Cumulus an online outlet and assist Rdio in its competition against giants like Spotify. Cumulus in turn will also provide Rdio with a broad access to to its programming and promotions. In a joint interview with Drew Larner, on Friday, Lewis W. Dickey Jr quoted, “This is our digital play,” Rdio, which will be available in 31 markets all over the world, allows its subscribers to listen to songs, playlists and interact with other users too.
With the deal kicking off, Cumulus will also sell the free version of the service in the US. Mr. Larner, in the same interview also stated, “The biggest challenge we face is really awareness. We live in this bubble in which everybody is talking about this stuff constantly, but to the wider world, streaming is still relatively nascent.” At present, the value of Cumulus’ content and services is estimated at more than $100 million.
Cumulus operates stations like Nash FM and Rock station KFOG-FM in San Francisco. It also announced its decision to buy Dial Global (in a $260 million deal), though the deal is still under consideration. Cumulus will slash out localized details like weather and traffic, to make place for Rdio playlists and programs for other users.
Its ability to offer a free, ad-supported version to compete directly against Spotify, is what will give Rdio and edge over other services. The Google searches suggest that Rdio is fairing relatively well against other companies like Rhapsody, Slager and Mod.
Already spullying streams to iHeartRadio app, Mr. Dickey called the arrangement, “a marriage of convenience”, admitting that Rdio will allow it to do much more.
“We’re trying to be much more active in the audio ecosystem than just passively handing our streams over,” Mr. Dickey said. “That has severe limitations in terms of our ability to monetize.”
In all, one can safely acknowledge the fact that many would not pay for services (or Rdio’s soon to be launched Premium Model), when they can get digital music for free. The subject is still under debate, clearly since many like Mark Mulligan still believe that, “It’s not that people don’t like streaming music. It’s that people are unwilling or unable to pay $9.99 for the privilege.”