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Why is the trend of listening to Internet Radio increasing?

Music listening trend

Historically, consumers used to buy individual songs or albums for downloading purposes. Apple’s (AAPL) iTunes Store has been a popular source for owning music. You can buy a single song for between $0.69 and $1.29. However, consumers’ listening preference shave started to shift towards low cost subscription services such as the Internet Radio. Internet Radio is a broad level radio service that allows the user to listen to music through the Internet. Under Internet Radio, there is Personalized Online Radio, On-Demand music, and Streaming Live Radio—which are self-explanatory terms. Pandora (P) is a leading player in the Internet Radio market while Google (GOOG), Samsung (SSNLF), and Amazon (AMZN) are upcoming players.


Internet Radio has started to become more popular than “Over-the-Air” AM/FM Radio

According to a survey conducted by Edison Research, the popularity of Internet Radio has increased over the last year or so. There are 67% more people listening to Internet Radio compared to only 23% more people listening to “Over-the-Air” AM/FM Radio. Some of the reasons cited by people for the preference of listening to Streaming Live Radio instead of local “Over-the-Air” AM/FM radio in the survey conducted by Edison Research were as follows:

  • There are more types of audio programming to choose from
  • The player often tells you what song is playing
  • You get a clearer signal
  • You like to listen to live radio stations from outside your local area
  • It’s more convenient than listening on a regular radio
  • You want to listen to a live event—sporting event or music event


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