Does Radio Airplay Matter?


Posted on May 7th, 2012 by Kristin Thomson in What We're Learning. 4 Comments

For many decades, commercial radio airplay has been highly coveted by songwriters, musicians and record labels alike because of its enormous promotional power and reach. It has been well understood that consistent commercial airplay accompanies significant record sales, generates public performance royalties, and burnishes a recording artist’s profile.

But there have been major shifts in the radio landscape in the past ten years. We’ve seen the development of both satellite radio and webcasting as alternatives to traditional AM and FM broadcast radio, models that have a lot more flexibility about what types of music they play, and how much control they give the listener over what they hear. We’ve also witnessed the development of a stronger noncommercial radio sector, led by NPR Music and certain powerhouse noncommercial AAA stations like KEXP, KCRW, WXPN, and The Current.

There has also been a shift in perceptions about broadcast radio. Some observers and music fans say that “nobody listens to the radio any more”, implying that commercial radio has lost its relevance. Others say that “radio airplay doesn’t matter”, suggesting that commercial airplay is overrated or unnecessary in a landscape that now includes Twitter, YouTube, iTunes and Spotify. But is this true? For musicians and managers, does radio airplay matter? If so, what kind of airplay matters, and how does it matter?

As part of our Artist Revenue Streams project, we collected enough data about radio airplay directly from musicians, composers and artist managers to examine this question. During the interview phase, we asked almost 80 interviewees about whether their music was played on the radio, and what they thought the effect was. On the Money from Music survey, over 4,500 survey respondents answered a specific question about their experiences with radio airplay. And, in the financial case studies, we were able to directly assess one outcome of radio airplay – the trends in public performance and digital performance royalties flowing back to the artists. This release compiles this data and provides a qualitative and quantitative assessment of the impact of radio airplay.

What the data suggests is:

  1. Frequent airplay on commercial radio is rare, but new forms of radio are providing airplay opportunities for more musicians and more types of music.
  2. Radio airplay contributes to an artists’ brand, but it is just one part of a larger marketing strategy.
  3. For some musicians, airplay is perceived as a major driver of record sales and other revenue streams, but for others, radio’s impact is difficult to measure.

The data from this report suggests that, yes, radio airplay is still important, but in different ways than it has been in the past. Given the expansion of radio-like experiences, there are more opportunities than ever for musicians – even those in niche genres – to get airplay.  Because the very definition of “radio” has changed, we need to look at the impact of airplay through a wider lens.  Some musicians believe airplay impacts sales or concert attendance. For others, it’s part of a broader brand awareness and exposure strategy. For a few, airplay on digital platforms has become a noticeable revenue stream on its own. And for most, airplay on any platform remains elusive. As the data and interview quotes below demonstrate, radio airplay does matter, but how much it matters – and its impact – varies widely from musician to musician

Table of contents

Frequent airplay on commercial radio is rare

The impact of radio deregulation

The impact of new forms of radio

The characteristics of those who get airplay

Radio’s perceived impact

Radio airplay and income

Perceptions about radio airplay and revenue

Radio’s impact on a musician’s earning capacity

Takeaways

A note about radio and compensation

Radio airplay has been traditionally thought of as a way to (a) increase a musician’s profile among the general public, (b) encourage record sales, and (c) build awareness about tours and live performances. But radio airplay is also a source of compensation for some rightsholders.

First, songs played on any form of radio -– commercial, noncommercial, webcast, satellite – generate a public performance royalty for compositions. This royalty is split between songwriters/composers and their publishers and paid via their performance rights organization – ASCAP, BMI or SESAC. The royalty rate varies based on a number of criteria (audience size, time of day, etc.), but consistent airplay on commercial radio can generate significant PRO royalties.

There is a second form of compensation: the digital performance royalty for sound recordings. When a sound recording is played on a digital platform – any webcast station (including Pandora), satellite radio, digital cable TV music channels, or the digital stream of any terrestrial radio station (commercial or noncommercial) -– a digital performance royalty is generated. The royalty is split between the performer(s) and the sound recording copyright owner (usually a record label), and paid via SoundExchange. Again, the royalty rate depends on the source of the performance, but frequent airplay on Sirius XM and/or Pandora can amount to significant royalties.

 

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4 Responses to “Does Radio Airplay Matter?”

  1. [...] extent. Our artist revenue streams study found that significant commercial radio airplay remains out of reach for all but a tiny handful of artists.  And our earlier radio-centric research demonstrates that [...]

  2. [...] extent. Our artist revenue streams study found that significant commercial radio airplay remains out of reach for all but a tiny handful of artists.  And our earlier radio-centric research demonstrates that [...]

  3. [...] extent. Our artist revenue streams study found that significant commercial radio airplay remains out of reach for all but a tiny handful of artists.  And our earlier radio-centric research demonstrates that [...]

  4. [...] extent. Our artist revenue streams study found that significant commercial radio airplay remains out of reach for all but a tiny handful of artists.  And our earlier radio-centric research demonstrates that [...]