Online music streaming is enjoying unmatched popularity these days. Since the rise of services like Guvera and Spotify, the era of buying physical discs containing music is quickly diminishing to become a thing of the past. As more and more companies seek to get on board the stream train, it has become apparent that streaming music is quickly becoming the new direction of music consumption.

Given the battle between artists, recording companies and streaming services surrounding the distribution of profits in this new trend, some would argue that this type of music consumption is likely to spell disaster for performers themselves and CEO’s in particular – negatively impacting advertising potential. But when we look at the early days of radio, won’t we find many similar dilemmas with copyright infringement and profit distribution? Hasn’t radio also been somewhat like an early form of music streaming since its inception? And does music streaming negatively impact on radio advertising or does it compliment it?

A Quick History of Radio and Music Streaming Services

The radio was revolutionary when it first came out. The experience of being able to enjoy uninterrupted playlists of recorded music was an innovation for producers and listeners of music alike and it was just as controversial as online music streaming is today. When radio became mainstream, many performers received no compensation for radio play on the grounds that it functioned as advertising for them. However, businesses were still able to advertise on the radio and talented music artists have survived. Despite the dilemma’s radio advertising thrived.

The latest 2014 statistics from Commercial Radio Australia show a 4.13% cumulative growth on commercial radio advertising – 10.1 million Australians listen every week in the 5 metropolitan cities. This statistic stands out despite the fact that it would appear that music streaming would make radio advertising less prevalent.

Radio Provides the 'Community Feel'

Radio, like social media these days, always has had – and continues to have - the same ‘community feel’ that modern social media and music streaming services like Guvera provide also. For example, radio listeners – on both AM and FM stations continue to have the opportunity to engage live on-air with the presenters, one step beyond, but similar to the same way that they can also engage on streaming services and social media. Listeners become accustomed to tuning in to engaging content on a regular basis, such as weekly contests, prize and money giveaways, controversial discussions and even the sharing of the audience’s personal life. This sort of engaging experience continues to drive radio as one of the largest and most effective advertising mediums.

Can Radio Advertising and Music Streaming Go Hand in Hand?

The emergence of new music streaming services like Guvera and Spotify really complements the more traditional radio advertising medium, rather than being a competitor to it. The great complementary feature of streaming services is that the cost of advertising on streaming services is typically a lot lower. This presents the opportunity for smaller organisations – micro businesses and start-ups – to commence a media-based advertising campaign earlier than they would otherwise be able to do. This will hopefully give them more confidence as their business grows to engage via advertising to a significantly larger audience with a radio advertising campaign.