Wednesday, November 14, 2007

Now you can rock 'n' go with personalized Internet radio

by Jefferson Graham, USA TODAY

LOS ANGELES — Personalized Internet radio is expanding from the PC to portable devices.

The "Be Your Own DJ" notion of creating stations based on your favorite artists is a popular pastime online: Yahoo's (YHOO) Launchcast, Pandora, Last.FM and Slacker all offer such services.

Thursday, Slacker introduces the Slacker Portable, a $199 device that lets you take its personalized stations anywhere you go. Wireless carrier AT&T (T) just made stations from Pandora available on eight phones, for $8.99 monthly (the service is free online). Earlier, Sprint (S) began quietly offering Pandora for $2.99 monthly on 15 phones.

"The whole world is moving in this direction," says Kurt Hanson, editor of RAIN (Radio And Internet Newsletter).

Ad revenue for Net radio will top $50 million this year, according to JPMorgan. That doesn't include traditional radio broadcasters who also webcast.

Net radio's future, which looked dismal earlier in the year after new copyright royalties were instituted, is apparently back on track. The proposed fees were so high many stations said they would be forced to go out of business. But Hansen says stations and record labels have been negotiating a settlement and are close to coming to terms.

Pandora, one of the Net broadcasters that said it couldn't continue under the new rules, is still at it, pumping out music based on a listener's taste. "We believe it's going to be fixed," founder Tim Westergren says of the royalty dispute.

Pandora attracted 3.3 million Internet listeners in October, according to measurement service ComScore Media Metrix. It expanded to Sprint phones in the spring with a low-key offering that is barely mentioned on Sprint's website. AT&T is offering the same low-key approach, with little marketing on the Web but instead an offer on the phone itself to sign up. Westergren says the carriers are treading cautiously to make sure the phones work well with Pandora.

"When you get personalized radio wherever you are, that's when we're able to redefine radio," Westergren says.

Moving personalized radio off the PC is in its early days. Beyond Pandora and Slacker, SanDisk's (SNDK) $149 Sansa Connect player offers Net radio from Yahoo, available anywhere there's a Wi-Fi connection.

Slacker's unique portable

Slacker CEO Dennis Mudd didn't want to go the Wi-Fi route. Instead, a selection of songs from your favorite artists is transferred to the Slacker portable player from your PC. New songs are added every time the player is hooked up. They are stored on the player, so you don't need an Internet connection to listen.

You have little control over what Slacker selects, beyond identifying what artists you like. That may not sound like true Net radio, but Mudd says consumers don't care. "Being connected to Wi-Fi isn't the way to go. There could be static, or you might lose the signal. This way the music is always there."

The Slacker Portable has a 4-inch screen, larger than most iPod screens. You can personalize selections, to a degree, by clicking on "heart" and "ban" buttons that help Slacker figure out your tastes. An ad-supported version of the service is free; $7.95 monthly without ads.

The device starts at $199.99 with 2 GB of storage (roughly 1,000 songs) and 15 stations, or $249.99 for 4 GB and 25 stations. The entry-level iPod Nano, by comparison, is $149 and has 4 GB of storage.

Why spend the extra bucks? With the automatic refresh of new songs, "You get a far richer, deeper music experience," Mudd says. "Most people end up with the same old playlists to listen to, week after week, because they don't have the time to do research and get new music."

Newsletter editor Hanson says taking Slacker and Pandora away from the computer is a great idea, but, "The question is whether they can progress quickly and beat the tsunami of every device and webcaster that's headed in this direction. Because they won't be alone a year from now."