Pirated Music Helps Radio Develop Playlists
By SARAH MCBRIDE
July 12, 2007; Page B1

The music industry has long blamed illegal file sharing for the slump in music sales. But now, a key part of the industry is trying to harness file sharing to boost its own bottom line.

Earlier this year, Clear Channel Communications Inc.'s Premiere Radio Networks unit began marketing data on the most popular downloads from illegal file-sharing networks to help radio stations shape their playlists. The theory is that the songs attracting the most downloads online will also win the most listeners on the radio, helping stations sell more advertising. In turn, the service may even help the record labels, because radio airplay is still the biggest factor influencing record sales.

Premiere's Mediabase market-research unit is working on the venture with the file-sharing research service BigChampagne LLC. BigChampagne collects the data while a Premiere sales force of about 10 people pitches the information to radio companies and stations. Premiere declined to disclose how much it charges.


The service has already had an impact. The Huey song "Pop, Lock and Drop It" was in light rotation in April at Power 106, a big Emmis Communications Corp.-owned hip-hop station in Los Angeles, and listeners weren't requesting it much. The station's own research on the best music mix to play indicated the song wasn't catching on with listeners. But data from BigChampagne showed the song was hot on file-sharing networks, including in Los Angeles. Emmanuel "E-man" Coquia, the station's music director, decided to stick with it. Now, three months later, "Pop, Lock and Drop It" is prominent on the station's playlist.

Using data on stolen music to help mold playlists may strike some as ironic. File sharing has likely contributed to the continuing decline in the music business. U.S. music sales were down 7% last year after a 3% drop the year before, according to the London-based music trade group IFPI. But BigChampagne's clients say ignoring file sharing wouldn't make sense. "It's a fact of life at this time," says Rich Meyer, Mediabase's president and executive vice president at Premiere.

Joe Fleischer, BigChampagne's vice president for sales and marketing, adds that the legality of grabbing music is a separate issue from the insight into peoples' taste the downloads offer. He also notes that the company incorporates legal, paid downloads from sites like iTunes into its data, though they represent a tiny fraction of all downloads.

Currently, says Emmis radio head Rick Cummings, the downloading information is one more tool to figure out what to play. It's not yet as helpful as the phone calls known in the business as "call-out" research, in which people listen to clips of songs and rate them, he says. But at some point, the download data are "going to be the primary method of research."

It's getting harder and harder to do passive call-out research, Mr. Cummings says, because "people don't have time, they have their phone blocked." He notes that it also "takes a while to play 20, 30 hooks," a reference to researchers' practice of playing the catchiest part of a song for survey participants.

But Emmis perseveres with the calls, in part because it reaches a slightly different listener that way -- people who don't necessarily buy or download music regularly but who like to listen to the radio and who make up a large part of the station's audience. Filesharers tend to be bigger music fans than radio listeners and generally warm to new songs faster. But basing a playlist exclusively on downloaders' tastes could end up alienating more passive listeners, Mr. Cummings says.

It also isn't easy to tell which medium influences the other more. "When a radio station adds a song, you oftentimes see an immediate bump in downloading activity" in that city, says Rich Meyer, president of Mediabase.

That was the case with "Party Like a Rockstar" by Shop Boyz. Like "Pop, Lock and Drop It," the song wasn't requested much by listeners or popping up in the call-out research, even though it was doing well on BigChampagne. In April, "we were wondering, if this record is supposedly the next big record, why is it taking longer than usual" to catch on, recalls Mr. Coquia. But just about then, requests started swinging up, especially those texted in by cellphone. Power 106 increased airplay somewhat, and downloads in the Los Angeles area kicked up a bit. By May, the song was in heavy rotation on Power 106 -- 18 spins a day -- and downloading continued to increase. "It's still strong, it's still requesting, it's still very big buzz," says Mr. Coquia.

Universal Music Group, the record company that distributes Shop Boyz, also looks at file-sharing data, largely for help figuring out which songs are working best or what to pitch to radio. But executives have mixed feelings about the information. "It's troubling that there is so much activity [that] it's useful" for research, says Larry Kenswil, executive vice president for business strategy.

In "Like This," a follow-up to his hit track "This Is Why I'm Hot," Shawn Mims alludes to scoring music online. Describing a woman who tells him she liked his last song, he sings, "She got it on her phone, Top 10 download, No. 1 ringtone." The new song's history also demonstrates the symbiotic relationship between file sharing and airplay. "When we stayed steady on it, downloads increased," Mr. Coquia says. The station played it occasionally starting in April but now plays it about eight to nine times a day.

Since the business was launched, Mediabase has cut deals with stations at sister company Clear Channel Radio, as well as group-wide deals with Radio One Inc. and Emmis. According to BigChampagne's Mr. Fleischer, the partnership has already surpassed its target of signing up 100 radio stations this year.



RePrinted from the Wall Street Journal