Slipstream Radio -- Business model

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Business model
Is it possible to make money streaming in 2009? Well, particularly due to the performance royalties deal that the NAB cut with SoundExchange, it's difficult. But it's not impossible, as shown by the table below.

Example for a top-25 market station with terrestrial AQH of 12,000 and a streaming AQH of 500:

	POTENTIAL MONTHLY REVENUES:
	Six "Channel Sponsorship" packages ($2K/month). Package includes one spot with synched banner ad every 2 hours on all channels (@ $15 CPM), plus title sponsorship of one channel.	$12,000
	Twelve "Hourly banner ad" packages @ $1 CPM ($300/mo. per advertiser)	$3,600
	One "Video Preroll" package (100K impressions per month @ $20 CPM)	$2,000
		________
	TOTAL REVENUES	$17,600

	MONTHLY EXPENSES:
	Slipstream monthly fee (incl. free bandwidth for first 200 AQH listeners)	$1,500
	Additional bandwidth (@ $400 per 100 AQH)	$1,200
	SoundExchange royalties (@ $1,400 per 100 AQH)	$7,000	*
	ASCAP/BMI/SESAC (@~5% of revs)	$1,000
		________
	TOTAL EXPENSES	$10,700

		________
	POTENTIAL MONTHLY NET INCOME:	$4,900


CONCLUSION: If you want your station brand to remain relevant to the consumers who are moving online for their radio listening, this is something you have to do. As such, it's comforting to know that at least there is a potential path to breakeven and/or profitability.




* Notes: (1) Public and religious radio stations will pay significantly less. (2) It may be possible for you to set up a separate LLC for your streaming operations and qualify for the Small Webcaster rate, which could reduce this expense to about $2,000 per month; consult your lawyer for advice.