Radio group Cumulus Media and online music service Rdio forged their partnership last September, so yesterday’s earnings call from publicly traded Cumulus could be approached as a one-year anniversary of the terrestrial/online hook-up. Cumulus CEO Lew Dickey and CFO Joseph Patrick Hannan discussed both the advertising and content-sharing components of the partnership.
In year-over-year growth in ad revenue, digital led the way by a large amount:
CFO Hanning noted that Rdio’s ad revenue for Q3 was $5-million (“attributed to Rdio”), representing 69 percent of the year-over-year digital ad growth. As illustrated in the table above, digital ad sales leapfrogged over broadcast advertising by several multiples.
“We’re expanding our digital and mobile presence through our partnership with Rdio” –Lew Dickey, CEO, Cumulus Media
In response to an investor question, Joseph Patrick Hanning spoke more about Rdio’s meaningful participation in Cumulus revenue. Changes to the Rdio product (expansion of no-cost, ad-supported listening) play into the digital revenue growth, with a hint of more to come:
“On the Rdio side, we are doing three things for [Rdio]. The first is an ad sales component where we’re the exclusive ad rep agent for all of their ad inventory, whether that is in-stream audio, display, mobile, sponsorships, etc., particularly in the United States. Actually, through the course of this quarter, we extended that component internationally as well, as they have relaunched the product with a free ad-supported experience first, and they’ve done that in 24 countries outside of the United States, so it’s provided some ad sales opportunities. That’s really ramping as we look at September, really, as the first month for the free ad-supported product to come out. So we’ve seen some encouraging data on their side, and we’re excited about the users. As those users build, their revenue associated with that, that we’ll be able to sell on their behalf will grow.”