Waiting around to record songs on the radio is so 1980s.

The DMCA was passed back in 1998, before peer-to-peer file sharing had even been invented and online radio mostly meant listening to a lo-fi mono stream with a modem. So here in 2010 this restriction seems like an anachronism, if not a paranoid and absurd limit. This is especially true given that any resourceful downloader should have no problem finding a place to download any song or album online if he’s willing to fudge the law and explore the seedy underbelly of the internet. Waiting around for an online station to play the artist or album you want is the digital equivalent of sitting with your finger on the pause button waiting for your favorite song to play on the Top 40 station so you could capture it on a cassette tape. Nevermind the fact that playing whole album sides were once a mainstay of album-rock radio back when the music industry was raking in record profits.

Wisconsin Rep. Tammy Baldwin aims to put this little absurdity to rest with a bill she introduced called the Public Radio Music Enhancement Act of 2010. If passed the legislation would ease this restriction. However, I’m unable to turn up the full text of the bill. All I find is the following summary:

To amend title 17, United States Code, to enable a public broadcaster to obtain statutory licenses for the transmission of sound recordings online, unless a substantial portion of the sound recordings transmitted, on a weekly basis, are by the same featured recording artist or of the same musical work, and for other purposes.

Reading this, I’m guessing that the legislation would allow long sets of the same artist provided that that station didn’t primarily play the same audience all week long. I’m also a little concerned that the bill only references a “public broadcaster.” I hope this would be considered to include college and community stations, not just strictly public station. Given that there is no FCC or legal definition for a public station, as a distinct type of station from a noncommercial community or college station, I’d like to think all noncommercial music stations would be covered.

Predictably, NPR is pretty happy about this bill, as expressed in a press release. For her part, Rep. Baldwin says,

My legislation offers a narrow fix that has broad implications for the music-loving public in my home state of Wisconsin and across the country. …I look forward to working with NPR to further enhance its programming and better serve its listeners.

The bill first goes to committee, and then we’ll see if it ever emerges.

On the surface this may sound like a great alternative to Pandora or last.fm. But it must be noted that the caching feature is only available with a paid Slacker Radio Plus subscription. Users of the free service can take advantage of a 14-day trial of caching.

Under the monthly paid subscription model Slacker Radio caching seems a whole lot more like the Rhapsody service, which provides access to unlimited music for $10 a month. Rhapsody also lets you download as much music as you like to your smartphone to listen to without using a wifi or cellular data connection. Now, it’s true that Rhapsody is less radio-like than Slacker, in that you choose the artists and albums. However, the service also features Rhapsody Radio, although it isn’t cacheable and isn’t based upon user preferences.

Overall Slacker caching looks like a middle ground between listening to streaming Slacker (or Pandora or last.fm) and listening to a playlist or music podcast stored on your smartphone. That might be worth the $3.99 – $4.99 a month for some folks, especially since it’s cheaper than the data overage charge.

I–along with many other online radio fans–was surprised to learn this morning that online indie rock station WOXY abruptly shut down its live stream this morning. The only explanation was a short blurb on their website blaming “current economic realities and the lack of ongoing funding” for the closure. The situation was all the more surprising given the station’s intensive participation in SXSW just last week.

WOXY website's farewell message

Pop Candy received some information directly from WOXY music director Matt Shiv who said the staff knew there were financial troubles, but maintained operations last week at SXSW because “a deal was ‘in motion’ to continue funding.” The staff only received notice of the closure from owner Future Sounds on Monday and were given no opportunity to say goodbye to listeners.

WOXY has certainly had a bumpy ride going from being a commercial FM station in Oxford, OH, going online-only in 2004, being bought by lala.com in 2006, and then being being sold to Future Sounds and moving operations to Austin last year. As I wrote last month, WOXY was one of my favorite commercial broadcast stations and I continued to be an online listener.

Unfortunately the closure of WOXY only reminds me that online streaming radio is not necessarily an inexpensive enterprise. By comparison traditional broadcast has higher fixed costs. A station must have a real brick-and-mortar studio and a transmitter with tower, and must maintain these technical operations in accordance with federal laws and regulations. Without even accounting for staffing, and depending on location, these base costs easily start at the low six figures annually.

Streaming stations don’t require much in the way of a physical studio–though certainly some of the best ones, like WOXY, have them. They also don’t require transmitters and the power to run them, nor compliance with FCC rules. But while free of these liabilities, streaming stations do have other significant costs to bare.

First, streaming music stations must pay royalties for the right to play music online, which scale up in cost as listenership increases. Second, and most significantly, streaming stations have to buy bandwidth to deliver their streams. And here’s where popularity can become a double-edged sword. Unlike broadcast, each additional listener requires additional bandwidth, which in turn costs more money. If your listenership grows, so does your bandwidth bill.

On the one hand streaming online has been such a boon for small niche stations because it can be relatively inexpensive to reach a small number of simultaneous listeners. For instance, the streaming radio host Live365 charges $112 a month for a plan that accommodates up to 25 simultaneous listeners using a stereo 128 kbps stream (not including any royalty charges). While 25 listeners doesn’t sound like a lot, remember that listeners tune in and out of online radio, and so a station with only that many listeners at any given time may still have an entire listenership of hundreds or thousands.

But when you scale up to broadcast-level audiences the costs also scale up. Back in WOXY’s old home broadcast market of Cincinnati even the lowest rated stations have an average simultaneous audience of about 7000 people. Using Live365′s published rates as a guide, it would cost $26,000 a month to reach this many simultaneous internet listeners. Now, I’m certain that a station with that many listeners can negotiate a better deal, but even extrapolating from a smaller, lower-cost company’s published rates would set the cost at $13,300. That’s a big difference from $26k, however it demonstrates that reaching the same number of listeners online as a small, low-rated broadcast station in large radio market will run at least $10,000 a month.

At that point a streaming station looks like less of a bargain, even if it is less expensive and complex than operating a broadcast station. But then my argument isn’t that a streaming station is more expensive or more of a hassle than a broadcast station. Rather, I’m pointing out that operating a live streaming music station can still be expensive, with costs getting higher as listenership goes up. One advantage of a broadcast station is that additional listeners don’t cost a thing — the costs of running the station are much more fixed as long as the price of rent, power and such remain relatively constant. Reaching 70,000 listeners costs the same as 7,000, provided that many people live in your listening area. Obviously, in broadcast it’s not economically advantageous to have 25 simultaneous listeners like it is online.

I honestly do not know what WOXY’s revenue model was. I know the station ran ads on its website but I don’t recall hearing ads on its live stream. I think the station had show sponsorships that sounded more like underwriting on public radio. WOXY was also being broadcast on the HD2 channel of Cincinnati public station WXVU, which would have prohibited regular ads being run. (As a side note, one has to guess that the HD channel is now silent, too.)

Given that the station had a studio and staff of six, in addition to bandwidth costs, my conservative guess is that WOXY operations ran at least $300,000 annually, and likely closer to $500,000. That’s a fraction of a top station in a major market, but it’s still not chicken feed, either.

WOXY was often mentioned in the same breath as other indie rock online stations like Seattle’s KEXP, Jersey City’s WFMU or Minneapolis’ The Current. But the difference is that that those other stations are also non-commerical broadcast stations that rely on a listener-supported revenue model to fund operations. So, I will be surprised if we see the resurrection of WOXY, at least in a form that sounds anything like it was. The brand may rise again, but it’s unclear if the funding and revenue is there to bring the spirit back to life.

Is the iPad good for mobile internet radio?

Already some of us have been listening to live streaming internet radio on our mobile devices, like iPhones and Blackberries. But, as I argued last month, the experience still doesn’t quite add up to true mobile internet radio, especially because when you’re using cell data like 3G it saps the heck out of your battery. My experience streaming live radio on my iPhone gives me a little more than an hour before I’m nearly out of juice. The new Apple iPad looks to be a great mashup of an iPhone and netbook, which are both decent devices for listening to internet radio on the go, but also have their drawbacks.

The fact that some iPad models offer 3G wireless data connectivity out-of-the box, for a very reasonable $30 a month without any contracts make it a great candidate for mobile internet radio listening. It won’t necessarily be any better for the car than an iPhone, Blackberry or Android phone. But in other mobile circumstances it shows distinct promise.

So the question is, will the iPad bring us one step closer to truly mobile internet radio? Based on early specs, and having never touched it myself, the answer is a distinct maybe.

The first important factor is battery life. If the battery poops out after only an hour, then it’s only good for short trips. But if you have a longer train or bus commute, or are outside away from a wi-fi connection you probably want at least two good hours. While Apple specifies that you get 10 hours of active wi-fi use on a charge, no 3G batterly life specs are published. With a much bigger battery than an iPhone one would expect that constant 3G use would go longer, but we’ll have to wait until the first longer-term reviews come out.

The next big issue is sound quality. I currently use my iPhone, netbook or MacBook Pro to stream audio in a variety of circumstances, including home and when away in hotels. They’re all fine for using with headphones or external speakers, though the iPhone is the clear winner for fidelity. But I don’t always want to use headphones or lug around speakers. In a pinch the iPhone’s speaker is better than nothing at all (sounding like a pocket radio), and the netbook is barely any better. My MacBook’s speakers are the best in this category, but at the same time it seems wasteful overkill to use this powerful laptop computer just to listen to radio. My hope is that it will sound at least as good as a MacBook Pro, which itself is on par with a portable radio the size of a paperback book. We’ll have to see how the iPad’s speakers measure up against these competitors.

The final big factor is multitasking, and on this measure we already know the answer: there is no multi-tasking on the iPad. This is important because all of the streaming radio apps are not made by Apple, and you can only run one non-Apple app at a time. So you want to listen to a live feed of a Cubs game while Tweeting? No can do. Catch a live feed of the State of the Union while reading the New York Times online? Also a big no. So, unless Apple decides to add the ability to listen to live streams to the iPad’s iPod app–which is allowed to multitask with other apps–this is probably the biggest count against the radio capabilities of the iPad.

At least as far as mobile internet radio is concerned, the iPad looks like a tiny step forward. If the 3G battery life and sound quality are up to snuff, then it’s a bigger step. But without multitasking where you can listen to a live stream while using other apps, the iPad is not the next big thing in mobile internet radio.