According to the Radio Advertising Bureau, radio revenue for 2009 dropped a whopping 18%. Because the radio's number one product is the listener, one would hope that the on-air advertising would have been more present, but advertising was down 20%, to just $13.2 billion.
What does this mean for the music industry? Internet based products are in demand, leaving traditional forms of entertainment, like radio and CDs, in the dust. Like I mentioned before, the radio's number one product is its listener, because it basically sells its listener to advertisers. The fact that advertising was down 20% shows that the money being put out by advertisers is going somewhere else...internet radio. We are all aware that websites such as Pandora have grown astoundingly large, so it is no surprise that many advertisers have left the radio and put their money towards internet advertisement, which is where more of the consumers are.
Although I am aware of how huge internet radio is, I am still surprised at how much radio revenue dropped in 2009. Although it dropped, I don't really think the radio will become obsolete, because it is convenient for people who can't always be by a computer...millions of people still listen to the radio in their cars. Also, the shift to internet radio has been mostly made by people who listen to the radio for music. Talk radio is still the biggest radio format, so while many music listeners are listening to internet radio, there will always be listeners who prefer traditional radio.