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Credit Suisse logoSpeaking at the Credit Suisse Global Media & Communications Convergence Conference held in Miami, Florida, this week, Ted Cohen (Tag Strategic), Harry DeMott (Raptor Capital Management) and Eyal Goldwerger (TargetSpot) all agreed with Cohen’s assertion that localization, personalization and recommendation engines will shape the relative successes of music services in the future. These services range from broadcast radio stations to MP3 and iTunes, to streaming audio services such as Pandora or Mog. Both Pandora and Mog are now pursuing cloud-based strategies to serve content to any device.

Interestingly, DeMott related a story about personalization. He was friends with a Cox Radio executive who challenged him to compare the playlists of Cox Radio stations with formats he liked with Pandora stations he created. DeMott surprised himself by concluding that the radio stations actually did a fine job of balancing familiar, preferred titles with enough discovery of new titles to keep him interested and satisfied.

Confirming what he said to several of us from BIA/Kelsey during a visit to his office a couple of weeks ago, Goldwerger argued that aggregating audiences for advertising is the key business model at the moment. Brand advertisers targeting national and regional markets is where the current spending activity is focused. Goldwerger sees significant activity at the local level in the future but he believes while the technology is there, the scalable and effective ad sales models are still somewhat lacking on the digital media side. This creates an opportunity for local radio stations to address the marketing opportunity before others figure out how to close in.

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