Web Radio Not Making Waves

Jeff Burgess walks into his Bakersfield broadcast studio (his bedroom), checks the transmission equipment (his PC), sits in the studio chair (blue vinyl, purchased used for $2), searches his CD library (cardboard boxes on the floor), adjusts the microphone on the announcer’s deck (built by a local carpenter for a 12-pack of beer) and speaks the words that can be heard, potentially, by millions around the world.

“This is Destroy Radio!”

At best, maybe 300 people actually hear Burgess. He and a friend, George Looney are the only announcers on the round-the-clock, Internet-only station that much of the time plays rock music at random from a five-CD deck (also purchased used).

Nonetheless, Destroy Radio (www.destroyradio.com) is respected enough to receive handout music from some independent labels. On the deck sits a new Christmas single by the Van Bondies, “Ain’t No Chimney in the Big House.”

The Internet was supposed to give anyone the power to run their own radio station. For a very few it has, but Internet-only radio has not come close to achieving what its adherents envisioned: that thousands of low-cost personal stations would spring forth to challenge the broadcasting status quo.

No detailed list has been compiled of the number of Internet-only stations founded since publicly accessible, streaming audio tools made them possible in 1995. Given the many that have disappeared into the “server not responding” netherworld, it’s probable that far more have died than are currently “on the air.”

Earlier this month, radio industry heavyweight Clear Channel pulled the plug on its Internet-only division. Several other major operations are either on the block or rumored to be in financial trouble. No one who watches the field could point to even one steadily profitable Internet-only station.

But often that’s not what it’s about.

“George and I might not be musicians,” said Burgess, 36, whose day job is as a real estate appraiser. “But what we do here--the choices we make about music and how we put the mixes together--gives us a chance to be artists, in a way. The way we play our music is our art form.”

Internet radio is relatively cheap to produce. The primary piece of hardware required for a serious endeavor is either a high-powered personal computer or a server--costing less than $2,000--dedicated to radio use only. The major software expense is an approximately $2,000 program to run the server. A broadband Internet service provider starts at $50 and increases with the amount of bandwidth used.

And if the station plays music, the operator is required to pay a minimum of about $500 a year in licensing fees to music publishers.

Relatively few people hear even the large Internet stations. Ratings service Arbitron did a study that showed 95% of Americans listen to broadcast radio for at least five minutes per week. That figure for Internet radio is only 8%.

The most prominent Internet stations are feeds from existing operations, such as public radio outlets and the BBC.

But the listener base for Internet-only radio is slowly growing, according to ratings compiled by Arbitron. About 12% of computer users with online access have listened to at least a bit of Internet-only radio, the rating service said. That’s about the same percentage who have tuned into regular stations via the Internet.

One factor that has helped: Earlier this year, several commercial stations pulled their Internet feeds in the wake of protests by recording artists who wanted to be paid extra when their music was played online.

“Listeners who had gotten used to Internet radio started looking for alternatives and they ended up at Internet-only stations,” said Bill Rose, head of Arbitron’s Internet ratings service.

Indeed, last month the top-rated Internet radio station was MEDIAmazing (www.mediamazing.com), a Net-only service out of Nazareth, Pa., that offers a variety of channels from adult contemporary to world music. According to Arbitron, the service accumulated a total of 600,800 listener hours during the month.

Other Internet-only stations in the top 10 were Groove Radio and KNAC Pure Rock in Southern California and the Jimmy Buffett-owned Radio Margaritaville in Florida.

But ratings are no guarantee of solvency. Of those four stations, one has ceased broadcasting, one is on the block and one is scrambling to reorganize after being dropped by its parent company. The last of the four is almost totally subsidized.

The one for sale is MEDIAmazing. “Our business relies heavily on advertising, which is not at its best state at the moment,” said co-owner Henry Callie. “We are basically a two-man operation, and it’s hard to keep paying the bills month after month.”

The more listeners an Internet station gets, the higher the overhead. Extra bandwidth must be purchased to accommodate a growing listener base.

Callie said the automated MEDIAmazing runs advertising on the music streams and its Web site. “We have had some profitable months,” he said of the service founded in September 1999. “But we don’t have an internal sales force to go out there and knock on doors.”

Groove Radio (www.groove radio.com) was operated by Egil Aalvik, better known in Southern California radio circles as Swedish Egil, the name he used during his many years as an announcer on KROQ (106.7 FM) and other local stations. Groove’s dance-music stream out of Santa Monica was sponsored for about a year by Clear Channel until the plug was pulled Nov. 30.

“I felt they basically never gave it a complete try,” Aalvik said. He said he is in talks with investors who he hopes will bring Groove Radio back to the Internet early next year.

Aalvik talks about the potential of Internet-only radio with an optimism that has not much been heard since the dot-com bubble burst.

“I just know that we have a huge audience and I have not seen anyone capitalize on the visual component that regular radio can’t offer,” he said. “We could put up a picture of the jock in the studio, a streaming video, a series of pictures. There are so many ways advertisers could use this.”

KNAC, which also was part of the Clear Channel group, is still streaming at www.knac.com, although at lesser quality now that it is without an expensive broadband connection. The service’s founder, Rob Jones, said KNAC is in “transition” but declined to comment further.

Radio Margaritaville debuted with a live Buffett concert in March 1999. Its one full-time employee, program director Steve Huntington, said Buffett started the station because of his annoyance with commercial radio.

“Artists like Jimmy can sell out concerts all over the country, but when they put out a new CD they can’t get a fair shake on the commercial stations,” Huntington said from the station’s studio in Bradenton, Fla., near Sarasota. Other performers heard on the service include Bonnie Raitt, James Taylor and Harry Belafonte.

“They don’t fit into the regular radio formula,” he said.

Buffett subsidizes Radio Margaritaville, which does not play regular ads but, in the style of public radio, announces that some segments are made possible by the sponsorship of companies.

“We have not yet caught the attention of media buyers,” Huntington said. “If only a company like Outback Steakhouse or Krispy Kreme would throw us a bone, we could lead the way in Internet radio to becoming solvent.”

Some stations are more interested in getting out a message than making profits. Reality 101 (www.reality101.com) was a traditional, high-wattage station in Birmingham, Ala., that played Christian pop music. The station was sold last year and the new management switched formats in February.

Only 36 hours after the switch, the former owners had Reality 101’s Christian format converted to an automated Internet service that features announcers introducing songs with sayings such as, “Rocking the world for Jesus” and “We don’t play ‘Stairway to Heaven,’ it’s our format.”

“Our operating budget is maybe 5% of what it was when we were a regular station,” said Bill Hardekopf, its general manager and formerly an assistant athletic director at USC. The Internet service has only two part-time employees--the rest of the staff, including Hardekopf, are volunteers.

“We get revenue from three sources--donations, advertising and people who pay to promote events on the Web site,” he said.

When the station broadcast over the air, it accumulated an e-mail list of 9,000. It has since grown to 13,000 and everyone on the list receives a monthly devotional message.

“We hear from people all over the world now,” Hardekopf said. “E-mail has come in from places, I have to tell you, I had never heard of before.”

Back in Bakersfield, Burgess was leafing through a scrapbook he has kept since 1995 when Destroy Radio first went on the air as a low-power, illegal pirate station.

There are pictures of the numerous locales the studio inhabited, including the attic of a pizza restaurant that seemed ideal until the fans from the oven made it uninhabitable. There are group pictures of inmates at a local prison who wrote to say the station was their favorite.

“One of them came over here as soon as he got out,” Burgess said. “We put him on the air and he said ‘Hi’ to all his buddies still inside.”

When the FCC forced the pirate off the air in February, Burgess went Internet-only, moving the studio into his house. “It was nice to be downtown, but I really like the homey atmosphere, here in Jeff’s house,” said Looney, who works as a bartender at a Doubletree hotel.

Burgess has developed a business plan to someday make Destroy Radio a commercial entity, but in the meantime he revels in its outsider status. At one point he demonstrates the setup’s monitor system for disc jockeys that allows them to hear themselves through speakers without wearing headphones.

He opened the mike and said, “See, it’s much better when you can hear yourself when you are on the air.”

The statement actually went out on the service.

“We don’t have any rules here,” Burgess said. “Except for ‘no racism.’

“This is not a normal station in any sense.”

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David Colker covers personal technology. He can be reached at david .colker@latimes.com.