Online Radio Advertising Consolidates and Prays

Online radio advertising network, TargetSpot, was in the press today. Apparently it is acquiring rival Ronning Lipset Radio.

It is not surprising that we would see some ad networks throwing in the towel in times like these.

On the other hand, this could be a good time for third-party ad networks like TargetSpot. The fact is that radio broadcasters are struggling to fill their over-the-air inventory, so online inventory becomes an afterthought for internal sales teams. Old biases against outsourcing ad selling becomes history.

So does this make TargetSpot the 800-pound gorilla in the room?

Hardly.

The online radio advertising market remains nascent. Even online radio industry leader, Pandora, claims to generate only $25 million in ad revenue...barely enough to cover the proposed increase in streaming royalties.

While we believe that improved geo-targeting and context-driven advertising will help grow online radio advertising faster, current market uncertainty will likely claim additional innovators in this space before things improve ....including Pandora!