Music Ally

British online radio startup Mixcloud has just emerged from private beta, promising to deliver what co-founder Nikhil Shah describes as the “YouTube of radio”.

That means aggregated radio shows and DJ mixes that users can stream from the Mixcloud website. It’s signed up more than 1,000 content partners, including some big names – Diesel Radio and ex Radio 1 DJ Chris Coco – but also hundreds of emerging club DJs and wannabe radio stars. It’s an open platform, so anyone can upload shows to the site.

We talked to Shah to find out more about the company’s plans, starting with that slogan. “It’s about making radio more personal, more social and more democratic,” he says. “We felt radio was being less innovative in some of these digital content trends that other verticals are exploiting. We started about a year ago, and have been in private beta since about March.”

Mixcloud’s focus at launch is pretty club/dance oriented, but Shah says that’s a reflection of the founders’ own interests and backgrounds, but that it will widen out quickly. “Ultimately it’s a radio site,” he says. “We want to get talk radio, comedy… We want it to appeal to everyone. It did start as an idea just for club music, but we realised very quickly that the problem we’re solving is applicable to a broader world of content.”

Licensing-wise, Mixcloud is classed as an interactive radio service, so is licensed in the UK by PRS for Music. Shah says that the company has a moderation process in place to guard against people uploading unauthorised music to the site – leaked pre-release albums would be one example. “People could upload an entire album with a fake tracklist, it’s true, but what benefits do they get?” says Shah. “There are other places they can do that.”

Social features are big for Mixcloud, with users able to recommend their favourite shows and sets on social networks, which handily promotes Mixcloud itself at no marketing cost. Meanwhile, Shah says the company is working hard on its recommendation engine, to help the best shows bubble to the top.

“Already, one of the first things you see on the front page is the popularity chart,” he says. “It’s almost like a Digg for radio, but we’re going to work hard on other features to help listeners find relevantradio content.”

Thus far, Mixcloud has been funded by the founders themselves, albeit with the help of a UK government grant from the Technology Strategy Board, which is being used for a project with London’s Queen Mary University to develop recommendation technology. “We’ll be looking for some angel or early-stage VC money in the next few months,” says Shah.

So what about the business model, given that Mixcloud is the latest free streaming service? “We’re approaching it as a 50-50 ad-funded and transactional model,” he says. From an ads perspective, that means a mixture of display and audio ads along with sponsorship.

And the transactions side? “We’re looking at having premium accounts for content creators with more hosting space and better analytics,” says Shah. “And then listeners may be able to pay to subscribe to content that’s premium. But one thing we’re learning is that the Spotify model is not necessarily conducive to advertisers – offering an advertising platform where you’re pushing listeners to upgrade to get rid of the ads is a negative model. Advertising wants to be seen as aspirational, which doesn’t fit with a platform that’s saying ‘upgrade to get rid of them’.”

Shah says he’s also intrigued by the possibility to charge Mixcloud users smaller amounts – micro-transactions – although it seems it’s early days on figuring out exactly how this might work.

We’ve been on Mixcloud for a few months as beta users, and the consumer experience is certainly impressive – pared-down and slick. From that point of view, the quality of the content – and the regularity of great new stuff being uploaded – will be key to building an audience.

On the business side, of course, it remains to be seen how lucrative those ad revenues are compared to licensing costs, while the company’s moderation process will need to scale as it ramps up too. But even so, it’s an intriguing and interesting entrant to the world of interactive radio.

We’ve embedded a mix from the site below, to show how its embedding features work:

Tags: mixcloud

This entry was posted on Monday, September 21st, 2009 at 12:09 pm and is filed under Digital Music News, Interviews. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.