Monetizing online music is a grave problem faced by those in the field nowadays and it is adversely affecting the industry in Canada. The most recent example of this is the Canadian Broadcasting Corporation (CBC) that faces the double edged sword of meager earnings from its music content offset by high costs for the rights to said music. The earnings of this firm can be judged from the numbers which state that CBC music has earned just $750,000 from advertisements in contrast to its $6-million in expenditures, this in spite of the 7.8 million visits from music devotees since the inception of this website.
Moreover, dozens of competitors have also played important roles in slashing the revenue of CBC. However, in their defense Chris Boyce, executive director of radio and audio for CBC English services said that, “We have a very different business model than a for-profit company focused on the shareholder bottom line.” He also added that, “Revenue is important to us, in that it allows us to reinvest in Canadian content and deliver on our mandate as a public broadcaster.”
The reason behind this equanimity from CBC is that they expect their expenses to go down a tad in the near future. Boyce explained this process by saying that “We do expect that expenses will continue to be larger than costs for some time, largely because of the cost of creating all the rich content on the site. Though we expect ad revenue to continue to grow and the gap to close.”
Troubles for CBC do not just end here, as apart from losing money this firm has also been criticized severely by private competitors that are charging users for their digital music services have launched a complaint against this music broadcaster. According to these private broadcasting companies, CBC is utilizing funds that are obtained by means of taxes from general public to run their show, a clear and distinct advantage.
Eric Boyko of Stingray Digital also has similar issue with CBC and he remained the most prominent critic of this public broadcaster. His reasoning is that, “If music is given away for free then people will say that it’s free. It will upset the market. That remains a threat, and that is why I’m mad at the CBC – someone is always paying.”
Source: The Globel and Mail
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