NEW MEDIA: SPOTLIGHT ON INTERNET RADIO - How to make internet radio a viable option for advertisers. Can a Virgin and Freeserve deal boost internet radio? Alasdair Reid investigates

Mick Jagger once said that the great thing about the internet was the fact that it allowed him to listen to Test Match Special no matter where he was in the world. For some of us, that's when the penny dropped.

So that's why they did it. That's why they used this hugely expensive resource to distribute this most disposable of media - a bit like using the space shuttle to deliver People's Friend to its subscribers.

It makes sense when you realise that internet radio is basically a home-thoughts-from-abroad comfort blanket for ex-pats. It's basically aimed at ageing rock stars who've now joined the world's first- and business-class elite and who want to be transported to Lords from their basement recording studios in Mustique.

Because at first glance it's clearly not a commercial proposition - if the demise of Puremix, the internet radio operation owned by Chrysalis, is anything to go by. Or for that matter, the collapse of Storm Radio, run by the ex-Radio 1 disc jockey Bruno Brooks.

But maybe the time has come to reassess the evidence. Just lately internet radio has been making something of a comeback in the credibility stakes.

It's even been developing more mainstream ambitions - and if you want evidence of that, look no further than the recent deal between Virgin Radio and Freeserve.

Freeserve is basically making Virgin content - both live and archive - available within the music section of its portal. It is, as the old cliche would have it, a win-win deal.

From Freeserve's point of view the wisdom of choosing Virgin as a partner is in the fact that the station regularly tops the worldwide league table of internet radio listening, as measured by the internet research companies Arbitron and Measurecast. It's a strong brand and fits with Freeserve's long-term strategy of bringing forward a whole range of music offerings, including a legal download service.

Peter Cowley, Freeserve's portal strategy and marketing director, says: "The key thing on broadband is that you can listen and surf at the same time. From Virgin's point of view, they want to pioneer this as they did with distribution via satellite. Radio works well on the internet.

"It offers more choice and it gives you access to a different type of content - like archive stuff. For Freeserve it helps build our portfolio in the music area."

But hang on. Surely the best way of getting radio is to turn on a radio set. A wireless set may not allow you to access Virgin Radio's archives, but on the other hand it's just possible that there are some listeners for whom that is no great hardship.

Justin Sampson, the managing director of the Radio Advertising Bureau, argues that the internet can help strengthen the relationship that listeners have with their favourite stations.

"It deepens the spirit of community that many listeners feel when they listen to their favourite radio stations, Sampson says. "It adds to the experience. You can win stuff, you can play games, you can find out more about the presenters. It adds another layer."

And the RAB is also excited about the growth of office listening. Apparently offices are full of people tuned to different stations on their personal speakers. It's especially prevalent in the early evening in the hour before home (or pub) time.

Which is good news, isn't it? Mark Helm, the head of radio at MediaVest, wants to be enthusiastic about this, but he doesn't always find it easy.

"The biggest problem is that radio is bought regionally, but the audience for internet radio is basically around the world. Virgin's internet audience is mainly foreign with a lot in the US, he explains.

The UK component of that extra audience is also off the agenda because the online audience currency, as reported by people such as Arbitron, is incompatible with the Rajar-based currency normally used to buy radio. So any incremental increase in the Virgin audience is basically no value whatsoever for a UK advertiser.

So from the point of view of a conventional radio advertiser, it's just not that interesting. But surely there are lots of interesting advertising opportunities that will arise?

You could have a pop-up box that appears on screen when your ad is playing.

Or you could have a sponsored microsite that tells you all about the track currently playing.

At this point, Helm says, he tends to think of the Grolsch ads and their catchline: "It's not ready yet. That's the truth. The fact that it offers a back channel is obviously of interest. It's just I'm not sure the technology exists to allow advertisers to take advantage of it in any specific way."

But what about the new-media people. Are they more excited by the potential of the radio-internet convergence?

Alasdair Scott, the creative director of Arnold Interactive, seems to think so: "I'm a huge fan of radio advertising - and it seems to me that radio has been about the most creative area in advertising over the last year or so. But it's also true that no-one's really done much with marketing and internet radio. Just at the simplest level, most radio ads are intended to be absorbed in transit - and they certainly don't have a call to immediate action. I think we'll start seeing people writing radio ads specifically with people sitting at their computers in mind. And, yes, you can envisage some graphic element being bolted on to a radio ad - it would be the same paradigm as interactive television advertising. I think we've reached the stage where it's technically achievable, but things won't start happening until people get their heads around it."

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