Cumulus Lew Dickey Talks Up Rdio, Talks Down Pandora

Lew Dickey

CUMULUS MEDIA INC. CEO LEW DICKEY JR. talked up the company's 15% stake in RDIO in an interview to the AP. NEWSWER.COM reports that DICKEY viewed the investment as a long-term bet on the future.

"RDIO isn't a revenue generator yet," he said. "We will be selling all of the ads from RDIO. That will be new media at that point. That's the way to think about this. We've got a business that's growing, we've got a business that's generating an enormous amount of cash, and we're positioning this business for the long run ... It's very, very early. We're just getting started with these guys and they have a new CEO, ANTHONY BAY. And so, ANTHONY's been running around the globe, getting everything set in the various countries where they're operating. This is really the setup year for RDIO in 2014. I would look for real progress to be made in terms of users and the beginning of monetization. In our mind, the next 18 months are all about building usage.

"This is a scale business," DICKEY continued. "RDIO's in 51 countries. JANUS FRIIS (who co-founded SKYPE) has spent close to $200 million on this business to build it. This is a business that will be a global scale business and I think there will be handful of survivors at the end of the day. I believe the digital music space today is very nascent. I liken it to the MYSPACE phase of social. I don't think it's clear who the winners are going to be."

The consensus early Net radio winner so far has to be PANDORA, yet DICKEY downplayed their success. "PANDORA self-measures. So they're, in essence, quoting their own numbers and they're using disparate data sources. They've been very clever in terms of the story they've told, but the actual numbers would tell a different story when held under close scrutiny."

That's undoubtedly why, when asked who's CUMULUS' biggest rival, PANDORA or CLEAR CHANNEL, DICKEY answered, "It's CLEAR CHANNEL. It's not PANDORA. The digital services  -- which is why we put our toe in the water and took a stake in RDIO -- we believe the digital services are increasingly going to play a role in the business."

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