Cumulus Media has announced a with Rdio, as the streaming digital subscription service is teaming with the broadcaster as its online component. Cumulus obtains a "significant equity stake" in Rdio's parent company Pulser Media, in exchange for "exclusive content, media and on-air promotional commitments" over a five-year period.
According to the New YorkTimes, the agreement is a cash-free trade, and no further terms of the deal were disclosed. Cumulus will also sell advertising on a free version of Rdio, which usually costs between $5-$10 per month for a subscription. Cumulus will also use its stations and syndicated programming to create playlists and other content for Rdio users, while removing local information such as traffic and weather.
"This partnership leverages our premier broadcast and content assets along with Rdio’s acclaimed digital audio platform -- enabling consumers to listen to whatever they want, whenever they want, however they want," said Lew Dickey, CEO of Cumulus.
"We are thrilled to be partnering with Cumulus and their robust network of radio stations and premium content," says Drew Larner, CEO of Rdio. "This monumental deal is the first time a digital and a broadcast platform have come together in this way and we’re eager to bring the Rdio experience to the greater Cumulus listening audience."
Dickey also told the Times, "This is our digital play." Commenting on Cumulus' deal with Clear Channel for its stations to stream via iHeartRadio, Dickey called it a "marriage of convenience" and added. "We’re trying to be much more active in the audio ecosystem than just passively handing our streams over. That has severe limitations in terms of our ability to monetize."
Speaking to the Times as well, Larner said, "The biggest challenge we face is really awareness. We live in this bubble in which everybody is talking about this stuff constantly, but to the wider world, streaming is still relatively nascent."
Addendum: Cumulus released a statement this afternoon to clarify Dickey's comments on the company's relationship with iHeartRadio. According to the statement, "The logical decision by Cumulus to pursue business opportunities in the growing digital space -- ensuring listeners have access to Cumulus content wherever, whenever they want -- should not be interpreted as any disappointment with the existing beneficial partnership between Cumulus and iHeart. Indeed, iHeart has been instrumental in driving in driving huge increases in Cumulus traffic growth and that arrangement is complementary to our deal with Rdio."