How to Make Money Operating an Internet Radio Station

Written by alex burke
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How to Make Money Operating an Internet Radio Station
Internet radio can target narrow audiences known as niche markets. (Jupiterimages/Photos.com/Getty Images)

Internet radio is challenging traditional radio by providing a low-cost business model that is easy to implement and profit from. Traditional radio is managed by the FCC, which requires millions of dollars for an FCC radio license. Add in the cost of equipment, the building and the employees, not to mention the daily expenses, and it becomes clear why the airwaves are owned by such a small number of people. Web only radio requires little investment and offers numerous opportunities for small businesses to make a buck.

Skill level:
Moderately Challenging

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Things you need

  • Legal agreements

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Instructions

  1. 1

    Charge your disc jockeys for a regular time slot on your Internet radio station. Hair salons, antique malls and flea markets charge vendors for space in their venues; Internet stations can do it, too. Allow each DJ a two- to three-hour time slot for a fee and a smaller dollar amount for replays at set intervals during the week. Use a contract or agreement to outline what is expected of you and of the DJ.

  2. 2

    Charge listeners for an advertising-free experience. A monthly fee from each listener can reduce the need to take in advertising income. Provide two venues, one for a fee that removes the advertising and a second that plays the same music but also includes advertising spots every hour. Create a Terms of Use document and a Privacy Policy so that listeners understand what you are providing.

  3. 3

    Sell banner ads and advertising targeted for your audience. Don't try to be a station designed for everyone. Instead, target a listening market and sell advertising they will be interested in: For example, stay-at-home moms, women travelling alone for work, local college kids and work-at-home individuals are all targeted markets with particular needs, and there are advertisers that want to reach them. Google's AdSense program is an easy way to manage advertising, but finding the advertiser, requiring them to provide their own ad design or audio and then placing it on the radio station website or somewhere in a broadcast could be more profitable.

  4. 4

    Provide a way to purchase the songs played on the Internet radio station and make money from each sale. Include a daily playlist with links for each song and a "Purchase Now" button for impulse buys that can occur while a song is playing. Amazon, iTunes and Walmart offer ways to sell individual songs as well as albums.

  5. 5

    Sell ad space to musicians, bands and venues. Music makers are always looking for a new and larger audience. Charge them a monthly fee to post an ad or to run an audio ad during play time. Create an agreement so that all parties understand deadlines and ad run times.

Tips and warnings

  • DJs spinning in local nightclubs or at college radio stations are the perfect DJs for Internet radio slots. They usually have an audience and are always eager for more fans.

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