Everyone knows that IP TV is on its way in. But it is podcasting - a combination of the Internet & radio - that is likely to become the first widely used Internet based mass medium. And though podcasting may not yet have a commercial formula, it certainly promises to give a new meaning to consumer controlled media.

The New Niche Audience
Podcasting is a technology which makes available digital audio files over the Internet so that iPod owners can download & listen at their leisure. And Ipod owners (some 22 million U.S. citizens) form a new, fresh category of audience. An audience which can be tracked easily (and eventually addressed individually). This segment is special not just because they are in the upper economic segment, who carry their iPods wherever they go. This audience is trendy, techno savvy and insist on exercising their freedom of choice.

Podcasting is re-defining the concept of niche audience.

Catching On
In June 2005, the world's 2nd largest auto maker Toyota (Lexus Division) signed up with California based KCRW radio staion for a marketing campaign which is to be podcast. (The world's largest auto maker GM had committed to podcasting a little earlier - it recently used podcasts to launch a new model - Buick Lucerne. Meanwhile, Audi is the sponsor of a podcast for Autoblog. And other large marketers like Warner Brothers, Durex Condoms & Henkel have already initiated campaigns via podcasts.)

KCRW Radio (known for its cutting edge music) has started podcasting 22 programs by RSS feed. The 1st week saw nearly 25,000 downloads. But after listing with podcast directories, downloads have peaked to around 75,000 per week. (This compares favorably with the number of their regular listeners estimated at 5,00,000.)

Another (New York based) public radio station WNYC claims to be adding 40,000 new listeners every week since they started podcasting their media analysis program "On the Media" around 6 months ago. (It is difficult to imagine by what conventional methods they could increase their existing listener base by 1,60,000 per month!)

Podcasting is a combination of an Internet model with the traditional radio spot. Listeners see the brand logo, banners when they visit the web-site to download content. They hear the traditional radio spots when they play the content. But the marketer pays based on the number of downloads (CPM basis).

From Music Distribution to Podcasting
Apple's successful online music store iTunes is marching towards podcasting. And why not? After all, this is where the iPod was born. iTunes has recently partnered with the Sundance Channel - content from Sundance will be podcasted exclusively by iTunes. To achive this (& more), iTunes is being modified to enable audiences to create & distribute audio recordings, host a directory of podcasts & creators, along with a service to rate podcasts.

Apart from hosting content from channels like Sundance, iTunes will also promote the content with video clips hosted on its web-site. This will transform iTunes from a sales/distribution hub to a new, radi-like medium.

Citizen Media
Almost anybody can podcast - it's that simple & cheap. Podcasting gives citizens the power to exercise their choice to listen selectively along with the option to broadcast. With estimates of podcast listeners exceeding 12 million by 2010, mainstream media is naturally worried. No wonder, so many have jumped on the podcasting band wagon!

TV & print media audiences are on the decline. And audience polarization is leading to ever narrowing niches of dedicated gamers, surfers & now, iPod-ers. So it is not surprising that radio broadcasters like Clear Channel, Infiniti & Sirius have already rolled out their 1st podcasts. Even large TV channels like ABC & NBC have launched their own version of podcasts. And a print magazine like BusinessWeek has released its audio version.

In Search of a Business Plan
Put simply, podcasting is a step towards consumer-controlled media. Similar to personal video recorders like TiVo, which give the consumer an easy option to store their favourite content for viewing at leisure. Going a step further, podcasting also provides customers a relatively easy way to broadcast their content - a kind of limited audio blogging. (Unlike the dynamic weblogs, podcasting is a one-way delivery system with many limitations.)

Public radio shows have used podcasting to (successfully) extend their reach. Large media houses want to use podcasting to find new audiences.

Spawned from the Web, podcasting is not advertising friendly. Most iPod owners are likely to skip spots embedded in their content. So where does that leave podcasting? Much like blogging, podcasting seems to be a threat to established media's hold on the public consciousness. But paradoxically, podcasting offers little opportunity to earn big bucks.