In 2009 Google cancelled their radio ads. Radio ads were created to let customers bid and place traditional radio spots using a simple self-serve auction system. Google didn't gain much traction with their radio ads. There were many reasons for radio ads failing, but it basically came down to the old guard of radio not embracing Google's system.
-Radio stations didn't want cheap ads playing even if they filled time.
-Media buying agencies were afraid it would hurt their business.
-Customers said ads were hard to track.
They say timing is everything, unfortunately for Google, they missed it by that much! Radio ads were cancelled in May 2009, the first Droid phone came out in October 2009. Instead of focusing on traditional radio Google should have put all their effort into creating ads for internet radio. With the Droid platform it would have given advertisers tools they've always wanted. Ads would have been self-serve and would have been highly targeted and played based on exact geographic location, time of day, search history, and now demographic data captured by Google+. Better tracking could have been accomplished with click tracking, click to call tracking, exact number of plays etc...
Yes, Google would have had to negotiate with the online radio stations, but I think these companies would have been interested in having a customer base as large as the Google Adwords network.
If Google could have made inroads with a player like Pandora it could have helped them finally get their foot in the door of traditional radio, which could have led to becoming the ad platform for apps like iHeartRadio or TuneIn. Right now these apps play advertising from the station you are listening to, no matter where you are actually located. No targeting whatsoever.
Google could have made it so the ads were actually targeted towards the person listening!
Google Radio ads would have also worked for local stations as well. Instead of stations basically throwing in ads on their internet stream for free or filling time with non-paid PSAs, local stations could have charged a premium for it without having to pay a sales staff to generate the leads.
In my opinion Google missed out big time, it will be interesting to see if they ever change their TUNE! /rimshot
Sources:
http://online.wsj.com/article/SB124172645603997429.html
http://searchengineland.com/google-turns-off-radio-ads-16554
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