TuneIn Premium
Courtesy of TuneIn

Internet radio platform TuneIn introduced a new premium tier Tuesday, offering paying users access to ad-free radio streams as well as full-length audio books and live sports. TuneIn CEO John Donham said in an interview Monday that this was a first step to more squarely compete with Sirius XM. “Our goal is to become that new premium radio,” he said.

TuneIn’s new premium tier, which costs consumers $7.99 per month, comes with ad-free streams from 600 internet radio stations like Digitally Imported and Jazzradio.com at launch. Donham said that the company will add terrestrial broadcasters in the near future as well. TuneIn is working with broadcasters to replace aired ads with songs on the fly, with DJs of each station selecting what listeners get to hear in lieu of the dreaded ad break.

TuneIn also partnered with Penguin Books, Random House, Harper Collins and Scholastic to add 40,000 full-length audio books to its paid tier.

A third component of the pair service is live sports: TuneIn has struck a multi-year deal with MLB to broadcast every game in both English and Spanish across all of its platforms to paying subscribers, and will be adding Premier League and Bundesliga broadcasts as well. Donham said that more than 18 million people already listen to live sports via TuneIn per month, and added that the World Cup was the company’s biggest live event last year.

TuneIn is going live with its premium package in the U.S., Canada and the U.K. this week, and will add additional countries in the coming months. However, Donham promised that the company’s free tier with its 100,000 radio stations won’t go away anytime soon. Instead, he compared the business model to Spotify, which has both a free and a paid tier. TuneIn reaches more than 50 million monthly active users with its free service, Donham said.

Under the hood, TuneIn’s model is a bit more complex that Spotify’s, in part because the company pays different rates for each type of usage. Publishers like Penguin get paid for every book a listener consumes, whereas internet and terrestrial broadcasters get a variable rate based on the consumption of their streams. Broadcasters will get more money from a paid than a free stream on TuneIn, explained Donham.

Asked whether TuneIn wants to more directly compete paid music services, Donham replied that the real competitor is paid satellite radio with its 28 million paying subscribers. TuneIn is heading down a very similar path as Sirius XM, he argued, which will also include adding more premium content in the coming months, he said, adding: “The more exclusive the better.”

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