BORLAND: Why do I want to listen to music on my computer instead of just turning on a radio right next to me?
SAMUEL: Today, we have 75 different channels of music. I suppose that possibly in the San Francisco area, you can find maybe 20 different formats of music, if you're pushing it. So with the 75, first you have the variety, you have the depth of different channels.

There are a couple other exciting things that occur with TheDJ. You have the song information, so when you are listening to music, you can actually see what music you are listening to, and other things. You can rate the music, which allows us to better our play lists. And another thing that many people don't think of is within the work environment -- if you're within a software industry, where there are lots of different computers, it is sometimes difficult to even get the traditional radio to work within your work environment. Since most of the computers going out these days are multimedia, people are able to listen to the music right then.

BORLAND: Who is listening right now? Is it folks at work, during the day, who are listening at their work stations?
SAMUEL: Today, most of our users are work users. So, it's the white-collar worker who comes in at the beginning of the day, and starts up listening to TheDJ, and is able to work and listen to the music.

BORLAND: How are you supporting this? Is this ad based?

"Most of our users are work users...the white-collar worker who comes in at the beginning of the day, and starts up listening to TheDJ, and is able to work and listen to the music."

SAMUEL: Our revenue model is mostly twofold. Advertising is number one, and e-commerce is second. We have a relationship with CDNow, where people can listen to music and purchase it online. As we move forward, there will be other e-commerce relationships that come out of the listening of the music. So, if you are listening to a Natalie Merchant album, and she happens to be on tour in your area, you are able to purchase a concert ticket for that tour.

BORLAND: What is your relationship with the publishers and the record companies themselves?
SAMUEL: We have a very good relationship with many different record labels. Many of the promotions departments of the record labels send us content. When dealing with the performing rights agencies, we are one of the first to have both the BMI and the ASCAP licenses, since back in early 1996.

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BORLAND: Do you get treated like a regular radio station by these folks?

"Today, our most popular format, is Awesome 80s, and that's actually one of my favorite formats."

SAMUEL: We are mostly a regular radio station. For the BMI and ASCAP Internet license agreement, you pay a percentage of the revenue, and that is very similar to what occurs with a traditional radio station. The nice thing about being on the Net is you don't have an FCC license -- and that is pretty expensive under certain circumstances.

BORLAND: What's the most popular format? What are people listening to?
SAMUEL: Today, Our most popular format, is Awesome 80s, and that's actually one of my favorite formats. We've also launched some special channels. We had an El Nino channel that we launched a month and a half ago, and that is actually doing extremely well. Other popular channels are ones that don't actually have words associated with them. So you have the ambient, the classical, the blues and jazz, etc., and this demonstrates, I think, that people are able to listen to music and work at the same time.

BORLAND: Do you allow users to choose which songs they want to hear?
SAMUEL: No, actually, we do the programming. That's actually a big legal issue that people who are interested in moving into the space need to understand. If you listen to music interactively, like if I wanted to listen to a particular song by Natalie Merchant, I would need to get the rights from Natalie Merchant to actually have that song played interactively. When you listen to TheDJ, we program all of our music. So with the modern mix channel, you might hear a Natalie Merchant song, but there's anywhere from 1,500 to 2,000 songs on the Modern Mix channel. So, you are going to hear many different artists, and you will hear Natalie Merchant sometimes, but it won't be interactive.

BORLAND: So, if I wanted to hear a specific song and there was a service that gave me that ability, then it would slip over into the sort of legally touchy realm of distribution, rather than what you are doing?
SAMUEL: That's correct. You would need to have the rights, from the record label, to have that song played interactively on your site.

BORLAND: Are there any moves toward that direction that you can do legally? Is there anything you are looking at?
SAMUEL: We're very excited in being able to offer services like that, it's a long road and, as I mentioned at the beginning, we're really focused right now on the broadcasting of music. We're interested in furthering talks with record labels, talking about what we can do within the true interactive realm, but that is a long road.

BORLAND: Right now, you seem to have a pretty successful business, just having the sort of slice-and-dice music channels. Is there anything you see next?
SAMUEL: Really, as we move forward, we are currently built up by word of mouth. So we've been around for two years, we're doing about 500,000 songs broadcast a day, and about 15 million impressions per month. And this has all been done by word of mouth.

BORLAND: So you've got the business, and now marketing is next?
SAMUEL: Yes. Yes.