The consortium, also including the Internet Advertising Bureau and Yahoo, has received £1.8 million from the government's Technology Strategy Board to work on the project, dubbed Apollo.
Apollo is a 12-month research initiative designed to investigate the potential of cloud radio, drawing on the individual skills of each company involved. The partners intend to build various cloud radio prototypes, with a view to having a working product developed by next year.
The consortium believes that cloud radio could be the key to developing "next-generation personal radio and music services that can work across any internet-connected device, such as mobiles, tablets and web TVs".
Cloud technology has the potential to unlock a wide range of digital services for radio broadcasts, such as personalised news updates or music playlists.
Plans under consideration by the group include using social network Facebook to create hybrid services that combine tailored music and audio data.
Paul Bennun, digital director at Somethin' Else, said that Apollo will also explore how the benefits of "location sensitivity" could be brought to radio services.
He explained: "Wouldn't it be useful to get traffic updates on your car radio saying the roundabout up ahead is blocked? With location sensitivity, we'll be able to editorialise audio content that would help you know that."
Last November, We7 launched a new personalised internet radio service, enabling users to create radio-style webcasts tailored to their own music tastes.