Feb
08
Pandora Will Win the Music Streaming War
Wed Feb, 2012 by Derek Mehraban
For years Pandora was the top dog in streaming music. Based on the music genome project, people tune into Pandora to listen to a particular flavor of music and then Pandora serves up other similar artists. Sometimes people even discover new artists or songs that they like through the service. Spotify came along almost a year ago and disrupted everything.
The main disruption was Spotify’s deep integration with Facebook. However, the service was lackluster and for millions of users the six-month trial service expired without any renewal or money going to Spotify. Those people are now cut off and returning to Pandora, if they had not already done so.
Pandora offers a freemium model that is supported by advertisements and some restrictions on the service. For many people these nuisances are not enough to deter its use. Pandora’s problem now is sustained losses. The free service is so desirable that most users are not forking over the cash for an ad-less and restriction-less service. Consequently, Pandora is losing millions because of the licensing fees needed for its catalogue.
The digital agency firm should consider advertising with Pandora. Pandora has an ability to send local advertising to users. Pandora’s financial woes will also make it eager for advertising inventory. There might also be some good will to be had from the consumer, by being perceived as supporting a superior service and helping to keep it free. Its lack of social media integration is being shown to not be an inhibiting factor for Pandora. When compared to Spotify’s requirement that people sign in with the Facebook accounts, it may actually turn out to be a boon. Pandora has plans, like installation into vehicles, and being in on the ground floor will be lucrative for the digital marketer.
Streaming music war? Really? In my personal view, I don’t feel Pandora has/had any real competition since it hit its stride. I’ve turned off my XM radio subscriptions over a year ago…whether in car or office…I’ve found Pandora meets my needs wherever I’m at.
And, if it’s not available, my iTunes library, in part stocked with music Pandora’s helped me discover, is readily at hand.
Even more important that it’s near-ubiquitous availability, is the fact it’s helped me discover more music this past year or two, than I’ve ever personally discovered in my entire life. No one will consider me a curator of fine music, but curating is sometime I’m doing for myself, that I’ve never done before.
Personally, I really like the fact it’s not integrated with social media. I’ve tired of finding sharing buttons, or being requested to use an SM account to login, everywhere I go.
Cheers