Free The Pandora Company Essay Example
The Pandora Company, a radio service provider, was founded in January of 2000 by Will Glasser, Jon Kraft, and Tim Westergren, in San Francisco, CA. By January 2011 the company was in need of investment funds to fuel its expansion, and met with investment bankers to consider the future of the company as a publicly traded entity. With the support of a group of investment bankers, the company opted to launch its initial trading in February of 2011, with $100 million in public shares offered. By June the price per share had rocketed to $16 a share, and the company was conservatively valued at $2.6 billion dollars. Historically, the stock peaked at $17 a share, and is currently valued at $16.4 4 share.
In the 2014 fiscal year, the company generated 920.8 Million in revenue, despite the fact that their streaming service is currently only available in the United States and New Zealand. They have a two legged approach to generating revenue. They currently generate revenue through a subscription services that they sell to their users (currently totaling more than 250 million), and they sell advertising space to businesses, whose commercials interrupt the streaming radio play for free users.
Pandora relies on the Music Genome Project (a patented recommendation format) which analyzes songs “liked” by the user, according to a list of 400 music genes. It then recommends songs based on their common genetic roots.
Currently, there are few true competitors to Pandora radio, though Spotify, Sirius, and Last.FM do compete, in terms of dollars spent on musical entertainment. Google has acquired new software, Songza, which it will be launching in the coming months which will provide true competition for Pandora in the financial quarters to come.