Does Pandora's soaring share price suggest a deal or grotesque Snapchat-style asset bubble?
Pandora, the online music streaming service, has been bobbing up and down the stock market for some time now. Liberty Media CEO Greg Maffai has been at the centre of a lot of those movements. But now, in a bid to stabilize and compete more aggressively with Spotify, Apple Music and the rest, Pandora has launched a new Premium service. The result has been a soaring share price.
Pandora Premium combines the current radio streaming service with a new ability to search and play any track or album from the 40 million songs available. There is also a set of playlists that tailor music to the tastes of the user. This personalisation, aka the Music Genome Project, is something that Pandora relies on as a strength when compared to the likes of Spotify and Apple Music.
The Pandora Premium Service is priced at $9.99 per month to set it head-to-head with the competition. It still offers a standard $4.99 per month service for ad-free internet radio services.
While a Snapchat-style asset bubble is still one possible future for Pandora, this new move looks set to propel its popularity in a direction of greater success on the markets.
Spotify recently announced it is leading the charge with 50 million subscribers internationally, with Apple Music closely following with 20 million. This move should help Pandora to help gain more paying subscribers - something it’s ad-funded free service doesn’t help as much in spite of 81 million listeners.
The new Pandora Premium service is a step in the right direction for the music streamer. However there is a chance that it’s too little too late. Spotify and Apple Music already offer this style of service. If Jay-Z’s Tidal streaming service has shown anything it’s that even with a good idea, lots of backing and celebrity endorsement the music streaming world is one where loyal listeners appear to stay with what they know.
Expect Pandora to continue to bob and weave but not to get knocked down the stock market too far anytime soon.