What Does Pandora’s IPO Mean for Music?

February 14, 2011

1:10 pm

Pandora Media Inc. announced late last week that they will issue an IPO this year to raise $100 million to grow their business.  Now that MP3 players and satellite radio have changed the way we consume music, we had to ask: What does the growth of Internet radio mean for music?

Though Pandora hasn’t mentioned what their growth plans entail, their IPO could mean two things: The music industry could start growing again (ie, increased sales) thanks to a new, growing distribution channel, and the way we consumers access music will continue to change.

Because they make it so easy to discover new artists by playing music with similar attributes on your radio stations, Pandora could help the beleaguered music industry grow.  Case in point: One of my Pandora radio stations is Mozart.  I hear a lot of Haydn on there, as well as lesser known composers from the same era and modern compositions that sound similar to Mozart.  Imagine what that means for an indie rock band that is only just starting out: lots of new listeners and, possibly, fans, and, possibly, explosive growth in record sales.  And because Pandora pays royalties to artists, bands and musicians receive a flow of cash that our iPod playlists do not provide.

And yes, the way we listen to radio stations will change.  Did you know you can integrate your Pandora stations with everything from your smart phone to your TV?  About half of Pandora’s subscribers listen to their stations on their iPhones, and you can stream your Pandora radio stations via select Blu Ray players, televisions, table top devices, digital media players, and home theatre systems.  Who wouldn’t want to take their customized radio station with them?

What do you think the growth of Internet radio stations means for music? Let us know in the comments below.

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Monika Jansen is a writer and editor who is happiest pounding out blog posts, newsletters, website content, and other materials. Follow her at: @monikacjansen

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