Existing Pandora Plus subscribers will enjoy six months of Premium for no additional charge. It is a big change for Pandora itself, however. The $9.99 per month fee is equivalent to competing services like Spotify and Apple Music, upping the ante for Pandora to keep up in the marketplace of subscription-based streaming.
On Wednesday the company rolls out Pandora Premium, which allows users to listen to any song or album they want on demand for a monthly fee of $9.99.
The company's ability to inexpensively transition 375,000 ad-supported users in Q4 to Pandora Plus strengthens Wedbush's faith in its ability to do the same with on-demand as Premium is rolled out over the coming months.
Pandora announced Pandora Premium today, the long awaited music subscription service from the streaming radio giant. Also, if you hit thumbs up on a couple songs on any radio station, a new playlist is automatically created.
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Entering the premium music streaming segment this late might seem like a tough task, with over 100 million people already subscribed and committed to their streaming service of choice.
"We look at the subscription (music) space and think we're kind of in the first-generation of products right now - it's essentially 30 million songs and a search box", Westergren said. "That's why they spend more time with Pandora than any other music service", said Tim Westergren, founder and CEO of Pandora in a statement. But Pandora is hoping that its simplified interface, built off of its free internet radio service, which has been used by over 250 million users, will attract those who have yet to subscribe to a premium music service. "With Premium, we're leveraging our enormous trove of data and everything we've learned about personalization to offer a listening experience that sets a new standard for what a music service should be". Chief among these are the efforts to streamline playlist creation and search, as all previously thumbed up tracks become immediately available for Premium users in one place via an auto-generated playlist. Premium is available now for iOS and Android, in the vehicle via Apple CarPlay and Android Auto and on Google Chromecast. Most of the other perks have to do with Pandora catering to your likes. Existing Pandora users will receive their invitations to try out Pandora Premium starting on March 15. For its part, Pandora Premium banks on Pandora's radio algorithm to dish out smarter playlists.
My Thumbs Up playlists.
Rather than bolstering the company's finances, Pandora Premium risks becoming a drain on the company's already sensitive balance sheet, BTIG media analyst Rich Greenfield said earlier this month in an investor note. Pandora says Premium will land on the desktop and "popular connected devices" in "the coming months".