Pandora signs labels for streaming service

Pandora’s on-demand service is on its way, signing up with Universal Music and Sony Music Entertainment and thousands of independents.

But it has yet to strike a deal with Warner Music although “constructive conversations” are continuing with the world’s third biggest record company.

Pandora’s founder and CEO Tim Westergren is keen to finalise a deal with Warner Music in the next few days. He wants to get his service to the market before Amazon’s full-featured lower priced streaming platform.

Warner was also the last label to sign with Spotify before its US launch in 2011.

But with the two biggest majors, Pandora is in a position to take on Spotify and Apple Music. It also widened its partnership, first signed in 2014, with Merlin Network, a digital rights agency which represents thousands of indies. It also has secured Sony-owned indie distributor The Orchard and 30 more separate deals with independent labels.

“This was a truly collaborative attempt to find a solution that would support artists while profitably growing our respective businesses,” Westergren said.

However Pandora’s announcement overnight did not include pricing. But it’s believed to be multi-tiered, including one less than $10 a month with less features, and a higher priced one for “superfans”.

At this stage, the licensing is only for the United States, which it is focussing on at the moment. But it is expected global rights will be signed shortly, and Pandora can reach more countries outside the US than just Australia and New Zealand, which is the current situation.

Pandora’s expansion to on-demand service would attract more subscribers, once it hopefully gets rid of previous issues that kept subscribers moving to other services. Pandora determines what songs listeners can access, how much they can skip, and which countries can tune in.

Pandora has 78.1 million active listeners, a slight dip in the last six months. In comparison, Spotify has 100 million users and 39 million paid members, and Apple Music has 17 million subscribers. All three have long way to go: the amount of global smartphone users is expected to tip 2 billion this year.