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<ul><li> 1. Catherine Ardito, Victoria Gersh, RyanKelly, and Caroline Vettese</li></ul> <p> 2. What is Pandora? Mission: To play only music youll love. (OK, weveadded comedy as well so were also up for playingsome jokes youll love.) Type in favorite artists, songs, composers, genres (orcomedians) and Pandora provides up to 100 uniquestations Thumbs UP/ Thumbs DOWN Option 3. Music Genome Project Uses Music Genome Project to provide a unique tailoring of music for eachlistener The most comprehensive analysis of music ever undertaken. Analyzes a world of songs that span over 100 years Suggests songs based on songs listeners give a thumbs up and down to Each song is listened to and analyzed for specific characteristics by"musicologists" The Music Genome Project is updated daily basis 4. Organizational Information Headquartered in Oakland, CAo Other Offices: New York, LosAngeles, Chicago, Detroit, Atlanta, and Dallas Pandora is a public company whose stock is traded onthe NYSE at a price of $10.38 as of September25, 2012 Joseph Kennedy is the company Chairman and CEO Revenue FY2012: $274,340,000 5. Statistics Over 125 Million registered users in the United States Over 900,000 songs in its catalog Over 15 Billion Thumbs Up o show theyre doing a good job of providing users songs they like 6. Demo 7. Where to access Pandora Pandora has become an App on all smartphonesmaking their music accessible everywhere Available on over 600 different consumer devices Many stand alone playerso Rokuo Slim Deviceso Apple productso Blackberryo Androido Windows Mobile devices 8. Types of Subscriptions Free Subscription o Can listen to music at any time o advertisements Paid Subscription o Can listen to music at any time o no advertisements 9. Pandoras Biggest FearApple Apple Inc. is planning to introduce its own competing online custom radioservice through iTunes. The day after Apples plans emerged earlier this month, Pandora Mediasstock plunged 17 percent and has still not recovered. Apples iTunes store had a 64 percent share of all digital music sold in theUnited States for the second quarter With Apples reach, and its ability to pre-install an app to every mobiledevice it ships, any Internet radio service it offers could quickly build a huge following. 10. Risk FactorsRisk Factors that could cause or contribute to differences from projected financial status include, but are not limited to:1. Competitive Factors2. Ability to continue to innovate and keep pace with changes in technology and our competitors in hypercompetitive markets3. Ability to increase our listener base and listener hours4. The operation in an emerging market and relatively new and evolving business model5. Ability to generate additional revenue on a cost-effective basis6. Ability to continue operating under existing laws and licensing regimes 11. Competitive Factors Spotify Radio is the biggest new feature in todays app release. Spotify offers 16x more songs to listeners at 15 million versusPandora at 1 million Spotify offers a bundled unlimited plan that allows you playwhatever song you desire. Spotifys goal is to become "ubiquitous" on all platforms, movingquicker and quicker to shift its priorities towards mobile. 12. Spotify vs. Pandora 13. Competitive Factors Songza is based on the principle that using Pandora requires toomuch thought. Our whole premise is not that this is more gamified than Pandora, orhas more elite features, Mr. Roman said. Its that this is simpler andmore directly related to the thing you want, which is music to makewhatever youre doing better. Songza carries no audio advertising because it makes money fromdisplay ads and from partnerships with other media companies. When Songza introduced a new version of its mobile app this month, itwas downloaded 1.15 million times in 10 days shooting to the top ofApples App Store rankings, passing Pandora. 14. Pandoras Business Modeland Problems The earnings report indicates that the vicious cyclewithin Pandoras model is getting, well, more vicious. Unless Pandora can raise ad prices or increase thenumber of ads it plays, it will remain in real trouble. Pandora has to pay royalties on every song it plays: thecosts rose to $101 million, while their revenues are$80.7 million. Those royalty fees will increase in 2015, threateningPandoras long-term success. 15. Graph. The graph shows that Pandoras revenues are falling behind its operating costs: 16. Pandora in trouble... Pandora is pushing users to write their Congressmen to support anewly introduced bill called the Internet Radio Fairness Act. The issue is Pandoras own weak business model. BTIG analyst Richard Greenfield, "the reason why companies suchas Pandora pay such high royalty rates as a percentage ofrevenues is because they severely limit audio advertising to protectthe user experience and keep people on the platform. If Pandoraran several minutes of audio ads per hour, the percentage ofrevenues paid out as royalties would be dramatically lower. " Greenfield claims Pandoras royalty rate should be increasing, notdecreasing, which would force them to either increase the ad loadand survive at that ad load or find other ways of generating revenueto sustain their service. 17. The Future of PandoraIn the near future, Pandora is planning on: Broadening listener base Focusing on execution Getting on more devices 18. Broadening Listener Base Currently operating under licensing from the federalgovernment In 2014, negotiations will begin to determine the futurefor after 2015 Hopes to go international "Pandoras story in the US becomes so positive that itbecomes more and more ridiculous that were notlicensed in other places" 19. Execution Only play music the listener wants to hear No changes to ruin the industry Expansion 20. Product InnovationsNew Devices: - Vehicles Deal with companies such as Ford, Honda, Acura- Home Electronics Televisions Wifi DevicesNew Content:- Video- Comedy 21. Questions How else do you see Pandora expanding? Do you think Apples invention of their own music radio willincrease or decrease their revenue considering Pandora isalready so well known? Even though Pandora and many other emergingtechnologies are so vulnerable to competition, why do youthink many people still choose to invest in them? Do you think Pandora would be as successful in othercountries as it is in the United States? Do you think it wouldgive them a competitive advantage? Would you pay to use Pandora? </p>