TTh+2+music+blog+post


 * Overview: What is Sirius? What is Pandora?**

Sirius XM: (Sarah) Sirius XM is a satellite radio company with over 130 channels. It was launched on July 1, 2002 and currently operates in American and Canada. In July of 2008 it merged with XM radio, cornering the market in satellite radio providers. Sirius XM is a pay-for-service company, meaning listeners pay for the service they desire.

//Pandora//: (Hillary) Pandora is a free online radio service that allows users to make their music experience one hundred percent what they want it to be. Pandora uses an interesting analysis of music called the Music Genome project which analyzes different songs using up to 400 musical characteristics. A user creates a radio station by typing a song or artist into the search and the station will not only play the selected song or artist but will play similar material. This allows each user to have their individual music experience.

Both Sirius XM and Pandora have their benefits. Pandora offers free service and is high customizable. Sirius XM has talk radio, is far more convenient for listening to while driving, and all stations have little to no commercials. Both can be played online and have iPhone apps, although Pandora's is much more popular, mostly likely because Sirius XM's app is $12.99 in addition to a monthly fee while Pandora's is completely free. The main downsides to Pandora are advertisements and limitations on how many hours of listening are allowed per month, but these can be avoided by paying a low monthly fee. All this said, Pandora is growing exponentially in popularity while Sirius XM still struggles to reach new listeners.
 * Competition:**

Sirius Video and Pandora Interview- Joel
 * Videos:**

Interview with Pandora CTO, Tom Conrad. (interview begins at 6:30 of video)

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Interview with Padora founder, Tim Westergren.

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Mel Karmazin, CEO of Sirius XM, talking about the Sirius XM strategy.

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Sirius vs. Pandora- Pham
 * Strategy:**

Pandora and Sirius XM radio has two different marketing strategies. Pandora primarily marketing strategy is ad-supported revenue. Sirius merger with XM radio plans to offer paid subscription plans that customers can choose a combination of programming offerings from the two providers, which would continue to operate as separate brands.

After building a free subscription base, Pandora has ventures out a new opportunity to generate more revenue for the privately own company. Pandora now offers paid premium accounts that remove advertisement, longer listening time, and mobile access (internet access is require by cellular company). Sirius XM Radio offers only paid subscription that offer exclusive channels that is commercial free. The benefit of Sirius XM Radio is the instant accessibility of satellite and Wi-Fi radio.

According to Audio4Cast report Pandora reached $40 million in revenue this year. Sirius XM Radio revenue is $587 million however they are working with a negative net income of $5.3 billion. A blog post by Type Pad states Sirius XM Radio has low returns on investment which indicates the company weakness of gaining profit from its customers. It is clear that Pandora is marketing strategy is a small but profitable private company.

Reference Standards and Poor:Pandora http://blog.pandora.com/faq/ http://audio4cast.com/2009/09/10/pandoras-strategy-spells-40-million-this-year/ http://adelino.typepad.com/adelino_marketing/2006/11/sirius_xm_radio.html

Gen Y/Market Implications- Kristine
 * Conclusion:**

Free vs. Subscription music services has been an ongoing battle over the past few years. Gen Y seems to like and use free music services more frequently than subscription services. Please consider taking the following poll:

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The free services are clearly more cost effective and still allow the user to listen to a variety of music tailored to their tastes. Essentially Pandora and Sirius XM provide the same service, but one includes the occassional commercial, with a chance of repetition and the other is less interrupted. Most of Gen Y is not bothered by the 30 second commercials that appear every 5 or more songs.

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This site describes the new iPhone app from Sirius XM and how it is thought that iPhone users will use the 7 day free trial and then switch back to Pandora.