September 15, 2016 Last Updated 4:10 pm

Pandora introduces Pandora Plus at $4.99 per month

The rumor that new lower priced steaming services would be introduced appears to have been correct, as Pandora was the first to make the leap. You can read the details below.

One wonders, however, if this is a race to the bottom. If so, there will certainly be fall out – meaning someone will be bought out or fold.

I vividly remember discussions I had many years ago during corporate meetings about rate increases. All the publishers would go around the table and advocate for rate freezes. I would then startle everyone by saying we would be increasing our rates. At the end of the year our average rate per page would have actually stayed the same as the year before, but volume would have increased. The secret was selling the customers on locking in their schedules – and hopefully increasing them – before any rate increases came into effect.

What’s the point? A race to the bottom makes bottom dwellers of everyone. This move might work for Pandora, but I doubt it. I predict that existing customers will love it, but those who use Apple Music, Amazon Prime or Spotify probably won’t switch. We’ll see, of course.

Here is Pandora’s announcement:

OAKLAND, Calif. — September 15, 2016 — Pandora, the go-to music source for fans and artists, today launched Pandora Plus, a one-of-a-kind, ad-free radio experience with dramatically increased functionality. For just $4.99 per month, this innovative listening experience includes more skips, replays and an ingenious solution for offline listening that elegantly handles issues with lost connectivity and cellular data usage. This unique marriage of design and functionality, at a very affordable price, marks yet another milestone in Pandora’s journey to create the most personal music experience in the world, giving listeners greater flexibility and control, while allowing for the endless discovery that listeners love so much.

“We’re always delighting our listeners through continuous innovation and a relentless focus on simplicity and ease of use,” said Chris Phillips, chief product officer at Pandora. “For example, our new predictive offline mode automatically detects when you lose signal and switches to one of your top stations that Pandora knows you love. No effort required. It just keeps playing.”

As part of this product transformation, valuable new features will also enhance Pandora’s existing ad-supported option. Listeners will now have more control over their advertising and listening experience with the ability to skip more songs and replay songs simply by opting into a video ad. Advertisers in turn will benefit from a more engaged and attentive audience.

“We’re methodically and passionately developing the world’s most personal music experience,” said Tim Westergren, founder and CEO at Pandora. “And that includes flexibility in how you listen and what you pay for it. Whether a listener wants to take advantage of our enhanced ad-supported experience, our groundbreaking subscription radio service, or our fully interactive on-demand option coming later this year, we have a solution tailored for you at a price point you can afford.”

Pandora Plus, as well as the new features available on the ad-supported tier, will launch today and roll out to listeners in the coming months on iOS and Android smartphones. Existing Pandora One users will seamlessly transition to the new Pandora Plus service during that period. For listeners in Australia and New Zealand, the new Pandora Plus and ad-supported features will be available in 2017.

Pandora will also host a conference call along with a product demonstration after the close of the bell on Tuesday, September 20, 2016, at 1:30PM (PT) / 4:30 PM (ET). A live audio/video webcast will be available at A live domestic dial-in is available at (877) 355-0067 or (614) 999-7532 internationally. A domestic replay will be available at (855) 859-2056 or (404) 537-3406 internationally, using passcode 80527392.

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