Internet radio giant Pandora is making big moves to keep up with on-demand streamers like Apple Music and Spotify, this time with a huge purchase that could propel it to the forefront of live music promotion.
The company has inked a deal to buy online ticket retailer Ticketfly, for the kingly sum of approximately $450 million in cash and stock.
This comes as part of Pandora’s longstanding desire to better connect artists with their fans, a goal the company has achieved through algorithmic analysis of people’s music tastes — the forerunner to features like Spotify’s massively popular Discover Weekly playlist. Pandora suggests new music it thinks users will enjoy, connecting them to new bands through basic choices, and helping smaller artists break into the mainstream.
The company has been looking beyond its internet radio roots for a while now, and this is just the latest piece of the puzzle.
Last year, Pandora launched an artist marketing platform, and has been noticeably increasing its focus on live music promotion, helping bands identify and connect with their fans on the service via utilities like Artist Audio Messages, a tool that allows musicians to record messages for their fans as a sort of advertisement.
Now, Pandora will be better able to integrate concert notifications and ticket sales into that formula than any other streaming music platform, presumably letting users know when an artist they like will be near them, and then collecting a percentage of the revenue when they buy tickets.
“This is a game-changer for Pandora – and much more importantly – a game-changer for music,” said Pandora CEO Brian McAndrews. “Over the past 10 years, we have amassed the largest, most engaged audience in streaming music history. With Ticketfly, we will thrill music lovers and lift ticket sales for artists as the most effective marketplace for connecting music makers and fans.”
To be sure, it’s an extremely savvy business move for the company that boasts nearly 80 million active users. This purchase will allow the company to exist in two of the fastest growing revenue areas in music: streaming music and live events. In 2014 alone, Ticketfly sold over 16 million tickets to more than 90,000 live events, and overall ticket sales in North America grew 22 percent in the last year, to $6.2 billion.
Time will tell whether the move propels Pandora’s revenues above the other streaming giants, but this is good business, and will further the company’s ability to get their listeners to the shows they want to see, and even alerting them about shows they might normally miss. It’s a big hole to fill, and if Pandora is even moderately successful, it should mean big bucks.