Pandora's founder has explained how online music services can appeal to advertisers, in the latest developments in the so-called 'freemium' music industry.
Pandora founder Tim Westergren says the company still wants to get statutory central licences – a move that would help to offset its "current punishing licensing rates."
Scale to survive
"To be attractive to advertisers you have to have scale" is the message he has for online music services on the advertising side of things.
"The big challenge in the ad space is that to be attractive to advertisers you have to have scale and it's difficult to go from zero to scale because your ad capability can't keep up with your growth. It's a Catch 22..."
Article continues below
The Pandora founder also gives a nod to Spotify and other new competition in the online music space, noting that: "Companies are coming along with different spins, different approaches and I'm rooting for them all."
Source: Music Ally Blog