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How Pandora Radio Works

        Tech | Internet Basics

Pandora's Future
Slim Devices' Squeezebox
Slim Devices' Squeezebox
Photo courtesy Pandora Media, Inc.

The Music Genome Project and its accompanying user interface are not exactly the first of their kind. Music producer Alan Lomax, best known for his work in the 1950s and '60s with BBC radio and folk artists like Woodie Guthrie, Lead Belly and Pete Seeger, spent 30 years developing an interactive music and dance "jukebox." Lomax's Global Jukebox makes social, cultural, historical and regional connections between various art forms. The connections are based on a Genome-like analysis of musical traits and dance moves combined with a database of cultural characteristics throughout history. According to's Martin Edlund in "The Madonna Code," the Global Jukebox can tell you that "a high-energy vocal style correlates with the presence of dairy in a society's diet." In "Alan Lomax's Multimedia Dream," Michael Naimark reports the connection between "dances with narrow heel-to-toe movements" and "societies whose main crop is planted in narrow rows (like rice)." The Global Jukebox prototype is currently stored on an Apple Quadra in New York City's Lomax Archive. Many corporations expressed great interest in the creation, but none followed up with a commercially viable use for it.

So how does Pandora plan to turn academic analysis into cash? Approaching the question from a theoretical standpoint, Pandora's potential commercial success is based on an economic concept called the "Long Tail." In the digital age, where consumers can easily find the specific thing they're looking for and producers can easily provide new content for distribution, Long Tail states that directing consumers off the beaten path is a potential key to profitability. In practical terms, Pandora's current revenue model seems to involve placing advertising in the free version (no ads in there as of May 2006), charging subscription fees for the ad-free version (as of May 2006, about 15 percent of subscription revenue goes to maintaining Pandora's music license and buying bandwidth) and sending users to iTunes and Amazon to buy the music they hear on Pandora. Pandora Media also licenses a commercial version of the music-discovery service to music sellers like Best Buy, Tower Records and AOL, who use it to recommend new music to their consumers at kiosks. According to the Pandora FAQ, what the company won't do is sell their objectivity. In the company's words, "We will never, ever take money to play a song or analyze it favorably on Pandora." So selling airtime is probably out.

If Pandora is going to be a real commercial success, it will have to compete with music giants like iTunes. Pandora already has teamed up with an electronics company to create a piece of hardware that releases Pandora from your computer, similar to what Apple's AirTunes does with iTunes. The Slim Devices Squeezebox plugs into a home network to stream Pandora from your computer and control it from anywhere in your home. And Pandora Media is already talking about taking Pandora mobile in the form of a standalone player and an application for devices like cell phones and PDAs. Gift subscriptions are in the works, and as soon as Pandora can work out the international licensing agreements, the service will be available outside the United States.

For more information on Pandora and related topics, check out the links on the next page.