Pandora Succeeds In Cutting Costs With 40-Hour Cap
May 7, 2013 at 3:55 AM (PT)
PANDORA MEDIA's 40-hour monthly limit on mobile users imposed earlier this year "has cut music streaming and content costs as intended, while the audience continued to grow," reports BUSINESSWEEK. "PANDORA streamed 1.31 billion hours of songs in APRIL, the first full month with the cap in place, a 5.1% drop from FEBRUARY’s 1.38 billion."
"The decline in hours will be very closely mirrored in content acquisition costs," CEO JOE KENNEDY told BUSINESSWEEK, declining to provide specifics.
PANDORA was seeking to control costs with the 40-hour cap, and seemingly has done so without turning off listeners. The company noted that of the users who hit the limit in MARCH, 86% came back to use the service in APRIL. "Some coped by switching to PANDORA’s unlimited desktop version, while others chose to pay," KENNEDY said.
"People found a way to make it work for them," added KENNEDY. "The vast majority found one or a combo of those methods worked for them."
PANDORA noted users climbed to 70.1 million in APRIL. That's up about 3.5%e from FEBRUARY’s 67.7 million and a gain of 0.9% from March.