Report: Pandora Reaches Out To Record Companies For Help
April 11, 2017 at 3:38 AM (PT)
PANDORA MEDIA has made a move to reduce pressure from shareholders, asking major record labels for money or better deal terms to help the webcaster reverse losses. BLOOMBERG reports, "Top executives at PANDORA have reached out with a couple of proposals for their counterparts at the record labels, which sell PANDORA the rights to vast catalogs of music, said the people, who asked not to be identified discussing private information. In addition to asking for direct investments from the labels, PANDORA has sought to renegotiate licensing deals to reduce its costs, they said. The labels are unlikely to accede to the requests, the people said."
The pressure on PANDORA is reportedly largely coming from investor CORVEX MANAGEMENT.
BLOOMBERG notes that, "PANDORA isn’t about to run out of money. It generates a significant amount of cash thanks to its online radio service, which has 81 million customers," but "PANDORA has been losing users and suffering from a slowdown in advertising growth as paid services from SPOTIFY and APPLE, as well as free options like YOUTUBE, have siphoned away customers."
PANDORA shares closed down 4.28% to $10.95. That's down from an OCTOBER high of $14.77.