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WESTERGREN LEVELS WITH GLASS IN MIDEM KEYNOTE

Tim Westergren, who recently returned to the CEO post at Pandora, offered up some chewy soundbites during a Midem keynote Q&A on Saturday conducted by none other than Daniel Glass. MusicAlly filed the initial report.

When asked by the Glassnote chief whether Pandora is for sale, Westergren replied, “We are on a path to do something big and something for the long-term. That’s why I got back in the saddle, so no plans for that.”

After pointing out that Pandora streams more hours of music per month than YouTube, Westergren explained why the online radio service is getting into on-demand music. “There’s this huge endemic audience on Pandora, and because we know their taste, we’re going to go into that business, but not like everybody else: 30m songs and a search box and good fucking luck!” He promised multiple tiers, including one priced below $10.

Westergren predicted significant subscriber growth, and said that his background as a musician made him acutely aware of the needs of the artistic community. My intent, my purpose in building Pandora was very purposefully to make a difference for working musicians,” he said. “It is a temple to our ethos, to our mission, to our principles… It is core to us. It matters in this world. Who does the industry want to partner with. Aligning with a company that is about music is a good thing, and I think we will find alignment.”

He noted that Pandora, like terrestrial radio, is “fundamentally promotional,” asserting that it’s one of the largest referrers of sales on iTunes and Amazon. “It is replacing a medium, AM/FM radio—the hours that are coming to Pandora are largely from broadcast radio—which does not compensate artists at all in the U.S. Every 1% of marketshare that moves from broadcast radio to Pandora creates an incremental revenue of $60m a year to the industry.

“If I was an artist starting out now,” Westergren continued, “one I would certainly push for the migration of radio broadcast listening to the web. That means Pandora is the music industry’s ad sales team. We have 2,200 employees or so, and about half of them do nothing but work on advertising, selling on Pandora… driving revenue, and about half of that goes to the industry.”

Westergren echoed the plaints of rights holders in his criticism of freemium. “What drives me crazy is there is a substantial part of the digital music world that is educating listeners to believe that they can get music for free, and for free on demand,” he said. “And it takes the form of unlimited free, perpetually free trials and poorly monetized services. It’s not good in the revenue it doesn’t generate, but it also creates bad habits… The industry really needs to get its hands on that quickly, before it’ll be harder to bring it back in… You [need to] create reasons for them that make it relevant to pay for something… That’s how you tease people into these things. Not by saying ‘here are 30 million songs, and a search box for 10 bucks a month.”

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