Pandora's CEO & other execs leave ahead of $480M Sirius XM investment [u]

Posted:
in General Discussion edited June 2017
Three major executives -- including founding CEO Tim Westergren -- are officially leaving Pandora, one of Apple's biggest rivals in the streaming music space. [Updated with Australia and New Zealand pull-out]




Aside from Westergren, the company is also losing its president, Mike Herring, and Nick Bartle, who was hired on as chief marketing officer just last fall, Recode reported on Tuesday. CFO Naveen Chopra will temporarily replace Westergren as CEO, and Jason Hirschhorn will take over Westergren's place on the board of directors.

It's not yet known why the departures were announced, but earlier this month Pandora agreed to sell a 19 percent stake to satellite radio firm Sirius XM in exchange for a $480 million investment. Under the terms of that agreement, Sirius will be unable to buy more shares for at least 18 months, or acquire more than a 31.5 percent stake without approval by Pandora's board.

The deal will also result in three out of nine spots on the board going to Sirius however, including the chairman position. It could be that Sirius feels a radical shakeup is needed to make Pandora more competitive.

While Pandora has some 76.7 million listeners, numbers have been shrinking, and most are listening to its free ad-based radio tier, from which revenues have been insufficient. In the past year the company has launched not one but two new paid plans -- the first, Plus, simply upgrades radio listening with things like better quality, no ads, and limited offline support. Premium is a full-scale on-demand service competing directly against Spotify and Apple Music, but has only been available to the public since April.

Apple has somewhere over 27 million subscribers. All of them are paid customers, since the company doesn't offer free listening past the first three months. It also uses music streaming mostly as a way of attracting people to its highly profitable hardware.

Update: Pandora informed Billboard that the company is halting operations in its only two markets outside the U.S., Australia and New Zealand, within the next few weeks. The company employs some 60 people at its Australian offices alone, and in March had over 5 million registered users in the ANZ region.

"While our experience in these markets reinforces the broader global opportunity long-term, in the short-term we must remain laser-focused on the expansion of our core business in the United States," a representative said.

Comments

  • Reply 1 of 6
    vukasikavukasika Posts: 77member
    Wow how times change.  I remember when Sirius & XM merged because both were bleeding cash & barely surviving.  Sirius was even a penny stock. Now a few years later, making a $480 investment in Pandora.  The worm has definitely turned.
  • Reply 2 of 6
    vukasika said:
    Wow how times change.  I remember when Sirius & XM merged because both were bleeding cash & barely surviving.  Sirius was even a penny stock. Now a few years later, making a $480 investment in Pandora.  The worm has definitely turned.
    I should have bought that 'Penny Stock' back when it was a nickel. Grrrrr!!
  • Reply 3 of 6
    buzdotsbuzdots Posts: 449member
    vukasika said:
    Wow how times change.  I remember when Sirius & XM merged because both were bleeding cash & barely surviving.  Sirius was even a penny stock. Now a few years later, making a $480 investment in Pandora.  The worm has definitely turned.
    I should have bought that 'Penny Stock' back when it was a nickel. Grrrrr!!
    Based on Pandoras performance, you may have your chance once again!
  • Reply 4 of 6
    badmonkbadmonk Posts: 754member
    Rats leaving a sinking...
  • Reply 5 of 6
    ignominiignomini Posts: 69member
    It did not help when Pandora came out in support of the BLM terrorists. Dropped them like a hot potato the day I read that. Probably only a drop in the bucket, but why a struggling corporation would go out and intentionally alienate half their prospective clients is lost on me. That had to cost them. Firing top management is a good start for Sirius/XM.
  • Reply 6 of 6
    foggyhillfoggyhill Posts: 4,767member
    ignomini said:
    It did not help when Pandora came out in support of the BLM terrorists. Dropped them like a hot potato the day I read that. Probably only a drop in the bucket, but why a struggling corporation would go out and intentionally alienate half their prospective clients is lost on me. That had to cost them. Firing top management is a good start for Sirius/XM.
    Ok, another person to ignore. Thanks for the warning.
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