Pandora, the top radio-based subscription streaming music service in the United States, is ready to launch a subscription on-demand service that will compete with similarly styled rivals Spotify and Apple Music. Pandora may be close to reaching deals with the three major music labels that could allow it to begin the on-demand service as soon as next month.
For some time, plans for the competing on-demand service have been in the works, and when Pandora acquired the assets and many of the staff of failed on-demand subscription streaming service Rdio, it became clear that the company was headed in that direction.
Until now, Pandora has operated only as a radio-based streaming service, meaning it cannot offer users the ability to listen to specific songs on demand, but instead offers stations that revolve around the style or genre of music the subscriber selects, or a specific artist of their choosing.
While on-demand services such as Spotify and Apple Music allow their users to listen to any track they choose from a service's music library, which can be limited in some cases, radio-based streamers like Pandora and its main direct competitor iHeartRadio can play any track by any artist, as long as they pay the requisite licensing fees.
That's why listeners to Apple Music and Spotify couldn't access Adele's hit 25 album, for example, but Pandora could play any song it chose from the collection as soon as it was released, provided it was offered on associated Pandora "stations" and not directly on demand. Now that Pandora will be offering an alternative on-demand service, it has to strike deals with the major record labels — Sony Music Group, Warner Music Group and Universal Music Group — similar to those of its competitors in order for it to provide music which can offer subscribers the ability to choose directly.
According to a new report, those major label deals are almost in place, which paves the way for the imminent rollout of Pandora's new on-demand subscription service imminently, potentially as soon as next month.
Pandora is expected to retain its current free and subscription radio tiers as well. Most of the 80 million Pandora listeners now use the free tier, while 4 million pay $5 monthly to access Pandora One, which allows for an ad-free experience and some limited skipping of unwanted tracks. With major label deals in place, those features are now expected to be enhanced with even more options shortly, including the ability to download music for offline listening.