How much has your digital music startup paid to artists, labels, and publishers? Well, since 2007, Pandora has paid well over $100 million to SoundExchange and various publishers, according to financial details emerging this afternoon. And, that number would have been much higher had it not been for negotiated, retroactive rate reductions affecting the years 2006-2010.
More specifically, for the period running through October, 2010, royalties have topped $100.5 million—most of which has gone to SoundExchange and its represented labels—on aggregated revenues of $178.9 million (click image to enlarge). And that doesn't even count the last three months, probably the best period yet for the company.
In fact, Pandora paid just over half (50.4%) of its year-2010 revenues for content licensing. The disclosure, part of a more detailed IPO registration filing, shows that during the first nine months of 2010, “content acquisition" costs topped $45.4 million, on topline revenues of $90.1 million. Overall, Pandora lost $328,000 for the period, a vast improvement over year-2009 losses of $22.5 million.
That is quite a financial turnaround, one that also includes some respectable ($12 million) non-advertising revenues streams. So maybe they can afford it? During the nine-month period, revenues nearly tripled, and fourth-quarter figures put the company at breakeven according to earlier statements by founder Tim Westergren.
Still, in year-2009, Pandora was drowning in content-related costs, most likely because of softened advertising revenues. And ongoing, doubts remain over whether Pandora can achieve a reasonable profit margin, especially in the absence of non-advertising revenue streams.
Here are some other stats from the filing. Pandora now has (as of January, 2011)...
More specifically, for the period running through October, 2010, royalties have topped $100.5 million—most of which has gone to SoundExchange and its represented labels—on aggregated revenues of $178.9 million (click image to enlarge). And that doesn't even count the last three months, probably the best period yet for the company.
In fact, Pandora paid just over half (50.4%) of its year-2010 revenues for content licensing. The disclosure, part of a more detailed IPO registration filing, shows that during the first nine months of 2010, “content acquisition" costs topped $45.4 million, on topline revenues of $90.1 million. Overall, Pandora lost $328,000 for the period, a vast improvement over year-2009 losses of $22.5 million.
That is quite a financial turnaround, one that also includes some respectable ($12 million) non-advertising revenues streams. So maybe they can afford it? During the nine-month period, revenues nearly tripled, and fourth-quarter figures put the company at breakeven according to earlier statements by founder Tim Westergren.
Still, in year-2009, Pandora was drowning in content-related costs, most likely because of softened advertising revenues. And ongoing, doubts remain over whether Pandora can achieve a reasonable profit margin, especially in the absence of non-advertising revenue streams.
Here are some other stats from the filing. Pandora now has (as of January, 2011)...
- 80 million users (up 73.9 percent year-over-year, with a new user registering every second)
- 800,000 songs
- 80,000 artists
- 3.9 billion listening hours for the year ending January 31st, 2011 (up 86% from 2.1 billion the prior year.)
- Mobile apps have been downloaded more than 50 million times to-date, in the US alone.
