You liked the song, so now would you like to see the artist in concert? That's the $450 million question that Pandora, the 80-million user music discovery service (read: streaming internet radio station) is banking on.
In an equal parts cash and stock deal first reported by Re/code and confirmed by a message to investors, the Oakland-based company agreed to purchase San Francisco online ticket vendor Ticketfly in a deal inked this week.
The New York Times writes that most users bump to Pandora for free and are served ads, though a $4 ad-free subscription version exists. Re/code notes of Pandora's profitability that it lost $16 million in the second quarter of this year, which was more than the $11.8 it lost over the same period last year.
Ticketfly is often compared with the significantly larger Ticketmaster, owned by LiveNation. The deal, the Times says, will bring "a level of complication to the sometimes delicate system of alliances in the ticketing world." Ticketfly reportedly raised $87 million last year.
“The combination of Ticketfly and Pandora will be a marketing and event discovery powerhouse," Ticketfly’s CEO and co-founder Andrew Dreskin addressed investors, “giving venues and promoters unprecedented access to a massive and targeted audience of nearly 80 million music fans.”
"It’s the perfect solution for listeners, artists, promoters and club owners, bringing the power of scale and personalization to bear on the working musician’s most intractable problem," wrote Pandora's founder and chief strategy officer Tim Westergren.
Investors seem less certain. The Business Times observes that Pandora's stock fell more than 5 percent in midday trading today.